Baker v Baker & Ors [2008] EWHC 977 (Ch)

[2008] EWHC 977 (Ch)

Case No HC03C01593

Date 20/03/2008

IN THE HIGH COURT OF JUSTICE

CHANCERY DIVISION

Before

PAUL CHAISTY QC

IN THE MATTER OF THE ESTATE OF

GEOFFREY CHARLES BAKER (Deceased)

AND IN THE MATTER OF THE INHERITANCE (PROVISION FOR FAMILY AND DEPENDANTS) ACT 1975

Between

SUSAN BAKERApplicant

(1) RAYMOND ROBERT JOHN BAKERRespondents

(2) ANTHONY DAVID TOWELLRespondent

(3) GEOFFREY CHARLES BAKERRespondent

(4) JODHIE BAKERRespondent

(5) KEVIN JOHN BAKERRespondent

(6) GREG BAKERRespondent

B E T W E E N :

M r P aul C haisty QC sitting as a Deputy Judge of the High Court

M r A llston for Applicant (instructed by Sherratte Caleb)

M r R owntree for First and Second Respondents

M r B uswell for Third to Sixth Respondents

JUDGMENT

[1]This is an application by Mrs Susan Baker pursuant to the Inheritance (Provision for Family and Dependants) Act 1975 (“the Act”). Mrs Baker’s husband (“the Deceased”) died on 17 November 2001. The Third to Sixth Respondents are the sons of Mrs Baker and the Deceased, they are now all in their 20s. The First and Second Respondents are the personal representatives of the Deceased. As may be expected, they have adopted a neutral position in these proceedings providing assistance to the Court as appropriate.

[2]I begin by setting out some of the background. Mrs Baker is 57 years of age, she was born on 8 August 1952. The Deceased died unexpectedly and in tragic circumstances aged 61. The relationship between Mrs Baker and the Deceased began in 1977 and they started to live together as man and wife in 1979. They married on 8 August 1986. The four sons were born between 1979 and 1983. The Deceased and Mrs Baker each had children from previous relationships, it is only necessary to mention Jamie the Deceased’s son from a previous marriage.

[3]At the time of his death, and for many years previously, the Deceased had, as sole proprietor, operated a scrap metal and vehicle recovery business known as “Whip Street Motors”. It operated from two sites in Ipswich. This business, for reasons which I will explain, features as a central issue in these proceedings.

[4]The Deceased’s Will is dated 16 July 2001. its material provisions are as follows:

“4. (a) I give all my interest in the freehold property known as Dale House 103 Henley Road Ipswich … (“the Property”) to my Trustees upon trust with the written consent of my wife … during her widowhood to sell the same with full power to postpone such sale … (e) My Trustees may permit … my said wife during her widowhood to reside in any house which or an estate or interest which is for the time being subject to the foregoing trusts of this clause … upon such conditions as to insurance repair payment of rent rates or other outgoings and generally upon such terms (if any) my Trustees think fit … (g) Subject as aforesaid my Trustees shall hold the proceeds of sale of the Property and the income thereof upon trust for such of my said wife … and my sons (the Third to Sixth Respondents) as survive me and if more than one in equal shares … 5. I give absolutely … to my sons (the Third to Sixth Respondents) the goodwill of my business Whip Street Motors carried on by me at Great Whip Street Ipswich and all the machinery plant stock in trade and all effects of every kind employed or used in carrying on the same and all book debts owing to me in respect of my said business … for the avoidance of doubt I declare that in the above bequest the words “business” shall not include any interest in the premises of Great Whip Street upon which the said business is carried on which may be vested in me at the time of my death … but shall include any interest in the premises at Bramford Pit which may be vested in me at the time of my death … 6. I give all the remainder of my estate … to my Trustees … (ii) to hold the Trust Fund upon trust absolutely for such of my wife … and my said sons (the Third to Sixth Respondents) as survive me and attain the age of twenty one years and if more than one in equal shares … 8. I declare that my Trustees shall have full power to carry on my business of Whip Street Motors at Great Whip Street Ipswich Suffolk and Paper Mill Lane Bramford Suffolk and to postpone the sale and conversion thereof into money for so long as they shall think fit …”

