Vanida Walker v Ekkachai Somboonsarn

On an account in common form, the trustee bears the burden of proving receipts, payments and their justification as trust transactions. A claim omitted from the trial cannot ordinarily be introduced during the subsequent taking of the account, particularly where the order does not encompass it. Business expenses attributable to commercial occupiers are not legitimate trust expenses merely because the trustee paid them. An equitable allowance for fiduciary work is exceptional, must be pleaded and proved, and cannot ordinarily be claimed as remuneration for services provided to companies rather than to the beneficiary.

Following a trial concerning beneficial ownership of three companies and two properties, the court declared that the claimant owned the relevant shares and properties beneficially. The defendant was ordered to account for rents, liabilities and dividends received while holding the assets on trust.

This judgment determined the disputed entries in those accounts: alleged contributions to the purchase price of 38 Charlotte Street, expenses connected with 78 Hermit Road, and dividends paid to the defendant while he held the shares as trustee.

1. The defendant bore the burden of proving that payments were made and of justifying them as payments made qua trustee. The claimant was not required to prove that alleged payments were unjustified.

2. The alleged contributions to the purchase price of 38 Charlotte Street could not be reopened. The trial judgment had finally determined that the immediate purchase monies represented sums belonging to and arranged by the claimant, and the order for the account did not naturally encompass contributions to the purchase price. The defendant could and should have pleaded and proved that case at trial. In any event, the late claim was implausible and unsupported by sufficient evidence.

3. Expenses incurred for the operation of businesses occupying 78 Hermit Road were not legitimate trust expenses. The defendant had not discharged the burden of showing that the disputed items were attributable to the trust rather than to the commercial occupiers. All disputed items were therefore disallowed, and corresponding credits for a covid payment and waste collection refund were removed.

4. The dividends were properly within the account because they had been paid to the defendant while he held the shares as trustee. A possible claim for remuneration as a company director was against the companies, not the beneficial owner, and was not a justifiable expense of trusteeship.

5. An equitable allowance is discretionary and exceptional. It must be pleaded and proved. No allowance was appropriate, particularly because the defendant had consistently denied his trustee status. The account was to record the full amount of the dividends as owing to the claimant.