Langley Estate v Rokel Commercial Bank Ltd
CC591/06 2006 W NO. 9
IN THE HIGH COURT OF SIERRA LEONE
William Jonathan -Wyse and Sylvanias James Newstead
(Executors of the Will of Leo Thomas Langley (Deceased) - PLAINTIFFS
Rokel Commercial Bank Limited - DEFENDANT
MARCUS JONES &CO For The Plaintiff
BASMA AND MACAULAY For the Defendant
RULING DELIVERED THIS 23rd DAY OF JANUARY 2007.
Upon reading Summons for directions dated 31st day of October 2006 and upon hearing Dr. W.S Marcus-Jones of counsel for the plaintiff's and Berthan Macaulay Jr. Esq. of counsel for the defendant it was directed by this Honourable Court as follows
1.That the Action CC554/2006 J. No 41 Dr W S Marcus-Jones and Rev Canon. Dr. J. E. M. Taylor Pearce (Executors of the Will of Katherine Lois Roberts(Deceased ) Vs Rokel Commercial Bank Ltd is consolidated with Action No CC591/06 No 9 William Jonathan - Wyse and Sylvanias James Newstead (Executors of the Will of Leo Thomas Langley (Deceased) Vs Rokel Commercial Bank Ltd and that the Action CC591.06 shall be the leading action:
2. That the following be argued as a preliminary point of law and determined by the court to wit:
"Whether an action is maintainable for the recovery or delivery of assets not declared by the executors in their declaration of probable value in the respective actions"
A day was fixed for the hearing and the parties requested to file affidavits exhibiting documents they would be using for the arguments on the preliminary point of law
The brief facts of the respective actions as evinced from their pleadings are that the plaintiff's as proving executors of the Will of the respective testators had obtained probate of the respective Wills. The said probates of Wills declared in the Leading Action PERSONALTY- Nil and in the other instance PERSONALTY- Le120,000.00 . The executors had demanded from the bank Payment of Le442,661.28 and Le 314,89589 respectively but the bank refused to pay any amount over and above that declared in the declaration of probable value requesting the production of a Supplemental grant if they were to make a payment of the additional sums to the extent that the plaintiff brought action in the action CC591/06 No 9 against the defendant for an account of all monies due and owing by the defendant to the plaintiff's and payment to them of such monies found due with interest thereon plus damages for breach of Contract. In the other action CC554/06/ J 41 the plaintiff's claim is for the recovery of the sum of Le442,661.28 due and owing to the estate of Katherine Lois Roberts as at 12th February 2004 together with interest thereon and damages for breach of contract and wrongful detention of the plaintiff's monies and cost.
Both parties filed documents to support their arguments . The plaintiffs' solicitor relied on his affidavit sworn to and filed on the 29th day of November 2006 and to the bundle of documents referred thereto marked A.
The bone of contention of the plaintiff's was that where the deceased persons have money in the Bank and probate is taken out through their proving executors and the letters of probate presented to the bank, as evidence of the persons to whom these monies should be paid, the bank ought to make payments and not refuse to pay these monies on the tenuous ground of requesting a supplemental grant. Dr Marcus Jones for the plaintiff argued that if the bank already has knowledge of who was entitled to the monies of the deceased person they were obliged, without more, to pay the person entitled on demand . The plaintiffs' solicitor argue that there was no need for the presentation of a supplemental grant as the Letters of probate covers all the assets of the deceased person. He referred to the wording in the Letters of probate to wit "All and singular the said estate and effects" as evidence of this . He submitted that what the defendant bank has
raised is whether the declaration of probable value is sufficient . He submitted that the defendant Bank has no business with the probable value. Referring to Mellows On The Law Of Succession 2nd Ed p 272, he stated that the declaration of probable is prepared only to determine whether and if so how much estate duty is payable and there is no duty to give the assets of the deceased with mathematical precision. He submitted further that the defendant bank was a third party and not agents of the Government. He referred to the case of MICHAEL PHARES VS HASSAN DAGHER 3 SL Law Recorder at Page 49. He submitted that the defendant bank were strangers in the contract between the Government and the Executors and a man cannot incur liability or right under a contract where he is not a party. He referred the court to HANSON'S LAW OF CONTRACT 2 Ed Pages 251-257. He concluded that by reason of all this the bank has prevented the executors from administering by reason of which it was necessary to bring the above claims.
