Bhushan & Ors v Chand [2015] EWHC 1298 (Ch)

Case No 1BM30584

[2015] EWHC 1298 (Ch)

IN THE HIGH COURT OF JUSTICE

CHANCERY DIVISION

Venue BIRMINGHAM DISTRICT REGISTRY, Birmingham Civil Justice Centre, Bull Street, Birmingham B4 6DS

Date 08/05/2015

Before

HHJ DAVID COOKE

Between

Kul Bhushan (1) Vinod Kumar (2) Gurmel Chand (3) Sat Paul (4)Claimants

Kahan ChandDefendant

Avtar Khangure QC (instructed by Aspect Law Ltd) for Claimants

Clifford Darton (instructed by George Green LLP) for Defendant

Hearing Hearing dates: 12-16, 19-23, 26-30 January 2015

Judgment

HHJ David Cooke:

[1]The parties in this case are five brothers, the defendant being the eldest. Between them they own a considerable number of commercial and residential properties in and around Birmingham each of which is registered in the name of one or other of them. Some of the residential properties are lived in by the brothers or members of their families, others are let out. They also carry on or control two businesses known as Mastersons Fashions (which manufactures clothes) and Mastersons Warehouse (a general retailer of household and other goods), and have in the past also run various shops and other businesses. These assets have been built up since the family arrived in this country in the 1960s, during most of which time it is clear the brothers worked closely together. They fell out however in 2010, leading to the present litigation.

[2]The claimants' case is that all the properties and businesses have been acquired and run under a general arrangement, expressly discussed and agreed between them, that they would work together and acquire assets for their joint benefit, it being a matter of convenience and without significance to them in whose name the assets stood or the businesses were conducted. The income of all the businesses and properties has they say been shared between them accordingly. Their claim, which is put in constructive trust and/ or proprietary estoppel, is that as a result all the properties and both businesses are beneficially owned in equal shares by all five brothers, whichever of them is the registered or apparent owner.

[3]The defendant denies any such agreement or arrangement. His position is that each property is beneficially owned by the brother who is its registered owner, that Mastersons Fashions is solely owned by him and that he has no interest in Mastersons Warehouse, which is owned by a limited company whose shareholders are Kul Bhushan and his wife. He maintains that he was the driving force behind acquiring all the properties and starting all the businesses other than Mastersons Warehouse, that they all derive from his financial and business contribution, and that insofar as the claimants have run or worked in those businesses it has been because he provided work for them and benefits to their families when they were otherwise unwilling or unable to find work, and that insofar as properties have been bought in the names of any of the claimants it has been with his money and as gifts to his brothers provided out of his sense of family obligation. He denies that the claimants have shared any income from their properties or businesses with him.

[4]There are in addition other properties in India and one property and business in the UK, known as the Smethwick Working Men's Club, which are acknowledged to be owned equally between the five brothers. The evidence has also extended to a number of properties owned in the names of sons of the claimants, which the defendant says have been acquired with money from the businesses run by the brothers and, if there is to be any general sharing of assets, should be brought into account.

The relevant legal principles

[5]The starting point is that the beneficial ownership of property follows the legal ownership, see Stack v Dowden

[2007] 2 AC 432

. The burden is of course on the claimants to show that they have an interest in businesses or assets that presently are held in the defendant's name. The claimants' primary case is based on expressly agreed common intention and I shall consider that first. Mr. Darton submits that, in effect, only proof of such an express agreement at the time of acquisition will suffice. He relies on the well known passage in the speech of Lord Bridge in Lloyds Bank v Rossett

[1991] 1 AC 107

at p 132 E:

“The first and fundamental question which must always be resolved is whether, independently of any inference to be drawn from the conduct of the parties in the course of sharing the house as their home and managing their joint affairs, there has at any time prior to acquisition, or exceptionally at some later date, been any agreement, arrangement or understanding reached between them that the property is to be shared beneficially. The finding of an agreement or arrangement to share in this sense can only, I think, be based on evidence of express discussions between the partners, however imperfectly remembered and however imprecise their terms may have been. Once a finding to this effect is made it will only be necessary for the partner asserting a claim to a beneficial interest against the partner entitled to the legal estate to show that he or she has acted to his or her detriment or significantly altered his or her position in reliance on the agreement in order to give rise to a constructive trust or a proprietary estoppel. In sharp contrast with this situation is the very different one where there is no evidence to support a finding of an agreement or arrangement to share, however reasonable it might have been for the parties to reach such an arrangement if they had applied their minds to the question, and where the court must rely entirely on the conduct of the parties both as the basis from which to infer a common intention to share the property beneficially and as the conduct relied on to give rise to a constructive trust. In this situation direct contributions to the purchase price by the partner who is not the legal owner, whether initially or by payment of mortgage instalments, will readily justify the inference necessary to the creation of a constructive trust. But, as I read the authorities, it is at least extremely doubtful whether anything less will do.”

This is not, he submits, a case in the domestic or shared occupation context (save perhaps in relation to the house at 104 St Paul's Rd which was occupied by all the brothers for a period) in which he submits that cases such as Oxley v Hiscock

[2004] EWCA Civ 546

hold that the existence of a common intention to share ownership (as distinct from the proportions in which ownership once agreed is to be shared) may be inferred from other conduct and dealings in relation to the property. To the extent contributions to the purchase price are relied on to prove such an intention they must be direct in the sense referred to by Lord Bridge and not indirect such as work done on the property or in a business owned by someone else which generates the funds used to buy the property.

[6]I do not myself think the question whether the court might infer an intention to share ownership by inference from conduct other than direct financial contribution to the purchase price is quite closed- see for example the remarks of Lord Walker in Stack v Dowden at para 25. But for present purposes, this is a case where the claimants have given evidence that there was an expressly communicated common intention of joint ownership, and the question is whether that evidence is to be accepted. I do not need to consider inference of intention unless I reject the evidence of express discussion and agreement. It is clear in my judgment that the court can have regard to the subsequent conduct of the parties in relation to the property (including indirect contributions such as work done) in determining whether their evidence as to an express agreement is to be believed or not, and if so whether they have relied on that agreement to their detriment.

[7]It is for the claimants to establish not only that there was an agreed common intention but also the terms of it. There is no contemporary documentary evidence of the discussions and agreements the claimants contend for, so the conclusions I come to will depend on resolving conflicts of oral testimony, for which purpose I will consider the extent to which what the parties say they did or did not discuss or agree is consistent with what they did afterwards (which itself is on many points disputed). As is common in such cases, and despite the volume of documents produced, there is little in the way of reliable contemporary documentary evidence directly dealing with the material points, and where contemporary documents do exist, a party with whose case they may be inconsistent seeks to dismiss them as having been merely produced to show a position for a particular purpose rather than reflecting the true intention of the parties. Many of the events relied on occurred long ago and the evidence of them is purely the testimony of the parties, which it is clear is strongly coloured by the positions they have now adopted. Conclusions of fact therefore rely heavily on inference from actions that in my judgment are likely to be reliable guides to what the parties truly intended at the relevant time, as distinct from actions the purpose of which was mere convenience or disguise for the purpose of outsiders such as Her Majesty's Revenue and Customs.

[8]I accept and bear in mind also Mr. Darton's submission that the evidence relied on must be suitably convincing bearing in mind that the finding of the court as regards ownership may affect third parties, particularly creditors. There cannot be one position as between the parties and another as regards outsiders, and the court must be wary of accepting too readily contentions that enable what may be regarded as a convenient and fair solution to be arrived at between the parties presently before it.

The facts

[9]I will now summarise the facts. In doing so I will not deal with each and every property acquired or transaction entered into, but mention only what is sufficient to describe the general sweep of events and the most important of them, and to refer to the most significant matters relied on. The evidence included allegations relating to a dispute with other family members which I will not refer to since it was irrelevant to the issues.

[10]In 1966 Kartara Ram Rattu, the parties' father, came to the UK from England. He got a job and initially lived with one of his daughters and her husband (Mr. Tooray), who had arrived previously. The next year his wife Chanan Kaur joined him with their five sons and another daughter. The defendant was already of working age and began work almost immediately in a foundry. He handed his wage packets to his mother, as was regarded as traditional.

[11]In 1968 Kartara Rattu bought a house in his name at 25 Albert Rd Handsworth, and the family moved there. He paid £2160. The defendant said that a substantial part of this, he estimated half, came from money he regards as his, his mother having assured him that she was keeping it as savings for him and that he had an interest in the house by way of resulting trust arising from such contribution. It emerged in his cross examination though that £400 was funded by a loan from Mr. Tooray, £600 was deferred (the seller was a relative) and the rest paid from monies Kartara Rattu provided, presumably money held by him and his wife There is however no supporting evidence for any such saving arrangement, and in particular no evidence that any monies were held separately or records that any particular amount was regarded as belonging to the defendant. Nor does the defendant allege any discussion or agreement that he should have an interest in the house. It does not appear to be a matter that has been mentioned prior to these proceedings.

[12]Unfortunately later in 1968 Kartara Rattu was involved in a motor accident and died. It appears that monies paid by insurers discharged the deferred price and the loan from Mr. Tooray and the property at Albert Rd was then vested in Chanan Kaur. Mrs Kaur became head of the household. Each of the brothers says that as and when he found employment, he paid his wages to their mother as the defendant had done, and that she controlled the family finances. The defendant does not admit that the claimants did so, and a considerable part of the evidence was taken up in exploring when each of the claimants had started work and how much he might have earned. I find however that whilst employed each brother did pay any wages earned to Mrs Kaur, and for the reasons below that it makes no difference to the outcome of this case how much they earned or paid her.

[13]In 1971 a property was bought at 77 Hamilton Rd, in the name of the defendant for about £750, using funds paid by Mrs Kaur. It was renovated and sold for £2150, the sale proceeds being paid back to Mrs Kaur. The claimants say that they, particularly Kul Bhushan, worked on the renovation. The defendant gave inconsistent evidence about this, saying first that little work had been done, though he then accepted a considerable list of types of work, and second that he had done all the work, though he then grudgingly accepted that Kul Bhushan had done some of it though it was all, he maintained, under his direction and tutelage. I think this unlikely, since the evidence as a whole shows that Kul Bhushan had considerably more building knowledge and experience than the defendant. The defendant said that this purchase was made using his money held by his mother and that the proceeds were also held by her for him. As before, there is no supporting evidence for this. The claimants said it was a purchase on behalf of all of them, though when pressed they had different views on whether their mother had any interest at the time, or the younger brothers who had not then started work and so could not have paid any wages to their mother. This evidence is in my view simply their opinion now as to what the fair result between the family members ought to be, and not reliable evidence of any actual discussion or agreement at the time as to what their legal interest should be.

[14]In 1972, Mrs Kaur sold 25 Albert Rd and purchased 66 Murdoch Rd for £2150, in her sole name. The family moved into that house. The defendant had said in his defence that he believed this property had been registered in his name. If he thought so, he was wrong. He said the purchase had "utilised his money" but I find that the funds were provided by Mrs Kaur from those she controlled, so the defendant's case depends on finding that he continued to own some part of those funds. 66 Murdoch Rd was sold in 1979.

