Bhusate v Patel & Ors

Beneficiaries of an unadministered estate have no choate beneficial interest in particular estate assets. Their entitlement is to due administration of the estate, unless there has been an appropriation or assent. A common intention constructive trust may be inferred, but not imputed, and the flexible approach used for a domestic family home does not automatically extend to an intestate estate. Inconsistent alternative claims based on different alleged common intentions may be struck out. The rule against self-dealing remains subject to rare exceptional circumstances. The court may remove personal representatives where prolonged failure to administer the estate and conflicts of interest make continuation inappropriate.

The claimant, the widow of the deceased, sought declarations that she was sole beneficial owner of the principal estate property, or alternatively that the family members held it on constructive or resulting trust. She also claimed her statutory legacy and capitalised life interest, with interest, and sought permission under section 4 of the Inheritance (Provision for Family and Dependants) Act 1975 to bring that claim out of time.

The deceased’s estate had remained unadministered for approximately 28 years. The defendants applied under CPR 3.4(2)(a) and CPR 24.2 to strike out the claims or obtain summary judgment. They also sought removal of the claimant and the first defendant as administrators under section 50 of the Administration of Justice Act 1985. The central issues were whether the pleaded property claims disclosed a viable legal basis, whether the legacy claim was statute barred, and whether the administrators should be replaced.

1. Property claims. The claimant and the first defendant remained under duties to administer the estate and preserve the property. Under sections 33 and 46 of the Administration of Estates Act 1925, the beneficiaries of the unadministered estate had no choate beneficial interests in the property. They had a right to due administration of the estate. No appropriation or assent had been pleaded or established.
2. The claimant’s case that she had become sole beneficial owner was unsustainable. Even if an appropriation or assent had occurred, the rule against self-dealing would generally prevent the claimant, as an interested personal representative, from vesting the property in herself. The rule is subject to very exceptional circumstances, but none existed on the pleaded facts.
3. A resulting trust could not arise on the facts relied upon. A common intention constructive trust may be inferred from facts, but the court cannot impute the parties’ intention to create such a trust. The claimant’s alternative cases relied on inconsistent alleged common intentions and were therefore liable to be struck out.
4. Jones v Kernott. The approach applicable to a jointly owned domestic home could not be extended on these facts to an intestate estate in which no common intention concerning beneficial ownership existed before the deceased’s death. A constructive trust might arise on conventional principles from an agreement, but no such agreement was pleaded or supported by evidence.
5. The claim for the statutory legacy and capitalised life interest was statute barred under section 22 of the Limitation Act 1980. Section 21(1) did not assist because the claimant was not a beneficiary under a trust: the estate remained unadministered, and her entitlement arose under sections 46 and 47A of the Administration of Estates Act 1925, not as a residuary legatee.
6. The sixth defendant could not support the claimant’s case while advancing a contradictory case of his own. His constructive trust, proprietary estoppel and account claims were also unsustainable on the pleaded facts and were struck out or dismissed under CPR 24.2.
7. The administrators had failed singularly to fulfil their duties over many years. Their removal was appropriate under section 50 of the Administration of Justice Act 1985, having regard to the welfare of the beneficiaries as a whole. The application to set aside the deceased’s assent of the property to himself was dismissed because very exceptional circumstances, including the passage of time and acceptance of the position by the defendants, made setting it aside unjust.
8. The claimant’s and sixth defendant’s claims were struck out or dismissed in their entirety, except for the claimant’s application under section 4 of the Inheritance (Provision for Family and Dependants) Act 1975, which was left for later determination.