Irani v Irani & Ors [2006] EWHC 1811 (Ch)

[2006] EWHC 1811 (Ch)Case No HC05C00520
IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
Venue Royal Courts of Justice, Strand, London, WC2A 2LLDate 24/07/2006
Before
MR JUSTICE LIGHTMAN
Between
EDWARD IRANIClaimant(1) RUSHNA IRANIDefendants(2) MAHANAZ DEMENEZESDefendant(3) XERXIS IRANIDefendant(4) FLORINE DA COSTADefendant(5) TEHMI FERNADOONZI GHASWALLAH IRANIDefendantTEHMI FERNADOONZI GHASWALLAH IRANIPart 20 Claimant(1) RUSHNA IRANIPart 20 Defendants(2) MAHANAZ DEMENEZESDefendant(3) XERXIS IRANIDefendant(4) FLORINE DA COSTADefendant(5) EDWARD IRANIDefendant
Mr Keith Knight (instructed by H C L Hanne & Co, St John’s Chambers, 1C St John’s Hill, London SW11 1TN) for Claimant and Fifth Part 20 DefendantMr David Ritchie (instructed by S D Rosser & Company, 25 High Road, Willesden Green, London NW10 2TE) for First, Second, Fourth and Fifth Defendants for Xerxis Irani did not attend and was not representedHearing Hearing dates: 11 th– 12 th July 2006
Judgment

INTRODUCTION

[1]The issue in this case is whether in July and August 1984 the late Kaikhushroo Boman Irani (“the Deceased”) entered into a contract with, or assumed or became subject to a binding obligation to, his former wife Tehmu Irani (“Mrs Irani”) by his will to leave to three of their children, Rushna Irani (“Rushna”), Mahnaz Demenezes Irani (“Mahnaz”) and Xerxis Irani (“Xerxis”) and their informally adopted child Florine Da Costa now Florine Irani, (“Florine”) in equal shares the only asset of any value forming part of his estate, namely the property of which he was the registered proprietor at 62, Macfarlane Road, London W12 7JZ (“the Property”). It is common ground that the Deceased made an offer to do so. The question raised is whether Mrs Irani by her solicitor notified the Deceased’s solicitor of her acceptance of the offer.[2]The issue arises because the Deceased died intestate and, if he did not enter into such a contract or become subject to or assume such an obligation, the Property formed part of his estate in which (besides Mrs Irani, Rushna, Mahanaz and Xerxis) his illegitimate child Edward Irani (“Edward”) has an interest. Mrs Irani maintains that the Deceased did enter into such a contract or assumed or became subject to such an obligation and that accordingly Edward has no interest in the Property. Edward denies the existence or enforceability in law of any such contract or obligation and seeks a declaration of entitlement to a share in the Property.

EVIDENCE

[3]The evidence before me consists of contemporary correspondence and documentation (but is not the complete contemporary correspondence or documentation) and the witness statements and oral evidence of Mrs Irani, Rushna, Mahanaz and Florine. I also have a witness statement by Edward, but that statement does not touch on any live issue in the action. It is significant, indeed remarkable, that neither side called as a witness the two persons who could or should have been able to give first hand evidence whether the offer was accepted, namely the solicitors who acted respectively for Mr Irani and the Deceased in 1984.

HISTORY

[4]I shall first set out the relevant history so far as it is not, or cannot be, seriously in any dispute.[5]The Deceased married Mrs Irani in Bombay on the 16th February 1956 and there were three children of this marriage, namely Xerxis born on the 7th October 1957, Mahanaz born on the 31st December 1958 and Rushna born on the 14th February 1961. They all came to live in the United Kingdom in 1966. The Deceased was not a good husband. He failed properly to support her or care for her. On the 24th June 1973 there was born to the Deceased and another lady (Mary Mustafa) Edward and on the 20th June 1978 the Inner London Magistrates Court made an affiliation order against the Deceased in respect of Edward[6]On the 26th January 1982 Mrs Irani issued a divorce petition against the Deceased. On the 6th July 1983 she was granted a decree nisi and this was made absolute on the 21st October 1983.[7]On the 11th March 1984 Mrs Irani swore an affidavit in support of her claim to ancillary relief and on the 5th April 1984 she issued a notice of application for a lump sum order and a property adjustment order in respect of the Property. In her supporting affidavit she made no reference to properties which she owned in India. Her reason for their omission was that they were worthless because of actions taken by the Deceased in the management of them. On the 16th July 1984 Mrs Irani issued a notice of application for an order that the Deceased file an affidavit of means within seven days with a penal notice attached.[8]On or about the 17th July 1984 Mrs Irani telephoned the Deceased. In the course of this claim;(a) the Deceased asked her why she was shaming him by making this claim;(b) she replied that the only thing which would persuade her not to pursue the claim was if the Deceased were to put the Property in the name of their three children and Florine; and(c) if no binding agreement was concluded, the Deceased was clearly agreeable to the idea of an agreement along these lines. The same day Mrs Irani told her solicitor on the telephone what had been said.[9]On the 19th July 1984 the Deceased’s solicitors wrote a “without prejudice” letter to Mrs Irani’s solicitors. After referring to the fact that, if the litigation continued, the Property would have to be sold and the proceeds applied in payment of costs, the solicitors said:
“In order to compromise this matter, may we put forward the following suggestion:- Our client undertakes not to sell, mortgage or otherwise deal with or dispose of the property and to execute a will leaving the property in equal shares to the children of the family Xerxis, Mahnaz and Rushna together with a further quarter share to Florine Da Costa. Perhaps you would be kind enough to take instructions with regard to this matter and write to us in due course.”
Our client undertakes not to sell, mortgage or otherwise deal with or dispose of the property and to execute a will leaving the property in equal shares to the children of the family Xerxis, Mahnaz and Rushna together with a further quarter share to Florine Da Costa.[10]On the 23rd July 1984 Mrs Irani’s solicitors wrote to her enclosing a copy of the Deceased’s solicitors’ letter and asking her to contact Miss Siabkin of their office in order to give her instructions in respect of the same.[11]On the 27th July 1984 on Mrs Irani’s application Mr Registrar Guest at a hearing which was not attended by Mrs Irani, the Deceased or the Deceased’s solicitors, made an order that the Deceased file an affidavit of means with 14 days of service of the order with a penal notice attached. The Deceased swore an affidavit of means in compliance with the order on the 1st August 1984.[12]Mrs Irani at some date after receipt of her solicitor’s letter dated the 23rd July 1984 attended at her solicitors and instructed Miss Siabkin to accept the offer contained in the letter and to discontinue her claim for ancillary relief. Mrs Irani cannot say of other own knowledge that Miss Siabkin solicitor complied with her instructions to accept the offer, but she presumed that they did.[13]Thereafter neither Mrs Irani or her solicitors took any further steps to pursue the claim and on the 6th August 1984 the Deceased signed a document of that date (“the Will”) which read as follows:
“6.8.84 To Whom It May Concern I Kaikhushroo Boman Irani in accordance with my divorce settlement dated 23.7.84 do here by leave my property at 62 Macfarlane Road Shepherds Bush London W12 7JZ in equal shares to Xerxis Irani, Mahanaz Irani, Rushna Irani and Florine Da Costa. K B Irani”
To Whom It May Concern K B Irani”

