The Case Files: where there's a will, is there a duty?

Transcript

00:00:04 David Lee, Host

Hello and welcome to Podcasts by Brodies. My name is David Lee and this episode is part of The Case Files series where we look back at significant cases from legal history and talk to Brodies modern day experts to discover how their predecessors in the profession helped shape how the law is applied today.

This episode is called ‘Where there's a will, is there a duty?’ and concerns the case of Miss Mary Davidson, who died in 1999. To discuss why her name and her case became important in law, I'm joined by two Brodies experts, Tony Jones KC is a partner with the firm, and Jamie Reekie is a senior associate, and they're both also solicitor advocates. Welcome to you both today.

I'll come to you first, Jamie, I always talk about simple definitions here, but I don't think it's necessarily simple. In this context, what do we mean by a will?

00:01:02 Jamie Reekie, Senior Associate and Solicitor Advocate

As you say, not as straightforward as you would think it would be because we have some legal authority that tells us that, actually, the term Will doesn't have its own technical definition. A will though is a type of what we call, testamentary writing, and that's essentially something whereby a person gives their instructions as to how their estate, so everything that they own, is to be dealt with on death. These sometimes go by different names you might hear about documents called trust dispositions and settlements, or documents called codicils and that's a type of document that makes changes to or supplements prior testamentary writing. A will is essentially one of those kinds of documents and it does have to be a document, for it to be valid we need a testamentary writing to be written down and signed in a particular way and that document will transfer their estate or the person's estate to executors or trustees, who will then manage and distribute the estate in the way that is set out in that document.

00:02:18 David Lee, Host

Very briefly, Jamie, what's the history of Wills in Scotland? When did they first come to exist and how have they have evolved over time?

00:02:28 Jamie Reekie, Senior Associate and Solicitor Advocate

So, we've had testamentary writings in Scotland for hundreds and hundreds of years and to go into the whole history of how they've developed over time would take us a while. But a couple of interesting things. The first is that up until relatively recently, it was only movable property, so not land or buildings that could be transferred by a will. As I said, we have had testamentary writings for hundreds of years, but it was only in 1868 with the Titles to Land Consolidation (Scotland) Act that the prohibition on transferring property such as land and buildings by a will was removed and up until then, although there were some ways around it, usually land and buildings just passed to, usually, the eldest son. We're going to talk a bit later about how English law has influenced Scottish law and things around Wills. So, it's interesting to note that it was over 300 years earlier that the law in England changed, in about 1540, to allow land and buildings to be transferred by testamentary writings. So it took us a while to catch up on that one.

More recently, the Requirement of Writing Act 1995 set out some new rules for what we call the formal validity of wills so, what wills have to say and how they have to be signed and so on, in order to be formally valid. I've already mentioned Wills and other testamentary writings, the clue is in the question, have to be in writing. The acts didn't change what writing means, so we've got cases in law from hundreds of years ago that tell us that a Will can be handwritten. It can be ink, it can be a pencil, it could be typed, it could be a printed sheet that's filled out. Or it could be any combination of all of those things. There's even examples in the case law of a Will in Braille, and that was held to be in writing and in England, there was a will that was in shorthand, and it was written down, so that was held to be sufficient.

What the 1995 acts tells us is that in order to be self-proving, so there can be no doubt on the face of it that the person who signed the Will did sign it, that Will or other testamentary writing has to be signed at the end, what we call subscription, and also has to be signed on every page if there's more than one page and all we need now is one witness who witnesses the signature at the end and that was a change from the previous law, where there were a couple of different ways in which a Will could be formally valid.

00:05:12 David Lee, Host

Thanks very much, Jamie. So, we'll move on to the case under discussion today, Tony, can you tell us a little bit about the will of of Miss Mary Davidson who died in February 1999 as we've said and what did that Will say?

