Raymond Saul & Co (A Firm) v Holden & Anor [2008] EWHC 8565 (Ch)

[2008] EWHC 8565 (Ch)Case No HC 06C01642
IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
Venue Royal Courts of Justice, Strand, London, WC2A 2LLDate 16 December 2008
Before
Mr. RICHARD SNOWDEN QC(sitting as a Deputy Judge of the High Court)
Between
IN THE MATTER OF THE ESTATE OF BERTHA HEMMING (deceased)ClaimantRAYMOND SAUL & CO. (a firm)ClaimantJOLYON HOLDENDefendantsLOUISE MARY BRITTENDefendant
Mr. Peter John (instructed by Raymond Saul & Co.) for ClaimantMr. Robert Denman (of Holden & Co.) for First DefendantMiss Constance Mahoney (instructed by Moon Beever) for Second DefendantHearing Hearing date: 10 December 2008
JudgmentMr. RICHARD SNOWDEN QC :
[1]In a Judgment given on 12 November 2008 [2008] EWHC 2731 (Ch), I decided that Mr. Bernard Hemming’s entitlement to his mother’s residuary estate, including the right to receive the assets comprising that residue as and when the administration of the estate is complete, vested in the Second Defendant, his trustee in bankruptcy.[2]I now have to decide the question of who should bear the costs of these proceedings. I use the same abbreviations as in my earlier Judgment.

Background

[3]As described in my earlier Judgment, Mr. Hemming was the sole residuary legatee under his mother’s will and, following a grant of probate on 17 February 2005, her sole executor. The Claimants, Raymond Saul & Co., acted as solicitors to Mr. Hemming in his capacity as his mother’s executor. They never acted for him in his personal capacity.[4]Raymond Saul & Co. dealt with the sale of a cottage at Guestling, East Sussex that was jointly owned by Mr. Hemming and his mother. In July 2005, after Raymond Saul & Co. learned of Mr. Hemming’s discharge from bankruptcy, they wrote to the solicitors acting for the Trustee, asking whether they had any objection to the part of the proceeds of sale that represented Mrs. Hemming’s interest in the cottage being paid to Mr. Hemming as residuary legatee.[5]The Trustee’s solicitors responded, asserting that the Trustee was entitled to the residue of Mrs. Hemming’s estate notwithstanding Mr. Hemming’s discharge from bankruptcy. In a letter of 23 August 2005 Raymond Saul & Co. replied at some length, setting out the arguments which, they said, supported their position that they should distribute the residue of the estate, when ascertained, to Mr. Hemming.[6]Two weeks later, on 6 September 2005, Raymond Saul & Co. wrote again to the Trustee’s solicitors and asserted that a dispute existed between the Trustee and Mr. Hemming in his personal capacity as to who owned the residuary estate of Mrs. Hemming. Raymond Saul & Co. said that as probate solicitors they were unable to distribute money “where two opposing parties have claimed its ownership”. They indicated that if the dispute could not be resolved, then an application would have to be made for the court to rule in favour of one or the other “competitors”. Mindful of the likely costs of such proceedings, but pointing out that they did not act for Mr. Hemming personally, Raymond Saul & Co. invited the Trustee to contact him directly to try to resolve the matter in order to avoid the need for litigation.[7]It is a curious feature of this case that I have not seen a single piece of paper emanating from Mr. Hemming in which he made any such personal claim to the residue of his mother’s estate at any time. However, in the absence of any other suggestion, the inference which I draw from the letter of 6 September 2005 is that Mr. Hemming, acting in his personal capacity, had latched on to the arguments which had been raised by Raymond Saul & Co. whilst advising him in his capacity as executor of his mother’s estate. I surmise, and none of the parties before me suggested otherwise, that Mr. Hemming must have adopted those arguments and told Raymond Saul & Co. that he wished to dispute the Trustee’s claim.[8]By a letter of 14 September 2005, the Trustee’s solicitors indicated that the Trustee had accepted Raymond Saul & Co.’s suggestion and that she had written directly to Mr. Hemming to seek a resolution of the dispute between them without recourse to litigation. The letter from the Trustee’s solicitor to Raymond Saul & Co. pointed out that the Trustee could seek an order for possession and sale of Mr. Hemming’s own home, the farmhouse which he owned jointly with his mother, but that it would be “infinitely preferable” for Mr. Hemming simply to authorise Raymond Saul & Co. to pay the Trustee what was needed to satisfy the liabilities in the bankruptcy out of the money that Raymond Saul & Co. were holding. Mr. Hemming would then be left as the only person entitled to the residue of his mother’s estate and the surplus from his bankruptcy.