[5]The assets of the Deceased’s estate comprise of Dale House, which is the former matrimonial home, the business of Whip Street Motors and the premises at Great Whip Street. Dale House was held in the Deceased’s sole name. Mrs Baker moved into this property in 1979 when she and the Deceased started to live together. It is common ground that Dale House is worth approximately £340,000. It is a relatively substantial detached property with 4 bedrooms. There is some dispute between Mrs Baker and her sons as to its condition. Mrs Baker contends that it requires considerable updating and decoration. She puts forward, in her evidence, a figure of £50,000 to £60,000 as being required to be spent in order to bring it up to what she would regard as a reasonable standard. The Respondents (which term I will use to describe the four sons) reject the propositions put forward as to condition. Mrs Baker adduced no evidence from surveyors or builders as to the condition of the property to support the matters put forward. The valuation report which supports the figure of 3340,000 refers only to a lack of complete redecoration creating a poor impression. The Respondents say, through the Sixth Respondent who still lives at Dale House, that Mrs Baker’s evidence on this issue is exaggerated and that while some updating or repairs may be desirable the cost would be nowhere close to approaching the figures put forward. In the absence of any report or quotations and having heard Mrs Baker’s evidence tested in cross-examination I have very real reluctance in accepting her evidence as to the level of works required. In any event it is unnecessary to resolve this issue.

[6]At the time of the Deceased’s death the site at Bramford Pit was held on a lease. As far as I understand the position neither side contends that such had any inherent value of its own.

[7]The premises at Great Whip Street are freehold and were owned by the Deceased at his death, this is said to be the principal site from which the business operated. A valuation report has placed a value on these premises of £150,000 based on their current use and £327,000 if sold for residential development. Planning permission for such has been allowed to lapse but it was common ground that regaining such permission, if sought, would not be a problem.

[8]The personal representatives currently hold a little over £55,000 on behalf of the estate. They have indicated, by correspondence, that their costs and expenses in respect of the administration of the estate and these proceedings will be between £20,000 and £25,000.

[9]I turn now to the Deceased’s interest in the business and its assets. It is this issue which raises serious difficulties. I should also at this stage refer to Section 3(5) of the Act which provides: “In considering the matters to which the Court is required to have regard under this section, the Court shall take into account the facts as known to the Court at the date of the hearing”.

[10]There is no agreement between the parties as to the relevant value to be placed on the estate’s interest in the business and assets of Whip Street Motors either as at the date of the Deceased’s death or now. There is no expert valuation before the Court. I am told that at an earlier hearing before Henderson J he expressed the view that there should at least be some assistance provided to the Court by way of a valuer providing at least some “ball park figures” as to value. There is some disagreement between the parties as to precisely what was said or suggested. What has been placed before me is of limited assistance. I have a letter dated 8 January 2008 from Russell James Limited “Chartered Certified Accountants” who are, I am told, the accountants to Whip Street Motors Limited. To add further complication, the business of Whip Street Motors has, since the Deceased’s death, been incorporated. There seems to have been a complete lack of attention to formality by the Respondents or the personal representatives as to the treatment of the business since November 2001, a point to which I shall of course return. The letter from Russell James Limited refers to the last finalised accounts of the limited company showing a net book value of assets of £346,101. The letter goes on to set out a figure of £660,549 based on a multiplier of three being applied to the profit shown in the accounts after tax and dividends. The total resulting figure is £1,006,650. The letter goes on to say this:

“It may assist the Court to know that the business today bears no relation to the situation at the time of death of the late Mr Baker. The four brothers have invested the majority of the profits into new plant, equipment fabric and structure of the site. This has allowed them to improve the efficiency and productivity of the business. They have also dedicated significant time and effort to achieve this”

These comments followed the earlier observation from Mr Short, the author of the letter:

“I do not carry out formal valuations as this is a specialist area and would require professional valuation of the assets and consideration of the relevant business areas. The above cannot therefore be construed as a formal valuation but as a ball park figure based on generally known principles.”