In reacting to the plaintiffs' submissions counsel for the defendant referred the court to the affidavit filed on the 5th day of December 2006 . On the said affidavit were several exhibits. He referred the court to exhibit BMJ 1A and BMJ1B.On exhibit BMJ 1A &B he noted the 2nd part thereof which states Personalty-Nil and Personalty-Le 120,000 respectively and the 3 rd part which states "Lastly this declarant declares that "No other real or personal estate or effects belonging to the deceased have at any time since her/ death (i.e. death of the deceased ) come to the hands possession and knowledge of these declarants save as is hereinbefore set forth "
He argued that probate cannot be given of all the assets as argued by the plaintiff but those assets stated in the declaration of probable value which is covered by the Grant. Thus he dismissed the argument that the probable value only goes to valuation He referred the Court to TRISTRAM AND COOTESPROBATE PRACTICE 19th EDITION AT PAGE 182-183 dealing with the necessity for Inland Revenue Affidavit under the rubric "the value of the property to be covered by the grant. Mr. Berthan Macaulay referred to the Stamp Duty Act ,Cap 274 of the Laws of Sierra Leone sections 12 and 14 thereof and to the Stamp Duty (amendment of Schedule ) Order, 1966,
Statutory Instrument No 28of 1966 to show that the grant covers only what is declared in the declaration of probable value and for which estate duty is paid for.
On the issue of there being no legal basis for supplemental grant, he argued that it was the plaintiffs' solicitor himself who drew the court's attention to a document known as corrective affidavit which is the affidavit leading to the supplemental grant .He submitted that the effect of a corrective affidavit is that when there is a reduction or addition of the assets you ought make these corrections by affidavit. He referred Court to TRISTRAM AND COOTE'S PROBATE PRACTICE 19™ Ed pages 196-197 and 331-335.
He submitted that having regard to the Stamp Duty Act which he has cited and the additional sums which are being claimed via the writ of summons i.e. Le 194,895.89 and Le442,261.28 respectively it is clear that there is no grant for these additional sums as evinced by the Probate of the Will of Leo Thomas Langley dated 25th June 1996 and Probate of the Will Of Katherine L Roberts dated 23rd December 2003. which do not cover the said additional sums..
He submitted that the cases cited were not relevant to these proceedings in that the issues as formulated in the question on point of law were not addressed in those cases. On the other hand he cited the case of TARN AND ANOTHER VS COMMERCIAL BANKING CO OF SYDNEY (1884) 12QBD 294. the facts of which were a testatrix , having indorsed and delivered a bill of exchange to her bankers for collection at maturity, died before the bill became due , and her executors , before probate of the will was granted , sued the bankers for a return of the bill or its value, as relevant to these proceedings. The court gave judgment for the defendant holding that the bank was right in withholding payment until probate was taken.
In his reply the plaintiff's solicitor stated that the grant in his submission covers known and unknown assets because it says "all and singular" ; the discovery of subsequent assets does not negate or nullify the grant. He concluded by submitting that it is not the probate that determines whether the defendant bank should pay over the assets but the Will.
I have perused all documents in respect of this matter and listened keenly to the submissions by both counsels. The question to be answered as a preliminary point of law is clearly as formulated above . To answer this question one must of cause consider what is the Declaration of Probable Value . The Declaration of probable value, otherwise known in England as the Inland Revenue Affidavit is an affidavit, one of the several affidavits you would find included as supporting documents leading to the grant of a letters of Probate under seal. It is a very special affidavit ; it comprises several parts . The first part is a declaration of the realty that the deceased was seized of at the time of death, if at all, listing each realty specifically and showing their respective value .The second part is a declaration of the Personalty that the deceased was seized of at the time of death, if at all, listing the kind and its value. The 3rd part is the portion where the deponents or declarants state:
"Lastly, these declarants declare that no other real or personal estate or effects belonging to the deceased have at any time since her/ death (i.e. death of the deceased) come to the hands possession and knowledge of these declarants save as is hereinbefore set forth"
This last portion is a confirmation that the declarants are doubly sure that the assets of the deceased do not surpass that which they are declaring. This declaration, as a whole, to my mind serves more than one purpose.
Firstly, it is the means by which estate duty is made payable. In Mellows On The Law Of Succession 2nd Ed page 272
"This document is prepared solely to determine whether and if so how much, estate duty is payable .It specifies each asset owned by the deceased , and shows its gross value, and any debts which are charged on it"
Secondly, "It also gives details of general debts and liabilities , and funeral expenses .See Mellows on the law of succession 2nd Edition page 272
Thirdly, without this affidavit there cannot be any grant of probate as the probate is always with reference to the declaration made on the declaration of Probable value after the necessary estate duty has been paid .It is a precondition for the grant. Thus a grant of probate covers what has been declared in the declaration of probable value and nothing more . It is never the case that what is declared is above or less the grant. They are both the same and the declaration of probable value a precondition to the grant.
A Bank or any other institution for that matter holding assets of a deceased person is under a duty either as debtor or bailee to pay or deliver those assets to executors named in the will but they can only do that on presentation of Letters of probate. The Grant itself is an Order of the Court and it confirms the assets of the deceased person. A passage from Mellows' "The Law Of Succession" 2nd ed at page 235 is instructive on this:
"A grant of representation is an Order of the Court which confirms or confers authourity of the personal representatives to administer the estate of the deceased and which indicates the terms on which the estate is to be administered. In every case the grant issues under the Court Seal and so takes effect as a Court Order, even though in most cases grants are obtainable by quasi administrative process of lodging certain documents described later, at the offices of the principal registry of the Family division of the High court at Somerset House or at the offices of the district registries of the High court or at the probate sub registries"
Thus the effect of the grant is that it enables the executors to deal with the whole of the deceased estate /assets as declared and to completely and fully administer the estate.
