Goodchild v Bradbury & Ors

In a presumed undue influence case involving a gift, the donor’s statement that the donee applied no actual pressure does not, by itself, rebut the presumption. Where the donor was vulnerable because the donee occupied a position of trust and confidence with potential for abuse, and the transaction was not explained by ordinary motives, the donee had to show that the donor acted after full, free and informed consideration. The evidence had to be assessed as a whole. The absence of a request or overt wrongdoing by the donee was not decisive. A subsequent transferee is affected where he has notice of the facts making the original transfer vulnerable to being set aside, rather than merely notice of impropriety.

Leslie Goodchild appealed against an order of the High Court Chancery Division refusing to set aside two transfers of land. He had transferred the Orchard to his great nephew, Shane Bradbury, as an alleged wedding gift. Bradbury then transferred it to Stephen Hillier for £1,800.

The deputy judge found a relationship of trust and confidence, an ascendancy by Bradbury, a transaction not readily explained by ordinary motives, inadequate advice, and Hillier’s notice of the relevant circumstances. Nevertheless, he held that the presumption of undue influence was rebutted by Goodchild’s evidence that he did not think Bradbury had pressured him. The appeal raised whether that evidence was sufficient, and whether full and informed consideration was necessary to rebut the presumption.

Appeal allowed. The first transfer was set aside. The second transfer to Hillier was also set aside. Permission for Hillier to rely on his respondent’s notice out of time was refused.

1. Chadwick LJ held that a presumption of undue influence arose where Goodchild reposed trust and confidence in Bradbury, Bradbury occupied an ascendancy with potential for abuse, and the gift was not readily explicable by the ordinary motives by which people act. This was consistent with the approach explained in Royal Bank of Scotland v Etridge [2001] UK HL 44, [2002] 2 AC 773.
2. To rebut the presumption, Bradbury had to show that Goodchild made the gift after full, free and informed consideration of its consequences. The fact that Bradbury had not asked for the gift, or had not acted improperly, was not sufficient. The principle was supported by Hammond v Osborne [2002] EWCA Civ 885, Jennings v Cairns [2003] EWCA Civ 1935, and Allcard v Skinner.
3. The deputy judge erred by treating Goodchild’s witness-statement evidence as decisive. The statement contained an unintended double negative and, in any event, had to be evaluated with the evidence as a whole. Its preparation as a draft, its timing after registration of an enduring power of attorney, and Goodchild’s inability to give oral evidence required particular care.
4. May LJ agreed. He concluded that the evidence showed that the gift was made under Bradbury’s influence, assisted by Hillier, and that Goodchild had little or no understanding of the value of the land or its effect on Mill House. Smith LJ agreed with both judgments.
5. Hillier’s notice was assessed by reference to the facts making the first transfer vulnerable to being set aside for undue influence, not merely to notice of impropriety by Bradbury. Hillier had full notice because he was instrumental in procuring the transaction.

• Court of Appeal (Civil Division): [2006] EWCA Civ 1868. Appeal allowed and both transfers set aside.
• High Court, Chancery Division: Order dated 18 April 2006. The deputy judge refused to set aside either transfer.