[15]In 1974 a property at 65 Hamilton Rd was bought in the defendant's name for £2750. It was renovated and sold for £3200. The defendant says that he bought and renovated it "with the help of" Mr. Tooray and split the profit equally with him. It is accepted Kul Bhushan assisted with the renovation work, though the extent of his and the defendant's contribution to that work is disputed. It was accepted however that any price paid came from Mrs Kaur and Mr. Tooray and that any share of the sale proceeds over what went to Mr. Tooray was paid to Mrs Kaur, so again the defendant's case depends on showing some claim to funds in her hands. This purchase shows the defendant entering into an arrangement in the nature of a joint venture where title to a property was vested in him but someone else was entitled to a share of the proceeds on sale. He accepted this was so, which must mean that was what he had agreed with Mr. Tooray at the time of the purchase.

[16]In 1974 or 1975 a property at 121 Murdoch Rd was purchased in the name of the defendant and let out. The defendant said in his defence that he and not Mrs Kaur had paid the price and received the rent. In cross examination however he accepted neither of these statements was correct; the price was paid from funds held by Mrs Kaur (though the defendant says these were his) and the rent had been collected by all of the brothers at different times and paid over to Mrs Kaur. This property too was sold in 1979.

[17]By 1976 all the brothers had left full time education and had some degree of work as employee for employers outside the family. Sat Paul, the youngest, left school in that year and I accept his evidence that he had at least a short period of work at a factory in that year, followed by 6-7 months at another factory in 1977. The others had been employed at different places prior to 1976. I accept the evidence that all of them paid the wages from such employment to their mother.

[18]In 1976 a property at 19 Brunswick Gardens was bought at auction in the name of Kul Bhushan for £2,500 and rented out. It is common ground the funds came from Mrs Kaur. The defendant's case is that these were his money but the property was bought as his gift to his brother who was about to get married, and it was therefore Kul Bhushan's property absolutely. The claimants' case is that it was a family decision to buy this property as an investment and it was held on trust for them all. The defendant accepted in cross examination that all the brothers used to look for advertisements of property for sale in the local paper, that there had been a discussion among the whole family when this property was advertised and when the auction catalogue was received and that the whole family were keen to buy it in order to improve the family fortunes. His answers made clear that the purchase process was substantially managed by Kul Bhushan and Vinod Kumar. They had marked the catalogue themselves as to which properties were worth looking at "because they were more educated". They had gone to inspect any properties so identified, and had subsequently gone to the auction. He sought to maintain that they were acting on his instructions, saying "after everything was finalised at home I used to send them" to the auction, and that one of them had to be named as purchaser once their bid was successful. This had been Kul Bhushan because he was the elder (as between himself and Vinod Kumar).

[19]This was not consistent with his pleaded case that he had intended to buy the property specifically for Kul Bhushan- if that was the intention it would not be relevant that Kul Bhushan was the elder of the two at the auction. Other answers were also not consistent with that position. When it was put to him that the family had jointly decided which properties in the catalogue would be worth buying he agreed and then said "after it is bought we will see whose name it is going in", implying that it might have been any of the brothers.

[20]Other responses were self contradictory. He said that it had been his mother's intention to buy houses for each of the brothers when they got married and move them out of the family home, but elsewhere he had said that his mother had always wanted to keep all her sons living together. That was why in due course they bought one large house to accommodate all of them and their wives, and subsequently bought others adjacent to it when their families expanded further. His pleaded case was that he believed Kul Bhushan had kept the rent, but he accepted in cross examination that Gurmel Chand had collected it, kept a written record and that it had been mostly paid over to Mrs Kaur.

[21]I find that this purchase was the result of discussions and agreement to bid at auction and buy it among all the brothers and their mother, and that the decisions as to whose name it should be bought in and that the funds held by Mrs Kaur should be used were jointly made in those discussions. They were not decisions taken by the defendant alone and then directing his brothers what to do.

[22]19 Brunswick Gardens was sold in 2001 in order to pay debts incurred by the defendant's son Pritam. I shall refer to that episode in more detail later, before expressing a finding as to its beneficial ownership.

[23]In 1976 the first of the family's own trading ventures (ie businesses other than dealing in or letting property) began. It was a market stall selling clothing at the Newtown Shopping Centre run by Vinod Kumar. The defendant's pleaded case was that he had purchased this stall for Vinod Kumar who was otherwise out of work. He said in his Defence (wrongly referring to the stall as a shop, which came later) that he had paid £1800 to buy this stall, £600 from his own savings and £1200 borrowed from his cousin Gurcharan Dass. His witness statement said he had paid a smaller amount, £1200 in all, that Vinod Kumar had run the stall though the defendant had helped out occasionally.

[24]In cross examination he said that his mother had forced Vinod Kumar to go out to work and he had bought the stall to provide him with work. He at first said that about £1800 had been paid in all, of which £500 had been paid to the previous stallholder for goodwill and that that amount had come from the funds held by Mrs Kaur which he maintained were his. He accepted this had been negotiated between himself, Vinod Kumar and the seller. When it was suggested that Mr. Dass had taken Vinod Kumar to meet the seller to discuss the sale the defendant said "I went as well because I was going to pay and employ him", thus appearing to suggest it was his business and Vinod Kumar was his employee, though that had not previously been his case at all.

[25]The defendant said that the rest of the £1800 had been paid for goodwill and stock for the stall, and at first that the cost of the stock had been lent by Gurcharan Dass. He then changed his account and said the supplier of the stock had allowed credit for the stock (reverting to the figure of £1200 for stock and goodwill in total), and that Gurcharan Dass had provided security for the credit by the supplier, which had not been previously mentioned. Inconsistently, he then said that this security was for £1200, and that there was no difference between lending money and standing surety.

[26]The defendant's account was so variable that I could not accept it as reliable. I find that £500 was paid for goodwill out of monies held by Mrs Kaur and that the stock was purchased on credit given by the supplier which was repaid from turnover of the stall. It was not borrowed by the defendant. Whether Gurcharan Dass stood surety to the supplier is irrelevant as between the brothers.

[27]Vinod Kumar ran the stall under the name "Danny's Fashions", Danny being his Anglicised nickname. He said that he had a business bank account in that name, but that he used that account mainly to make payments by cheque and that when he wrote a cheque he paid money into the account to meet it. I infer that most of the takings were in cash. He said that he paid all the profit from the stall to his mother, but when pressed as to how much this was, became very vague. He said he regularly paid his mother £100 per week and sometimes more. There are no records of any kind as to what the turnover of the stall was, still less its profit, and Vinod Kumar could give only the most general description of how he determined what amount he had left at any time to pay his mother. I find that he did make some payments to Mrs Kaur, but I am not satisfied they represented all the profit made. There is no account of what else may have happened to any surplus, save that the defendant says he assumes Vinod Kumar kept it for himself.

[28]At some point, probably around 1978 or 1979, Vinod Kumar moved the business of Danny's fashions from the market stall into a shop unit at the Newtown Centre, and Kul Bhushan also began trading in clothes from another nearby shop unit. Their evidence was that they had paid nothing to acquire these shops, the Council which owned the Centre being keen to find tenants for unoccupied units. The brothers between them had done the work required to fit them out. These shop businesses were traded until about 1986 when they were sold. In cross examination Vinod Kumar for the first time disclosed that they had been sold to buyers who had paid a price for goodwill and stock. He gave different figures for what this might have been, eventually settling on a total of about £8,500. There are again no records of turnover or profit from either shop. Vinod Kumar said at first that turnover had been just under the vat threshold, then that he had registered for vat and that Kul Bhushan's shop had also traded under his vat registration. I conclude it is likely that again most of the takings were in cash and it is now impossible to determine what they might have been or what happened to them. Some was no doubt paid to Mrs Kaur, but how much and whether some was spent by the brothers running the shops or accumulated separately is impossible to tell.

[29]In 1978 a property at Suffrage St Smethwick was purchased in the name of the defendant for £8500. It consisted of a shop unit with lockup garages and a workshop behind. The defendant's pleaded case and written evidence was that he had purchased it from his own savings and earnings. In cross examination he accepted that Kul Bhushan had found the property for sale and discussed it with him. He denied that any other brother had been involved in the discussions, though they all maintained that they had been. As before the immediate source of the funds used was monies held by Mrs Kaur, though the defendant maintains they were all his.

[30]It seems clear the intention behind this purchase was to establish a business manufacturing clothes. The claimants' case was that all the brothers had discussed and agreed this. The defendant said that it was his idea, and that insofar as others had been involved it was on his instructions and for the purpose of a business that was to be his. Inconsistently, he seemed to accept there had been a discussion of buying the property, but not of what to do with it. He accepted that Kul Bhushan had made an application for planning permission to convert some of the outbuildings to a factory unit, dealing with an architect for the purpose.

[31]The claimants' case that they were involved in the discussions and were to be involved in the proposed manufacturing business is supported by the fact that by this time three of them were working in some way in the clothing industry, Gurmel Chand having been employed as a cutter by Gurcharan Dass at his factory and later by a clothing manufacturer called Sue Martina, and Kul Bhushan and Vinod Kumar running their respective shops. In 1979 some manufacturing of clothes began, with Gurmel Chand cutting clothes in the house at 19 Brunswick Gardens (which was then empty) other family members sewing them up and Vinod Kumar and Kul Bhushan selling them in their shops. The defendant was working throughout full time in a foundry. Although he also said he had previous experience as a machinist in India and helped Gurmel Chand build a cutting table, his participation in the actual manufacture at this time must have been minimal since, as he said, when he came back from the foundry he was accustomed to having a meal and then spending most of the evening at the pub with friends. I do not accept his evidence that he gave all the directions and that his brothers did only what he told them.

[32]Planning permission was refused, and shortly thereafter in 1979 (or possibly 1980) the property was compulsorily purchased by the Council, which paid compensation of £19,000. That amount was paid to the defendant's bank account. The defendant accepted the compensation negotiations were conducted by Vinod Kumar and Kul Bhushan "as they could speak well. I had to be there as it was in my name. They discussed it on my behalf." I do not doubt that the council were not told anything other than that the property was owned by the defendant, but that does not help in determining whether as between the brothers Vinod Kumar and Kul Bhushan were acting purely to assist the defendant, or themselves had an interest in the outcome.

[33]Also in 1979 a large house was purchased at 104 St Paul's Road, in the defendant's name, for approximately £10,000. It was bought at an auction attended by Kul Bhushan and Vinod Kumar. It had been divided into 4 flats, but the intention was to reconvert it to a single house into which Mrs Kaur, all 5 brothers, their wives and children (by then 17 people in all) would move from 66 Murdoch Rd. The defendant's case was that he had decided on the purchase with his mother, and that he had done all the renovation work except the electricals, which was Kul Bhushan's trade. I do not accept this, and prefer the evidence of the claimants that they (other than Vinod Kumar who on his own evidence was no builder) did most of the work, particularly Kul Bhushan whose building skills were much wider than being an electrician.

[34]Shortly after buying 104 St Paul's Rd, both 66 and 121 Murdoch Rd were sold. The defendant accepted the sale proceeds were paid to Mrs Kaur, though No 121 was owned in his name.