These comments followed the earlier observation from Mr Short, the author of the letter:

[11]During the course of the trial I expressed concerns on a number of occasions about the task which I was being asked to undertake, namely to value the estate’s interest in the business and assets in the absence of expert evidence or any clear evidence at all as to relevant events and factors. I was at one stage minded to consider adjourning the matter for evidence to be gathered and placed before the Court. I well understand the desire of the parties to avoid cost and expense if at all possible. Nevertheless, this is not always possible and sometimes if the matter is to be fully argued and developed it is wrong to try to cut corners. I asked the parties on several occasions what realistically I was being asked to do in the circumstances. In response to my own questions I ventured the answer “do my best in all the circumstances”. This received a positive response from both sides. Therefore, and with some real trepidation, I approach the issue of valuation conscious of the limited information placed before me. Nevertheless, I propose, as invited, to do “my best” conscious of the desire of the parties to have matters resolved and to stem the flow of cost and expense. The approach which I am to adopt will therefore necessarily be somewhat crude and broad brush in nature. A detailed forensic analysis is inappropriate and impossible in any event. Further, and this appeared to gain acceptance, it would be too optimistic to hope that I can arriveat a single figure. At best I can only provide what I regard as a possible range of figures. I therefore propose to address this issue before returning to further consideration of the principles and relevant facts relating to the Act.

[12]At the time of the Deceased’s death he operated the business of Whip Street Motors from the two sites at Great Whip Street and Bramford Pit. It was operated by him as a sole proprietor. The Respondents assisted him from an early age being encouraged to do so by the Deceased and Mrs Baker. They had far greater enthusiasm in working in the business than in attending to educational matters at school and as early as they could they started to work full time for the Deceased. I have been provided with certain sets of accounts. In the year end 31 March 1999 the figure for sales and work done was £347,821. After expenses, which included a figure of £96,615 for wages and salaries, the net profit was £23,472. For the year 2000 the corresponding figures were £376,427, £100,500 and £39,343. The figures for net assets in the balance sheets were £123,922 and £130,727 respectively.

[13]A set of accounts produced to 17 November 2001 shows certain sets of figures, I have not seen separate accounts to 31 March 2001. These show net profits of £83,014 or £79,722 and net assets of £228,381 or £168,645.

[14]As from the Deceased’s death the Respondents continued to operate the business by in effect a seamless transition. It appears that there was no consideration by either the Respondents or the personal representatives to how such continuation should be formalised or treated. In accounts from the period 18 November 2001 to 31 March 2002 the Respondents are treated as partners of Whip Street Motors. The net profit for that relevant period, after salaries of only £15,460, are recorded as £56,278. The net assets are recorded as £233,065. By the year end 2003 the net profits had risen to £300,017, with salaries and wages recorded at £34,194. The capital accounts of the Respondents show drawings of between £21,000 and £27,000. I do not have any accounts for 2004 but figures can be seen in accounts for 2005. By the year end 2005 the net profit is recorded as £347,533. The drawings by the Respondents are shown for the years 2004 and 2005 as ranging from £21,819 to £57,425. None of the Respondents provided any clear explanation as to why such figures so recording drawings were not accurate although they did question these figures and rejected the proposition that they had received the same. During the following financial year the business was incorporated, again it would seem without any consideration as to how this might impact on the estate. The latest unaudited accounts which I have seen to 31 March 2006 show profits before tax of £414,563. They also show cash at the bank of £523,591 with a net asset figure of £220,283. I am told that the current amount held as cash at the bank is in the region of £800,000.

[15]The business has therefore been continued by the Respondents without any thought directly to the estate’s interest and has , more recently, been incorporated. It is against this very unsatisfactory background that I must now attempt to assess what may be the value of the estate’s interest in the business now run from Great Whip Street and Bramford Pit.

[16]As at the date of the Deceased’s death he had run the business for many years from the two sites. The business was well known in the locality as Whip Street Motors and the Deceased had a good and solid reputation in the trade. The premises at Whip Street were freehold and at Bramford Pit leasehold. Relevant licences required to operate were personal to the Deceased. It appears from the evidence, which was not contested, that the Deceased operated largely on word-of-mouth without formal contracts being in place. It also appears to be uncontested that as at the Deceased’s death the business operated at far lower levels of throughput and volume than is now the case and that much of the plant and machinery was old and in relatively poor condition. It further appears very clear from the evidence adduced by the Respondents that since their father’s death they have effected significant developments and changes and advances in the nature of the business in relation to the split of scrap metal and vehicle recovery and caused significant investment to be made in new plant and machinery. They acquired from Jamie Baker his interest in the leasehold of Bramford Pit, a point which was in issue between Jamie and themselves. They have acquired new licences and continue to keep abreast of changes in legislation relating to the operation of the business. From the evidence which I have heard it would appear that there is much force in what Mr Short said to the effect that “the business today bears no relation to the situation at the time of death”. Nevertheless, the Respondents have in large part arrived at where they are now from trading on with the name Whip Street Motors, operating from the two relevant sites and adopting and developing the customers and contracts in effect inherited from the Deceased. Further, for some time at least they have had the benefit of plant and machinery which was in existence in November 2001. It was in this way that they were able to continue and benefit from the business in the seamless fashion which I have described.