On the death of a testator, the will it self is evidence of persons to whom payment ought to be made . These are normally the executors named in the will hence the reason why its said the executor derives his title from the will. A grant of probate confirms this . Thus on presentation of a grant of probate it becomes clear that the persons to whom payment should be made are the executors taking out the grant. However, while the probate may
confirm and is evidence of persons to whom payment ought to be made, this is not all, it is also the only evidence available to confirm the testators asset held in the bank . This is so because it is the production of probate that confirms the testator's assets. Where the probate does not confirm the testators assets in the bank there is no obligation to pay . It is also the only evidence as to the terms under which the executor is empowered by Court Order to administer the estate . What this means is that the power to administer is with reference to or according to the Court Order i.e. according to the terms of the Order or Probate . Where the Court Order or grant states PERSONALTY-NIL, the executors having discovered further assets cannot recover the further Assets unless and until there is a supplemental Grant or Order obtained through the preparation of a Corrective/ supplemental Affidavit.
IN Mellows On The Law Of Sucession 2nd Ed Page272 he stated as follows:
"In most cases some adjustment is necessary to the Inland Revenue Affidavit, either because further assets or liabilities come to light in the course of administration, or because the value of the asset has to be altered. This is done by means of a corrective affidavit, which can be submitted to the estate duty officer at any time after grant"
In this case; it would appear to me that what the bank is holding and has refused to give the plaintiff are further assets that have come to light in the course of administration as those assets were no where deposed to in exhibits BMJ1A&B which show Personalty -Nil and Personalty - Le 120,000.00 respectively in both actions and most interestingly not known about at the time these probates were taken out (see letter to bank seeking information from Marcus Jones and co dated 29th December 2003 and the reply from Basma and Macaulay dated 12thFebruary 2004.Further more it could also be said that by these disclosures the value of the assets has increased.
The practical situation is that a supplemental / corrective affidavit is supplemented to the documents with which the original grant was obtained and the original grant amended to reflect the discovered assets. The is what the bank is demanding and is known as a
supplemental grant and they are right to demand it. The will is insufficient in such circumstances as it does not prove assets but persons and so too a probate which does not cover Assets discovered as the implication by the 3 part of the declaration of probable value is that the declarants are doubly sure that the assets of the deceased do not surpass that which they are declaring by declaring:
"Lastly, these declarants declare that no other real or personal estate or effects belonging to the deceased have at any time since her/ death (i.e. death of the deceased ) come to the hands possession and knowledge of these declarants save as is hereinbefore set forth."
Bankers are in a peculiar position and when asked to hand over any sum of money or assets to persons claiming as executors of a deceased customer , they would be justified in requiring to be safe by production of a probate or order of court that confirms the assets of the deceased held by the bank. To refuse to pay cannot be wrongful detention or conversion for the bank account is still in the name of the deceased person and not the bank and the bank has always evinced an intention to pay but refused payment on legal grounds.
Lending support from the case of NORTHERN COUNTY SECURITIES LTD VS JACKSON AND STEEPLE LTD 1974!WLR 1133, (1974) 2ALL ER,625 in which it was held that a court can make supplemental order I would wish to define A supplemental order/grant as "an alternative order whatever which might be appropriate in the changed circumstances to secure the due performance of the defendant's obligation".
In view of the changed circumstances necessitated by the discovery of additional assets there is a need of a supplemental grant to secure the due performance of the defendants obligations as debtor to the deceased's estate .
For reasons as aforestated I cannot agree with the reasoning and submissions in respect of the plaintiff and hold that the defendants position represents the correct state of the law in
respect to additional assets discovered after probate of the will has been taken. I also hold that an action is not maintainable for the recovery or delivery of assets not declared by the executors in their declaration of probable value in the respective actions"
Let me end by observing that the defendants did not dispute the plaintiff's title, and were quite ready to give up the money on the production of a supplemental grant . The defendants, meanwhile, were prepared to incur unnecessary cost by instituting these actions when there is nothing to try and nothing to be done except take out a supplemental grant .The action nonetheless provides an opportunity to make the law on the subject clear and this I have endeavoured to do. I would nonetheless order as follows:
1.That the consolidated actions CC591/06 No 9 William Jonathan - Wyse and Sylvanias James Newstead (Executors of the Will of Leo Thomas Lanley (Deceased) Vs Rokel Commercial Bank Ltd and CC554/2006 J. No 41 Dr W S Marcus -Jones and Rev Canon. Dr. J. E. M. Taylor Pearce (Executors of the Will of Katherine Lois Roberts(Dcccased ) Vs Rokel Commercial Bank Ltd be and are hereby dismissed with cost.
2. Cost thrown away assessed at Le 1,000.000 ( One Million Leones ) Hon. Mr. Justice D.B. Edwards J.