[35]In 1980 an outbuilding behind No 104 was converted to a manufacturing unit. The defendant and Kul Bhushan each said they had done most of the work. I am satisfied they both played extensive parts, and that other family members also helped. The defendant accepted that Gurmel Chand had sourced second hand sewing machines, which Kul Bhushan and Vinod Kumar had travelled to buy. He did not know where they had come from, which points against his having been in control of that process. The sewing work was done by the brothers' wives, or some of them. The defendant said that he did some overlocking and delivered the finished goods, but this cannot have been a great involvement since he remained employed full time at the foundry so could only have worked in the evenings, and he could not drive. When it was put to him that his role had in truth been minimal he said his major contribution had been that he started the business, he had converted the shed at No 104 and it was all his money that had been used. Thus again his main claim to participation and ownership depends on attributing to him all the money held and used by Mrs Kaur.

Tividale Methodist Church site

[36]It is both sides' evidence that larger premises were sought for the manufacturing business, though they disagree about who was driving the process; the defendant says it was his initiative and the claimants that it was discussed and agreed between all of them with Kul Bhushan finding the premises and taking the lead. In 1980 a site in Tividale was purchased, in the defendant's name and using the £19000 proceeds received by him from the CPO of Suffrage St. The site consisted of(a) a former Methodist Church,

(b) adjoining cottages, and

(c) houses at 76-82 Dudley Rd West, Tividale. The documents available do not cover the entire purchase; those in the bundle show the purchase of the church for £15000 and one of the houses for £1100. It is the defendant's evidence that he used in addition a redundancy payment of £3000 and an unspecified amount from a life policy. I do not believe this can be entirely right however since it appears from his National Insurance records that he was not made redundant until 1981, at which point he began to run a shop at 106 Oldbury Rd, as referred to below.

[37]The manufacturing business was transferred to the Tividale site and began to trade under the name "Mastersons Fashions". It is common ground that the name was a reference to all the brothers as "sons of the Master", their father having been a teacher in India and known as "Master". The defendant accepted that this was so, and did not for instance say that it referred only to one son, ie himself.

[38]It is common ground that the business had a bank current account in the defendant's name and that he was registered as its proprietor for VAT purposes. The claimants say this was agreed between them all for convenience, the business by common agreement belonging to all of them. The defendant accepts that dealings with the solicitors for the purchase, arrangements for the Vat registration and an application for planning permission were all handled by Kul Bhushan, though he says this was just paperwork done on his behalf. Renovation work was done by the defendant, Kul Bhushan and Gurmel Chand, thought the defendant says the others were merely helping him. Sewing work was done by the wives of all the brothers, though the defendant says some worked only part time. It is accepted none of them was paid; the defendant says he regarded this as fair since they were living rent free in his house (ie no. 104). 106 Oldbury Rd shop (Paul's Supermarket)

[39]In 1981 a shop property at 106 Oldbury Rd was purchased, in the name of the defendant, for about £12,500. There is no documentary evidence of the source of funds. It is common ground that initially the defendant ran the shop selling clothes (including those manufactured by Mastersons Fashions), but it was not successful and was closed down after a few months (he said 6-7 months, the claimants about 12 months). After that it was empty until converted to a grocery shop, which Kul Bhushan and Sat Paul began to operate in 1984. It is common ground that no rent was paid to the defendant and this shop provided, without payment, all the food and groceries required by the extended family from then until it was sold in 1989 for £60,000. Vinod Kumar also worked in this shop from 1986 when he sold the two shop units at Newtown Shopping Centre. It seems likely that the defendant commenced work in the shop once he had been made redundant at the foundry, that this may have indicated he was not initially needed full time at Mastersons Fashions, but that the period of about 2 years when the shop at 106 Oldbury Rd was empty suggests that the manufacturing business, which all agree was burgeoning, was by then taking up the majority of the time of all the brothers.

The Windmill Lane site

[40]In 1984 an opportunity arose to buy a site at 105-108 Windmill Lane, Smethwick, consisting principally of a large building formerly used as a wholesale meat distribution warehouse. It is accepted that Gurmel Chand first identified it, all five brothers went to see it and discussed its purchase. It was purchased in the name of the defendant for £75,000. The defendant's pleaded case and written evidence was that he had provided all of this from his own savings and by borrowing £35,000 from Lloyds Bank, the other brothers having contributed nothing. In cross examination he accepted that i) Payments of £7500 and £13,381 had been made from the Mastersons Fashions business current account (in his name) ii) £35,000 had come from a separate business loan account (also in his name). Curiously he said he had never before seen the bank statements on the loan account, though elsewhere he had said that even when payments were made by others he was always fully aware of what had gone in and out of the bank. The loan account had been repaid in full within a few months by transfers from the business current account which must have represented trading receipts of Mastersons Fashions. iii) The rest of the money (which must have been about £20,000) had been collected from various sources. It was put to him that "the family" had been desperately trying to get this money together and he said "not all of them, I did, Gurmel Chand did, Kul Bhushan gave some, so did Vinod Kumar's wife and my wife". He then accepted that Kul Bhushan's wife had provided £1200 from an account in which she kept child benefit payments. All these amounts he said had been paid back in cash, for which there is no record. He had given cash to Kul Bhushan to repay his wife, rather than to her direct. iv) Although in a witness statement in proceedings in the Land Tribunal (which denied any contribution by the claimants) he said that he had drawn money from accounts of his wife and his son, the copy statements produced in support did not show any payment from his wife's account and only £350 from his son's.

[41]These figures do not cover the whole purchase price, but the defendant has not suggested any other source of funds that can be attributed to him and accepts that the balance over what came from the business accounts (current and loan accounts) was collected from one source or another within the family. It appears that approximately £20,000 may have been raised in that way, without which the purchase would not have been possible. The defendant denied or ignored that assistance in his written evidence. His claim to have paid the whole price depends (save for £350) on accepting that all money provided by family members has been repaid and attributing to him the moneys paid from the business of Mastersons Fashions, either at the time of purchase or later in repaying borrowings from Lloyds TSB and such family members. If he was not the sole owner of Mastersons Fashions, he cannot claim the sole benefit of those payments. It is also true of course that he was personally exposed to Lloyds as borrower on the loan account.

Establishment of Mastersons Warehouse

[42]In 1985 Kul Bhushan made an application for planning permission to use part of the main building at the Windmill Lane site as a retail shop or supermarket. Although initially refused, it was pursued and planning permission was eventually granted for use as a warehouse selling goods to the public. A considerable amount of work was done to make the premises ready for such use. As before the defendant says that he carried out this work, with any involvement of others being relatively small and done under his direction, but I find that their involvement, particularly that of Kul Bhushan, was much more substantial than the defendant is prepared to allow.

[43]In 1990 or 1991 the warehouse opened for trade under the name "Mastersons Warehouse". It is a general trading store selling everything from food and clothing to hardware and building supplies, and despite the "warehouse" name it is open to any member of the public. It is conducted, nominally at least, through a limited company, Mastersons Warehouse Ltd, of which Kul Bhushan and his wife are the sole registered shareholders and directors. There is a business bank account in the name of that company.

[44]The claimants' position is that this business was run in tandem with Mastersons Fashions, that as with Mastersons Fashions it is jointly owned by all five brothers and that the benefits it produced were mixed with those of Mastersons Fashions and applied for the benefit of all the brothers and their families equally. All parties agree that at least £60,000 was spent on the conversion works and purchase of stock, and that this came from the sale proceeds of the shop at 106 Oldbury Rd, which was owned in the defendant's name. The defendant says that he thus did the conversion work at his expense and allowed Kul Bhushan to run the business of Mastersons Warehouse rent free in his (ie the defendant's) premises as a gift or favour to his brother, and that he continues to meet all the heating and lighting costs for the same reason. The Mastersons Warehouse business he says was "placed on Kul Bhushan's name" and is "managed" by Kul Bhushan "with Vinod Kumar and Sat Paul", and Kul Bhushan keeps all the profits.

[45]It is not in dispute that all the brothers and their families have been provided with any items they may need from the stock of the warehouse without payment, including food (referred to among themselves as "rations") which was either supplied from Mastersons Warehouse or purchased specially from shops by one of the brothers and charged to Mastersons Warehouse. Further, money from Mastersons Warehouse has been used to buy investment policies in the names of all five brothers, as referred to below. This clearly is more consistent with the claimants' case than that of the defendant.

Other activities on the Windmill Lane site

[46]In about 1997 108 Windmill Lane, which had been purchased as part of the main site, renovated and previously either empty or used for storage for Mastersons Warehouse, was let out to Mr. Cliff Kelly who ran a takeaway pizza business there. The rent was collected in cash and, according to Kul Bhushan put in the safe with the cash takings from Mastersons Warehouse and Mastersons Fashions. There are some records which show that Gurmel Chand kept track of what was received, and paid it out for domestic and other expenses of the brothers in the same way as other rents received.

[47]In 2000 Sat Paul took over use of this shop and ran a fish and chip shop called "King Fryer". It was subsequently let to various tenants for business purposes and for the most part rents were collected by Kul Bhushan, Gurmel Chand or Vinod Kumar and used for general purposes. At one stage the upstairs was let to a residential tenant receiving housing benefit and in this period the benefit was paid to the defendant, as it was with the Cape Hill shops (see below). It appears that where rent was received from "official" sources it was paid into an account in the name of the registered owner of the property, but when paid in cash from private sources it was held and administered privately without creating any trace in third party records.

[48]Over this period work was required to modify the property for the various business and residential tenants. The evidence of the claimants, which the defendant does not contradict, is that most or all of this work was done by the brothers or their sons,, and that much of the materials required was supplied without charge by Mastersons Warehouse.

[49]In the mid 2000s Kul Bhushan's son Raman established a garage business on part of the Windmill Lane site. For a time this was run or intended to be run in conjunction with a garage business established by the defendant's son Parvinder at 3 Salisbury Rd, a property which adjoined at the rear and was purchased in 2006 in the defendant's name using a combination of money from Mastersons Fashions, rent proceeds held in the defendant's West Bromwich Building Society account and the proceeds of an investment policy in Sat Paul's name. The defendant said this was a loan from Sat Paul, though there is no evidence of it being repaid. The claimants say it was another joint purchase from joint funds, and that as with other properties the work required to make it usable was done without payment by them and their sons, with materials provided or paid for from Mastersons Warehouse.

Other houses occupied by the brothers

[50]By 1986 it is clear that the extended family was too large to be accommodated in 104 St Paul's Rd. Various properties were acquired thereafter to ease the pressure on space.

[51]First was 101 St Paul's Road, which in fact was the house next door to No 104 though there was a space between the two buildings (which formed part of the plot of No 104). This house was bought in 1986 in the name of Gurmel Chand, for £25,000. According to the claimants, this purchase was organised and managed by Gurmel Chand, Vinod Kumar and Kul Bhushan because the defendant and their mother were on holiday in India throughout the acquisition period. The defendant's case is that while they made the initial offer, the purchase took place after he returned, when his brothers acted on his instructions. He had told them to put the property in Gurmel Chand's name as a gift to him because he was working for the defendant in his business at Mastersons Fashions without a wage. There are no documents to assist with resolving this difference. There is no documentary evidence of the source of the purchase funds, but since none of the parties suggests there were mortgage borrowings I infer the price was paid in cash, in which case the most credible explanation would be that it mainly derived from takings at Mastersons Fashions.