[9]I have not been shown the letter which the Trustee actually wrote to Mr. Hemming, but no-one has suggested that such a letter was not sent, or that it was not along the lines reported in the letter to Raymond Saul & Co.. I infer that it was made clear to Mr. Hemming that the dispute was between him and the Trustee over the entitlement to his mother’s residuary estate, and that the Trustee was suggesting a pragmatic way in which he could avoid litigation over their rival claims and thereby save costs.[10]The Trustee’s approach to Mr. Hemming did not, however, produce a resolution of the dispute. Raymond Saul & Co. then wrote again to the Trustee’s solicitors on 30 November 2005. The letter was written “on behalf of the estate” and indicated that counsel had advised that payment should be made to Mr. Hemming. The letter sought to make “a final attempt” to persuade the Trustee to agree to payment being made to Mr. Hemming. It concluded that if no such agreement was forthcoming, “the Estate has no other choice but to commence proceedings pursuant to CPR Part 64 where it will ask the Court to determine the issue and the Executor will seek an Order that the Trustee in Bankruptcy should pay the costs of that claim, personally.”[11]The Trustee stuck to her guns, and the Part 8 Claim Form was eventually issued by Raymond Saul & Co. on 21 April 2006. The defendants were Mr. Hemming and the Trustee. In the claim, which was said to be brought pursuant to CPR Part 64, Raymond Saul & Co. sought a determination of the question of entitlement to Mrs. Hemming’s residuary estate.[12]The claim was supported by a witness statement of Mr. Peter Sheehan, an associate solicitor with Raymond Saul & Co.. Mr. Sheehan’s evidence was that an issue had arisen as to whether the residue of Mrs. Hemming’s estate should be paid to Mr. Hemming or to the Trustee. Mr. Sheehan stated that he had been advised and believed that payment should be made to Mr. Hemming. He concluded his evidence by asking the court to determine the issue. No Statements of Case were ordered and no other evidence was filed by any of the other parties. The parties’ attention was then diverted to the possession proceedings which were commenced by the Trustee in respect of the farmhouse shortly after Raymond Saul & Co. launched their claim.[13]On 12 April 2007, Mr. Hemming died after a long period of ill-health. The First Defendant obtained a grant of probate and was substituted as a defendant to the claim in his capacity as Mr. Hemming’s executor. He also became Mrs. Hemming’s executor by succession.[14]As I recounted in my earlier Judgment, on taking office, the Executor questioned the utility of these proceedings and the level of costs incurred. The thrust of his point was that it was obvious that Mr. Hemming should have agreed that the Trustee should take sufficient money to discharge the then bankruptcy debts from the proceeds of sale of the cottage, thereby avoiding the need for litigation. That may be so, but I observe that this point had been made in correspondence by Raymond Saul & Co. and by the solicitors to the Trustee in their letters dated 6 September 2005 and 14 September 2005 to which I have referred. As I have indicated, I also infer that the same points had been put directly to Mr. Hemming by the Trustee before the proceedings were commenced.[15]Be that as it may, in a long letter to Raymond Saul & Co. dated 25 October 2007 the Executor clearly expressed his view that the present proceedings were and had been a waste of time and money, and that he wished to have no active part in them. The tenor of the letter in that respect is encapsulated in the following paragraphs:- “As regards Claim No. HC06C01642, we note that your firm is on the opposite side of the record to not only the Trustee in Bankruptcy but also Bernard Hemming. Of course, there will have to be an application to substitute Mr. Holden, as executor of Bernard Hemming, as the First Defendant. As things stand at present, we do not see any point in resolving the substantive dispute raised by these proceedings. There is no more