England and Wales Court of Appeal (Civil Division) Decisions

IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM CHICHESTER COUNTY COURT
(DISTRICT JUDGE DAVIES)

		Royal Courts of Justice Strand London WC2 Wednesday, 14th March 2001

Wednesday, 14th March 2001

1. LADY JUSTICE ARDEN: This is an application by Mrs Josephine Margaret Clarke for permission to appeal against the order of District Judge Davies dated 29th February 2000. This application was lodged on 24th November 2000, and as that date was after 2nd May 2000 Civil Procedure Rule 52 applies. There are also applications for extension of time, for permission to file new evidence and for a stay of execution.
2. By virtue of the order of District Judge Davies the application made by Mrs Clarke under the Inheritance (Provision for Family and Dependants) Act 1975 section 2 was dismissed. That section enables the court to make orders for reasonable financial provision for a child or certain other persons out of the estate of a deceased person. The estate in question in this case was the estate of Mrs Clarke's mother, Mrs Margaret Murray.
3. Mrs Clarke is one of three daughters of Mrs Murray. The other two are called Caroline and Virginia. The deceased died on 2nd October 1995. Probate of her will was granted on 4th June 1996. Mrs Murray's will provided for the residue of the estate to be held on discretionary trust for the benefit of the three sisters and their families, and that there was a letter of wishes executed by Mrs Murray on the same date as the will (12th April 1994) which in essence provided that the principal trust asset (the deceased's half share in a block of flats) should not be sold against the wishes of Jane and Victoria, and that the net income should be paid to Mrs Clarke in her life time unless she should become bankrupt or unable to deal with her affairs. The letter of wishes also states that the Trustees should exercise their powers so that Mrs Clarke is able to live in reasonable comfort for the rest of her life and that they should not feel obliged to preserve the capital for the sake of those entitled on her death.
4. Mrs Clarke says that her resources and income are now negligible and that she has debts of some £14,000; and she has submitted that the will treats her sisters more favourably.
5. As at September 2000 the Trustees have paid to Mrs Clarke some £29,366.30. The letter of wishes authorises the Trustees to have recourse to the capital so that Mrs Clarke can live in reasonable comfort for the rest of her life. I have seen a valuation of the block of flats as at September 2000 which states that the then current open market value of the freehold interest subject to existing tenancies is £700,000, which places a value of £350,000 on the Trust's half share if the whole interest were being sold. Mrs Clarke is approximately 63 years of age and she has a life expectancy, according to the judge's judgment, of some 21 years. The applicant, Mrs Clarke, also says that she looked after her mother in her final years.
6. The applicant, Mrs Clarke, gave evidence before the district judge. In his judgment the district judge said that the assets of the Trust consists of a half share in a block of sixteen flats, and that the capital value of the Trust is approximately £280,000. He also referred to letters from Mrs Murray which showed that she had paid a great deal of money to Mrs Clarke in her lifetime and that the applicant had not managed her personal or business affairs prudently and had spent the money which she had been given. For example, and I am now quoting from the judge's judgment, she decided to start a horse business and took a stable yard at a high rent with no resources behind her, and she had spent a legacy of £40,000 that she had received.
7. The district judge observed that the income of the Trust consisted of the rent received for the flats, and that the Trustees had paid out approximately £6,000 per annum. On the basis that the applicant had that income from the Trust and her own pension, she now has an annual income of some £10,000 per annum. The district judge said that the bequests which had been made to Mrs Clarke's other sisters were irrelevant and that since the other sisters were comfortably off there was likewise no need to consider their financial position. The judge held that section 3(5)(e) of the 1975 Act was not relevant because the applicant was in an earlier category because she was a child of the deceased. The judge identified the correct question which was whether the provision for the applicant was reasonable. It was not a question of whether the mother had treated all the sisters fairly.
8. The district judge also heard evidence from one of the Trustees, Mr Peterkin. Mr Peterkin had also been one of the deceased's professional advisers for many years. The district judge noted that the applicant, in his judgment, wrongly believed that her mother had some obligation to pay her bills; and there was reference to Mrs Clarke having been bankrolled by her parents in her lifetime. He regarded her assertion that there was a surplus of £81,000 since her mother's death as absurd, and he reached that conclusion on the basis of draft accounts which are in the bundle.
9. In her grounds of appeal Mrs Clarke contends that the Trustees have not made reasonable provision for the applicant since the deceased died. She makes allegations, including an allegation that her mother tried to force her out of her business. She contends that her income is not sufficient for her to live on; and there is a reference to collusion between the judge and the defendants, but I must say forthwith that there is no evidence whatsoever to back that argument up. Mrs Clarke also says that she did not have time to meet the arguments produced at the trial, for instance that she did not see the defendants' skeleton arguments before the trial. As to this I do not think those arguments can assist because Mrs Clarke was legally represented at that trial.
10. Mrs Clarke seeks to put in on this appeal new evidence consisting of correspondence that she has had with the Trustees requesting further distributions since December 2000 to which she has had no reply.
11. I must now turn to my conclusions on this application. Section 2(2) of the 1975 Act provides that reasonable financial provision means such financial provision as it would be reasonable in all the circumstances for the applicant to receive for his or her maintenance. As I see it the judge clearly asked the right question and in that regard there can be no error of law; he clearly applied the correct principle.
12. The net income from the property seems to be about £16,000 after tax. This sum is, as I see it, being received by the Trustees each year subject to the flats continuing to be occupied. The Trustees have, however, to keep some money back for emergencies and also for expenses connected with the flats such as insurance repairs, and in addition they have to make reserves for their legal costs. Subject to that, as I understand it, the income is available for Mrs Clarke. The district judge clearly had to form a view as to whether there was reasonable provision for the applicant, taking into account her resources and the amount which was available as it appeared from the estate.
13. The judge came to the conclusion that reasonable provision was made. As far as that point is concerned, for an appeal to succeed it would have to be shown that the judge considered the question whether the provision was reasonable and reached an answer which was contrary to the weight of the evidence, and irrational taking into account matters which he ought not to have taken into account or failing to take into account some relevant factor. As I see it the finding which the judge made was not against the weight of the evidence. There is no reasonable prospect of success on appeal on that point.
14. The new evidence goes really to another point which is that Mrs Clarke asserts that the Trustees have not been paying out to her all that could be paid, and indeed she has told me that they have not provided her with the information about the assets of the Trust and its income and so on to which she says she is entitled as a beneficiary. But those are not points which could be made on an appeal. It would involve an inquiry into the conduct of the Trustees of the management of the Trust which is an entirely separate issue. That is outside the proceedings and would not afford a reasonable prospect of success on this appeal.
15. As I see it, the learned judge did not exercise his discretion under section 2 in a way which could be said to be susceptible to review by this court, and I do not consider that there is any real prospect of success on an appeal. Therefore this is a case in which I decline permission to appeal. Accordingly, the order that I make is that I extend time for hearing this application, but I dismiss the application. I dismiss also the application for a stay and for the admission of new evidence.
(Applications dismissed; no order for costs).