[52]Despite the fact the purchase was made in the name of Gurmel Chand, it was the defendant who moved into No 101 with his wife and children. They remained there for 11 years until 1997, when they returned to No 104 and Gurmel Chand and his family moved to no 101. This in my view does not sit easily with the idea that the purchase was as a gift for Gurmel Chand or in lieu of wages, since he did not get any benefit from its use for many years. It tends to support the position of the claimants that the family operated an informal pool of assets, the registered ownership of which was of little relevance to their beneficial use.

[53]In 1988 a house at 10 Lodge Rd was bought, in the names of Vinod Kumar and his wife Giano Kaur, for £50,000. There is no documentary evidence of the source of funds, and Vinod Kumar does not explain it in his witness statement. There is no evidence of any borrowings, so again it must have come from cash retained from one or more of the sources of income. The defendant's evidence is that he had nothing to do with this purchase though he thought it had been made in Vinod Kumar's sole name, and the price must have been paid from Vinod Kumar's own money from trading at the Newtown shop and that at 106 Oldbury Rd. He had previously said (in evidence to the Land Registry) that it came from the proceeds of sale of the Oldbury Rd shop (£60,000) but that cannot be right as that shop was not sold until 1989 and it is now accepted the sale proceeds were used to set up the premises and business of Mastersons Warehouse. I think it unlikely that these shops could have generated that amount, and in any event the shop at Oldbury Rd was being run by three of the brothers, so any contribution from that source must have been agreed by all of them. It is likely in my view that funds from Mastersons Fashions and the rented properties were also used.

[54]Vinod Kumar has lived in 10 Lodge Rd with his children ever since. He was however divorced from Giano Kaur in about 1990. In September 1989 a deed of transfer was apparently executed, recording the transfer of 10 Lodge Rd by way of gift from Vinod Kumar and Giano Kaur to Sat Paul. According to Vinod Kumar's oral evidence, Giano Kaur did this voluntarily, knowing that the house was held on trust for all the brothers and wanting nothing by way of financial relief on the breakdown of the marriage but only to be away from the arrangement in which all the brothers and their families lived jointly as one extended family. This does not however chime well with his written evidence, and the written and oral evidence of the other claimants, which was that when the marriage broke down they were all concerned, especially the defendant, that their most expensive house might be at risk from a claim by Giano Kaur in the divorce and that the defendant had instructed Vinod Kumar to "sort it out" and get Giano Kaur to transfer the property to Sat Paul. The defendant denies that he did this but says that he does not believe Vinod Kumar's explanation, and even doubts that the signature on the document is that of Giano Kaur.

[55]I have no evidence from Giano Kaur herself, but in my view there are a number of reasons to doubt that the explanation given by Vinod Kumar can be wholly true. First, his account of Giano Kaur never wanting any financial settlement is at odds with his brothers who say that they all feared such a claim. Second, if Giano Kaur freely entered into this transfer and did not intend to make any financial claim against Vinod Kumar, there was no need to transfer the property to Sat Paul; her interest could as easily have been given to Vinod Kumar. Third, the transfer itself raises questions. Although drafted by solicitors, it was not executed in their presence, the witness to Giano Kaur's signature being said to be a worker at Mastersons Fashions (though he states himself to be "unemployed"). And generally, it is surprising (though not impossible) that a divorcing wife would want no financial relief from a husband despite (on his account) knowing that she was the joint owner of the family home and he was one of five joint owners of a large and valuable portfolio of properties and businesses. I cannot make specific findings on any of these matters (and do not need to do so for the purposes of this claim) but given all these factors I have concluded that Vinod Kumar's account is unlikely to be the whole truth. The fact he was prepared to put it forward must weigh against his credibility generally.

[56]In 1989 and 1990 a new house, known as 102 St Paul's Rd, was built in the gap between Nos. 101 and 104, on land forming part of the title to No 104 (and thus in the defendant's registered ownership). It is accepted that Kul Bhushan made the application for planning permission and that the planning permission fee was paid from Mastersons Fashions. According to Kul Bhushan, he did most of the construction work, though he also used outside labour. He kept a record of the amounts paid for materials and labour (p 873A) which is not challenged. There is no documentary evidence of the source of funds for these purchases, though Kul Bhushan says they were funded from Mastersons Fashions and Mastersons Warehouse. Kul Bhushan and his family moved into the new house, but not apparently until 1993. According to the defendant it was not quite finished- no kitchen was installed and Kul Bhushan continued decorating it. I was not given any convincing explanation for the delay. Since 1993 Kul Bhushan and his family have occupied No 102 but it has remained part of the title of No 104. The defendant acknowledged that he has promised the house will be transferred to Kul Bhushan, but says the land around it belongs to No 104. No attempt has been made to agree how much of that land, if any, he would transfer with the house.

[57]In 1995 a house at 100 St Paul's Rd, next to No 101, was bought in the name of Sat Paul for £48,500. The defendant accepted that this amount had been paid from Mastersons Fashions, but said this was a gift from him as Sat Paul and his wife had been working in the business without wages. Sat Paul and his family moved into that house and have lived there since. At present, all the gardens of Nos. 100,101,102 and 104 are combined and used by the occupants of all 4 houses.

Cape Hill shops

[58]Two properties were bought on Cape Hill, Smethwick, each consisting of a shop on the ground floor with residential accommodation above. 49 Cape Hill was bought in 1992 in the name of the defendant for £75,000. Again the price appears to have been paid in cash and there is no documentary evidence to show its source. The claimants say it came from a combination of funds generated from Mastersons Fashions, Mastersons Warehouse, the other shops and rents. The defendant says it all came from Mastersons Fashions. The shop was run as a butcher's shop, initially by Sat Paul. The defendant says this was at his request, and without specific payment. It is accepted that this shop provided, free of charge, all the meat requirements for the entire extended family. After a few months, Sat Paul stopped running the shop and it was rented out to an unconnected tenant. The rent was collected by Gurmel Chand, who kept a record of it. The defendant accepted that this was with his consent and that the rent had been used for the benefit of all the brothers, Gurmel Chand's records showing expenditure of items such as utility bills for all of their houses.

[59]43 Cape Hill was bought later in 1992 for £68,000, in the name of Vinod Kumar. The defendant accepted in cross examination this had been paid for from funds of Mastersons Fashions. Copies of bills for rates and utilities were produced in the defendant's name though he denied any knowledge of this (inconsistently with a complaint in his witness statement that he "remained liable" for rates). The ground floor was initially run as a shoe shop by Sat Paul, but later rented out. Again the defendant accepted Gurmel Chand had collected this rent with his consent. It is apparent from Gurmel Chand's rent records that this money too was applied for purposes that included domestic spending of all the brothers.

[60]The upstairs of both Cape Hill shops was let to residential tenants, some of whom had their rent paid by Housing Benefit. It is accepted that this was all paid, for both properties, into a bank account in the defendant's name. It must follow that the defendant was named as landlord in these tenancies and described as such in claims to the Council for housing benefit, even though he was not the owner of one of the properties. Correspondence was produced from solicitors for a Mrs D Kaur as tenant of No 43 addressed to the defendant as landlord, together with a rent cheque from that tenant to the defendant. The defendant claimed to have no knowledge of this tenancy or the cheque, though he then, inconsistently, said that "they" (meaning his brothers) had let the property to Mrs Kaur verbally.

[61]It is apparent, in my view, that all the brothers were content that rents from these properties be received by Gurmel Chand and the defendant, without any segregation or distinction based on the registered ownership of the property.

[62]The claimants also rely on a letter dated 22 April 1992 sent to the defendant by Mr. Corser, a solicitor at Challinors who acted in relation to many (but not all) of the property purchases. He sends a copy of the land certificate for 49 Cape Hill and says "As mentioned to you and your partners I would strongly urge your careful consideration in making wills…". This they say shows that Mr. Corser was aware the brothers were acting as partners even though the particular property was being bought in the name of the defendant. He had told them that with the bulk of their assets in the defendant's name they should take some steps to protect the interests of the others if he should die. Mr. Darton points out that making a will would not be an appropriate way of dealing with an existing joint beneficial interest; it would pass by survivorship to the other joint owners without a will, and if what was required was a record that it existed, a declaration inter vivos would be more appropriate. This letter does in my view show that Mr. Corser had been made aware that the brothers (or some of them) were acting together to some extent, probably in relation to 49 Cape Hill but possibly in other respects, and with the intention that they were to share in some way in the benefits, but it is not specific in any respect as to what was covered, who would benefit or how. 39 Dale St/104/101 Windmill Lane

[63]In 2000 a house at 39 Dale St Smethwick was purchased at auction for £35,000 in the name of Gurmel Chand. The defendant said in his defence that the property belonged solely to Gurmel Chand, that the funds to pay for it came from Mastersons Fashions but he had bought it as a gift for Gurmel Chand and in recognition of his work at Mastersons Fashions. In cross examination however he accepted that the immediate source of funds was derived from a property bought in his name in Heathfield Rd for a relative he described as a "cousin-brother". This had been treated as a loan, and once the relative had been able to repay the cost, the Heathfield Rd house was transferred to him. That repayment funded the purchase of 39 Dale St. The defendant said this loan had been from him, but I infer the source of those funds was Mastersons Fashions so that his claim to be the lender again depends on attributing all Mastersons Fashions' money to him.

[64]In 2005 39 Dale St was the subject of a compulsory purchase order by Sandwell Council. In January 2006 the Council agreed a payment of £95,000 as the value of the property (p2801). Gurmel Chand then however negotiated additional payments totalling £12,000, partly as a "home loss payment" on the basis that 39 Dale St had been his home, and partly as a special addition on the basis that he would buy a house at 104 Windmill Lane as his family home, which was said to be an equivalent property but only available at a price of £107,000. In fact, as he in substance admitted in cross examination (and in any event as I find, since I disbelieved his evidence to the extent he denied it) he and his family lived throughout at 104 St Paul's Rd and never lived or intended to live at 39 Dale St or 104 Windmill Lane. Gurmel Chand lied to the Council to obtain the additional payments. 104 Windmill Lane was bought because it was adjacent to the factory premises at 105-108, and the seller extracted a premium price as a result. The purchase was in fact financed by mortgage borrowing, again on the untrue basis that it was to be used as Gurmel Chand's home. This purchase had already been completed by the time the final payment was agreed by the council, so that it appears the council were also deceived into thinking that their payment was necessary to enable Gurmel Chand's family to purchase a replacement house.

[65]Gurmel Chand's willingness to deceive the council and the mortgage lender counts against his credibility. But the fact he did so in order to acquire a property for the strategic purpose of enhancing the site at Windmill Lane registered in the defendant's name supports the case that that site was regarded as a joint property rather than the defendant's alone.