reason to do so now than there was at the time of the sale of [the cottage]. Either the bankruptcy can be fully dealt with out of what is left of the proceeds of sale of [the cottage] or it will have to come out of [the farmhouse]. What, however, is essential to be dealt with in relation to this claim is the question of costs. For the reasons we have given, we do not accept that you should ever have raised an issue with the Trustee as to what should happen to the proceeds of sale of [the cottage]. It seems obvious from the information that is available now and was available to you in 2005, that those proceeds should have been used to discharge the bankruptcy. All that issue has done is generate a staggering increase in costs. Given this, we see no reason why you should take any of your costs from the estate of Bertha Hemming. Further, we will contend that the costs of the Trustee in Bankruptcy, particularly insofar as they relate to this litigation, should not be borne by either Bertha’s or Bernard’s estates either. As to who, between yourselves and the Trustee and her legal advisors, should bear those costs is a matter for determination by the Court unless you agree it between yourselves.”[16]The Executor repeated his criticisms in a skeleton argument filed for a case management conference on 10 April 2008 and in his skeleton argument for the hearing before me in October. For that hearing, Raymond Saul & Co. and the Trustee each filed skeleton arguments addressing the substantive point in issue. Raymond Saul & Co. argued positively that Mr. Hemming (and now the Executor on behalf of Mr. Hemming’s estate) was entitled to payment of Mrs. Hemming’s residuary estate. For his part, Mr. Denman on behalf of the Executor took what he described as a “neutral” stance and, at his request, was excused attendance whilst the argument took place between the other parties.

Jurisdiction

[17]The general rule about costs, as enshrined in CPR Part 44.3(2)(a), is that the “unsuccessful party” will be ordered to pay the costs of the “successful party”. However, CPR Part 44.3(2)(b) provides that the court may make a different order. That power enables the court, in an appropriate case, to depart from the general rule if it would be unjust to apply it.

The rival submissions

[18]It is readily apparent from my earlier Judgment, and it is common ground between the parties, that the Trustee was the successful party in these proceedings and that she is entitled to recover her costs. The question is, from whom?[19]On this point, the submissions of the parties diverged radically. The Trustee did not really have a strong view as to who should be ordered to pay her costs. That attitude reflects the fact that the Trustee anticipates that she will in any event be able to recover her costs and expenses from the significant monies that will come into her hands from the intended sale of Mr. Hemming’s interest in the farmhouse. However, Miss Mahoney did criticise the way in which the proceedings had been pursued in an adversarial fashion by Raymond Saul & Co. and her primary submission was that they should be ordered to bear the costs personally.[20]Mr. John, for Raymond Saul & Co., disputed this. He submitted that as solicitors holding the proceeds of sale of the cottage on behalf of Mrs. Hemming’s estate, Raymond Saul & Co. had had no alternative but to bring the proceedings to get a ruling on the rival claims of Mr. Hemming (in his personal capacity) and the Trustee. Mr. John suggested that the just result would be that Raymond Saul & Co. should not bear any of the costs, and that they should have their own costs paid by the Executor, either from Mrs. Hemming’s estate or from Mr. Hemming’s estate. By inference I deduce that Mr. John was submitting that the Trustee’s costs should also be borne by the Executor.[21]In contrast, Mr. Denman, on behalf of the Executor, submitted that the proceedings were entirely the fault of Raymond Saul & Co.. He said that it was Raymond Saul & Co. and not Mr. Hemming who had devised and run the case against the Trustee, and that Mr. Hemming must have been led to act as he did by the advice which he had received from Raymond Saul & Co. in his capacity as his mother’s executor. He submitted that the Executor should not be ordered to pay the Trustee’s costs out of either of the two estates; nor should Raymond Saul & Co. be entitled to recover their costs from either estate.

