The Moness Country Club+terence Louis Vose+isobel Mcneill+charles Taylor+joy Boyle+julie Kilpatrick V. First National Trustee Company Limited
| Jurisdiction | Scotland |
| Judge | Lord Doherty |
| Neutral Citation | [2013] CSOH 188 |
| Court | Court of Session |
| Docket Number | A286/12 |
| Published date | 31 January 2014 |
| Date | 10 December 2013 |
| Year | 2013 |
| OUTER HOUSE, COURT OF SESSION | |
| [2013] CSOH 188 | |
| A286/12 | OPINION OF LORD DOHERTY in the cause THE MONESS COUNTRY CLUB and TERENCE LOUIS VOSE, ISOBEL McNEILL, CHARLES TAYLOR, JOY BOYLE and JULIE KILPATRICK Pursuers; against FIRST NATIONAL TRUSTEE COMPANY LIMITED Defenders: ________________ |
Pursuers: D M Thomson; Halliday Campbell WS
Defenders: M V Ross; Turcan Connell
10 December 2013
Introduction
[1] The issue in this case concerns the validity or otherwise of the pursuers' purported termination of the defender's appointment as Trustee in terms of a Deed of Trust entered into in 1993.
The pursuers
[2] The first pursuer is a non-profit-making club ("the Club") the objects of which are to secure for the members joint rights of ownership of cottages at the Moness resort in Aberfeldy and exclusive rights of occupation of them for specified periods in each year; and to provide additional sporting and other facilities for the members. The second to sixth pursuers are the members of the Club's management committee.
The Constitution
[3] The Club is a voluntary association. It cannot hold title to heritable property. As of 24 May 1993 the Constitution of the Club provided:
" 5. ...The Founder Member will arrange for the said cottages and others and any amenity ground pertaining thereto to be conveyed to an independent Trustee and Custodian which will hold the same for behoof of the members of the Club from time to time...
11. ... The Founder Member will...on behalf of the Club, enter into a Deed of Trust with an independent body or person to act as a Trustee or Custodian to hold the Club's heritable property. The said Deed of Trust shall be of a style as varied from time to time and to be entered into between the Founder Member and the current Trustee. Without prejudice to the foregoing the Committee shall have the following specific powers:
....
(g) In the event of the Trustee or Custodian appointed by the founder Member at any time resigning office or the Club terminating such appointment to appoint another body or person as Trustee and Custodian of the heritable property of the Club.
...."
The first Deed of Trust
[4] In furtherance of articles 5 and 11 of the Constitution the Founder Member and The Royal Bank of Scotland plc ("the Bank") entered into a Deed of Trust dated 29 October and 6 November 1986 in terms of which the Bank was appointed as Trustee and Custodian on behalf of the Club and the members to hold title to the heritable property of the Club. Clause 11 of the Deed of Trust provided:
"11. This trust shall commence on the last day hereof and shall continue thereafter in full force and effect until terminated either by the Founder or the Club giving not less than three months notice in writing to the Bank or by the Bank giving to the Founder and the Club not less than three months notice in writing... Upon termination of this Trust the Founder whom failing the Club shall pay to the Bank all remuneration then owing to the Bank together with any outstanding out-of-pocket expenses and all expenses incurred by the Bank in conveying the title to the Property in manner after provided. The Bank shall in the event of this Trust being terminated convey or cause to be conveyed at the expense of the Club whom failing at the expense of the Founder to any succeeding Trustee and Custodian (which has entered into a Deed of Trust with the Club and which the Founder or the Club have shown to the reasonable satisfaction of the Bank to be acceptable as Trustee and Custodian to the members of the Club) or to the Club the Property, the title to which is then vested in the Bank ..."
[5] In 1987 the Founder Member assigned its interest in the Club to Moness Management Limited ("the Company").
