Karen Pegler & Ors v Timothy Bruce McDonald & Anor

The court may pass over or remove a personal representative where the statutory criteria are met and the welfare of the beneficiaries as a whole requires it. Wrongdoing is unnecessary. A conflict created by the testator’s own arrangements does not automatically disqualify an executor, although an executor cannot unilaterally determine or pay a disputed personal claim. Friction alone is insufficient, but persistent hostility, inability to act objectively, disregard of legal limits, improper handling of estate assets, and inability to work with co-representatives may make administration difficult or impossible. In such circumstances, the testator’s choice may yield to the beneficiaries’ interests, even where professional replacement costs reduce the estate.

The claimants sought an order under section 116 of the Senior Courts Act 1981 to pass over the first defendant as executor of Clive McDonald’s will, or alternatively his removal under section 50 of the Administration of Justice Act 1985. No grant of probate had been obtained. The defendant had expressed an intention to challenge the will, asserted substantial personal claims against estate property, disputed the authority of judges, pursued applications recorded as totally without merit, and had experienced serious breakdowns in relations with beneficiaries and others involved in the administration.

The central questions were whether these matters constituted special circumstances for the purposes of section 116 and whether removal was justified under section 50, having regard to the proper administration of the estate and the interests of the beneficiaries as a whole.

1. Outcome. The defendant was passed over under section 116 of the Senior Courts Act 1981. Alternatively, he was removed under section 50 of the Administration of Justice Act 1985. The existing professional personal representative was to continue alone.
2. Section 116 applies where no grant has yet been obtained and requires special circumstances making it necessary or expedient to appoint someone other than the person otherwise entitled. Section 50 also applies before grant, so both jurisdictions were available, but their criteria differ: A-B v Dobbs [2010] WTLR 931 and Goodman v Goodman [2014] 1 Ch 186.
3. For removal under section 50, the guiding concern is proper administration and the welfare of the beneficiaries considered as a whole. The court need not find wrongdoing or fault. It must balance the testator’s wishes, the beneficiaries’ views, the practical difficulty of completing the administration, any material misconduct, and the cost and consequences of replacement: Letterstedt v Broers (1884) 9 App Cas 371, The Thomas and Agnes Carvel Foundation v Carvel [2008] Ch 395, Harris v Earwicker [2015] EWHC 1915 (Ch) and Schumacher v Clarke [2019] EWHC 1031 (Ch).
4. The defendant’s potential beneficial claim arising from a deed created by the testator did not automatically disqualify him. The principle in Sargeant v National Westminster Bank (1990) 61 P & CR 518 applied because the conflict had been created by the testator’s own arrangements. Any disputed claim would require independent consideration and, if necessary, litigation in which the defendant was claimant: Re Fish [1891] 2 Ch 413 and Armstrong v Armstrong [2019] EWHC 2259 (Ch).
5. Nevertheless, the defendant’s equivocal position on the validity of the will, persistent hostility, inability to accept independent legal decisions, breakdown in relations, actual or potential misuse of estate powers, and pursuit of hopeless applications demonstrated that he lacked the objectivity and personal qualities required for fiduciary administration. These matters amounted to special circumstances and made lawful completion of the administration difficult or impossible. The testator’s choice therefore had to yield to the beneficiaries’ welfare. The relevant circumstances were those existing, and material available, at the hearing: Re Wrightson [1908] 1 Ch 789.