[66]There is also support for the case that 39 Dale St was a joint asset from a solicitor's attendance note (p2913-4) made in 2007 in relation to the CPO of 42 Dale St (see below). It records a meeting with the defendant and Sat Paul, who were the registered owners of that site, and includes the note "Clients advise they were the owner of 39 Dale St, which was CPO'd by Sandwell MBC. They purchased the property privately in 2000 and it was occupied as a family home until the CPO was executed. The property was purchased with a view to also purchasing number 40 thus increasing the land owned at the site [ie No.42]." From that it appears that the defendant and Sat Paul regarded No 39 as having been bought to enhance the value of No 42, and regarded themselves as owning or having some interest in no 39 as well. That would be more consistent with all the brothers owning both sites than with Gurmel Chand having been given No.39 as his sole asset.

[67]In 2007 another house on Windmill Lane, No 101, was bought in the name of Gurmel Chand for £115,000. In his first witness statement, the defendant said that he had made a gift of that amount to Gurmel Chand, and explained in some detail why he had done so. He now accepts that account was wholly incorrect, and maintains instead that Gurmel Chand bought No 101 for himself and using his own money. I accept the evidence of Gurmel Chand that the funds came from a combination of increasing the mortgage on No 104 (which was in his name), cash held at Windmill lane which may have been generated by Mastersons Fashions or Mastersons Warehouse, rental receipts deriving from properties in the names of various brothers, and a life policy originally funded by Mastersons Warehouse. That tends to support the claimants' case of a pool of assets used for common benefit. Their position is that all three of these properties are held on trust for the five brothers as part of that pool. 42 Dale St (the Smethwick Laundry site), its CPO and use of the proceeds

[68]This substantial site was purchased in 1994 for £106,000, in the names of the defendant and Sat Paul. It was a former laundry building, identified as a potential purchase by Gurmel Chand. It is common ground that it was intended to be developed as a venue for weddings and banquets, but that this was never put into action and the property remained empty and unused for 16 years.

[69]In this case it can be seen (p980) that at least £98,621 of the purchase price was paid from the account of Mastersons Fashions. This appears to be the completion money; the defendant says that the whole price was paid from Mastersons Fashions so I assume a deposit was previously paid from that account also. I note that deposits of £85,000 were made into the account in the days before the payment, so it would appear that the money had been held elsewhere, but since it is common ground that Mastersons Fashions was the source of most or all of the funds I proceed on the assumption that the money had been originally generated by Mastersons Fashions.

[70]According to the claimants, they all discussed and agreed on the purchase, which was to be on behalf of all of them. The defendant's position in oral evidence was that he paid for it with his money (Mastersons Fashions being his business) but he decided to give a half share in it to Sat Paul because Sat Paul was his younger brother who had "already failed in many things and I wanted to support him". He denied any joint decision to purchase but said he had told the other brothers that he intended to buy the site.

[71]However in a witness statement to the Land Registry opposing the restrictions entered by the claimants (p1333) the defendant said "I decided that the 42 Dale St property would be jointly owned between the [claimants] and myself even though it was placed on Sat Paul and my name. I discussed this with the [claimants] who happily agreed to it." No date is given for this, and it is not clear whether this discussion is meant to have taken place at the time of purchase or after. When asked about it in cross examination he gave no clear explanation and was in my view evasive in his replies. If he had held such a discussion at the time of purchase, it would be inconsistent with his initial response that he intended the site to be owned equally by himself and Sat Paul. If afterwards, he has given no reason for the change of heart.

[72]At some point in 2006 or early 2007 the local authority served a CPO in respect of this site also. There were negotiations over the compensation payable, in which it is common ground that Vinod Kumar and Gurmel Chand played the leading roles in dealing with the council and with solicitors and valuers instructed on behalf of the owners. The brothers sought £1.4m, on the basis they had been in discussions with a developer over a sale at that price. The council did not accept that (and the evidence produced in this case does not support any firm intention to buy at that price). There were proceedings at the Lands Tribunal to determine the compensation, in the course of which a witness statement was prepared and signed in the defendant's name setting out a case on behalf of himself and Sat Paul (no mention being made of any interest of the other brothers).

[73]It is now accepted that the defendant did not in fact sign this witness statement, and in cross examination he sought to distance himself from its content, saying he had not read it (or, inconsistently, that he had not read all of it). It is not clear who did sign it, though the overwhelming likelihood is that it was one of the brothers, showing again their willingness to deceive outsiders in the pursuit of family interests. The defendant accepted however before me that he had attended the hearing expecting to have to confirm that witness statement and answer questions based on it, without the benefit of a translator. Although it is in English with no statement as to translation and the defendant gave evidence to me through an interpreter, I am satisfied from the way he answered questions that he was able to understand English spoken to him and to read English, and to make himself understood in English when he chose to. I conclude that he took sufficient part in the preparation of this witness statement to have known its contents and be prepared to affirm them as his evidence if the hearing had proceeded. He was thus party to the presentation of this document as his.

[74]In the event the Lands Tribunal hearing did not proceed, a compromise being agreed on the day under which the defendant and Sat Paul accepted compensation of £800,000. This was clearly the biggest amount received from any of the property dealings to date.

[75]From these proceeds, £125,000 was used to buy a property at 5 Salisbury Rd in the name of Kul Bhushan. That is at the rear of the Windmill Lane site, and is one of a number of houses surrounding and adjoining that site that have been purchased at different times. It is the claimants' case that all were bought with a view to benefitting the main site in different ways, because they all had equal interests in it. The defendant in cross examination initially denied but then accepted that this purchase was made from the CPO proceeds.

[76]In 2008 the Smethwick Working Men's club was purchased for £590,000. It is accepted that the bulk of this was paid from the remainder of the CPO proceeds from 42 Dale St, but some amounts were collected from funds held by Kul Bhushan, Gurmel Chand and one of Vinod Kumar's sons. There are disputes about whether these monies are to be regarded as their own funds, or represent monies held on behalf of all the brothers. It does not however seem to be in doubt that, to the extent the immediate source of those funds was from accounts other than in the defendant's name, the amounts paid were returned soon after by payments from Mastersons Fashions.

[77]The Club property was purchased in the names of the defendant, Kul Bhushan, Gurmel Chand and Sat Paul jointly. There can of course be only four joint holders of the legal title. All parties accept however that Vinod Kumar is entitled to a one-fifth share, though there is no declaration of trust or other document recording that interest. The claimants rely on the fact of this purchase for all five brothers, out of the proceeds of a property apparently owned by only two and originally paid for from monies from Mastersons Fashions ostensibly owned by the defendant, as showing that they have all regarded Mastersons Fashions and all the assets derived from it as jointly owned throughout.

[78]The claimants also rely on a note of a meeting prepared by the solicitors acting in the compensation claim (p1215). The meeting was on 8 February 2008, attended by the defendant, Gurmel Chand and Vinod Kumar (not Sat Paul), three representatives of the solicitors and two from the valuers instructed. It was sent by post to the defendant and Sat Paul after the meeting. It records the then current offer by the council, the hope of achieving £1.4m and the advice that this was unrealistic but a figure around £800,000 might be negotiated, which turned out to be exactly right. It contained the following in a section headed "Background":

“Site was purchased in early 1994 by the clients: Kahan Chand, Gurmel Chand, Vinod Kumar, Sat Paul and Kul Bhushan (being 5 brothers). The registered owners are Kahan Chand and Sat Paul.”

[79]This note is plainly recording the background facts as the solicitors were given them by way of instruction. It reads as if the instructions were given at the meeting, though it is possible that some of it may be information told to them beforehand. Presumably, if not a record of information given by the clients themselves at the meeting, the note must be recording what was said at the meeting in order to bring the valuers up to speed. Either way, therefore, the information recorded here is what would have been said at the meeting by or in the presence of the defendant. It is clear that the solicitors have been told that the site is owned on behalf of all 5 brothers, all of whom are to be clients for the purposes of the instructions in connection with the CPO, notwithstanding that the "registered owners" are the defendant and Sat Paul.

[80]It was suggested that the defendant would not have given these instructions himself, and would not have understood if others had spoken about them in English, and that he would not have read or understood the note when sent to him afterwards in English. I do not accept that. It is plain that although other brothers often dealt with professionals, on many occasions including this one the defendant attended himself. I do not believe he went to participate only through the translation of others, or that even if he was assisted by others that he did not sufficiently understand what was said or written in English. In this case in particular, the solicitors appear to have had no qualms about writing letters to the defendant in English, preparing a witness statement for him in English without any statement as to translation and arranging for him to attend to give evidence at the Tribunal without a translator.

[81]I find therefore that this information was either given by the defendant, or given or repeated in his presence without contradiction by him in circumstances where he would have understood what was being said. It is information imparted in circumstances where no advantage would be gained by telling the solicitors and valuers this if it were not true. It did not form any part of the case put forward for compensation, and so even if it might be thought the brothers would be capable of embellishing the facts to improve their claim, it is not information likely to have been invented for that purpose. I conclude that it accurately represented the position as those present, including the defendant, understood it to be.

[82]It is therefore consistent with that position that the proceeds of the CPO should have been used to buy the Working men's club on behalf of all five brothers, and that 5 Salisbury Rd was also bought on behalf of all of them as the claimants say. The fact that this was the arrangement in relation to 42 Dale St is strong support for the claimants' case that the same applies in respect of Mastersons Fashions, from which the funds came, and that other properties were bought on a similar joint basis.

The Tividale Houses

[83]After the manufacturing business was moved from the Methodist Church site to Windmill Lane, the former lay vacant for some years. It became vandalised and the church itself was burnt down. In 1988 Kul Bhushan applied for planning permission to demolish the church and cottages and build 3 new houses. After some delay, planning permission was obtained and work began in 1993. This application was made in the name "B Chand" and using an architect called Alan. Kul Bhushan's evidence is that it was he who knew and worked with Alan, and that Alan knew him as "Bhushan", assumed that as he was the defendant's brother his second name would be "Chand" and so completed the application forms in the name "B Chand". I did not find this wholly convincing, but it is clear from the documents that in this and other cases Kul Bhushan has used the name "B Chand" in dealings with authorities, for whatever reason. It is the defendant's position that Alan was his architect and everything Kul Bhushan did was on his instruction, but there is nothing in the documents to suggest that is the case and I do not accept it.

[84]Construction of the shells of the houses was done by a builder called Barry Astbury, for a fixed labour only price per house. Kul Bhushan kept reasonably detailed records of what was paid to Barry and in the purchase of materials and other external labour. It is his evidence, which I accept, that he was effectively in charge of administering the construction work, arranging for labour and materials as necessary. I also accept his evidence that he did most of the subsequent work on the houses himself in the 1990s (he would say all of it). The defendant said that all the costs were paid from Mastersons Fashions, mostly from cash held and so not showing in any bank statements, but also accepted that some had been paid from the rents collected by Gurmel Chand. Kul Bhushan says that part of the costs was paid from Mastersons Warehouse.

[85]The houses were not immediately finished off. Kul Bhushan's records of payments to Barry (and another builder who finished the shells off) run up to the end of 1993 (p960). His records of materials purchases are mostly undated, but such dates as there are end in early 1997 (pages 961-8). It appears that the houses lay unfinished between 1997 and about 2004. The defendant says this was "in part" because Kul Bhushan refused to do any further work on them as he did not own them. Kul Bhushan denies this, but gives no other explanation save that he was needed at Mastersons Warehouse at the time.