[17]Mr Allston on behalf of Mrs Baker contends that the figure of just over £1,000,000 put forward by Mr Short is in all the circumstances a conservative one and that the true value is much higher. In closing submissions Mr Allston developed the argument that the Respondents were executors de son tort and have intermeddled with the business to such an extent as to make them liable now to account for profits and the full value of the business as presently operated.

[18]In relation to this point Mr Buswell responded by submitting that what has occurred is an assent on the part of the personal representative such as to defeat any such argument. I do not propose to address these arguments any further than to say that they are at best factors to take into account and I certainly do not propose to draw any conclusions. No proceedings have been brought by the estate and I have heard no relevant evidence from the personal representatives on these issues even though Mr Towell did give oral evidence on other matters.

[19]In the circumstances the Respondents have had the benefit of using the name and goodwill of Whip Street Motors together with its assets since their father’s death. By their own hard work and skill they have developed it into the successful business that it is today. When I raised with Mr Allston that even on his argument, that they were liable to account, he agreed that the Respondents would be entitled to have their efforts reflected in any resulting figures and to receive some appropriate account to reflect this. If the Respondents had not picked up the reins and continued the business it may well, and probably would, have simply folded and competitors may have well taken over its business by their own separate efforts.

[20]Mr Allston says the relevant figure is over £1,000,000. In his written submissions Mr Buswell was reluctant to commit himself , the figure which he provided for plant and assets was £176,711 but against the entry “WSM goodwill” there was no figure provided and there appeared a question mark. During the course of oral submissions he suggested that the figure of £176,711 such was too high and should be nearer £100,000. Mr Buswell continued to express some reluctance in committing the Respondents to a figure on valuation. He did accept that it may be appropriate to view their position as one which might increase the value of the estate’s interest on the basis of them being special purchasers. He also accepted that a relevant multiplier to be applied in any calculation would be a figure of three.

[21]I approach the value of the estate’s interest in the business as at today, doing what I believe is the best that I can on the limited evidence and information available and the informality which has attended matters for a number of years, as being in the region of £600,000 to £800,000. As I have already expressed, I do so tentatively and with some reservation and conscious of the broad and summary nature of the exercise which is involved. I base this conclusion on the following factors:(1) The inherent benefits which attached to the name Whip Street Motors;

(2) The levels of turnover and net profit at the date of the Deceased’s death;

(3) The values attributed to the assets at death;

(4) The fact that the Respondents were immediately able to continue to operate a successful business;

(5) The customer base and the contacts with relevant authorities which existed at the time of the Deceased’s death;

(6) The fact that the current business operates as Whip Street Motors and Bramford Pit;

(7) The fact that the current business continues to benefit from some of the initial customers and contacts;

(8) The fact that the Respondents have used the assets which existed at the Deceased’s death;

(9) The efforts, hard work and skill of the Respondents;

(10) The replacement of machinery and equipment;

(11) The scope for argument in relation to the actions of the Respondents in continuing the business without having to make any payment to the estate and the response of the personal representatives who knew of the actions of the Respondents;

(12) The fact that no payment has ever been made by the Respondents to the estate in respect of the business.

[22]The figures of £600,000 to £800,000 are not readily capable of any arithmetical analysis but I do, in broad brush terms as I was invited to approach the task, take account of the relevant levels of turnover and profit at the time of the Deceased’s death, and now, the multiplier of three, the figures for assets, the use, without cost to the Respondents, of such goodwill and assets and the arguments and counter arguments surrounding the conduct of the Respondents and personal representatives in respect of the continuation and development of the business. This claim is brought by Mrs Baker. She has not adduced any expert evidence. It would be wrong in my judgement to accept the figure of £1,006,650 referred to by Mr Short by reason of the explanations which he himself provides. Equally, it is unhelpful for the Respondents to put forward no real figures of their own. I was asked to provide a band of figures and I was asked to do so on a broad brush approach. The exercise I have conducted I have so conducted on the basis as requested.

