Balwant Singh Gill v Jashpal Singh Thind & Ors

The claim concerned the beneficial ownership of shares in three family companies (Jeeves Estates Ltd, Jeeves Investments Ltd and Simicare Ltd). The court applied the ordinary principles for establishing express trusts (intention to create a trust shown by words and conduct) and resulting trusts (presumption where title is taken without consideration), and had regard to Companies Act 2006 provisions on the register of members and rectification (sections 127 and 125) and the procedure for unfairly prejudicial conduct (section 994). The judge accepted handwriting expert evidence that two alleged bare trust deeds were forged, made adverse credibility findings about several witnesses and held that, on the balance of probabilities, the JIL and Simicare shares were held by Mr Gill on express trust for the three Thind children equally; by a narrow margin the 100 JEL shares were held by Mr Gill on express trust for all of his grandchildren. Because of the findings on trust and forgery, the Part 7 claim and the section 994 petition were dismissed, and the judge reserved the precise terms of any declaratory order for further submissions.

This is a first instance trial as to liability of a Part 7 claim and an associated Companies Act 2006 s.994 petition arising from a family dispute about the beneficial ownership of shares in three companies (JEL, JIL and Simicare). The claimant alleged he was beneficial owner; the defendants said the registered shareholdings were held on trust for the Thind children (and, as to JEL, for all grandchildren).

Nature of the application: the claimant sought declarations of beneficial ownership and relief under s.994; earlier interim relief (freezing order/proprietary injunction) had been applied for and largely abandoned.

Key issues (framed and decided by the court):

• whether the shares in JIL and Simicare were held by Mr Gill on express or resulting trusts for the Thind children;
• whether the 100 shares in JEL were held by Mr Gill on trust for all grandchildren or were beneficially his;
• the authenticity of two purported bare trust deeds and related stock transfer forms;
• credibility of oral witnesses and the weight of contemporaneous company and bank records;
• whether rectification of company registers should be ordered (Companies Act 2006 ss.125, 127).

Reasoning and outcome: the judge emphasised the scarcity of contemporaneous documentary evidence and therefore the need to assess plausibility, consistency and witness credibility. Handwriting experts agreed there was strong evidence the two relied-on bare trust deeds were forgeries; the judge accepted their opinion. The judge found Mr Gill’s oral evidence generally unreliable and in parts deliberately false, and found parts of Mr Thind’s evidence untruthful (notably about the signing and dating of the trust deeds) though elements of the defendants' case (notably Mrs Thind and the two younger Thind children) were accepted as reasonably reliable. Applying established law on express and resulting trusts (and the burden of proof), the court concluded on the balance of probabilities that JIL and Simicare shares were held on express bare trusts for Avneesh, Jeevan and Simran equally; by a narrow margin the 100 JEL shares were held on express trust for all grandchildren. The forgery and other misconduct led the judge to dismiss the Part 7 claim and the s.994 petition and to invite further submissions on the precise terms of declarations and any consequential orders.

This is a first-instance decision. The court dismissed the Part 7 Claim and the Companies Act 2006 s.994 Petition. The judge found that, on the balance of probabilities, the registered shares in JIL and Simicare were held by Mr Gill on express bare trust for the three Thind children equally, and by a narrow margin that the 100 shares in JEL were held by Mr Gill on express trust for all of his grandchildren. Key reasons were: unreliability and, in parts, dishonesty of witnesses; unanimous expert handwriting opinion that two relied-on trust deeds were forged; consideration of contemporaneous company and bank records; and application of the legal tests for express and resulting trusts and for rectification/relief under the Companies Act 2006. The judge reserved detailed declaratory wording for further submissions.