Analysis

[22]So far as Raymond Saul & Co. are concerned, I accept that they raised the argument of law concerning the proper destination of Mrs. Hemming’s residuary estate in good faith in their capacity as solicitors to Mr. Hemming as executor of his mother’s estate. I also find that they acted reasonably in raising it, supported as they were by an opinion from counsel.[23]I also accept that once Mr. Hemming had adopted the argument and asserted his personal claim, and the Trustee had taken a firm stance against it, Raymond Saul & Co. faced something of a problem as to what to do with the proceeds of sale.[24]In the ordinary course of events, a solicitor to an executor who faces rival claims to monies payable in respect of a legacy has at least two possible courses of action to ensure that the dispute is resolved by the court.[25]The first option would be for the executor to encourage one of the rival claimants to sue the other for a declaration as to which of them was entitled to the legacy. The executor could simply agree to abide by the result and thereby avoid getting embroiled in litigation. This option would have much to commend it in a case such as the present where the issue was not an uncertainty over the terms of the will, but arose out of the personal circumstances (i.e. bankruptcy) of a person who was indisputably entitled under the will.[26]The second option would be for the executor to issue proceedings himself, joining the two rival claimants as defendants. The role of the executor in such proceedings would simply be to put the matter before the court in a neutral fashion and to submit to the ruling of the court.[27]The problem facing Raymond Saul & Co. was that their client, the executor of Mrs. Hemming’s estate, was also one of the two rival claimants to the funds in his personal capacity as residuary legatee. It seems likely that, given his personal circumstances, Mr. Hemming may not have had much appetite to initiate a claim against the Trustee himself. It would also have been difficult for him to initiate proceedings in which he was both the claimant in his capacity as executor, and defendant in his personal capacity.[28]In these circumstances, I do not think that Raymond Saul & Co. can be criticised for taking the initiative and deciding to bring the matter to the court in their own name as claimants, joining Mr. Hemming and the Trustee as defendants. However, what makes the question of costs unusual in this case is the way in which Raymond Saul & Co. have gone about the litigation.[29]As I have indicated, in the ordinary course, an executor or trustee who brings a claim for determination of a matter arising in the administration of the estate or the trust, must remain neutral. The position was clearly explained by Lightman J. in Alsop Wilkinson v. Neary [1996] 1 WLR 1220 at 1225C-G:
“In a case where the dispute is between rival claimants to a beneficial interest in the subject matter of the trust, rather the duty of the trustee is to remain neutral and (in the absence of any court direction to the contrary and substantially as happened in Merry's case [1898] 1 Ch. 306) offer to submit to the court's directions leaving it to the rivals to fight their battles. If this stance is adopted, in respect of the costs necessarily and properly incurred e.g. in serving a defence agreeing to submit to the courts direction and in making discovery, the trustees will be entitled to an indemnity and lien. If the trustees do actively defend the trust and succeed, e.g. in challenging a claim by the settlor to set aside for undue influence, they may be entitled to their costs out of the trust, for they have preserved the interests of the beneficiaries under the trust: consider In re Holden, Ex parte Official Receiver (1887) 20 Q.B.D. 43. But if they fail, then in particular in the case of hostile litigation although in an exceptional case the court may consider that the trustees should have their costs (see Bullock v. Lloyds Bank Ltd. [1955] 1 Ch. 317) ordinarily the trustees will not be entitled to any indemnity, for they have incurred expenditure and liabilities in an unsuccessful effort to prefer one class of beneficiaries e.g. the express beneficiaries specified in the trust instrument, over another e.g. the trustees in bankruptcy or creditors, and so have acted unreasonably and otherwise than for the benefit of the trust estate: consider R.S.C., Ord. 62, r. 6; and see National Anti-Vivisection Society v. Duddington, The Times, 23 November 1989 and Snell's Equity, 29th ed. (1990), p. 258.”
