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You are here: BAILII >> Databases >> High Court of Ireland Decisions >> S.1 v P.R. 1 & Ors [2013] IEHC 407 (23 August 2013)
URL: http://www.bailii.org/ie/cases/IEHC/2013/H407.html
Cite as: [2013] 2 IR 302, [2013] IEHC 407
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Judgment Title: S.1 v P.R. 1 & Ors Neutral Citation: [2013] IEHC 407 High Court Record Number: 2011 7826P Date of Delivery: 23/08/2013 Court: High Court Composition of Court: Judgment by: Laffoy J. Status of Judgment: Approved |
Neutral Citation: [2013] IEHC 407 THE HIGH COURT [2011 No. 7826P] IN THE MATTER OF THE ESTATE OF F. DECEASED BETWEEN S. 1 PLAINTIFF AND
P.R. 1 AND P.R. 2 DEFENDANTS Judgment of Ms. Justice Laffoy delivered on 23rd day of August, 2013. A – PROCEDURAL AND FACTUAL BACKGROUND Preliminary issues/Related proceedings 1. By order of the High Court (McGovern J.) made on 16th July, 2012 in these proceedings (the Plenary Proceedings) it was directed that certain preliminary issues be tried, namely:
(b) whether the Court has jurisdiction to grant the relief sought by the plaintiff pursuant to s. 117 of the Succession Act 1965 (the Act of 1965) at paras. (5) and (6) of the prayer in the statement of claim, these proceedings “having issued more than six months after the first taking out of representation to the estate of the [Testator] which occurred on 15th October, 2010 and whether the said grant of representation was a valid one for the purposes of the running of time”. 2. The Related Proceedings under Record No. 2011/663 SP are entitled:
S. 2 PLAINTIFF AND
P.R. 1 and P.R. 2 DEFENDANTS” It is not clear on the documentation before the Court whether a separate order directing the trial of a preliminary issue was perfected in the Related Proceedings. However, the preliminary issue which the Court has to determine in relation to the Related Proceedings is the issue outlined at (b) in paragraph 1 above. 3. The plaintiff in the Plenary Proceedings, S.1, and the plaintiff in the Related Proceedings, S. 2, are brothers, being sons of the Testator. Time line
The Testator made his last will and testament on 4th March, 1996 wherein he appointed his wife, M., or if she should predecease him, his son, S. 1, and the defendants, P.R. 1 and P.R. 2, to be executors and trustees thereof. The Testator’s wife, M., did predecease him. It is common case that under the terms of the will the six children of the Testator, including S. 1 and S. 2, are the beneficial owners of his estate in equal shares. • 6th July, 2008: The Testator died on 6th July, 2008. • 5th July, 2010: The order of the High Court referred to in the grant of Letters of Administration next referred to was made under s. 27(4) of the Act of 1965 on 5th July, 2010. There is no copy of that order before the Court. • 15th October, 2010: Letters of Administration of the estate of the Testator were granted by the Probate Office to A.A.L. on 15th October, 2010 and were expressed to be granted to A.A.L., who was described as a solicitor, as follows:
. . . Bank intend instituting against the estate of the deceased.” • 28th March, 2011: A grant of probate of the Testator’s last will was made from the District Probate Registry at Limerick to S. 1 and the defendants on 28th March, 2011. The grant was in the usual form of a grant of probate and followed Form No. 6 of Appendix Q to the Rules of the Superior Courts 1986 (the Rules). It was recorded on the face of the grant of probate that an Inland Revenue affidavit had been delivered showing the gross value of the estate of the Testator at in excess of €25.8m and the net value at in excess of €23.8m. • 11th July, 2011: By order of the Assistant Probate Officer dated 11th July, 2011, the grant of probate made on 28th March, 2011 was revoked, as the evidence discloses, because S. 1 signalled his intention to issue the Plenary Proceedings. • 30th August, 2011: The Plenary Proceedings were initiated by a plenary summons which issued on 30th August, 2011. From the outset P.R. 1 and P.R. 2 were named as defendants and an appearance was entered on their behalf on 2nd September, 2011. • 23rd September, 2011: The special summons in the Related Proceedings was issued on behalf of S. 2 on 23rd September, 2011. P.R. 1 and P.R. 2 were named as defendants from the outset and the history of the grant of probate was outlined in the endorsement of claim, wherein it was stated that the defendants were sued “in their capacity as remaining legal personal representatives” of the Testator. An appearance was entered on behalf of the defendants on 20th October, 2011. • 21st November, 2011: Letters of administration of the estate of the Testator with the will annexed de bonis non were granted to the defendants by the District Probate Registry at Limerick on 21st November, 2011. 5. As has been recorded, the plenary summons in the Plenary Proceedings issued on 30th August, 2011. The statement of claim was delivered on 2nd September, 2011. The reliefs sought at paras. (1), (2) and (3) in the prayer in the statement of claim were as follows:
(2) A Declaration that insofar as the Defendants hold the said shareholding they do so in trust for the Plaintiff absolutely. (3) A Declaration that the Estate of the Testator, is obliged to honour the Guarantee provided by the Testator, in respect of the borrowings for the purchase of lands at Blackacre, from F. Co. Limited.” 6. The basis on which S. 1 pleads entitlement to the relief set out at (3) in the prayer for relief in the plenary summons is that in December 2006 he purchased about two acres of land at Blackacre from F. Co. Limited for the sum of €1.2m. He was assured by the Testator that following the sale by another company, described “as nominee for” the Testator, of 4.6 acres of land adjoining Blackacre, S. 1’s borrowings from a bank (S. 1’s Bank) to finance the purchase were to be discharged. The Testator died before the completion of the sale of the adjoining lands. The plaintiff is presently indebted to S. 1’s Bank in the sum of approximately €1.7m in respect of his borrowings for the purchase of the two acres at Blackacre. It is pleaded that the estate of the Testator is obliged to honour the guarantee given by the Testator. 7. The reliefs sought by the plaintiff at paras. (5) and (6) in the prayer in the statement of claim referred to in the order of 16th July, 2012 are the following reliefs:
(6) An order pursuant to Section 117 of the Succession Act, 1965 making such provision for the Plaintiff out of the estate of the [Testator] as this Honourable Court thinks just.” 8. In their defence delivered on 25th April, 2012, the defendants pleaded, by way of preliminary objections, that –
(b) the Court does not have jurisdiction to grant the reliefs sought pursuant to s. 117 of the Act of 1965 at paras. (5) and (6) of the prayer in the statement of claim, these proceedings having issued more than six months after the first taking out of representation to the estate of the Testator, which is asserted to be the grant of administration ad litem granted on 15th October, 2010, pursuant to the order of the High Court dated 5th July, 2010. Procedural aspects of the Related Proceedings Structure of remainder of the judgment B – SECTION 117(6) OF THE ACT OF 1965 ISSUE Relevant provisions of the Act of 1965 11. It is convenient to deal with this preliminary issue first, as it affects both the plaintiff in the Plenary Proceedings, S. 1, and the plaintiff in the Related Proceedings, S. 2. Although s. 117 has been in operation for more than forty six years, the preliminary issue apparently raises a point which has not been previously decided by the High Court. 12. Section 117 of the Act of 1965 is to be found in Part IX of the Act of 1965, which is headed “Legal Right of Testator’s Spouse and Provision for Children”. Sub-section (1) of s. 109, which is the first provision in Part IX, provides that where a person dies wholly or partly testate leaving a spouse or children or both spouse and children, the provisions of Part IX shall have effect. Sub-section (2) of s. 109 provides that in Part IX references to the estate of the Testator are to all estate to which he is beneficially entitled for an estate or interest not ceasing on his death and remaining after payment of all expenses, debts and liabilities, other than estate duty (not of relevance in this case as the Testator died after the coming into operation of the Capital Acquisitions Tax Act 1976), payable thereout. 13. The provision for children is made in s. 117. Sub-section (1) of s. 117 provides:
14. The legal controversy between the defendants, as personal representatives of the Testator, on the one hand, and S. 1 and S. 2, as applicants under s. 117, on the other hand, is when did “the first taking out of representation of the [Testator’s] estate” occur: did it occur when the grant of administration ad litem issued to A.A.L. on 15th October, 2010 pursuant to the order of the Court made on 5th July, 2010 under s. 27(4) of the Act of 1965, as submitted on behalf of the defendants; or did it occur when on 28th March, 2011 the grant of probate issued to S. 1 and the defendants, as S. 1 and S. 2 contend. The resolution of the controversy turns on the proper construction of subs. (6). The interpretation provision in the Act of 1965, s. 3(1), contains the following definitions:
(b) “probate” means probate of a will; (c) “administration”, in relation to the estate of a deceased person, means letter of administration, whether with or without a will annexed, and whether granted for special or limited purposes; and (d) “grant” means grant of representation.
