Trusts Law And Reasons For Appeal - Essay Example

Trusts Law And Reasons For Appeal Re Bogusz [2013] EWHC 1449 (Ch) 1. The High Court decision in the case of Vallee v Birchwood held a gift given in contemplation of demise constitutes neither an inter vivos nor a testamentary. Such a gift must be declared by a donor who contemplates, but not essentially expects to die. Additionally, the gift must be made in an environment which reveals that the gift should only be valid upon the death of the donor. In light of these conditions, the judges ruled that such a gift should be retrievable by the donor in the event that he/she recovers from the illness and becomes invalid if the donee dies prior to the donor. 2. The facts of the High Court case are as follows: Vallee the plaintiff was an adopted child of the deceased. She was staying in France, but one day she called on the deceased before his demise in the third quarter of 2003. She promised him that she would return during Christmas, to which he answered that he did not contemplate to live up to the time and that his desire was to hand over his house to her upon his death. The deceased handed over the title deeds to the land on which the house was built and a key to the estate to her. He also gave her a plastic container with his war treasures and a photo album. Four months later, he passed on. The defendant was informed of her father’s demise by the Coroner’s Office, which regretted that the deceased had not left any valid will specifying how the estate would be divided. 3. In 2006, the defendant directed lawyers, who contacted the treasury solicitor in writing to claim the property on the grounds that her father had given it to her by a donatio mortis causa; which is a gift whose ownership remains conditional until the death of the donor. The treasury refused her claim and proceeded with an advertisement for any potential claimants. The defendant, a clinician who was running a business organization named “Celtic Research Limited”, established through his “heir hunting” that the deceased had a surviving male sibling, Mr Mykola Bogusz. He acquired a power of attorney from the surviving Bogusz and made applications for, and was given documents for administering the property on October 8, 2009, “for (his) use and benefit.” The treasury solicitor permitted Mykola Bogusz’s claim and placed a caveat on the property against further claims. Ms Vallee filed proceedings in court seeking to claim the property by a donatio mortis causa. 4. The case came before the Oxford County Court on 26th October 2012, and was presided over by Justice Harris. The two sides sent legal representatives. Ms Vallee was called to table the evidence and she furnished the court with the original title deeds that she had received from the deceased during her last call at the deceased’s place before his demise. She also tabled before the court the photograph album mentioned in her evidence and asked for the court’s indulgence to allow her produce the bag containing the war medals, which she was with in court to strengthen her case. She was due for cross-examination but the defence lawyer opted not to cross-examine her. 5. The High Court invoked the criteria set in Sen v Headley [1991] 2 All ER 636 to establish the rightful owner of the estate1. The Court validated the plaintiff’s claims for a donatio mortis causa regarding the estate. The presiding judge overruled the Treasury Solicitor with a declaration that the defendant Mr Birchwood (acting for Mykola Bogusz), held the property on trust and that Ms Vallee was the rightful beneficiary of the estate. 6. In arriving at the decision, the High Court based its verdict on the precedent set in the appeal case of Sen v Headley [1991] Ch 425, where the Court set up grounds for a valid transfer of real property by a donatio mortis causa. In the case, the deceased and the plaintiff, Mrs Sen, were very close friends. About three days prior to his demise, Mrs Sen asked deceased who the house would go for in the event that he died. He replied that the house would be the claimant’s, and proceeded to hand-over the keys to the house, which were already in her bag to her. He even instructed her to take the deeds from the steel box where he had kept them. Then after, the deceased passed on intestate and the issue came up whether a valid donatio mortis causa was sufficiently available for the claimant to own the property. 7. The Court summarised the key criteria for a valid donatio mortis causa in the case of Sen v Headley as follows: (a) the property gift has to be given in contemplation of death – meaning the donor must not necessarily be certain about his impending death; (b) the giving of the gift and its full implementation has to be pegged on the donor’s death; this implies in the event that the donor recovers from the illness, they should be at liberty to recover their property. In addition, if the donee dies before the gift is validated, then the gift remains invalid. Lastly, the verdict established that a valid donatio mortis causa must involve a transfer of the tangible essence of the gift, which is otherwise referred to as the essential indicia. In light of this, the transfer of items such as title deeds to a land and or keys to a house basically amounts to a change of dominion in the property. 