00:05:28 Tony Jones KC, Partner and Solicitor Advocate

Sure, David. The best way of explaining is to set the scene and to see who all the players were in this particular drama. The pursuers in the case were the niece and the nephew of Miss Mary Davidson, and Miss Mary Davidson was 86 years old when she died, she was unmarried and had no children. A number of years before she had died, she had made a Will, as Jamie has described it was properly valid, leaving pretty much everything to her sister, Mrs Goldstein, other than the two egacy legacies, £10,000 each to the niece and the nephew. But in February 1999, Mary Davison wasn't in good health and her health was failing and she consulted her bank manager with the defenders because, of course the defenders in this case were a bank and it's not unknown and it's been done for a long time that banks have prepared Wills for individuals as well as lawyers. She wanted a new Will to be made, she wanted to leave her house and the contents of her house to her sister, Mrs Goldstein, but she wanted to change how everything else was going to be dealt with and she wanted to leave it to her niece and nephew. I think it was agreed by the parties that she had given detailed written instructions to the bank manager on the 4th of February 1999 but sadly Mary Davidson died some 17 days later and no new will was in place, so consequently there was only the one Will and that left everything to Mrs Goldstein other than the two legacies of £10,000 each, and that was where the parties started to fall.

00:07:35 David Lee, Host

Do you want to pick up there, Jamie, and explain, I think it’s pretty clear why the niece and nephew were unhappy, they were left in this situation where they thought something else was coming into place but it hadn’t done by the time their Aunt’s death. If you could just take the story on from there and maybe move into a little bit about duty of care.

00:07:57 Jamie Reekie, Senior Associate and Solicitor Advocate

The reason, to put numbers on it, that the niece and nephew were particularly unhappy with how things played out is that they worked out that had their Aunt’s instructions been put in place and they inherited, what we call, the residue of the estate, so everything less the legacy of the House to Mrs Goldstein, rather than the £10,000 each that they would have got from the Will that was valid was in place, they would have got something closer to £200,000. It doesn't take a big jump to work out why someone might be unhappy at the missing £190,000. So, their ire was principally focused on the bank manage and they said ‘well, you knew that our aunt was old, you knew that she was unwell and because of that, you were under a duty to put in place her instructions quickly and they said between four and five days would be the appropriate length of time for someone to put those instructions in place in the circumstances’ and because the bank manager was employed by the bank, it's the bank were what we call vicariously liable for what he did so the bank had to take responsibility for the actions of their employee, and that's why it's the bank who were the defenders in this case and not the bank manager himself, albeit it was his actions that were being complained about. The problem up, until the point, that this case was heard for the niece and nephew was that it would be easy enough as the law stood at that point to see that the bank manager might have owed a duty so a responsibility to Miss Davidson because she was essentially his client. But the law didn't extend or didn't go as far as saying that there would be a duty owed to the niece and nephew as the disappointed beneficiaries. Where that would have left them is that any duty that was owed to Miss Davidson, which was obvious enough on the law as it was there, could be enforced by her estate, and it may well be that, certainly in this example, actually the estate hasn't suffered any loss because the estate was still the same size as it would have been, but for the negligence it was the two individuals that lost out. So, whilst there might have been grounds for a case to be raised by the executors on behalf of the estate, there wouldn't be any loss to sue for. So, in order for the niece and nephew to have any redress, they needed the law to extend to them so that there was a duty or responsibility owed to them as individuals by the bank, and they could claim for the losses that they contended for.

00:10:59 David Lee, Host

Thanks very much, Jamie. Tony, we touched a little bit earlier on about the way that the law in this area developed differently in England and Scotland, and particularly around this idea of duty of care. If you can expand a bit on what we mean by duty of care here and tell us a little bit about the way that it had developed differently on either side of the border.

