Jenny Pierce & Anor v Paul Barton & Anor

A will is construed in the same way as other documents, by identifying the meaning of its words in their documentary and factual context, including the document’s purpose, other provisions, known circumstances and common sense. Where a will is ambiguous in the light of surrounding circumstances, Administration of Justice Act 1982, section 21 permits extrinsic evidence, including evidence of the testator’s intention. A specific gift may pass the interest which the testator actually owned, even where the will describes it imperfectly. Limitation may bar recovery of money secured by a charge without extinguishing the underlying debt, but section 17 can extinguish the chargee’s right to possession after the relevant period has expired.

The claimants, personal representatives of Malcolm Barton’s estate, sought directions concerning a legal charge securing £87,727.52 over a flat occupied and registered in the name of the first defendant, Malcolm’s son. The principal issue was the construction of clause 5a of Malcolm’s will, which purported to give the flat to the son although he already owned the lease. The court also considered whether limitation had barred recovery of the secured debt and extinguished the charge. A related rectification claim had been issued, but the construction issue resolved the need for further directions.

1. Construction. Clause 5a was construed as giving the first defendant the legal charge and the debt secured by it. The court applied the modern contextual approach to wills stated in Marley v Rawlings. The words were considered in their natural and ordinary meaning, the purpose and provisions of the will, the facts known or assumed when it was made, and common sense.
2. Although clause 5a was not ambiguous on its face, it was ambiguous in the light of surrounding circumstances because the first defendant already owned the lease. Section 21(1)(c) of the Administration of Justice Act 1982 therefore applied, and section 21(2) permitted evidence of the testator’s intention. The attendance note showed an intention to release the charge and debt. That construction gave effect to the intended benefit and avoided an ineffective gift of property which the testator did not own.
3. The earlier authorities concerning specific gifts of land or mortgaged property were treated as context-sensitive rather than imposing rigid rules. The court considered the distinction between a gift of the interest in land and a gift of the debt secured on it, and held that the wording and surrounding circumstances supported the latter.
4. Limitation. Sections 5 and 6 of the Limitation Act 1980 were irrelevant because there was no contract of loan between the first defendant and his parents. Section 20(1)(a) applied to the principal sum secured by the charge. The 12-year period had expired, so the sum could no longer be recovered by action, although the debt itself retained other legal effects.
5. Section 17 also applied. The chargee’s right to possession accrued when the charge was created. More than 12 years then elapsed without an attempt or demand for possession, or acknowledgment of the chargee’s right to possession. Following Ashe v National Westminster Bank, the mortgage estate was therefore extinguished. The construction issue was decided in favour of the first defendant, and the practical limitation outcome would have been the same in any event.