[86]In 2003 or 2004 work resumed, this time done by Parvinder (the defendant's son) and Rajan (Kul Bhushan's son). The claimants say that Vinod Kumar's son Aaron also assisted. The houses were completed one by one and two of them were let out. It was agreed that Parvinder and Rajan could between them keep a year's rent in return for the work they did. The defendant says this was his agreement alone; the claimants say they all agreed it and that some materials continued to be provided without charge from Mastersons Warehouse. When the last house was finished, Parvinder moved in to it with his family. Parvinder gave evidence and said that his father had given the house to him, though he had not had it transferred in to his own name because he was recently married and did not want to have assets in his own name as he could not be sure how the marriage would work out. 36 Lothair Rd Leicester and the travel agency

[87]In 1999 a house at 36 Lothair Rd Leicester was bought in the name of Pritam Rattu, the defendant's son. The price of £33,000 was paid from the proceeds of an investment policy purchased in the defendant's name. According to the claimants, that policy had been purchased from "family funds". The defendant says it was his money. The house was initially lived in by another son of the defendant, Kulvinder, whilst a student at Leicester. From 2000 various other children of the brothers (but never Pritam) lived at the house while they studied in Leicester. None of them paid any rent.

[88]In February 2000 two houses in St Paul's Rd, Nos 339 and 342, were bought at auction. The auction was attended by Gurmel Chand and Vinod Kumar and No 342 was registered in Gurmel Chand's name while No 339 was registered in the name of Vinod Kumar's son Ajay. The defendant says in his Defence that these were bought from funds of Gurmel Chand and Vinod Kumar respectively and are nothing to do with him. The claimants say they were bought from family funds, ie money generated by Mastersons Fashions or Mastersons Warehouse, and are held on trust for all the brothers. Vinod Kumar's explanation for the purchase in the name of Ajay was that although it had been agreed he should go to the auction and bid on anything he thought suitable, afterwards the defendant had objected to the purchase of no 339, which was in a poor state and had a closure order from the local authority. His witness statement said it was intended to do the property up and resell it, and it was put in Ajay's name as he might be able to get a mortgage (I do not follow how this would work if Ajay already owned the property). In oral evidence he said it had been put into Ajay's name to hold until the defendant calmed down and accepted the purchase.

[89]The defendant said he had not gone to the auction and it was not his concern what the claimants bought at it. He had to accept however that it appears from the bank statements that no 342, at least, was paid for out of the account of Mastersons Fashions (vol 5 p1046), so if his version was correct the money used was, on his case, his, not Gurmel Chand's. That does not fit well with the defence or the defendant's professed lack of interest.

[90]Pritam had in 1998 bought out a travel agency business. He was allowed to move it into the Windmill Lane premises. From his oral evidence, its main activity seems to have been in sale of discounted air tickets. In 2000 there was what the claimants describe as a family crisis when Pritam went on holiday and substantial creditors came to the premises demanding payment of their debts. On their account, the family rallied round to pay the debts in order to bale Pritam out. The defendant appeared to play down the extent of the problem, but accepted that the debts had been substantial. His position is that he paid all the debts from his own money, with only temporary assistance from his brothers.

[91]What can be ascertained from the documentary and witness evidence is as follows: i) It was discovered that Pritam had mortgaged 36 Lothair Rd to one of his largest creditors, who was apparently owed about £45,000. Funds were paid from Mastersons Fashions, and from cash held at Windmill Lane, to clear that debt. 36 Lothair Rd was then transferred into the name of Kul Bhushan. The claimants' case was that this was decided on by all the brothers, Pritam having held the property on trust for them and wrongly charged it without their agreement. They insisted that if his debts were to be paid, the property must be transferred to one of them to prevent Pritam misusing it again. ii) 19 Brunswick Gardens (in the name of Kul Bhushan) and 339 St Paul's Rd (in the name of Ajay Kumar) were put up for auction to raise money to pay creditors. No 339 failed to sell, but in November 2001 19 Brunswick Gardens was sold and proceeds of some £52,000 were paid to the account of Mastersons Warehouse (p 1089). From that account, at least two cheques totalling £41,000 were drawn to pay Pritam's creditors (p 1090) in December 2001. The defendant's case is that he asked Kul Bhushan for help in this way, and in return agreed to ensure that Pritam transferred 36 Lothair Rd to Kul Bhushan as repayment. iii) It appears that the transfer of 36 Lothair Rd took place shortly after the sale of 19 Brunswick Gardens. A solicitor's letter at p2785 dated 21 January 2002 and sent to Pritam refers to a proposed transfer of that property to Kul Bhushan, which was held up because "it would appear that a caution has been registered against the [property] by Jatinder Rai Taheem on 23 May 2001". The documents disclosed include a legal charge by Pritam Rattu to Mr. Taheem dated 18 December 2000 (p 2784) and a letter from HMLR, sent to Pritam on 19 March 2001 refusing an application to register what is presumably that charge. It would appear that this refusal may have led to the registration of a caution instead, and that it may have been the solicitors' letter in January 2002 that revealed this charge to persons other than Pritam. iv) If so, that discovery came after the proposal to transfer 36 Lothair Rd to Kul Bhushan and was not the cause of the decision to transfer. On this point, then, it is more likely that the defendant's account is correct and the transfer was reimbursement for the monies raised on sale of 19 Brunswick Gardens. v) One other payment can be traced, £5,000 paid from an account of Gurmel Chand in January 2001 to Takhar Travel, which the defendant accepted was one of Pritam's creditors. Others were said to have been made (and the defendant appeared to accept this) from cash held at Windmill Lane and administered by Gurmel Chand and/or from rents collected and held by Gurmel Chand. It was suggested this amounted to £25,000. The defendant accepted that it was "a lot" but not as much as that.

[92]I am satisfied that the family did rally round to help with Pritam's creditors, and that to some extent at least they used money which could not have belonged to the defendant. The extent to which this can be shown however is limited to £5,000 paid by Gurmel Chand from his own account, and an unidentifiable portion of an unidentifiable amount paid from rent receipts partially derived from properties not in the defendant's name. There may have been more from cash at Windmill Lane derived from Mastersons Warehouse, but the amount cannot be ascertained. To the extent Kul Bhushan funded payments from the sale of 19 Brunswich Gardens, the evidence is more consistent with his having been reimbursed by Pritam transferring 36 Lothair Rd to him. If 19 Brunswick Gardens was as the claimants say held on trust for all the brothers, it would be consistent that 36 Lothair Rd which replaced it would be held on like trusts, whether it had previously been Pritam's separate property or not.

[93]It was said that the cash crisis caused by Pritam's debts was such that other activities had to be put on hold, and that this was one reason why the Tividale houses lay uncompleted. I think that is unlikely to be the main reason, since the gap in work seems to have begun before 2000 and the eventual cost of finishing off was relatively small, such that it could be compensated by a year's rent.

Running of the businesses of Mastersons Fashions and Mastersons Warehouse

[94]The claimants say that although these two businesses were for some purposes presented as being separate and separately owned, in reality they were operated as one combined business in which they were all in effect partners. The defendant maintains that they were separate, and to the extent his brothers were involved in Mastersons Fashions, they were acting as, in effect, his employees and working on his behalf.

[95]It is accepted that both businesses operated on the Windmill Lane site without any rent being paid to Mastersons Fashions, though Mastersons Fashions paid all the utility bills, insurance and business rates for the whole site.

[96]Mastersons Fashions was for some purposes presented as being the defendant's business. He had the bank accounts in his name "trading as Mastersons Fashions". It is common ground that at various points and to different extents all the brothers and their wives worked in that business, and that none of them was paid any salary or equivalent form of remuneration for that work.

[97]For a period of several years however (it is not clear exactly how long, but such tax assessments and other records as exist suggest it was at least from 1991 to about 1996) Mastersons Fashions was presented to Her Majesty's Revenue and Customs as being owned by a partnership consisting of the defendant, Gurmel Chand, Sat Paul and their respective wives, each being equally entitled to profits. There was no reality to this partnership; no such division of profits took place and the wives in particular never received any financial reward paid to them for their work or supposed ownership. The bank accounts were not transferred into joint names. When that presentation came to an end the defendant simply told the tax authorities the business was his and accounted for tax as if all the declared or assessed income was his. He paid nothing to buy out the supposed shares of the other supposed partners. A "Mastersons" trade mark with a windmill logo that had been registered in the names of the "partners" has not been transferred to the defendant. It seems to be accepted by all the brothers that this presentation was made on the advice of an accountant that it would reduce tax to show the income as being spread among more people. I am satisfied that it was a fiction to avoid tax. It does not correspond to either side's case as now put forward, and the fact that it was put in place tends to support the claimants' case that the external presentation of ownership was regarded as a matter of expediency, variable at will.

[98]Between 1982 and about 1985 steps were taken to establish a new trade name of "Rainbeater" or "Raincheater". Trademark searches were made in those names. A company called Rainbeater Weatherproof Clothing Ltd was incorporated, the shares being held by Kul Bhushan. He opened a bank account in his name "trading as Rainbeater Weatherporoof Clothing". I accept the evidence of the claimants that the name "Rainbeater" was used on garments made by Mastersons Fashions, and that neither the company nor he traded separately using that name. The company was incorporated only to protect the trade name, and was dissolved when it proved an unnecessary expense. The defendant had no alternative explanation. The fact Kul Bhushan took these steps is consistent with his having an interest in acting for the benefit of Mastersons Fashions, and so supports the claimants' general case.

[99]I heard evidence from two witnesses who were major customers of Mastersons Fashions. Mr. Harold True was the director of Whatbaron Ltd, which for a period in the 1990s was the principal customer for clothes. He said he had originally purchased from a seller in Walsall, but been approached direct by Kul Bhushan, Sat Paul and Gurmel Chand who had driven to his premises and introduced themselves as the company that made the clothes for his supplier. They had persuaded him to cut out the middleman and order direct, following which his business with Mastersons Fashions built up to a point at which he was ordering about 1000 garments per week, which he thought was virtually the whole production.

[100]Mr. True did not know how the brothers had come to contact him. He visited Windmill Lane and the previous factory once or twice per week to check on production and collect garments. He knew that there were 5 brothers but dealt wholly or mainly with Gurmel Chand, whom he knew as "George". He had not found out that the defendant was Gurmel Chand's brother until 2 or 3 years into the trading relationship. He had no business discussions with the defendant and did not have the impression that he was the driving force behind Mastersons Fashions, or its owner. It was suggested that the defendant had made deliveries to him, but he said he did not recall that. Kul Bhushan had come on occasion, but not the defendant.

[101]In about 2000 Whatbaron Ltd had gone into insolvency and Mr. True started a new company, Whatbaron 2000 Ltd. Mastersons Fashions had been owed about £45,000 and he negotiated an arrangement with Gurmel Chand that this would be recouped over a period by an additional price paid on orders from the new company. In this important financial matter therefore he did not deal with the defendant.

[102]Mr. Trevor Dolman bought fishing garments made by Mastersons Fashions. He said that his business began in about 1994 and between 2000 and about 2008 he had been spending about £80,000 pa with Mastersons Fashions. Almost all his business dealings had been with Gurmel Chand, though he occasionally dealt with Vinod Kumar or Kul Bhushan. He saw the defendant occasionally at the factory but had little or no dealings with him and hardly saw him after about 2000. It was "not [his] experience" that the defendant was the driving force or owner.