To Whom It May Concern

[14]It is common ground that the Will is not properly executed to constitute a valid will, but clearly the Testator intended to execute and thought that he had executed a valid will.[15]It is clear from the terms of the Will and his statements to Rusha and Mrs Irani that the Deceased considered that he had an obligation to make a will in the terms of the Will and that he had fulfilled this obligation. The inference must be that he thought that he had fulfilled it by making the Will. Searches have revealed the making of no other will.[16]The Deceased died intestate on the 14th September 1996. On the 8th November 1996 the Property was valued at £125,000. Letters of Administration to the Deceased’s estate were granted on the 24th December 1996 to Rushna and Mahnaz. In 1998 Rushtom Irani (a friend but no relation of Mr Irani) handed the Will to Mrs Irani. She had not previously known of its existence.[17]On the 16th March 1999 Edward’s solicitors gave the first intimation of his claim and he commenced proceedings in the Willesden County Court on the 3rd May 2000 which he discontinued on the 4th September 2000. The claim form in the present proceedings was issued on the 4th March 2005.[18]In it Edward claims declarations that he is entitled to an equal one quarter share in the Deceased’s estate (which is admitted) and that the Property forms part of the Deceased’s estate (which is in dispute). Mrs Irani thereupon made a third party claim (to which her three children, Florine and Edward were defendants) in which she claimed that she had orally accepted unconditionally the terms proposed in the letter dated the 19th July 1994 and that there was thereby constituted a contract between her and the Deceased. The terms of the contract were that, in consideration of Mrs Irani not proceeding with her application for a lump sum payment order and a property adjustment order in respect of the Property, the Deceased would not sell, mortgage or otherwise deal with or dispose of the Property and would execute a will leaving the Property in equal shares to her three children and Florine.

RESOLUTION OF ISSUE OF FACT

[19]Mrs Irani, Rushna, Mahnaz and Florine were witnesses of truth. So far as any effort was made in cross-examination to challenge their evidence, it failed. I have no doubt on the evidence before me that Mrs Irani’s solicitor Miss Siabkin notified the Deceased’s solicitors of her acceptance of the offer and that a contract was thereby concluded. The presumption must be that a solicitor so instructed does her duty, and this is confirmed by(1) the execution by the Deceased of what he evidently considered was a valid will in the form agreed;(2) the assurances he gave to Mrs Irani and Rushna that he had done so; and(3) the discontinuance by Mrs Irani of the ancillary proceedings. I am not deterred from reaching this conclusion by the choice by the Deceased of the puzzling date of 23.7.84 as the date of the “divorce settlement”: why he chose that date does not matter. Nor am I concerned that no valid will was executed: the Deceased clearly thought that the Will was a valid will and that its execution constituted fulfilment of his contractual obligation. I do not think that the discontinuance of proceedings is attributable (as suggested by Edward) to the “disclosure” in the Deceased’s solicitors’ letter of the 19th July 1984 of Mrs Irani’s ownership of properties in India. The Deceased and Mrs Irani at all times knew of their existence and that (as established by Mrs Irani’s evidence) it was valueless. The discontinuance of the proceedings is clearly attributable to her contract with the Deceased.

RESOLUTION OF ISSUE OF LAW

[20]Edward has contended that any such contract concluded between the Deceased and Mrs Irani is unenforceable as not evidenced in writing as required by section 40 of the Law of Property Act 1925. But it is quite clear as a matter of law that, if an offer is made in writing and is accepted orally, that contract is in law a contract in writing and accordingly there can be no question of any unenforceability of the contract made in this case by reason of the absence of a necessary memorandum: see Tiverton Estates Ltd v. Wearwell Ltd [1975] Ch 146.

CONCLUSION

[21]I accordingly dismiss the claim by Edward and uphold the claim by Mrs Irani.