. . . to be necessary or expedient to do so, the Court may order that administration be granted to such person as it thinks fit.” 16. It would appear that the effect of s. 117(6) was first considered by the High Court in MPD & Ors. v. MD [1981] ILRM 179. The problem in that case was that the probate of the will of the testator was granted to the defendant on 25th September, 1978, whereas the summons seeking a declaration under s. 117 of the Act of 1965 was not issued until 16th October, 1979. At the time, s. 117(6) was in its original form. An issue which the High Court had to consider in that case was whether s. 127 of the Act of 1965 applied to an application under s. 117. Section 127, provides that s. 49 of the Statute of Limitations 1957, which amends s. 49 and extends the periods of limitation fixed by that Act where the person to whom a right of action accrued was under a disability, shall have effect in relation to an action in respect of certain specified claims to the estate of a deceased person. The issue which the Court had to decide was whether s. 127 covered an application under s. 117. It was held that it did not. Carroll J., having given an example of a situation in which an application under s. 117 might not have been considered appropriate initially, but might be considered necessary later, went on to state (at p. 183):
Equally there are reasons why the administration of estates should not be delayed beyond reasonable time. This was adverted to by the Supreme Court in Moynihan v. Greensmith [1977] I.R. 55 at 72.”
18. Of course, in this case, S. 1 and S. 2 being of full age, the issue of the application or otherwise of s. 127 to an application under s. 117 is not material. However, the judgment of Carroll J. and subsequent consideration of s. 117(6) illustrates the legislative policy underlying that strict provision. 19. In a report of the Law Reform Commission published in 1989 (LRC 30 – 1989), the Law Reform made the following recommendation in the report which was subsequently submitted to the then Attorney General in June 1989:
20. On the issue of construction of s. 117(6) with which the Court is concerned here, the meaning of “first taking out of representation”, the law on a corresponding statutory provision in the United Kingdom gives some guidance. The relevant statute is the Inheritance (Provision for Family and Dependants) Act 1975 (the Act of 1975), which empowers the Court to make orders for the making out of the estate of a deceased person of provision for, inter alia, spouses and children. What is interesting for present purposes is that s. 4 imposes a time-limit on applications to court and it provides that such an application –
22. It is reasonable to infer that, in this jurisdiction, the primary consideration which informs legislative policy in relation to the strict unextendable time limit for initiating an application under s. 117 is the avoidance of delay in the administration and distribution of estates. 23. Two matters are adverted to in the footnotes on para. 58 – 13 in Williams et al., which I consider give useful guidance. The first is apropos of s. 23 of the 1975 Act, where the editors submit that, by analogy, other limited grants, for example, those ad colligenda bona or pendente lite, do not count either, citing Re Johnson referred to below. The second is the statement by the editors that the time limit in s. 4 is not merely procedural. It is substantive, citing Re Salmon (Deceased) [1981] Ch. 167, which was a decision of Sir Robert Megarry V-C refusing an extension of time under s. 4, which he described as “a substantive statutory time limit, not one that is merely procedural”. 24. The decision of Latey J. in Re Johnson (Paul Anthony) (Deceased) [1987] CLY 3882 cited in Williams et al. is persuasive. In that case, a limited grant had been made in 1983 to the deceased’s estate to two solicitors, limited to pursuing negligence claims in relation to the road accident in which he had died. Probate of the deceased’s will was granted in 1987. The question arose whether time ran under s. 4 of the Act of 1975 from the date of the limited grant or of the full grant of probate. Latey J. held that the limited grant was not “the first taking out of representation required for time to begin to run under s. 4 as it merely enabled a particular thing to be done in relation to the estate and did not enable the distribution to take place”. As has been noted, Williams et al. cite that authority at para. 58 – 13, footnote 65. Later, they summarise the law in a passage following the passage which I have quoted earlier, as follows:
26. The proper approach to be adopted in construing a statute is outlined in the following passage from the judgment of Denham J. in DB v. Minister for Health [2003] 3 IR 12 (at p. 21):
29. Section 5 of the Act of 2005 provides as follows:
(a) that is obscure or ambiguous, or (b) that on a literal interpretation would be absurd or would fail to reflect the plain intention of – (i) . . . the Oireachtas, or (ii) . . ., the provision shall be given a construction that reflects the plain intention of the Oireachtas . . ., where that intention can be ascertained from the Act as a whole.” 30. When one looks at s. 117(6) on its own but incorporating the definitions contained in s. 3 of the Act of 1965, “first taking out of representation” reads as follows: first taking out probate of a will or letters of administration, whether with or without a will annexed, and whether granted for special or limited purposes. Such a reading would mean that, once a grant for a limited purpose, such as a grant to substantiate proceedings of the type granted to A.A.L. was extracted, time would start to run for the purposes of s. 117(6). However, when one looks at the Act of 1965 as a whole, as one is required to do at common law and under s. 5 of the Act of 2005, to ascertain the intention of the Oireachtas, it becomes obvious that the Oireachtas could not have intended that a grant limited for a purpose, such as a grant of administration ad litem, would start time running against a prospective applicant under s. 117. 31. As has been pointed out earlier, before the Court can determine whether to make an order under subs. (1) of s. 117 –
(b) the estate of the Testator must be identifiable.
(ii) whether the Testator had made proper provision for the child applicant in accordance with his means, hence the necessity for requirement (b). 32. Further and significantly, under the limited grant of 15th October, 2010, the authority of A.A.L. was limited for the purpose of defending the proceedings which the creditor bank intended to bring against the estate of Testator. If an application under s. 117 was initiated against A.A.L., as defendant as representing the estate of the Testator, it could not be prosecuted because A.A.L. had no authority from the Court or otherwise to defend such an application. 33. Accordingly, it seems to me that, when one considers subs. (6) of s. 117 in the context of the Act of 1965 as a whole, the intention of the Oireachtas cannot have been that a grant of administration ad litem would trigger the commencement of the limitation period provided for in s. 117(6). On the contrary, it must have been the intention of the Oireachtas that only a grant of probate or a grant of administration with the will annexed granted on terms such as would enable –
(b) the personal representatives to defend, or, if they thought fit, compromise the application, and (c) the Court to adjudicate on the application, 34. That interpretation is not in any way at variance with the legislative policy which is discernible in the strict unextendable time limit imposed by s. 117(6). The administration of the estate of a testator and its proper distribution, having regard to potential claims under s. 117, necessitates the type of grant of representation suggested as being necessary to trigger the commencement of the limitation period in s. 117(6), in other words, an effective grant. Therefore, there can be no additional delay factor consequential on such interpretation. 35. I have no doubt that it is open to the Court to interpret “first taking out of representation” in subs. (6) of s. 117 in the manner which I have indicated and to conclude that such interpretation must have been the intention of the Oireachtas on either of two bases. The first is the proper application of s. 3(1) of the Act of 1965. The definitions in that sub-section are expressed at the commencement of the sub-section to apply “except where the context otherwise requires”. I consider that it has been demonstrated that the application of subs. (6) of s. 117, in the overall context of the provisions of the Act of 1965 and, in particular, the totality of s. 117, requires that “representation” in that sub-section be given the meaning which I consider the Oireachtas must have intended. Alternatively, insofar as it is necessary to rely on it, s. 5 of the Act of 2005 permits the Court to give the expression “representation” in that sub-section a construction that reflects the plain intention of the Oireachtas ascertained from the Act of 1965 as a whole, because a literal interpretation by applying the definitions in s. 3(1) of the Act of 1965 simpliciter would be both absurd and fail to reflect the plain intention of the Oireachtas. Answer to preliminary issue on s. 117(6) of the Act of 1965 37. Therefore, I find that –