[103]Documents were also produced showing dealings with customers in Scandinavia who met and spoke to Kul Bhushan and Gurmel Chand in relation to their orders, and establishing a bank account for Mastersons Fashions in Sweden (in Kul Bhushan's name) into which these customers could make payments. There was no mention of any contact with the defendant.

[104]Gurmel Chand kept the manual ledgers recording all sales invoices raised by Mastersons Fashions, and also all the purchases made, from which the VAT returns were made.

[105]Kul Bhushan was a signatory on the Mastersons Fashions bank accounts from about 1985. The defendant said this was a matter of convenience put in place when he went to India one year, which he simply left in operation. He said that he always knew what was being paid and how much was in the account. It was apparent however that Kul Bhushan had been principally responsible for payments out of the accounts, and that the financial affairs of Mastersons Fashions had been principally dealt with by Kul Bhushan and Gurmel Chand. When the defendant was asked about a number of payments it transpired that he did not know what had happened and resorted to saying that "my assistants" or "my secretaries", meaning his brothers, had made all the arrangements.

[106]It was also clear from the evidence of all the brothers that cash generated by both businesses at the Windmill Lane site had been kept in a safe at the premises, to which Gurmel Chand had the key, and that it was Gurmel Chand who had control of that cash. When any of the brothers wanted cash, for business or domestic purposes, they would go to Gurmel Chand and ask for it. Sat Paul said that Gurmel Chand had kept records of the cash held and what it had been spent on, which would be consistent with his practice of keeping detailed records of rents received and how they were spent. However, no such records have been produced. From the description of operations given by the claimants, it seems likely that substantial amounts of cash were generated and held in this way, and paid out by Gurmel Chand for any purpose the brothers asked. The defendant appears to accept that this was so, and one of his complaints is that by the time he was given access to the safe there was very little cash in it.

[107]I find that the defendant did not exercise any real degree of control or supervision over the handling of the financial affairs of Mastersons Fashions. The degree to which Kul Bhushan and Gurmel Chand particularly were engaged in the conduct of its key business and financial transactions is indicative of their acting in an executive capacity consistent with ownership and not, as the defendant said, as being his employees, assistants or secretaries. Mingling of funds of Mastersons Fashions and Mastersons Warehouse and application for benefit of all the brothers

[108]I have referred above to the mingling of cash from both businesses in the safe at Windmill Lane, the use of that cash for the personal benefit of all the brothers and the routine supply of goods from Mastersons Warehouse for similar personal benefit.

[109]It is the claimants' case that funds of Mastersons Warehouse and Mastersons Fashions were effectively regarded as one pot, and treated as belonging to all the brothers. They point to an occasion in April 2002 when Vinod Kumar realised some £18,000 from an investment policy in his own name and paid it out (vol 18 p 4979-80) as to £15,000 to the account of Mastersons Warehouse and £3,000 to Mastersons Fashions, in each case such that overdrawings on those accounts would be cleared. The defendant said he had no knowledge of this, which would not be consistent with his claim to be familiar at all times with the operation of the Mastersons Fashions account. There is no obvious reason why Vinod Kumar would feel responsible for the overdraft of either business if he did not have a personal stake in them.

[110]Substantial amounts were paid to buy investment policies in the names of all five brothers. There is no full record of these, but the documents disclosed show: i) In May 1988 investments were either made or discussed for each brother in a "Veronica Plan" with a company called CCL (p 3366ff) ii) In the same month investments were made of £18,000 for each brother with a company called Queen St Trust Company in Jersey (p3371 ff). These payments appear to have been made by Mastersons Warehouse. iii) In June 1988 regular premium pension plans were established with Norwich Union for each brother and certain of their wives iv) There appear to have been other policies for each brother with Standard Life (p 3434, it is not clear whether these were investments), investments worth about £37,000 in the name of Gurmel Chand with CoOperative Insurance (p 3439) an investment worth approximately £8000 in the name of Sat Paul with Zurich Insurance, and policies with Century Life in the names of the defendant and Gurmel Chand (it is not clear whether these were investments)

[111]The premiums for these policies were all paid from either Mastersons Warehouse or Mastersons Fashions.

[112]Substantial amounts were paid from both businesses towards the cost of weddings for the sons of the brothers. No comprehensive records exist, but all the estimates that the brothers gave ran into many tens of thousands of pounds. One relevant document was found, a receipt for £6,000 paid for hire of a venue for Ajay's wedding in August 2008. The defendant denied agreeing to pay this amount and said it had been done without his knowledge by the others. But when the original was inspected, it showed that he had signed the order himself, though in the copy he disclosed his signature had been obscured.

[113]All of this evidence in relation to the running of the businesses and the use of funds generated by them is in my view much more likely to indicate that they were regarded as effectively one business in which all the brothers had an interest, rather than the separate ownership and individual acts of generosity that the defendant asserts.

Meetings in August 2010

[114]The claimants rely heavily on two meetings held on 11 and 12 August 2010. At the first, four of the brothers (but not Sat Paul) were present. They say that the purpose was to discuss a division of their joint "pot" of assets, a matter which had been raised several times previously but which the defendant had always deferred. At that meeting, an agreement in principle was reached on the following broad terms: i) Each brother would have one commercial property and the house he was living in. ii) So far as commercial properties were concerned, the defendant and Vinod Kumar would keep the shops in their names (43 and 49 Cape Hill). The Windmill Lane site would be transferred to the joint legal and beneficial ownership of Kul Bhushan, Gurmel Chand and Sat Paul. iii) Insofar as the residential properties were concerned, they would be transferred to the brother living in them, where not already so held. They were regarded as being of approximately equal value. iv) No adjustments needed to be made in respect of properties already jointly owned (ie the Smethwick club and certain land in India) v) There would be a division of other properties held such that each brother held property of equal value.

[115]On the claimants evidence, no final agreement was reached for a number of reasons: i) There was disagreement about the values of some of the investment properties, and the amount of mortgage borrowings against them ii) The defendant argued that certain properties that had been acquired in the names of sons of the claimants should be brought into account. He said that they had been paid for, in part or wholly, with the proceeds of the businesses and should be treated as the property of the brothers and not their sons.

[116]A further meeting was arranged for the next day, to which Sat Paul came as well, to finalise the agreement. However at that meeting the defendant refused to discuss matters further, said that "what's on my name is mine and what's on yours is yours" and walked out.

[117]A document was produced at the first meeting. It commences with a list on 7 lines of properties and values which the defendant accepts is in his handwriting. He accepted in cross examination that this was done with a view to agreeing a division, and that it referred only to those where there was no agreement in principle (ie it excluded the residential and commercial properties). It includes the Tividale houses, which were in his name and against which he has written a value of £750,000. Some of the values have been crossed out and overwritten by him, which suggests he was party to some discussion about those values. It also includes two houses in Rotton Park Rd bought in the name of Sat Paul, the second of which had been mainly paid for by the proceeds of an investment policy in Sat Paul's name. The claimants say this shows the defendant regarded that policy, and the house it paid for, as part of the joint pool of assets.

[118]Below the entries written by the defendant is a final line referring to a property described as "Garage", which refers to the property at 3 Salisbury Rd in the defendant's name, a value of £90,000 for it and then a total of all 8 lines, amounting to £1,945,000. Below that the values have been added up for properties held by Gurmel Chand (£225,000), Kul Bhushan (£225,000) and Sat Paul (£490,000) respectively and a balancing figure of £840,000 which represents the Tividale houses and Garage in the defendant's name. The figures do not exactly reconcile, according to the claimants because some amounts were deducted for mortgages in one place but not another. It is accepted that Kul Bhushan wrote everything on the "Garage" line and below.

[119]One of the lines written by the defendant reads "Kul-Vinod ½ 1 …100… 100,000". The value was originally written as [£]50,000 and then overwritten as [£]100,000. The defendant's evidence was that Kul Bhushan and Vinod Kumar had told him that they owned a property between them, so he had written it in the list. I consider this unlikely since there is no such property, and that their explanation is more credible, which is that the defendant said he knew there was another property in Ajay's name which he regarded as owned by one or both of them, and (probably) that they had suggested that it should be regarded as half Ajay's so they should be regarded as owning half, but the defendant insisted on including the whole value.

[120]The defendant's evidence was that he came to this meeting without being told what it was about, stopped writing this list and left when his brothers started arguing about which properties should be included and their values. He accepts though that he engaged in a discussion with a view to dividing the assets, and in his defence accepts that the agreed the terms relating to the residential and commercial properties (though he sought to resile from this to some extent in oral evidence). I think it unlikely he would have done this if the meeting was as much of a surprise as he says. He also accepted that the meeting was to be reconvened the next day to reach agreement on the matters the claimants said were outstanding, and obtain Sat Paul's agreement. He had plainly therefore not rejected the idea of a division of assets even at the conclusion of the first meeting. The fact that he was prepared to engage in the discussion as far as he did is not in my view consistent with his having held the view up till then that each brother held entirely separate property and had no interest in what was not in his name. The fact that he included certain properties in the list supports the claimants' contention that he knew they had been acquired on behalf of all of them.

Conclusions in relation to ownership

[121]Although there are matters which indicate that the evidence of the claimants may not be wholly reliable, in my judgment their evidence in general fits better with the objective and external evidence than that of the defendant. This does not mean either that I accept wholly the claimants' evidence, or reject entirely that of the defendant, but on the whole I think it more likely that the claimants account can be relied on.

[122]In relation to the early period in the history of events I have described, the picture that emerges in my view is that of a traditional family under the close control of the head of the household, initially Kartara Rattu and after his death his wife Chanan Kaur. From the time the family first came to England, I find that the major family decisions were taken by them in that role. When Kartara Rattu died, I prefer the evidence of the claimants that their mother was regarded as head of the household to that of the defendant, who maintains that he took over this role. In the years after Kartara Rattu died, all the brothers continued to pay over their wages to their mother who controlled the family's money; this role did not pass to the defendant as eldest son. The family home at 25 Albert Rd was transferred into her name, and its successor at 66 Murdoch Rd was bought in her name.

[123]There is no evidence that Chanan Kaur kept any part of the money she received separately for each of her sons. Insofar as the defendant maintains that she agreed to do so in his case, I do not accept that. Instead, as far as can be told now, she received money from various sources and simply mixed it and applied it as she thought fit for the family's benefit, either in day to day expenses or in acquiring the assets she no doubt expected to benefit her sons in due course. The effect of this mixing of funds under her control would be that she became the beneficial owner of the money each of her sons paid to her. When an asset such as a house was bought with that money, the ownership of that asset would depend on her intention as expressed at the time, and is not to be treated as relating back to the respective contributions to the mixed fund.

[124]I reject therefore the defendant's case that he is or was entitled either to the whole or some ascertainable share of the assets purchased from that fund merely because of his contribution of wages to it. Insofar as assets were bought in his name from that fund, the prima facie position would be that they were legally and beneficially owned by him, in the absence of proof of a contrary intention at the time of purchase. However, if such a property was subsequently sold and the money paid back to Chanan Kaur, then ownership of that money would vest in her, again subject to proof of a contrary intention at the time.