00:11:23 Tony Jones KC, Partner and Solicitor Advocate

Generally speaking, there are three ways duties are imposed. Statute law by Parliament or some regulation, because parties have a contractual relationship which Jamie referred to earlier. So, there was a contractual relationship between the late Mary Davidson and the bank or there may be a duty arising under the common law in what we call delict or south of the border, they call tort. Part of the law delict is the law of negligence and to try and put that in a nutshell, and there are better lawyers than me that have tried to put it in rather large nutshells, but you have a duty to take reasonable care to avoid causing harm to someone who you can reasonably foresee may suffer harm if you are negligent and some of the best expressions of that go to back to a case of Donoghue v Stevenson, which was about a snail in a bottle in 1931. But you can see that there are two reasonables in that proposition, and therefore it becomes quite difficult for the lawyers to be clear as to when a duty arises and when it doesn’t, but it gets even more complicated and geeky when the party who's making the claim has only suffered financial loss. So, distinguish that in your head from Donoghue against Stevenson, where Mrs Donoghue apparently ingested a decomposing snail and became sick and she was claiming for financial compensation for being sick. Here the two claimants, the nephew and the niece, were claiming for pure financial loss, they hadn't suffered a physical injury. As Jamie mentioned earlier, there was no diminution, no lessening in the value of Mary Davidson's estate and indeed there was discussion in the decision that the money that Mrs Goldstein was going to inherit could well and was likely in due course if Mrs Goldstein didn't spend it to go to the niece and the nephew anyway, so you might have a situation where they eventually would have inherited that same money from somebody else. But that didn't undermine the fact that they had a claim because they had suffered financial loss because they hadn't got the money when they expected to get it. The next point is how that's developed differently in England and Wales from Scotland, in 1995, the then House of Lords, which is now the United Kingdom Supreme Court, decided in a case White v Jones, which Jamie will probably talk about later. The thing to remember about both the House of Lords, as it was, and the UK Supreme Court is that it is what it says on the tin. Now the UK Supreme Court so it hears appeals from different parts of the United Kingdom so we can hear appeals from England and Wales and also it can hear appeals from Northern Ireland and appeals from Scotland and of course the law in Scotland is a separate jurisdiction from the law in England and Wales. Consequently, a decision in an English appeal doesn't necessarily extend to Scotland. Well, in 1861, the then House of Lords had made a decision in a Scottish appeal called Robertson v Fleming, which had perhaps traditionally been understood to suggest that unless there were particular circumstances, a solicitor who was negligent didn't owe a duty of care to a disappointed legatee who didn't get what they thought they were going to get. Of course, consequent upon White v Jones which Jamie may touch on, there was a question of was the law in Scotland, because of that 1861 case, different to the law in England and Wales.

00:16:03 David Lee, Host

So, Jamie, if you want to tell us a little bit more about White vs Jones and the significance of it in this complex, legal geeky cross-border context which Tony has outlined.

00:16:18 Jamie Reekie, Senior Associate and Solicitor Advocate

So, one of the ways that Tony explained a duty of care could be imposed is through common law and that can be the development of the law, or the interpretation of the law through the courts and applying previous legal decisions. There are a number of important cases on duty of care, which again could fill several textbooks, but one of them is known as Hedley Byrne and we developed what is called the Hedley Byrne principle, whereby if various criteria are met, a duty of care may be imposed and what the courts have done is incrementally moved duty of care so that is imposed in perhaps more and more circumstances. It's the incremental aspect of that imposition that's important, we don't move from A-Z very quickly, you move through A to B to C and so on. Prior to White v Jones, as we've both touched on, there could be no doubt that there was a duty of care on the part of a solicitor, or in this case, the bank preparing the Will taking on the role of solicitor and the client and that there was a sufficient relationship and the three things, broadly, that one would look for are a reasonable reliance by the person instructing the services, so, in this case, the client relying on the skill and knowledge of the solicitor, the voluntary assumption of responsibility on the part of the person providing the services and that's not that they're doing it for free and that's that they willingly take it on without any pressure. Thirdly, that there's a special relationship of trust and confidence, and you can easily see there that between solicitor and client, all three of those have big ticks and there's a duty of care to make good any losses that might be suffered by the client for or in negligence. Up until White v Jones, and even in England, there was no authority for the idea that that relationship would extend to the disappointed beneficiary so, in Miss Davidson's case, the niece and nephew, or in the case of White v Jones, the Whites. The facts were very similar in White v Jones as they turned out to be in their homes in Bank of Scotland, there were instructions issued to draught a new Will, two months later the Will still wasn't in place and not ready for signature, and then the person whose Will it was died before it was signed. Given the state of the law at that time, perhaps unsurprising that at first instance it was decided that the case couldn't proceed because there was no legal authority for the idea that the solicitor would be liable in that situation. But eventually it went to the House of Lords and the Lords held that it was appropriate to incrementally impose the duty of care in those circumstances and as Tony explained, House of Lords, now the Supreme Court – the highest court in the UK, because it was an English appeal, that decision then became binding in England and Wales. But what's interesting is that the decision in White v Jones was split, three judges agreed with the outcome, and two judges disagreed. Indeed one of the, what we call, dissenting judges, so one of the judges who disagreed, commented that he was unable to reconcile the claim with principle and couldn't accept that it was an appropriate application of the law from the case of Hedley Byrne. I think that just goes to show how difficult the area of law can be and how far reaching the principles from the decision could be that two of the five judges were pretty reticent about pointing the law in that direction.