(b) S. 2 by having made the application for relief under s. 117 of the Act of 1965 by special summons which issued within six months of the issue of the grant of probate of the will of the Testator on 28th March, 2011, made that application within the time limited in s. 117(6) of the Act of 1965 and the Court does have jurisdiction to hear it. C – SECTION 9 OF THE ACT OF 1961 ISSUE Relevant provisions of the Act of 1961 38. It will be recalled that this issue arises only in respect of the Plenary Proceedings in which S. 1 is plaintiff. 39. The time line set out earlier is a chronological representation of a statement of facts put before the Court, which I understand was agreed between the parties. In relation to the s. 9 issue and, in particular, the facts on which S. 1 grounds his claim for the reliefs sought at paras. (1), (2) and (3) of the prayer in the statement of claim, no agreed statement of facts has been put before the Court. Although the moving parties on the preliminary issue, the defendants, did not so indicate, it must be assumed that they are accepting, for the purposes of the trial of the preliminary issue, the facts alleged by S. 1 in his statement of claim, having regard to the decision of the High Court (Lynch J.) in McCabe v. Ireland [1999] 4 IR 151. The analysis which follows is based on that assumption. 40. Section 8(1) of the Act of 1961 provides as follows:
41. Section 9 of the Act of 1961 provides:
(2) No proceedings shall be maintainable in respect of any cause of action whatsoever which has survived against the estate of a deceased person unless either – (a) proceedings against him in respect of that cause of action were commenced within the relevant period and were pending at the date of his death, or (b) proceedings are commenced in respect of that cause of action within the relevant period or within the period of two years after his death, whichever period first expires.”
(ii) the Plenary Proceedings clearly not having been commenced prior to or being pending at the date of the death of the Testator, in compliance with paragraph (b) of subs. (2), the proceedings should have been commenced within two years after the death of the Testator. 42. Apart from the authorities usually relied on as to the approach the Court should adopt to the construction of statutes, for example, Howard v. Commissioner of Public Works [1994] 1 I.R. 101 and D.B. v. Minister for Health referred to earlier, in effect the parties to this issue have relied on four authorities, which I propose considering in chronological order. 43. The earliest is the judgment of the High Court (Barron J.) in Bank of Ireland v. O’Keeffe [1987] I.R. 47. The facts in that case were that in November 1980, Michael O’Keeffe and two others had entered into a continuing guarantee with Bank of Ireland whereby they jointly and severally agreed to pay on demand up to a limit of €70,000 and interest monies which were owed by a company to Bank of Ireland. Mr. O’Keeffe died on 11th February, 1982. A demand for payment on foot of the guarantee was subsequently made against his estate on 6th May, 1982 by Bank of England. Proceedings were instituted against the defendant, as legal personal representative of Michael O’Keeffe, on 19th February, 1985 for monies due on foot of the guarantee. Barron J. rejected the defendant’s submission that the claim was statute-barred by virtue of s. 9(2) of the Act of 1961. He stated (at p. 50):
45. However, if the basis of the reliance by S. 1 on the decision in Bank of Ireland v. O’Keeffe is that the money which S. 1 contends was due to him by the Testator to discharge his indebtedness to S. 1’s Bank did not, as a matter of fact, become payable by the Testator during his lifetime and only became payable after his death for some other reason, for example, that the sale of the lands adjoining Blackacre was not completed until after the Testator’s death, that authority may be of relevance. However, I think I am correct in stating that such argument was not articulated on behalf of S. 1. Having read all of the pleadings in the Plenary Proceedings carefully, and, in particular, the defence delivered on behalf of the defendants, it appears that the involvement of the Testator in relation to the borrowings by S. 1 may have been much more complicated than is pleaded in the statement of claim. The case being made by S. 1 in relation to the alleged guarantee given by the Testator to him, as elaborated on in the replies to notice for particulars, in my view, lacks clarity and is confusing. In the circumstances, in view of the lack of clarity, and