Solicitor prevented from charging for his time spent as an executor because of absence of an express charging clause under a will.

Article by our Jack Beckett

Brealey v Shepherd & Co Solicitors [2024] EWCA Civ 303 (26 March 2024)

Background to the Appeal

This case was a second appeal by a defendant firm of solicitors made against an order for costs awarded in a third-party assessment proceedings brought by the Claimant pursuant to section 71(3) of the solicitors Act 1974.

In those proceedings, the claimant challenged the entitlement of one of the executors, Mr Shepherd, who was a partner in the defendant firm, to charge fees for the time spent by him in the administration of the estate.

The Facts

The claimant's mother died on 15 April 2024. By Clause 1 of her will, dated 21 March 2014, she appointed her brother and Mr Shepherd as executors of the will together with an additional clause which saw an additional partner in the defendant firm also made executor, a Mr Smyth.

The will contained no express provision entitling the solicitor executors to charge for their own time spent in the administration of the estate.

Probate was granted to the executors on 23 June 2024; the value of the estate was certified as £878,680.

To deal with various issues arising out of the administration of the estate, the executors entered into various retainers with Shephard & Co. The fees billed in connection with these totalled £153,507.38.

Issues Before the Court

At paragraph 13, Sir Nicholas Patten states "What we are concerned with on this appeal is the issue of principle as to whether Mr Shepherd is inhibited from charging for his time spent as an executor by the absence of any form of charging clause in Mrs Brealey's will"

He went on to say that in the absence of a charging clause, the Defendant must rely on either:

(1) Section 29 of the Trustee Act 2000;

(2) the Court exercising its inherent jurisdiction to permit Mr Shepherd to be remunerated for his time spent and services rendered in connection with the estate.

Decided

The Defendant failed under (1) as the provision requires the agreement of all other executors/trustees that the specific executor (in this case Mr Shepherd) is entitled to be remunerated for their services provided to or on behalf of the estate. The Defendants, on the evidence, could not show that they had procured all of the executors' signatures.

On (2), the Court upheld the finding that they could not exercise the inherent jurisdiction of the Court to allow Mr Shepherd to be remunerated as executor in the absence of any real information to explain the lack of a charging clause in the will. Again, the defendant failed on the strength of their evidence and was accordingly not entitled to be remunerated.