Whitlock and Another v Moree
| Jurisdiction | UK Non-devolved |
| Judge | Lord Briggs,Lady Hale,Lord Sumption,Lord Carnwath,Lord Wilson |
| Judgment Date | 21 December 2017 |
| Neutral Citation | [2017] UKPC 44 |
| Court | Privy Council |
| Docket Number | Privy Council Appeal No 0075 of 2016 |
| Date | 21 December 2017 |
[2017] UKPC 44
Lady Hale
Lord Wilson
Lord Sumption
Lord Carnwath
Lord Briggs
Privy Council Appeal No 0075 of 2016
From the Court of Appeal of the Commonwealth of the Bahamas
Banking Law - Joint account — Joint tenancy — Survivorship — Beneficial ownership — Appeal — Whether beneficial interest in previously held joint account passed to respondent by survivorship — Whether respondent held monies in previously held joint account on resulting trust for estate of deceased — Appeal dismissed.
Appellants
Gavin Kealey QC
James Goudkamp
(Instructed by Clyde & Co)
Respondent
Kahlil D Parker
Roberta W Quant
(Instructed by Cedric L Parker & Co)
Heard on 19 October 2017
(with whom Lady Hale and Lord Sumption agree)
This appeal from the Court of Appeal of the Bahamas is about the beneficial ownership of money held on joint account at a bank. The account holders were Mr Francis Lennard until his death in February 2010, and his friend Mr David Moree, who is the respondent to this appeal. The money in the account, which amounted to some $190,000 by the date of his death, was all contributed by Mr Lennard, mainly if not entirely from an account previously in his sole name at the same bank, the First Caribbean International Bank (Bahamas) Ltd. The sole question in these proceedings is whether, upon Mr Lennard's death, the beneficial interest in the previously joint account passed to Mr Moree by survivorship, or whether it formed part of Mr Lennard's estate, by reason of the operation of the equitable doctrine of presumed resulting trust, since Mr Lennard had provided all the money.
On the setting up of the joint account in November 2009, both Mr Lennard and Mr Moree signed an account opening application in the Bank's standard joint account form which included the following provision, at clause 20:
“JOINT TENANCY: Unless otherwise agreed in writing, all money which is now or may later be credited to the Account (including all interest) is our joint property with the right of survivorship. That means that if one of us dies, all money in the Account automatically becomes the property of the other account holder(s). In order to make this legally effective, we each assign such money to the other account holder (or the others jointly if there is more than one other account holder).”
At the heart of this appeal lie two questions:
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(1) Does clause 20 deal with the beneficial ownership of the joint account, or merely with the bare legal title to the chose in action against the bank represented by the account?
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(2) Is the fact that Mr Lennard and Mr Moree opened the joint account by means of a signed written application containing clause 20 determinative of its beneficial ownership, as at the date of Mr Lennard's death?
This was not how the issues were identified in the courts below. There, it appears to have been common ground that, upon Mr Lennard's death, Mr Moree held the money on resulting trust for Mr Lennard's estate unless he could prove, the burden being on him, that Mr Lennard had intended to make a gift of the money to him. The Chief Justice decided at the trial that Mr Moree had failed to discharge this burden. The Court of Appeal took the opposite view.
Mr Lennard was a successful businessman, in his mid-90s by 2009. By his will dated 19 October 2009 he gave his home in Nassau to Mr Moree. Out of the rest of his estate, including “Cash in Banks”, he gave a number of pecuniary legacies, including $55,000 to Mr Moree and $75,000 each to the Bahamian Salvation Army and the Bahamas Humane Society. He divided the residue equally between Mr Moree, Dorothy Jack and Norman Whitlock. In the event of a shortfall for the payment of legacies he specified that the requests to the Salvation Army and the Humane Society should abate first, so as to enable payment of the other legacies in full. The executors named in the will were Mr Moree and a lawyer named Mr Pinder.
On 20 November 2009 Mr Lennard and Mr Moree visited the First Caribbean International Bank (Bahamas) Ltd (“FCIB”) for what the judge described as the purpose of joining Mr Moree to Mr Lennard's existing bank accounts. There is some uncertainty whether Mr Lennard had one or more accounts at FCIB. In any event Mr Moree was to be joined to all such accounts. Nothing turns on whether there was one or more and, like the judge and the parties, the Board will refer to the accounts or account in the singular. The mechanism adopted was for both Mr Lennard and Mr Moree to sign account opening forms as joint account holders on FCIB's standard forms for that purpose. The substantial balance then standing to the credit of what had until then been Mr Lennard's sole account was thereafter treated as standing to the credit of the newly opened joint account.