8. Despite the recognition of the title to a land as a valid symbol of transfer of dominion of property, the law provides reliefs to the effect that the delivery of deeds must not necessarily be made when the gift is being made. In addition, where a donor’s property is already in custody of another party, although not for the sole aim of a planned gift to be made, a proper utterance of its transfer to that other party may be considered valid without any more delivery requirements as was witnessed in the case of Woodard v Woodard [1995] 3 All ER 980, CA. In this case, the court affirmed that the deceased made adequate oral communication to this effect. 9. In the case of Re Richards, Jones v Rebbeck [1921] Ch 513, the court established that a valid donatio mortis causa cannot be impacted by the existence and or claims by a deceased’s personal agents, and therefore does not need any role they play as constituting a valid claim as the donee. In situations where the issue surrounding the gift has not yet been conclusively given to a donee, the party is entitled to reach out to the personal agents for support in order to complete claims on the title. In this case, the court overlooked the fact that Vallee needed the surviving Bogusz’s input in order to achieve a complete the ownership of the property. 10. In deliberating the case of Vallee v Birchwood, the High Court established that the issues set for determination required application of the rules set in Sen v Headley, which held that the transfer of the subject matter to the gift by the donor in contemplation of his looming death accompanied by the power of the uttered word was an adequate delivery of dominion over the property to validate a donatio mortis causa. Conversely, this is the first grounds of this appeal since the surviving Bogusz still had substantial control over the property2. 11. The High Court upheld the verdict of the junior court to the effect that the deceased had made the gift in contemplation of his impending death. It beats law and logic to consider that an individual who is anticipating his or her demise would do so four months in time. It is my submission that the four-month period within which the High Court admitted an impending death claim was adequate for the writing of a will instead of reliance on a donatio mortis causa, which is meant to handle more urgent transfer of property by sick donors catching their last breaths. 12. A study of the issues in the case clearly reveals that the deceased had allegedly given Ms Vallee the gift of property because he was afraid he would to live until her return at Christmas. The issue according to the judge was whether the intent of the deceased in making the gift was that he instinctively contemplated the likelihood of demise in the near future. The court argued that it seems from the orals of the deceased that he had anticipated the odds that he would die prior to his daughter’s next visit, and that alone constituted an impending death. Conversely, equally important but set aside by the court in arriving at its decision was whether the deceased had good reasons for contemplating his impending demise; which however, did not come to bare for four good months. 13. The High court erred by assuming that the claimant had dominion over the property left behind by the deceased. As a matter of fact, Mr Mykola Bogusz was granted the authority and the necessary documents by the Treasury Solicitor to administer the property for his own benefit. This implies Ms Vallee cannot legally claim the property because she has had a long stint abroad in France, and thus left the property in abandoned state between 2003 when the testator died and 2012 when she formally brought the claims on the property. 14. As it is normally the case under common law jurisdictions, the law permits management of a property such as an estate upon intestate death of the “donor.” In this case of Vallee v Birchwood the, the deceased did not write a will. It is the lack of a will in the case that warranted the appointment of Mr Mykola Bogusz as the administrator of the estate whom according to the letter and spirit of the administrative note, he reserved the right of control and dominion in the property. In this case, the surviving Bogusz performs the same role of an executor of a written will. And owing to the lack of clear instructions as to what Ms Vallee was required to do with the estate upon its acquisition, the administrator has the legal mandate to distribute it according to the laid down statutory procedures and the common trust. 15. The duration for the allowing of the claimant’s prayers by the High Court is also subject to this appeal. This is especially true because the court disregarded concerns about what an “impending death” death. Contrary to the issues surrounding the case of Sen v Headley [1991] 2 All ER 636 with regards to time, the case of Vallee v Birchwood does not meet the conditions set in donatio mortis causa. Whereas the former case witnessed the communication and an immediate handover of the deathbed gift three days to the death of the donor, the case of Vallee v Birchwood dragged on and on for four months. In light of the making of the gift exactly three days ahead of the passing on of the donor, the High Court erred in its consideration of the precedent despite the fact that time factor really made the two cases rather different. 