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Tenants in Common/ Trustee Problems

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Tenants in Common/ Trustee Problems

Postby Jonathan919 » Sun Sep 27, 2015 2:31 pm

Four trustees co-own a garden as tenants in common. I am one of the trustees. Two of the trustees (who between them own 2/3 of the beneficial interest) are now divorcing acrimoniously and a Form A has just been filed by the wife with a request for a property adjustment order on the land.

There is a live adverse possession claim that we submitted in and that is about to be referred to the First-Tier Tribunal for a piece of land that attaches to the garden. All four co-owners made the claim and all submitted statements of truth with it. We are representing ourselves in this matter.

The divorcing husband has now gone to the other side in the dispute without notice to us that there was a problem and is trying to withdraw from the dispute saying he does not wish to proceed with it as we are not acting in his best interests.

I am concerned that unanimity of trustees will be required for us to proceed with a tribunal application as we are technically starting again.

A relevant factor would appear to be that the husband trustee went to live in Spain several years ago and remains there, although he is not officially domiciled there and visits England occasionally, though does not come here and this is not the address he uses as his official residence in the UK. We believe he has not visited England in the last year. However, the husband trustee has just told us he is giving someone on the other side of the dispute - the main "witness" - his power of attorney to deal with the garden and is instructing them to do as they please with it, including taking down our fences and digging up our trees. He also appears to be using the same solicitor that is representing the other side to draft it for him and who is also representing this same supposedly independent witness!

Can three of the trustees remove or retire the husband as a trustee? Is there a quick and relatively cheap way to do this? How could it be done? Does the husband trustee have to be replaced?

Any advice on any of the above would be appreciated.
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Re: Tenants in Common/ Trustee Problems

Postby Jonathan919 » Sun Sep 27, 2015 4:54 pm

I should probably add that there is no trust deed, simply a note of the size of our beneficial shares as tenants in common on the solicitor's file. The trust was originally set up to create a private garden for the family home, in which three of the trustees still reside.
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Re: Tenants in Common/ Trustee Problems

Postby atticus » Sun Sep 27, 2015 8:28 pm

This is probably a good time to take legal advice.

This forum is for discussion, not advice.
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Re: Tenants in Common/ Trustee Problems

Postby dls » Mon Sep 28, 2015 5:11 am

It is a fascinating problem if you are not sat in the middle of it.

I very strongly suspect that the value of the additional land may not be worth the cost of the dispute. The values of strips of land are often surprisingly low - and even more so if you establish at best only a possessory title. You need to be very sure.

Trustees act either under a power or a duty. If they act under a power then they can only act with unanimity. It may well be that there is no duty to make such a claim, and that therefore they act if at all under a power.

There are several things needing consideration before making any decision. We cannot possibly, from here, see them all, and what might otherwise be apparently a small factor, can make or break a claim. You need direct legal advice from someone who can talk it all through with you and see the documentation involved.
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Re: Tenants in Common/ Trustee Problems

Postby theycantdothat » Mon Sep 28, 2015 8:02 am

Section 36(1) of the Trustee Act 1925 may help:

Where a trustee, either original or substituted, and whether appointed by a court or otherwise, is dead, or remains out of the United Kingdom for more than twelve months, or desires to be discharged from all or any of the trusts or powers reposed in or conferred on him, or refuses or is unfit to act therein, or is incapable of acting therein, or is an infant, then, subject to the restrictions imposed by this Act on the number of trustees,—

(a) the person or persons nominated for the purpose of appointing new trustees by the instrument, if any, creating the trust; or

(b) if there is no such person, or no such person able and willing to act, then the surviving or continuing trustees or trustee for the time being, or the personal representatives of the last surviving or continuing trustee;

may, by writing, appoint one or more other persons (whether or not being the persons exercising the power) to be a trustee or trustees in the place of the trustee so deceased remaining out of the United Kingdom, desiring to be discharged, refusing, or being unfit or being incapable, or being an infant, as aforesaid.
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Re: Tenants in Common/ Trustee Problems

Postby shootist » Mon Sep 28, 2015 8:23 am

dls wrote:Trustees act either under a power or a duty. If they act under a power then they can only act with unanimity. It may well be that there is no duty to make such a claim, and that therefore they act if at all under a power.


Could you please expand upon what decides whether they are acting under a duty or a power?
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Re: Tenants in Common/ Trustee Problems

Postby dls » Mon Sep 28, 2015 12:23 pm

It is obvious in general, but not always quite so obvious in particular.

A duty is that which the trust deed (or the general law) says that they must do.

A power is what they are able to do, but can choose not to do.

In old law, every bit of land held under a general joint tenancy after 1925 included an immediate and binding duty to sell the land. There is a duty so that if any trustee says it is to be sold, then it must be sold. The logical corollary of that is that there is a power to delay the sale. That power can only be exercised if all trustees agree not to sell (there may be additional conditions).

In this case there can be no duty to pursue an action to add land to the trust - which brings its own additional problems anyway.
There can only be a power, and as such, a decision t pursue such a claim must be unanimous.

The provision recited by TCDT is, as usual pertinent and accurate, but it is also nowadays more than a little inappropriate. Pursuing such an avenue may add considerable complexity and expense to something which already may easily be disproportionately so.
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