in the absence of an agreed statement of facts in relation to the underlying facts of this aspect of the claim of S. 1, I consider that it would be inappropriate for the Court to express a definitive view on the s. 9 issue as regards the relief claimed at para. (3) in the prayer in the statement of claim. Therefore, it remains an issue to be resolved by the parties to the Plenary Proceedings in whatever way they think fit. 46. Chronologically, the next of the four authorities is a decision of the High Court (Barron J.) in Reidy v. McGreevy (Unreported, High Court, Barron J., 19th March, 1993). One aspect of that case was that the plaintiff was the son of the testator whom he alleged had made certain promises to him which gave rise to a constructive trust. Dealing with the claim based on the existence of a constructive trust, Barron J. stated:
47. The next judgment is the judgment of Fennelly J. delivered on 13th March, 2006 on a Circuit appeal in Monaghan in a matter entitled Corrigan v. Martin, a copy of which was put before the Court. The plaintiff in that case alleged that, while working on the testator’s farm he had suffered injury in a tractor accident. The testator was not insured and, in consideration of forbearance to sue, it was alleged that the testator orally agreed that “he would transfer and/or devise the Lands to him”. It was further alleged that the plaintiff had worked on the lands. Insofar as is relevant for present purposes, the plaintiff’s claim was for specific performance of the alleged agreement. The testator had died on 29th December, 2000, but the proceedings were not issued until 24th July, 2004. The defendant pleaded that the plaintiff’s claim was barred by the provisions of s. 9 of the Act of 1961. In his judgment, Fennelly considered s. 8(1) of the Act of 1961 and its application to “all causes of action . . . subsisting against him . . .”. He stated:
50. The most recent authority referred to by the parties is the decision of the High Court (O’Keeffe J.) in Prendergast v. McLaughlin [2011] 1 IR 102. The facts in this case were that the plaintiff had been a neighbour of the deceased. He claimed a declaration that he was entitled to the entire beneficial interest in lands the deceased owned, based on promises made by the deceased during his lifetime that he would bequeath the lands in question to the plaintiff. The deceased had died on 28th August, 2003, but the plaintiff did not institute his proceedings until 25th July, 2006. The issue the Court had to determine was a preliminary issue as to whether the plaintiff’s claim was statute-barred. Unlike this case, there was an agreed statement of facts for the purpose of determining the plenary issue, which addressed the facts underlying the plaintiff’s claim that he was entitled to the entire beneficial ownership in the lands, outlining what the plaintiff claimed transpired between him and the deceased. To digress briefly, in my view, there should have been a similar agreed statement of facts in this case as to the facts underlying the claims of S. 1 which the defendants contend are statute-barred by s. 9 and, if there had been, the Court could probably have determined the issue in relation to the claim at para. (3) of the prayer in the statement of claim. In any event, in his judgment O’Keeffe J. addressed the nature of the plaintiff’s cause of action as follows (at para. 30):
53. I respectfully agree with the analysis of the law set out in the judgments of Fennelly J. and O’Keeffe J. I reject the submission made on behalf on S. 1 that they were wrongly decided. Application of the law 55. In this case, S. 1’s claim as formulated in the pleadings seems to be founded on promissory estoppel or on a constructive trust in equity, as distinct from being founded in contract or in quasi-contract. Either way, the civil wrong on which S. 1 grounds his action is a wrong alleged to have been perpetrated by the Testator by reason of his failure to fulfil his promise. It is a wrong which must have occurred during the lifetime of the Testator, even if it came into existence just before the point of death. Accordingly, the plaintiff’s cause of action against the Testator must have subsisted at the time of the Testator’s death. It was a cause of action which, by operation of s. 8 of the Act of 1961, survived against the estate of the Testator on his death. Accordingly, the limitation period in s. 9(2)(b) applied to it. As these proceedings were not commenced within the period of two years after the Testator’s death, the claims at (1) and (2) in the prayer in the statement of claim are not maintainable. Answer to preliminary issue on s. 9 of the Act of 1961 |