The only evidence about what, if anything, was explained to Mr Lennard and Mr Moree by FCIB on the opening of the joint account, as to the consequences of Mr Moree's joinder, was a statement from Mr Moree that both he and the late Mr Lennard “understood that it was explained to us that we were converting his personal account to a joint account between us, so that upon his death the amounts held on that account became my property”. No evidence was called from any bank official about that event, nor was there any documentary record of what took place, other than the account opening forms themselves.
The judge did not accept Mr Moree's evidence, regarding it as self-serving. The account opening form signed by Mr Lennard also contained, in a box headed “State Purpose of Account”, a manuscript note “to pay utilities” which, it was common ground, had been made by an unidentified bank official. Both forms contained, immediately above Mr Lennard's and Mr Moree's respective signatures, a declaration in the following terms:
“I hereby declare that the information provided by me in this application is correct and complete to the best of my knowledge and that I have received, read, understood and accepted the agreement (detailed section 5 above) and the “Disclosure Documentation” and shall be bound by its terms.”
Section 5 included, at clause 20, the provision as to Joint Tenancy set out above.
By codicil to his will made on 12 January 2010 Mr Lennard revoked the legacies to the Salvation Army and Humane Society, thereby reducing the aggregate amount of the specific legacies by $150,000.
Mr Lennard died on 18 February 2010, at which time the joint account was in credit in the amount of $190,000.
On 11 March 2010 Mr Moree attended FCIB and re-constituted the former joint account with Mr Lennard as a joint account between himself and his wife.
Meanwhile, as the legally qualified executor, Mr Pinder set about preparing for the administration of Mr Lennard's estate, and in particular for the obtaining of probate. He obtained information from his co-executor Mr Moree on 30 March which, he said, included being told that the assets of the estate included $190,000 (on current and deposit accounts) at FCIB. Later, on 9 June 2010, Mr Pinder and Mr Moree signed the Executors' Oath for the purposes of obtaining Probate. The annexed Schedule makes reference to $100,000 held at FCIB. This may have been a misprint for $190,000, since otherwise the aggregate in the Schedule cannot be reconciled with its detail.
In July 2013 each of Mr Moree's fellow residuary beneficiaries, Ms Jack and Mr Whitlock, issued originating summonses in the administration of Mr Lennard's estate seeking declarations that the balance held in the joint account at Mr Lennard's death was thereafter held by Mr Moree on trust for the three residuary beneficiaries, rather than having passed to Mr Moree by survivorship.
A singular feature of the litigation which then ensued, both at first instance and in the Court of Appeal, was that it was treated as common ground between counsel, and therefore accepted by both courts, that a resulting trust of the money in the joint account was to be presumed in favour of the estate if Mr Moree could not discharge the burden of proving that Mr Lennard intended to make a beneficial gift of that money to him. In substance therefore, the litigation took the form of Mr Moree seeking to prove the requisite intention on the part of Mr Lennard, and the plaintiffs Mr Whitlock and Ms Jack seeking to challenge that evidence, but otherwise to rely upon the presumption. Mr Moree and Mr Pinder gave evidence by affidavit, and were cross-examined at the trial. Mr Moree relied upon his own statement, summarised above, about what happened at FCIB when the joint account was opened and, heavily as the judge noted, on the terms of clause 20 in the account opening forms.
The judge directed himself (at para 20) as follows:
“In the present case there is a presumption that Mr Lennard did not intend to make a gift to Mr Moree and the burden is on Mr Moree to rebut that presumption. In considering whether Mr Moree has discharged that burden I am obliged to look at all the evidence adduced and determine whether at the civil standard of a balance of probabilities Mr Moree has discharged that burden and establish[ed] that Mr Lennard intended to give the moneys at FCIB to him.”
The judge noted that the only evidence supportive of such a finding was Mr Moree's statement about what happened at FCIB, which the judge rejected, as noted above. He expressed surprise that no one had been called to give evidence from FCIB either as to a recollection of the transaction in question, or as to the bank's usual practice when opening joint accounts. He rejected the submission that clause 20 was probative of Mr Lennard's intention mainly because of the absence of any evidence showing that clause 20 had been explained to Mr Lennard, or drawn to...
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