Gregson v HAE Trustees Ltd & Ors [2008] EWHC 1006 (Ch) (08 May 2008)

Gregson v HAE Trustees Ltd & Ors [2008] EWHC 1006 (Ch) (08 May 2008)

There is no legal basis for a 'dog leg' claim allowing beneficiaries to enforce against directors of a corporate trustee for breach of duty owed to the company; such claims are not trust property. The claim against the directors must be struck out. The trustee's duty to review diversification under the Trustee Act 2000 depends on the trust instrument and the nature of the assets retained.

Citation
[2008] EWHC 1006 (Ch)
Parties
Claimant: Caroline Susan Gregson; First Defendant: H. A. E. Trustees Ltd; Second Defendant: Ruth Joan Gertrude, Lady Morris of Kenwood; Third Defendant: Simon Nicholas Peter Phelps; Fourth Defendant: Veronica Cohen (as personal representative of Richard John Cohen deceased); Fifth Defendant: Howard Stephen Rodney Cohen
Jurisdiction
England and Wales
Judgment Date
08 May 2008
Procedural Posture
Chancery Division Civil Claim / Application to Strike Out or for Summary Judgment
Outcome
Claim against director defendants struck out; summary judgment granted for defendants on the dog leg claim.
Legal Topics
Corporate Trustees, Directors' Duties, Beneficiaries' Rights, Trustee Investment Duties, Summary Judgment, Strike Out Applications
Trusts and Equity Company Law Corporate Trustees Directors' Duties Beneficiaries' Rights Trustee Investment Duties Summary Judgment Strike Out Applications

Case Brief

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Parties

Caroline Susan Gregson

Claimant

H. A. E. Trustees Ltd

First Defendant

Ruth Joan Gertrude, Lady Morris of Kenwood

Second Defendant

Simon Nicholas Peter Phelps

Third Defendant

Veronica Cohen (as personal representative of Richard John Cohen deceased)

Fourth Defendant

Howard Stephen Rodney Cohen

Fifth Defendant

Procedural Posture

Chancery Division Civil Claim / Application to Strike Out or for Summary Judgment

Legal Issues

  1. 1 Whether a 'dog leg' claim exists allowing beneficiaries to enforce against directors of a corporate trustee for breach of duty owed to the company
  2. 2 Whether the trustee company was under a duty to review diversification of trust assets under section 4(2) Trustee Act 2000

Ratio Decidendi

There is no legal basis for a 'dog leg' claim allowing beneficiaries to enforce against directors of a corporate trustee for breach of duty owed to the company; such claims are not trust property. The claim against the directors must be struck out. The trustee's duty to review diversification under the Trustee Act 2000 depends on the trust instrument and the nature of the assets retained.

Court Disposition

Claim against director defendants struck out; summary judgment granted for defendants on the dog leg claim.

Orders

  • The claim against the second, third, and fifth defendants is struck out.
  • Summary judgment is granted in favour of the second, third, and fifth defendants on the dog leg claim.