00:20:36 David Lee, Host

Thanks very much, Jamie. Tony, we will come back to Miss Mary Davidson and her disgruntled niece and nephew, which court ruled on that case in the end? What was decided?

00:20:51 Tony Jones KC, Partner and Solicitor Advocate

In that particular case, it was a single judge, Lord Kingarth, and the thing to remember about the Court of Session, which is the Supreme Court sitting in Scotland, is that it's divided into what they call the outer house and the inner house and the outer house is single judges and the inner house is like an appeal court. Lord Kingarth was sitting in the outer house and he had to struggle with White v Jones from the House of Lords English case, and the earlier case of Robertson from 1861, which the Advocate Council for the Defenders were saying was binding on him and said that the pursuers here didn't have a good case. But counsel for the pursuers alighted on Scottish case in 1995, which was unreported but came from the inner house and that case confusingly here, this is called Robertson v Whatton Company, another Robertson, I'm not saying that Robertsons are any more litigious than anyone else just so happen it's also called Robertson. Robertson was suing a firm of solicitors in a similar situation and there was an indication in that Scottish case so that it wasn't clearly expressed that White v Jones, which had recently been decided by the House of Lords coincided with the principles that should be applied in Scotland under common law. Lord Kingarth’s job was to sort all of that out and he decided that the case from 1861 was not authority for the proposition that White v Jones didn't extend to Scotland and what he decided is that the niece and nephew's case could go on to a hearing of the evidence to decide their case, which really was a big decision in principle because it said they had a sound case to say that there was a duty of care owed to them, and if that duty was breached then they would have a good claim.

00:23:18 David Lee, Host

So, what happened next?

00:23:20 Tony Jones KC, Partner and Solicitor Advocate

Well, all that Lord Kingarth had to do was to send it off to proof for a trial. Ultimately, there's no report of a trial, and as often happens in many of these cases, once the important point of principle has been dealt with, parties come to an agreement and that's likely what happened here.

00:23:41 David Lee, Host

So, what do we know, Jamie, about the outcome for the niece and nephew of Miss Mary Davidson deceased?

00:23:47 Jamie Reekie, Senior Associate and Solicitor Advocate

Well, in terms of if they got their money, we don't know. Someone at Brodies will know, the firm acted for the niece and the nephew, but certainly around this table given that there's no report of a proof or a trial and of evidence being led, there's no public record of what happened as Tony has suggested, the majority of court cases settle before a trial for various reasons, and so we might infer that's what happened in this case.

00:24:21 David Lee, Host

Finally, Tony, what changed? Summarise why this case really mattered to the law and the way it was applied in this area, which potentially could affect any number of people who might feel they have a claim on somebody’s Will?

00:24:42 Tony Jones KC, Partner and Solicitor Advocate

Well, Lord Kingarth decision really matters because it clearly states that White v Jones from 1995 applied in Scotland, it brought clarity to that area of law. It means that solicitors or others that are preparing Wills can owe duties of care to disappointed legatees, that duty can extend to avoiding pure economic loss and it's fair to say that there has been litigation further cases on the back of that which have been trying to test the boundaries of that and indeed about 15 years ago I was involved in one of them where an executor, a person charged with administering the estate, brought a claim against solicitors for failing to or allegedly failing to revoke a legacy to an ex-husband of a half share of a house. The problem for the executor was that, as Jamie alluded to Mary Davidson's case, it was the same the estate hadn't suffered a loss up until the deceased died. The claimants behind the executor were legatees charities in a Will that had been written quarter of a century after the alleged negligence, so that claim failed in front of the judge. So, there are real boundaries there that are constantly being tested and I would say, well, you could summarise it by saying that where there isn't a new Will and perhaps there should have been, there isn't always a way to make a claim.

00:26:35 David Lee, Host

Thanks very much, Tony.

Thanks to Tony Jones KC and to Jamie Reekie for their expert insights today. You've been listening to an episode of The Case Files, which is part of Podcasts by Brodies, where leading lawyers and special guests share their Enlightened Thinking about issues and developments affecting the legal sector and what that means for organisations, businesses and individuals across the various sectors of the UK economy and wider society.

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