[125]I am not satisfied that, in this early period, there is any sufficient evidence of a contrary intention. Insofar as the defendant claims any interest in 25 Albert Rd or 66 Murdoch Rd it is only as a consequence of some of the price (an amount which cannot be determined) having originated from his wages, which is insufficient. Nor however am I persuaded that the claimants' case of a general intention from the start of common ownership of all the assets bought is made out. Their evidence was that their mother particularly told them frequently that they should always "live together and work together" and that whatever was bought was for the benefit of them all. The defendant accepted the first part of this, but maintained that nothing had been said about ownership of assets and it would have been up to his parents, and later to him, as head of the household to determine how much and in what respect the others would benefit.

[126]Insofar as the claimants said there had been specific discussion of ownership before or at the time of acquisition, I am not persuaded that this recollection can be accurate in the early years, when they were not all working and some would have been too young to participate in such discussions. Their own recollections of it varied, and as I indicated above seemed to me to be more based on their ideas now of what would be a fair outcome rather than any real recollection of discussion at the time.

[127]It is in my view perfectly plausible that in this period Chanan Kaur would provide funds to buy assets in the name of her eldest son, expecting (but without creating or imposing any trust) that he would deal with them for the benefit of the family and in accordance with her wishes as head of the household, and that he would comply with those wishes. The result would be that 77 Hamilton Rd, the family's interest in 65 Hamilton Rd (where there was plainly an agreement to share ownership with Mr. Tooray who paid part of the price) were at the time beneficially held by the defendant, but when he sold them and paid the money back to his mother it became hers in law and in equity.

[128]So far as 121 Murdoch Rd is concerned the position is less clear since the evidence is that although purchased in the defendant's name the rent when collected was paid to and applied by Chanan Kaur. But even if the defendant was the beneficial owner of that house, the evidence is that when it was sold he paid the proceeds to Chanan Kaur and it was she who decided how they would be dealt with, so that she would have become the owner of the money even if she had not been the owner of the house.

[129]This position changes, in my judgment, from 1976 onwards, with the purchase of 19 Brunswick Gardens. That purchase, I have found, was the result of a joint discussion between all the brothers and their mother. It is true of course that the fact of such a discussion does not necessarily mean that all were to be joint owners- other arrangements would be plausible in principle, for example that Mrs Kaur would use her funds to buy assets for each brother in turn, or that any assets would be bought in the name of one of them but their use would be controlled by informal family arrangements, not amounting to a trust, so that all would benefit in a way that Chanan Kaur would from time to time direct.

[130]But the evidence of what the family actually did thereafter in my judgment overwhelmingly supports the case that they agreed to work together in business and build up assets in common. 19 Brunswick Gardens was presumably originally intended as a property investment, but the beginnings of the trading businesses quickly emerged with the market stalls and shops, developing into the manufacturing business that became Mastersons Fashions. The germ of that idea seems to have been formed early on, with initial cutting work being done at 19 Brunswick Gardens but soon after looking for premises into which to grow, beginning with Suffrage St. All of the brothers worked in this joint enterprise in different ways, and in my view the roles they played were much more consistent with being owners than with four being unpaid employees of the defendant dependant on his whimsical generosity.

[131]So far as can be ascertained at this distance in time, all of the income and benefits of all the businesses seem to have been shared between them all. It is true that few records exist, so that it is not possible to say that each brother accounted for everything he received, but there is very little if any evidence at least from the early years that any of the brothers built up any substantial separate assets or funds. Benefits in kind from the shops and the warehouse were provided to all five families. Investments were purchased from the funds of Mastersons Fashions and Mastersons Warehouse for each brother without regard to their ostensible ownership of those businesses. The proceeds of those investments were applied in the purchase of properties which were not always in the same ownership. Rental income from properties and cash accumulated at Windmill lane were aggregated and applied without distinction as to origin.

[132]Importantly also, although distinctions as to ownership were presented to outsiders, these did not correspond with the way the properties, businesses and their income were treated between the family members. The nominal ownerships of the businesses of Mastersons Fashions and Mastersons Warehouse and the rental properties bore no relationship to the way in which the income and proceeds derived from them were used. The decisions to use those funds were taken by people other than the ostensible owners- Kul Bhushan and Gurmel Chand in particular had and exercised the power to deal with money generated by Mastersons Fashions. I do not accept that they did so as assistants or secretaries to the defendant. When the major financial issue arose of the CPO of the Laundry site it was described to the professionals acting as being owned by all five and the proceeds obtained were predominantly reinvested in the Smethwick club owned on the same basis.

[133]Finally, in my judgment the defendant acknowledged the existence of such an arrangement when he took part in the discussion of the division of assets at the meeting of 11 June 2010 and began to compile his own list of the assets to be divided. He did not even in his own evidence say that he did this as a way of finalising the claims on his own generosity and family duty to his brothers, but only that it did not result in a concluded agreement and so was not binding. Its importance is not as a binding contract but as evidence of the pre existing arrangement between the brothers, supporting the common intention trust they rely on.

[134]There were matters referred to which might have pointed in the other direction- Mr. Darton relied particularly on these: i) 10 Lodge Rd was bought in the name of Vinod Kumar and his wife, whereas no other wife was given even a nominal interest in any assets. The defendant said the property was purchased from shop income received by Vinod Kumar, showing he treated that income and the house he bought as his separate assets. But there is simply insufficient evidence to show where the money came from. The claimants' account that it was paid for from a combination of money held by Chanan Kaur and/or deriving from a combination of the various shops and Mastersons Fashions is equally credible. No corresponding entries have been traced in the bank account of Mastersons Fashions, but it seems clear that Mastersons Fashions as well as the other businesses operated to a significant extent on a cash basis. It is not inconsistent with the general idea of operating a pool of assets that they might be held in different names- the brothers might very well have considered for instance that it would reduce the risk of jealousy between them or if any of them were pursued by outside creditors or matrimonial claimants. ii) 104 St Paul's Rd was purchased in the defendant's name, using money provided by Chanan Kaur. But I see nothing inconsistent in her doing so for the purposes of a home to be occupied by all the sons whom she wanted to live together as she did to acquire businesses in which they would work together. iii) Many of the properties were paid for in whole or in part using funds from Mastersons Fashions. But since as I find the business of Mastersons Fashions was established by the brothers jointly, its income and funds belonged to them all and not just to the defendant as he would seek to claim, even in respect of periods in which he allowed it to be presented to the tax authorities as owned by a partnership of six. iv) The transfer of 10 Lodge Rd to Sat Paul is unexplained. It is true it has not been satisfactorily explained, and there may be an inference the transfer was intended to keep it away from claims by Giano Kaur. But it is not inconsistent with that property being regarded as part of the pool of assets, even if Giano Kaur was not told of the existence of that pool. v) The accounts of Mastersons Warehouse show that it did not produce the money necessary to support the expenditure claimed to have been paid from it. I do not have accounts for all the years in question, and it is not safe to assume that those I do not have would show similar income to the ones that were produced. In any event, it is clear the family were perfectly willing to deceive outsiders as to their affairs and if as appears very likely Mastersons Warehouse was generating significant amounts of cash it would be entirely plausible that it would not all be reflected in the accounts prepared for the tax authorities. vi) Some funds for later purchases were provided by brothers or their families and repaid after the purchase when funds were available, showing that they regarded themselves as having accumulated separate assets outside the "pool". The evidence on this was not always clear, but in any event it does not seem to me that the claimants case requires that all assets and funds held by any of them are part of the "pool". It is clear that each of them received cash from the various income sources that were pooled, and if they then put that in separate accounts or investments it would be necessary to examine the facts in each case to see whether this was regarded as an investment on behalf of the pool or as their own application of money distributed from the pool to them. A particular instance arose in respect of accounts and premium bonds held by Gurmel Chand, but he accepted that these were held on behalf of all the brothers, and will have an obligation to account for them accordingly. vii) Certain assets have been bought in the names of sons of the brothers. One was 36 Lothair Rd in the name of Pritam. In relation to this property, it seems to be accepted that all the brothers knew it was to be bought by Pritam and so consented to any use of "pooled" funds involved. There is no convincing evidence of any discussion or agreement at the time that Pritam would hold it on trust for the brothers, with the result that in my judgment it was beneficially owned by Pritam. The brothers may no doubt have expected their own families to benefit from its existence by using it if studying in Leicester. Whatever its status during Pritam's ownership, it came back in to the "pool" when transferred to Kul Bhushan after the sale of 19 Brunswick Gardens. That was not, as I find, to compensate Kul Bhushan for allowing his personal property to be used to meet Pritam's debts, but to compensate the "pool" for the use of a pool asset. viii) Other properties have been purchased in the names of children of the claimants. In respect of some of these (eg 339 St Paul's Rd and others purchased by Ajay and a property in Brighton purchased in the name of Kul Bhushan's son Anil) it is accepted, or emerged in the evidence, that funds from the businesses of Mastersons Fashions and/or Mastersons Warehouse had been used to assist the purchase. The claimants said that the defendant had been aware of and agreed to these purchases at the time, but they would be happy to treat the funds used as having been borrowed by them from the "pool" in any division of assets the court might order. I am not however satisfied that the defendant did know of these purchases, not least because he was unable to include particulars of them in the list he compiled for division at the meeting of 10 June 2010 and I am sure would have done if he could. I infer that by the time these purchases came to be made the claimants may have been seeking to protect their position by seeking to acquire assets for their families to balance what they saw as an excessive build up in the name of the defendant and his family. It would be appropriate in my judgment as between the brothers to treat any property shown to have been contributed to from the "pool" monies as if it had been purchased by the relevant brother himself, so that its whole value comes into account and not just the money used. There may be properties to which this does not apply- Vinod Kumar gave evidence for instance that his son had bought two buy-to-let properties in Birmingham with the aid of a mortgage funded by the rents themselves. If so, I see no reason why that should not be regarded as belonging to his son; the arrangement the claimants contend for is not one in which all assets of any member of their families would be pooled.

[135]It is of course also necessary that a party seeking to show a common intention constructive trust must have relied to his detriment on the agreement contended for. There is no difficulty in that regard here as each of the brothers himself worked in the various businesses bought or established (and procured that his wife would do so) in circumstances in which he was not on the face of it entitled to any reward from those businesses or interest in the assets.

[136]It is not in the circumstances necessary to go on to consider the cases based on Pallant v Morgan or proprietary estoppel. I would say only that I do not consider the facts would fit easily with Pallant v Morgan since there is no suggestion that one or more brothers had the opportunity to acquire particular properties but stood back in favour of another, and an agreement for joint ownership fits more easily with a common intention trust than a promise of an interest in the property of another.

[137]On the principal issue in the case then I find in favour of the claimants. It follows that insofar as the claimants have since the dispute arose taken control of the business of Mastersons Fashions and the defendant and his family have assumed control of the working men's club (as they have, though I have not reviewed the evidence in those regards) there will have to be orders for accounts to be taken. I anticipate that these and other consequential matters will require an order to be worked out and perhaps further hearings. I invite the parties to seek to agree directions accordingly. If they cannot do so I will consider directions at the handing down, or, if a hearing of more than 30 minutes is required, fix a later hearing if the parties will provide an agreed time estimate.