[30]To similar effect was the decision of Park J. in Breadner v. Granville Grossman (unreported, 17 July 2000), which concerned the costs of complicated proceedings brought by trustees to determine the respective entitlements to the trust fund of parties referred to by the Judge as “Jonathan” and “the cousins”: see [2001] Ch 523. The trustees adopted what the Judge called “a partisan role” in the sense that they supported the arguments of Jonathan and argued strenuously against the cousins. The cousins won, and Park J. ordered that the entire costs of the proceedings should be paid personally by the trustees, without recourse to the trust fund.[31]Park J.’s analysis was that in the terms of CPR Part 44.3(2)(a) the cousins were the successful parties and the trustees and Jonathan were the unsuccessful parties. He was not inclined to depart from the general rule that requires the losing party to pay the costs in the case of the trustees, but he was prepared to apply CPR Part 44.3(2)(b) and make a different order in the case of Jonathan.[32]After referring to Alsop Wilkinson v. Neary, Park J. commented that, “It seems to me that the thrust of what Lightman J. says is that if the trustees decide not to be neutral, but to take sides in a dispute between beneficiaries, they must accept that, if the side which they support loses, they will be at risk of being subjected to an order for costs.”[33]Park J. then referred to the classification of disputes by Kekewich J. in Re Buckton [1907] 2 Ch 406, and the commentary upon that classification by Hoffmann LJ in McDonald v. Horn [1995] 1 All ER 861, and concluded, “I accept that usually applications by trustees for directions are friendly litigation, and that the trustees’ costs are paid out of the fund. I also accept that the usual instance of hostile or adversarial litigation in which trustees are involved is external litigation between the trustees and a third party, for example in a dispute with a third party about property comprised in the trust fund. However, in my judgment there can, albeit exceptionally, be cases of applications to the court by trustees which, although being internal in the sense that only the trustees and the beneficiaries are involved, are hostile or adversarial litigation. This case was adversarial litigation and the trustees chose to make it such. I am not criticising them for their choice; it was an understandable choice. However, what I do say is that, having decided to launch proceedings which, as between themselves and the cousins can only realistically be seen as adversarial, the trustees cannot complain if, the proceedings having gone against them, the normal consequences for a losing adverse litigant follow.”[34]It seems to me that these principles, developed in the case in which a trustee or executor brings proceedings for determination of an issue, are applicable by analogy in the present case, where Raymond Saul & Co. could be said to have acted as a surrogate for the executor of Mrs. Hemming’s estate. Mr. John did not dispute that approach.[35]Realistically, Mr. John also accepted that, as between Raymond Saul & Co. and the Trustee, the present case fell to be classified as hostile or adversarial litigation. I think he also implicitly accepted that although Raymond Saul & Co. had no personal interest in the outcome of the dispute between Mr. Hemming and the Trustee, they could fairly be described as “unsuccessful parties” within CPR Part 44.3(2)(a).[36]However, recognising that this would probably lead to the result that the general rule on costs would apply, Mr. John pointed out that in the extract from Alsop Wilkinson v. Neary to which I have referred, Lightman J. cited Bullock v. Lloyds Bank Limited [1955] 1 Ch 317 and stated that there could be exceptions to the general rule.[37]Mr. John suggested that the present case was just such an exceptional case in which the general rule in CPR Part 44.3(2)(a) should not apply because it would not be just to require Raymond Saul & Co. to bear the burden of any costs order. Mr. John submitted that in this case, Raymond Saul & Co. were effectively forced to adopt an adversarial approach, because if they had not done so, the point at issue would not have been properly argued and the court could not have reached its decision. He also said that in light of the criticisms that had been made by the Executor, it had been necessary for Raymond Saul & Co. to argue the substantive point at the hearing before me in order to demonstrate that their initial decision to bring the proceedings was justifiable.