Margarita Hamilton v Her Majesty's Attorney-General & Ors.

English law governs the devolution of freehold land in England held on trust by a foreign company. On dissolution, the legal estate does not determine by escheat. It passes to the Crown subject to the trust, and restoration of the foreign company does not automatically revest the land in it.

A vesting order under section 44(ii)(c) of the Trustee Act 1925 is discretionary and pragmatic. The court need not recreate the pre-dissolution position or vest the property in the holder of the largest beneficial interest. It may vest the land in the person best placed to protect the property and relevant interests, having regard to all the circumstances.

Two related claims concerned Walton Castle, English freehold property formerly registered in the name of Walton Properties Ltd, a Guernsey company. The company and its parent were dissolved in Guernsey and later restored to the register.

Margarita Hamilton occupied the property and operated a wedding and events business there. She sought a vesting order in her favour. Walton Properties Ltd sought a competing order in its own favour, supported by its trustees in bankruptcy, contending that restoration had automatically revested the legal estate in it.

The court determined the effect of dissolution and restoration on English land, Hamilton’s standing to seek relief, and the proper exercise of the vesting-order discretion.

1. Effect of dissolution and restoration. English law, as the lex situs, governed the devolution of Walton Castle. On dissolution of a foreign corporate trustee, the legal estate in English freehold land did not determine by escheat. It vested in the Crown subject to the trust. Restoration to the Guernsey register therefore did not automatically revest the legal estate in Walton Properties Ltd.
2. Sections 181 and 58. Section 181 of the Law of Property Act 1925 was not engaged because the legal estate had not determined. Section 58(1) of the Land Registration Act 2002 did not preserve the company’s title merely because it remained named on the register. The disposition to the Crown operated by law, notwithstanding the absence of registration.
3. The Guernsey company legislation had no extra-territorial effect on English land. There was no principled basis for applying Guernsey law instead of the general lex situs rule.
4. Standing. Hamilton had sufficient standing. The evidence supported the authenticity and effect of the assignment of the beneficial interest, and the challenges advanced by the trustees were unsupported. In any event, her equitable charging order over the beneficial interest gave her sufficient interest to apply for a vesting order, applying Midland Bank v Pike.
5. Discretion. The power under section 44(ii)(c) of the Trustee Act 1925 was very wide but had to be exercised judicially. The court adopted the pragmatic approach in Potier v Treasury Solicitor (Bona Vacantia). It was not obliged to recreate the status quo or vest the property in the person with the majority beneficial interest.
6. The material circumstances favoured Hamilton: she occupied the property, operated the business, had potential refinancing capable of redeeming the existing mortgage, and there was no compelling evidence that she was unsuitable to act as trustee. Walton Properties Ltd could protect and realise its beneficial interest through a subsequent application under the Trusts of Land and Appointment of Trustees Act 1996.
7. The court accordingly ordered that legal title to Walton Castle be vested in Margarita Hamilton.

This was a first-instance decision. Hamilton’s claim was issued on 10 September 2020. The trustees were joined on 15 February 2021. Walton Properties Ltd was restored to the Guernsey register on 7 May 2021 and issued its competing claim on 25 August 2021.