16. In the case of Cai Guo Xiang v Mok Hang Won Elsa [2001] HKCFI 292, where the donor had handed over a bunch of keys to an estate in Hong Kong, there was a little confusion similar to the one in this case. In the former case, the issue of donatio mortis causa was left pending a determination of the premise that when the deceased issued out the keys to the estate including keys to a safe box, which contained another bunch of keys to the same estate, the court found it unusually ambiguous as to what was the deceased’s intention regarding the flat. In this case, there is some ambiguity with regards to the surviving Bogusz’s access to the keys to the premises and administration of the same. The High Court failed to effect a complete “delivery” of the dominion in the property to the claimant or investigate how the surviving Bogusz came to possess the keys to the estate. 17. The case of Vallee v Birchwood is factually dissimilar to the Woodward v Woodward (1992) in which a father with a terminal illness told his son to keep the keys to the car, which he used on a regular basis. In the case decided more than two decades ago, the court argued that there was an effective delivery of the subject matter to the donee and that he had dominion in the property. This is however not the case in the current case, where a seemingly estranged, adopted child has laid claims for a property that she has not made an effort to control and or administer for almost a decade. 18. Under the English land law doctrine of proprietary estoppel, Mr Bogusz is allowed by law to enjoy rights with regards to the use of the estate and the land upon which it rests whether or not it is the property of Vallee. Mr Bogusz’s claims are supported by the documents issued to him by the Treasury Solicitor. The doctrine normally applies to disputed transfers of the ownership of property. Proprietary estoppel can legally transfer rights in case; a) an individual is given assurance that they will benefit from a particular property; b) they apportion reasonable dependence on the assurance, and; c) they incur substantial losses in their actions as a way of fulfilling the assurance3. 19. Mr Bogusz’s actions fulfil these three conditions in the sense that he had secured an assurance from the Treasury Solicitor to use the property for his own benefit; he relied on the assurance considering that it originated from a reputable government institution; and he had spent substantial effort and his precious time maintaining the property for more than three years. In light of these factors, the appeal judges should reconsider the ownership of the property. 20. The claims are backed by the verdict in the case of Dillwyn v Llwellyn (1862) 4 DE GF & J 517. In the case the court acknowledged the legal transfer of ownership of a house from a father to his son because the latter was granted a notice in writing to the effect that he would be given the property, regardless of the pending conveyance documents, following the son’s use of “substantial” resources to facelift the property4. 21. Although, in English law promissory estoppel has not yet been a cause of action in as much as it has under other Western jurisdictions, in the case of Cobbe v Yeoman's Row Management Ltd [2008] UKHL 55, Lord Scott appeared to welcome the enforceability of the doctrine of proprietary estoppel as a key tenet of promissory estoppel5. Generally, it allows individuals who follow up to the assurances of others about their legal rights the claims, regardless of the existence of an express agreement to that effect. In case law, Crabb v Arun District Council [1975] EWCA Civ 7 best explains this; the case saw a farmer acquiring the right to the use of a path on the council's land merely because they had given him an assurance that even if he sold away part of the land, he would still find the path. 22. In summary, the High Court decision on Vallee v Birchwood should be set aside on the following grounds: a) the dominion in the property remains with Mr Bogusz, the controller and administrator the deceased’s estate; b) therefore, a donatio mortis causa does not apply since the absolute transfer of the property was not effected in practice; c) the donor’s death after nearly 5 months of making the deathbed gift was neither made in contemplation nor expectation of death, which should happen much earlier; that the death of the donor was not “impending” as alleged by the claimant. 23. An impending death is one that takes place immediately after a death bed gift has been made. The case of Sen v Headly provides, perhaps the best grounds that should be used to measure an “impending death”. The deceased died three days after making a donation mortis causa. List of Authorities Vallee v Birchwood [2013] EWHC 1449 (Ch) Sen v Headley [1991] 2 All ER 636 Woodard v Woodard [1995] 3 All ER 980, CA. Re Richards, Jones v Rebbeck [1921] Ch 513 Cai Guo Xiang v Mok Hang Won Elsa [2001] HKCFI 292 Woodward v Woodward (1992) 4 DE GF & J 517 Cobbe v Yeoman's Row Management Ltd [2008] UKHL 55 Crabb v Arun District Council [1975] EWCA Civ 7 References Clements, R., and Abass, A. 2013. Equity & Trusts: Text, Cases, and Materials. Oxford: Oxford University Press. Moffat, G., Bean, G., and Probert, R. 2009. Trusts Law: Text and Materials. London: Cambridge University Press, p.158. Watt, G. 2012. Equity and Trusts Law Directions. Oxford: Oxford University Press. Watt, G. 2012. Trusts and Equity. Oxford: Oxford University Press. Read More