Jemma Alizade & Ors v Martin Kudlick

A trustee’s retirement does not, without more, discharge an outstanding obligation to account. The court ordinarily enforces a trustee’s or personal representative’s duty to provide a full account, but retains a discretion to refuse relief in exceptional circumstances. Relevant considerations include unjustified delay, oppression, the respondent’s age and health, the availability of records and the proportionality between the benefit of further information and the burden of producing it. The duty to account generally requires identification of the assets, what was done with them, their present position and distributions. It does not ordinarily require trustees to explain why they exercised their powers in a particular way. The court may refuse a further account where existing accounts substantially discharge the duty and a further order would impose disproportionate burdens without realistic practical benefit.

The claimants, including a beneficiary and present trustee, sought orders under section 25(b) of the Administration of Estates Act 1925 and the court’s inherent supervisory jurisdiction. They sought accounts of the defendant’s administration of two estates and his dealings with three trusts over a period approaching 50 years.

The defendant had been an executor and trustee but had retired. Estate accounts had been prepared, and trust accounts had historically been produced, although the claimants sought further information about property sales, company dealings and the reasons for decisions taken during the administrations. The central issues were whether further accounts were owed and whether the court should exercise its discretion to order them.

1. Disposition. The claim was dismissed. The court declined to order further accounts concerning either the trusts or the estates.
2. Trust accounts. A trustee’s retirement does not itself discharge an outstanding obligation to account. The court rejected the proposed distinction between current and retired trustees. However, retirement may be relevant to the discretionary question whether an order should be made. The evidence showed that annual trust accounts had historically been prepared and provided, and there was no sufficient basis for intervention in relation to the trust assets.
3. Content of an account. The account should identify the assets, state what was done with them, identify what the assets now are and record distributions. The obligation does not ordinarily require trustees to explain why they dealt with trust assets in a particular way or what factors they considered in exercising their powers. The claimants could ask whether a transaction occurred, but could not generally demand a general explanation of the reasons for it.
4. Personal representatives. The statutory duty under section 25(b) of the Administration of Estates Act 1925 applied whether or not the representative remained in office. The court applied by analogy the discretionary approach in Henchley v Thompson. It ordinarily enforces the duty to provide a full account, but may refuse relief as an exception where the facts justify that course.
5. Discretion. Refusal was justified by the 28-year delay after completion of the administrations, the oppressive and burdensome scope of the request, the defendant’s advanced age and serious ill-health, the loss or destruction of records and faded memories, and the absence of any realistic prospect of pursuing substantive claims for which the information was required. The benefit of further information was therefore disproportionate to the burden of compliance.

First-instance decision. No prior appellate decision is stated in the judgment.