The 1993 termination
[6] In 1993 the Bank duly gave notice in writing of termination in terms of Clause 11. A Deed of Retirement and Appointment was entered into between the Founder Member, the members of the Management Committee of the Club, the defender, and the Bank. At the same time a new Deed of Trust was entered into between the Founder Member, the Company, and the defender.
[7] In terms of clause 2 of the Deed of Retirement and Appointment the Bank retired as Trustee. In terms of clause 7 the Founder Member on behalf of itself and the Committee on behalf of the members of the Club appointed the defender to act as Trustee in place of the Bank on the terms of and for the purposes of the new Deed of Trust.
The 1993 Deed of Trust
[8] The new Deed of Trust provided:
"2. The Founder Member hereby appoints the Trustee and the Trustee hereby agrees to act as Trustee on behalf of the Club and the Members thereof on the terms set out in this Deed of Trust and the general terms and conditions upon which the trustee acts as a trustee last published before the date hereof which are more particularly set out in Schedule 1 hereto. The said general terms and conditions shall apply and be incorporated herein and if there shall be any conflict between the same and the other provisions of this Deed of Trust then such terms and conditions set out in Schedule 1 shall pro tanto prevail. The Founder Member shall procure that the Share Certificates and the title deeds evidencing the ownership of the Cottages and documents relating to any other property are delivered to the Trustee as soon as reasonably possible and will remain throughout the period of this Deed of Trust in the custody of the Trustee...
15.1 This Deed of Trust shall continue until terminated either by the Club giving not less than six months notice in writing to the Trustee or by the Trustee giving the founder Member and the Club not less than six months notice in writing.... Upon termination of this Deed of Trust the Founder Member (or failing which the Club) shall pay to the Trustee all remuneration then owing to the Trustee ...The Trustee shall in the event of this Deed of Trust being terminated convey or assign the Property or Cottages ... to any succeeding Trustee or otherwise as the Committee in writing may direct.
15.2 Upon the termination or expiration of this Deed of Trust pursuant to the foregoing provisions or as soon as reasonably practicable the trustee shall as directed by the Committee either:-
(a) transfer the Property and the Cottages or procure the same to be transferred by the Owning Company to the alternative trustee of this or any new trust constituted in accordance with the Constitution or
(b) retain the Property and the Cottages upon the terms of any new trust constituted in accordance with the Constitution or
(c) sell the Cottages (or in its sole discretion, the Shares) in such manner as it may choose ...
15.3 ... (T)he Trustee shall distribute the net proceeds of sale to such persons as would be entitled under the Constitution to such proceeds upon dissolution of the Club ...
22. If the Trustee retires from the trust ... such Trustee shall, subject to the terms of Clause 15 hereof, be released from all claims, demands, actions, proceedings and accounts of any kind on the part of the beneficiary (whether in existence or not) actually or prospectively interested under this Deed of Trust for or in respect of the Property or the income thereof or the Trusts of this Deed of Trust or in any act or thing done or omitted in execution or purported execution of such trusts other than and except only actions:- [the clause proceeds to list certain exceptions].
23. The Trustee declares and it is hereby agreed that it shall have all the additional powers, discretions and rights set out in Schedule 1 hereof...
Schedule 1
General terms and conditions upon which the Trustee accepts appointment
....
8. Unless otherwise provided in the trust instrument, every appointment whether under the statutory power or under any special power of a new trustee during the period of the trusteeship shall be subject to the consent in writing of the Trustee."
The 2008 termination
[9] At the annual general meeting of the Club in May 2008 the Members voted to terminate the defender's appointment as Trustee by giving it six months notice. On 28 November 2008 the Committee wrote to the defender in the following terms:
"Re: Moness House Hotel and Country Club (Timeshare resort)
I have been asked to write to you on behalf of the Moness Owners Club Committee.
Please accept this letter on behalf of the owners and the Owners Committee and Founder Members, as formal notification that as a result of a vote taken at this years (sic) Annual General Meeting held in May, we are hereby giving First National Trustee Company Ltd six months notice to cease being...
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