[23]In these circumstances the estate is comprised as follows: Dale House £340,000 Great Whip Street £150,000 (ie. on the basis that it continues to be used for the business) Goodwill and other assets £600,000 - £800,000 Balance of funds (not including costs and expenses) is £55,000 This gives a total in round figures of approximately £1,150,000 to £1,350,000.

[24]I turn now to consider the provision made by the Will and what provision, if any, should be made pursuant to the Act. Section 3 of the Act sets out the matters which a Court is to have regard to when considering whether a Will has made reasonable financial provision and when considering how to exercise its power if such becomes appropriate, it provides as follows:

“(a) The financial resources and financial needs which the applicant has or is likely to have in the foreseeable future … (c) The financial resources and financial needs which any beneficiary of the estate of the deceased has or is likely to have in the foreseeable future (d) Any obligations and responsibilities which the deceased had towards any applicant … or towards any beneficiary … (e) The size and nature of the net estate of the deceased (f) Any physical or mental disability of any applicant … or any beneficiary (g) Any other matter, including the conduct of the applicant or any other person, which in the circumstances of the case the Court might consider relevant”

[25]In the case of an applicant such as Mrs Baker the Court is also to take account of her age, the duration of the marriage and her contribution to the welfare of the family and in looking after the home and caring for the family. It is also necessary to take account of the provision which Mrs Baker might reasonably have expected to receive if instead of the marriage being terminated by death it had ended by divorce, Section 3(2). Further, in the case of Mrs Baker “reasonable financial provision” means reasonable in all the circumstances for a wife to receive and not simply what is required for maintenance, Section 1(2)(a). I have already referred to Section 3(5).

[26]I have referred to certain background matters to this application. Before turning again to Mrs Baker I can limit myself to a relatively few words in respect of the Respondents. It is not necessary to deal with all of the individual circumstances of each. They are all aged in their twenties. Whilst there appears to be some propensity to high blood pressure the Respondents do not have any disability which would fall for consideration as relevant within Section 2(1)(f). Each of the Respondents of course works in the current business and is a director in the limited company. The business clearly provides each, on current figures, with a relatively healthy income by way of salary and dividends. The expectation is that the business will continue to flourish and that they will continue to benefit accordingly. The Fourth Respondent and his wife have two young children. They own their home which is worth about £140,000 with a mortgage of about £70,000. It is sufficient to say that the personal and domestic position of the others, save for the Sixth Respondent, is similar although with properties worth a little more. The Sixth Respondent continues to live at Dale House. None of the Respondents have significant savings or assets, beyond their shareholdings, save for the Sixth Respondent who, possibly in part because he lives with his mother, has savings of about £80,000.

[27]I turn now to Mrs Baker. Clearly, her relationship with the Deceased lasted for well over 20 years and was only brought to an end by his untimely death. Mrs Baker brought up the Respondents and looked after their welfare and that of the Deceased. She looked after the home and the family. Some issue was raised as to the extent to which Mrs Baker was active in the business. Mrs Baker maintained she was active to quite a high level in driving the Deceased around on business, dealing with calls and some administration. The Respondents disputed this and would put her role at a far reduced level. I do not feel it is necessary to reach any final view on this point. I have some concerns that Mrs Baker was perhaps exaggerating somewhat the level of her direct contribution to the business. She was unable to provide very much by way of detail and such as she did descend to appeared to be occasional in nature and broadly limited to answering calls at home.

[28]I did hear evidence as to Mrs Baker’s financial position. It is common ground that she received after the Deceased’s death money from a joint bank account and from insurance policies which amounted to about £160,000. I should add that the Respondents each received about £20,000 from policies. The money received by Mrs Baker has since been spent. A modest income which she received from the business has stopped being paid and she has used those monies, from the bank account and insurance policies, on her maintenance since the Deceased’s death and, further, on legal fees. Mrs Baker is now legally aided, she explained how, very sadly, she has in the past been forced to pawn jewellery in order to purchase train tickets to attend Court hearings.

