Nasloom Aslam v Maria Seeley & Anor

A personal representative who applies for removal because they can no longer perform the role will ordinarily be entitled to an indemnity for the costs of the application from the estate, provided the proceedings were properly and reasonably brought. A beneficiary whose unreasonable conduct necessitates or materially escalates proceedings may instead be ordered to bear some or all of those costs. The court retains a broad discretion to achieve overall justice, including where the litigation does not fit neatly within established categories. Costs caused by a separate procedural failure, rather than by the beneficiary’s conduct, should not be shifted to that beneficiary.

The claimant, executor of an estate, applied under section 50 of the Administration of Justice Act 1985 for her own removal because conflict and an impasse had prevented administration of the estate. She was removed and an independent personal representative appointed. The remaining issue was the incidence and basis of the parties’ costs.

The claimant sought payment from the estate. The second defendant sought payment of her costs, and some of the claimant’s costs, from the first defendant’s share because of the first defendant’s alleged conduct. The court also had to address costs caused by an adjournment arising from concerns about the claimant’s litigation capacity.

1. Claimant’s indemnity. Proceedings brought by a personal representative for their own removal, where they are no longer properly able to act, are prima facie brought for the benefit of the estate. Under section 31 of the Trustee Act 2000, CPR rule 46.3 and paragraph 1 of Practice Direction 46, the representative is entitled to an indemnity for costs properly incurred unless the proceedings or conduct were improper or unreasonable. The court applied the principles summarised in Price v Saundry [2019] EWCA Civ 2261 and Mussell v Patience [2019] EWHC 1231 (Ch).
2. Beneficiary conduct. Following Green v Astor [2013] EWHC 1857 (Ch), where a beneficiary’s unreasonable conduct necessitates an application, or generates substantial costs in the litigation, the court may order that beneficiary to bear some or all of the costs which would otherwise fall on the estate. The discretion is directed to the overall justice of the case and is not a sanction for intemperate language alone. The categories identified in Re Buckton [1907] 2 Ch 406 are useful but are not exhaustive.
3. The claimant’s removal application was reasonably brought in response to the impasse and the first defendant’s conduct. However, the additional costs after the June hearing resulted principally from the claimant’s lawyers’ failure to raise capacity concerns promptly and were not caused by the first defendant. The first defendant was therefore not ordered to pay either defendant’s costs.
4. The claimant’s costs were allowed from the estate in the sum of £25,000 inclusive of VAT, after disallowing costs thrown away by the adjournment. The second defendant’s costs were allowed from the estate in the sum of £7,200 inclusive of VAT, representing costs incurred up to the June hearing.