In the case of Pegler & Ors v McDonald & Anor, Timothy McDonald (the Defendant) was removed as executor of his late brother’s Will and ordered to pay costs without indemnity due to his unreasonable conduct.
Pegler & Ors v McDonald & Anor (Re Estate of Clive McDonald) [2022] EWHC 2405 (Ch)
Case background
In a postscript to the judgment, the Defendant had sent detailed emails to the Judge. One proposed the addition of significant further material to the judgment, not relevant to the decision. Another sought to re-argue the substance of the decision and further questioned the Judge personally, his judicial independence, and his conclusions.
The Judge considered the evidence before him in regard to the Defendant’s behaviour in the case itself.
- Was there an inability to get on with others?
From unchallenged evidence before the Judge the Defendant had made a number of complaints, some of which were later withdrawn:
- To the police about their allegedly poor investigation and failure to charge individuals.
- The broker and insurance companies insuring the estate for rejecting claims in respect of alleged thefts of estate assets.
- To the Law Society, Solicitors Regulatory Authority, the Society for Trust and Estate Practitioners, and Solicitors for the Elderly about the solicitor who was his co-executor at the time.
- To Hugh James about its partners and solicitors’ conduct,
- To the Legal Ombudsman about its response to his complaints about other regulatory bodies
- To the Judicial Conduct Investigations Office about the District Judge.
The Defendant also made an application for the Judge to recuse himself from hearing the matter, on the grounds of bias and also sent an email to his solicitor alleging that the three Judges involved in the case were incompetent and corrupt.
- Did he show a lack of neutrality?
The Claimants alleged a lack of independence or neutrality in relation to the estate beneficiaries. They relied on a number of applications made by the defendant during the course of the litigation which had been dismissed as totally without merit and said that this amounted to vexatious litigation against them. They also referred to comments made about them in correspondence, and to an unpaid costs order against the Defendant in favour of them. It appeared to be common ground that relations with the Claimants had broken down. The Defendant stated that the breakdown in relations did not affect his neutrality.
- The Defendant’s conduct in these proceedings?
The Defendant made four applications that have been recorded as totally without merit, and an extended civil restraint order was made against him in consequence.
The Defendant told the Judge he had not made many “contacts with the Court”, and that he was trying to deal with what he said were misappropriations of estate funds, which were “clearly appropriate” and “totally legitimate”. He also sent an email which in the Judge’s view was utterly inappropriate, directly to the barristers representing the Claimants and the second defendant, apparently in an attempt to “inform them of some facts and evidence that your clients likely kept from you”.
- The authority of the Court?
The Defendant told the Judge that he was upset at being ordered to pay £6,000 in costs and that he did have difficulty with the authority of the Court, when he saw it going wrong.
The Judge stated that Defendant’s general approach to objective decision-making, seen repeatedly in the papers before him could be summarised by his words in his own witness statement.
“As a retired high-level publishing executive with proven unusual powers of perception and recall, strong accreditation including a prize for highest marks in a law exam from a Chartered Accountants Institute, as well as knowledge of the estate and the parties involved, all of which should be obvious from the above, I know all my allegations are well-founded.”
Although points 2, 3 & 4 were not in the original evidence filed and served and related to matters occurring after the commencement of the present proceedings, the Judge was satisfied, due to the Defendant’s participation and behaviour in the previous hearing, that he could take into account the newer points as well as the original ones in reaching his decision.
Assessment
The Judge bore in mind that he was not required to find wrongdoing on the part of the Defendant, even so, the Judge was quite satisfied that the defendant, however well-meaning, and however much he believed that he knew what his late brother would have wanted and that he was capable of implementing this, was unfortunately incapable of acting as a disinterested, objective administrator of this testator’s estate.
He acknowledged that in the Defendant’s favour, the testator himself had appointed the Defendant, and that the Defendant wished to fulfil that task.
However, he found against the Defendant the following:
- An equivocal approach to the validity of the Will
- An inability to recognise and accept the authority of the Court and that Judges may reach legal conclusions he does not like
- Falling out and the complete breakdown in relations with beneficiaries
- Obsessive (and frequently abusive) letter- and email-writing
- Lack of judgment shown in pursuing hopeless applications before the Court
The Judge concluded that the Defendant:
- Was used to taking charge, getting his own way, and brooked no dissent from what he decided
- Considered any difference from his opinion was attributed to incompetence or base motive
- Did not have the temperament, character, or personal qualities needed to act as a personal representative
The Judge stated that these things added up to a comprehensive disqualification for his being concerned with the fiduciary administration of assets for the benefit of other people.
Conclusion in regards to costs
The Judge stated he would make a decision on his substantive decision, and not on what the Defendant thought the substantive decision should have been.
The costs order
- The Defendant must pay the Claimants’ costs including those incurred by the professional executor and the application for her removal but without any indemnity from the estate for them. This was because the Judge accepted that but for the unreasonable behaviour, litigation would not have been needed and the Defendant’s costs were not properly incurred
- The Claimants have an indemnity from the estate for any costs that they are unable to recover from the defendant
- The professional executor was indemnified for her legal costs out of the estate, to the extent not recovered from the Defendant
- The legacy given to the Defendant will be set off against the liability for costs owed to the Claimants
Conclusion
In this case, there was strong evidence of the unreasonable conduct of the Defendant, and whilst it may not always be this evident, it shows that a Court will take into account conduct when assessing costs and this needs to be borne in mind when advising clients in a matter.
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