[29]I have heard evidence from Mrs Baker as to her level of spending during her marriage to the Deceased and her requirements since her death and now. I regret that I regard some of her evidence again as somewhat exaggerated on certain issues. Under cross-examination Mrs Baker found it difficult to substantiate much of her claims and often gave confused and confusing answers. From the totality of the evidence and without descending into personal levels of detail I accept that the level of lifestyle enjoyed in the past by Mrs Baker would require an income of £20,000 to £25,000 per year. In reaching this conclusion I take account of her written evidence in chief and of her oral evidence. It is broadly consistent with her level of expenditure until the funds from the bank account and insurance ran out. Mr Buswell drew my attention to a table entitled “At a Glance” which can be used as a comparison of salaries within the public sector. He pointed out that a figure of somewhere between £20,000 to £25,000 equates to the income of a teacher in the upper pay scale with £25,000 equating to that of a Head Teacher. Mrs Baker contended that an appropriate figure was £30,000 per annum. Based on the evidence which she gave I regard that as too high. I do not accept that her evidence, after being tested in cross examination, supports that figure and I find that she was not able to substantiate the individual elements which she put forward so as to reach such a total. It is a matter which I will return to in any event.

[30]As for provision by the Deceased, in all of the circumstances, I have no hesitation in concluding that his Will failed to make reasonable financial provision for his wife and partner of over 20 years and mother of his four sons. If this was not accepted by the Respondents the contrary was not argued with any vigour or apparent enthusiasm.

[31]I turn now therefore to the question of what provision should be made. In addition to the factors I have already identified I also refer to the following. As for Mrs Baker’s own physical well being I take account of the report of Dr Rowley dated September 2007 and his conclusion that she does not have any “noticeably worse health than any other woman of her age”, again therefore Section 2(1)(f) appears to be of no relevance.

[32]I address Sections 2(1)(d) and (e) together. I have already expressed views as to the inadequacy of the Deceased’s Will in its treatment of Mrs Baker. I take account of the further provisions of the Act relating to claims by a spouse. It is in respect of the Respondents and the business that sub-sections (d) and (e) become particularly important. The Respondents worked with the Deceased from a very early age. They were encouraged to do so by the Deceased and Mrs Baker. It may well be that they did so at the expense of their formal education. Nevertheless, it was clear to me during the course of the evidence from each that they are intelligent men and know their business very well. As a result they have made a significant success of matters. It is self evident that the estate’s interest in and with the current business is inextricably mixed. It cannot be easily separated out. If the estate attempted to realise such interest as it has I can well envisage serious difficulties, indeed of the kind that I have had in valuing its interests. The Deceased clearly was concerned to provide his sons with a business in which they could thrive. In my judgement, and I refer to Section 3(5), it is proper that I should take account of the impact of any order I may make as to the continuation of the business. The order is not an order against the Respondents. In the absence of the Respondent’s providing funds to the estate to satisfy its interest there could well be very difficult litigation to extricate that interest. Looking broadly to Section 2(1)(g) these are relevant circumstances when considering what award to make pursuant to the Act. The unravelling of the position could be extremely time consuming, expensive and difficult for all concerned.

[33]The initial, opening, position of the Respondents was to contend that adequate provision for Mrs Baker would be met by conferring a right to live in Dale House for life or until she should remarry, it being transferred otherwise to themselves, and for them to pay a lump sum of £63,000 to Mrs Baker and thereafter for them to pay to her £23,000 per year. I pointed out to Mr Buswell the unsatisfactory aspects of this proposal. This was an offer not from the estate but beneficiaries. It was unclear how such was to be administered and what proper safeguards were to be in place. In any event I regard such proposals as inadequate and unrealistic.

[34]During the course of closing arguments Mr Buswell, I understand, conceded that a proper and appropriate course to take was for a clean break by way of a lump sum provision.

[35]I have been referred to limited authority on the question of the level of provision to be made. I have already referred to the special position of applications made by a spouse as provided by the Act. In this regard I was referred by Mr Allston and Mr Buswell to Cunliffe v. Fielden

[2006] 2 WLR 491

. I refer in particular to paragraphs 19 to 21 and the following observations of Wall LJ, having referred to proceedings between divorced former spouses and White v. White

[2001] 1 AC 596

he said:

“… a way of assessing the fairness and non-discriminatory nature of the proposed result is to check it against the yardstick of equality of division. There is, however, no presumption of equal division of assets, but as a general guide, in the words of Lord Nicholls of Birkenhead at 605, “equality should be departed from only if, and to the extent that, there is good reason for doing so …”

. Caution however seems to me necessary when considering the White v. White cross check in the context of the case under the 1975 Act … in cases under the 1975 Act a deceased’s spouse who leaves a widow is entitled to bequeath his estate to whomsoever he pleases; his only statutory obligation is to make reasonable financial provision for his widow. In such a case, depending on the value of the estate, the concept of equality may bear little relation to such provision”.