[38]I do not accept these submissions. If Raymond Saul & Co. had placed the matter neutrally before the court, rather than expressly siding with Mr. Hemming in the evidence from the start, it would probably have been much clearer to Mr. Hemming that it was incumbent upon him to look after his own interests and take a positive role if he indeed wished to pursue his claim against the Trustee. As it was, Mr. Hemming could be forgiven for thinking that his interests in the litigation were being looked after by Raymond Saul & Co., and it must have been obvious to Raymond Saul & Co. that Mr. Hemming was unrepresented and not taking an active role in the proceedings.[39]Moreover, if Raymond Saul & Co. been neutral from the start and Mr. Hemming had simply decided to do nothing, the claim for a declaration could not have been determined by default. The court would still have had to hear argument from the Trustee as to why a declaration should be made. True it is that the argument would have been one-sided, but counsel for the Trustee would have been under an obligation to ensure that any relevant authority was cited and the court would still have been required to address the issue.[40]As Miss Mahoney observed in the course of argument, even in an extreme case where a trustee brings proceedings and remains neutral, but neither rival defendant makes submissions (or the court is not satisfied that the point at issue is being addressed properly), the court can always invite submissions from the trustee. If that occurs the trustee will be obliged to put both sides of the argument fairly for the assistance of the court, and will doubtless be awarded his costs and be protected against any adverse costs consequences if he does so.[41]I also do not think that it was necessary for Raymond Saul & Co. to argue the case for Mr. Hemming just to defend themselves against the Executor’s arguments on costs. The Executor’s criticisms were not based upon an assertion that the legal point taken against the Trustee was a bad point. The Executor’s complaint was the supposed failure of the professionals to give pragmatic commercial advice to Mr. Hemming. Whether or not that was a justified criticism in light of the correspondence to which I have referred and Mr. Hemming’s apparent rejection of the Trustee’s overtures to him before the case was commenced, did not depend upon resolution of the substantive issue.[42]Moreover, after receipt of the Executor’s letter of 25 October 2007 to which I have referred, I do not think that Raymond Saul & Co. could have been under any illusions that the Executor did not intend to advance any positive argument on the substantive issue. The Executor had made it clear that if Raymond Saul & Co. continued to contest the Trustee’s claim, they were on their own, and did so at their own risk as to costs.[43]I also do not think that the case of Bullock v. Lloyds Bank Limited assists Mr. John. That was a case in which the plaintiff, a young woman, was advised by her father (who was described as “pecuniarily embarrassed”), and his solicitor, to settle her substantial inheritance from her mother’s estate on a bank, as trustee, on the statutory protective trusts for herself for life and, in default of any appointment in favour of any of her children or surviving husband, in favour of her father and her brother. After a few years the father and the solicitor died, and the plaintiff made unsuccessful efforts to induce the trustee to give her access to the trust fund. Thereafter, some 13 years after the settlement had been made, she issued a writ against the trustee bank and her brother, seeking to have the trust set aside for undue influence.[44]Having been sued, and with the validity of the trust under direct attack, the trustee bank sought to uphold the settlement. The brother played no part in the proceedings. Vaisey J. set the settlement aside on the grounds of undue influence. He acquitted the father, his solicitor and the trustee bank of any misconduct, and ordered the bank to have its costs out of the funds that had been settled upon it.[45]Bullock v. Lloyds Bank Limited does illustrate that there can be exceptions to the general rule, but it seems to me that the facts of that case were quite different from the present case. The proceedings directly concerned the circumstances attendant upon a settlement some 13 years earlier. Apart from the plaintiff, all of the other persons involved in those events were dead. The plaintiff bore the burden of proving undue influence if she wanted the trust set aside, and given the very substantial lapse of time and the lack of other witnesses, the court would have wanted to have the plaintiff’s evidence tested in cross-examination and to hear contrary argument. It is unreal to suggest that the plaintiff’s brother, who had not been involved in the earlier events and whose interest was remote, should have been required to litigate against his sister. Vaisey J. plainly thought that the bank had performed a useful function in enabling the plaintiff’s case to be presented. Certainly I do not think that it would be fair to characterise the bank as having chosen, entirely freely, to take an adverse stance in the litigation, or to suggest that it had sided with the brother against the sister.[46]In conclusion on this issue, and having regard to the principles to which I have referred, I do not think that there are any factors which make this case an exceptional one, or which make it unjust to apply the general rule on costs set out in CPR Part 44.3(2)(a) as between the Trustee and Raymond Saul & Co.. Raymond Saul & Co. eschewed a neutral role and took Mr. Hemming’s side in this litigation against the Trustee. They lost the argument. The normal consequences for an adverse litigant who loses the case must follow.[47]Accordingly, I will order Raymond Saul & Co. to pay the costs of the Trustee, without recourse to Mrs. Hemming’s estate. The question of whether they should be solely responsible for such costs depends upon whether part of the burden should be borne by Mr. Hemming’s estate, which is the question to which I now turn.[48]As I have attempted to relate, the role of Mr. Hemming in relation to the genesis of the issue raised by this claim is not entirely clear. Although it is obvious that Mr. Hemming was not the architect of the legal argument raised against the Trustee, the correspondence to which I have referred suggests that Mr. Hemming adopted it for himself and that, even when approached directly by the Trustee, he was not willing to concede her claim and agree to a pragmatic solution. It was that attitude on the part of Mr. Hemming that Raymond Saul & Co. relied on as giving rise to the need for these proceedings.[49]However, although cast in the role of one of the rival claimants to the residuary estate, Mr. Hemming seems not to have taken any active part in these proceedings. As I have indicated, this may well have been a consequence of the partisan stance adopted by Raymond Saul & Co. both before and after the commencement of proceedings. After Mr. Hemming’s death, the Executor has also not taken an active role on the underlying issue. Instead, as I have indicated, the Executor has focussed his attention on criticising the necessity for, and utility of, the proceedings, together with the level of professional fees and costs. Although the Executor did not, in express terms, withdraw Mr. Hemming’s claim or concede that the Trustee was entitled to the residuary estate, from at least October 2007 it was clear to all parties that the Executor had no intention of engaging in any substantive way with the proceedings, and intended only to concern himself with issues of costs.[50]I find it difficult to fit these rather unusual circumstances into the black and white terms of CPR Part 44.3(2)(a). Taking a very technical view, it might be possible to regard Mr. Hemming (and now the Executor) as an “unsuccessful party” for the purposes of CPR Part 44.3(2)(a) on the basis that I held that it was the Trustee who is entitled to the residuary estate and not Mr. Hemming.[51]However, even were that so, as I have indicated, CPR Part 44.3(2)(b) gives the court a discretion to depart from the general rule and to make such order as it thinks appropriate in order to achieve a just result having regard to the factors set out in CPR Part 44.3(4) and (5). Those factors include, in particular, the conduct of the party in question and how he has pursued or defended his case or a particular allegation or issue.[52]In that respect, whilst it does seem that Mr. Hemming’s adoption of Raymond Saul & Co.’s legal argument and his refusal to concede the point as part of a pragmatic solution may have been the root cause of these proceedings, Mr. Hemming did not choose the form of them, Raymond Saul & Co. did not issue them on his behalf, and, once the claim was commenced, Mr. Hemming did not take any part in them. In particular, Mr. Hemming did not file any evidence or take any steps that would have caused the Trustee to incur costs.[53]After Mr. Hemming died, from October 2007 the Executor made it clear that he did not intend to advance any substantive argument on behalf of Mr. Hemming’s estate against the Trustee, and it was clear that he did not support Raymond Saul & Co.’s pursuit of the point. Thereafter, all the running on the substantive point was done by Raymond Saul & Co. on their own behalf.[54]In all the circumstances that I have described, and having regard to the factors set out in CPR Part 44.3, I do not think that it would be just that Mr. Hemming’s estate should pay any part of the Trustee’s costs of these proceedings. The reality is that Mr. Hemming and the Executor have played no substantive part in the opposition to the Trustee.

Conclusion

[55]In the result I shall order that the Trustee’s costs be paid by Raymond Saul & Co., such costs to be assessed on the standard basis if not agreed, with no right of recourse to any funds in their hands forming part of the estates of Mrs. Hemming or Mr. Hemming.