[36]I therefore approach the concept of equality conscious of the many varied circumstances which can arise on a claim under the Act. I have set out what I regard as the relevant factors in this particular application, including the length of the marriage, the role of Mrs Baker as wife and mother, the financial circumstances of the Respondents and Mrs Baker’s circumstances. I also emphasise the nature of the estate and in particular the difficult circumstances which prevail in extricating the estate’s interest in the current business and the Deceased’s desire, and indeed I understand that of Mrs Baker, to provide the Respondents with the means to earn their living and make their way in life. An opportunity which they have not wasted.

[37]During the course of argument it became clear, and common ground, that if a lump sum was to be awarded the reality of the position was that the Respondents would look to raise a sum through the business and provide it to the estate and personal representatives to thereafter hand over to Mrs Baker so as to seek to ensure the preservation of the business.. Obviously it could take a little time to raise any necessary funds. The evidence I received as to the means to raise funds was again limited but such as I heard indicates that the business is a successful and growing one, there is limited security over its assets and it has substantial funds in its bank account.

[38]The order I propose to make, and I accept that when this judgement is handed down there may be some fine tuning to be carried out, is that Mrs Baker should be awarded Dale House absolutely. In addition she should receive a lump sum of £410,000. As to this £25,000 should be paid at once from funds held by the personal representatives. As to the balance I will hear further argument but what I have in mind is a period of say 3 months for the relevant amount to be raised.

[39]I am of course conscious that Mrs Baker in these proceedings was asking for a figure of £550,000 in addition to Dale House. This was analysed on the basis that £519,000 would, if invested, produce £30,000 per year and payment of £550,000 would leave a balance as a contingency fund. For the reasons which I have sought to give this figure is in my judgement too high. In my judgement an income of £30,000 per year is not reasonable in all of the circumstances. Further, I am concerned, although as I have said the evidence is limited, that an award of £550,000 or thereabouts would create undue and potentially overwhelming difficulties. The estate does not have these ready funds. Such could only be generated by some kind of recovery from the Respondents or sale and a division. That itself would potentially be time-consuming and expensive. The evidence which I have heard indicates that a figure a little under £400,000 could be raised by the Respondent’s which they could use to pay to the estate. If invested Mrs Baker should be able to secure levels of income of the order I have decided are reasonable.

[40]I also bear in mind that my award and order includes Dale House which is valued at £340,000. It is a relatively large property. I accept of course that Mrs Baker has lived in it since 1979 and brought up the family in it. I fully understand her attachment to it. During the course of evidence I heard from the Respondents, and I accept, some detail as to likely prices of properties in the locality. This was not given as expert evidence but simply on the basis that they had from time to time looked at properties and house prices for themselves. It was clear, and I accept, that there are within relatively short distances three bedroomed properties which would cost in the region of £200,000. The total value of the award to Mrs Baker is £750,000. How Mrs Baker may wish to invest or use this is a matter essentially for her but it is only fair and reasonable in my judgement for it to be taken into account that £340,000 is invested in Dale House. It is for Mrs Baker to decide whether she wishes to retain the £340,000 in that property or to release some of the value by selling and buying a smaller and less expensive home. This has to be judged and assessed against the nature of the estate and the position of the Respondents who were working in the business prior to the Deceased’s death and also his desire that they should continue with it. My task is to make such provision as is reasonable and reasonable in all of the circumstances. It would be wrong for me to disregard the nature and value of Dale House.

[41]On the figures which I have proceeded on, namely an estate of £1,150,000 to £1,350,000 an award of £750,000 is more than half. The authorities do not provide for a maximum figure and the factors set out within the Act have to be taken into account and applied against the yardstick of equality. Further, the approach to valuation is, for the reasons I have given, a general one.

[42]I will hear further argument as to the terms of the appropriate order in the light of the conclusions I have reached. PAUL CHAISTY QC