[2025] EWHC 2054 (Ch)

Richard’s primary pleaded case was that he was entitled to half of Alan’s estate. Recognising that this case was not consistent with the promises that I found were made to him by Alan (which all concerned Richard’s future at North Cowton), Richard submits that the just outcome is for him to receive North Cowton unencumbered by any debt or to receive a lump sum equating to its unencumbered value. His strong preference is to keep North Cowton. He argues that Alan’s estate is sufficiently large to produce such a result and how the result is achieved is largely a matter of logistics. He relies on the view I expressed in the liability judgment (at [243]) that it was essential there should be a clean break so that neither brother is in any way dependent on the other.

Richard refers to the fact that the Lloyds borrowings are secured against North Cowton, the Marton land and certain land at Allerton Park but not against the main site at Allerton Grange. He takes particular objection to the Lloyds loan taken out by George and Simon in July 2021 for £250,000 in order to build a shed or sheds at Allerton Grange, where there is now some £200,000 outstanding which is secured against North Cowton and not Allerton Grange. He makes no complaint about the Oxbury loan for £200,000 taken out by Simon and George in November 2024 because he accepts that this is not secured against North Cowton, nor about the Barclays’ borrowing which is also not secured against North Cowton.

Richard submits that Alan’s estate’s share of the golf course monies is about £1.9 million which is roughly equivalent to the Lloyds secured debt figure of about £1.92 million. He says that the award of North Cowton to him as an unencumbered farm is a fair result because (i) North Cowton was promised to him, (ii) it was not envisaged by any of the family members that the Lloyds debts would remain secured against North Cowton in perpetuity and (iii) rather, it was envisaged that the golf course monies would be used to discharge the lending on both farms. Richard further submits that it would be grossly unfair to him, in circumstances where it was anticipated that both brothers would ultimately receive their farms debt free, to make an award that he receive North Cowton, worth some £3.1 million, but with all debts (some £1.9 million) secured against it, with Simon receiving the balance of an unencumbered estate worth, according to Richard’s calculation (which includes the golf course monies), some £5 million.

Richard suggests that Simon is seeking to raise a new argument that, during the November 2017 split, the allocation of debt to each farming business was either not finalised or not supposed to be permanent. He says it is too late for Simon to rely on this evidence because it has not been tested or put to any of the other witnesses.

In the alternative, Richard submits that if it is not possible for Simon and George, as personal representatives and beneficiaries of Alan’s estate, to achieve a result whereby Richard receives North Cowton unencumbered, they ought to be ordered to pay Richard a monetary sum equivalent to the unencumbered value of North Cowton, namely £3.128 million.

So far as logistics are concerned, Richard submits that the simplest order for the court to make is to declare that the entire beneficial interest in North Cowton is held on trust for Richard and to direct that the estate transfers the legal title to North Cowton to Richard “in short order” and that if the estate fails to do so, the legal transfer should be signed by a district judge, expressed as being subject to the existing charge in favour of Lloyds so as not to prejudice Lloyds’ security. The estate should then be directed by a later date to either procure the release of the charge (which in turn would require the estate to offer Lloyds satisfactory alternative security) or to pay Richard a lump sum equating to the amount necessary to redeem the charge so that he may do so himself. Richard asks that indemnities be ordered, including an order that Simon and George be restrained from dealing with the estate assets other than to meet the estate’s liabilities to Richard under the court’s order.

In relation to the court’s desire that there should be a clean break, Richard submits that there are three impediments to achieving a clean break. First, he says he has a 10% interest in the golf course monies and this point cannot be resolved in the current litigation. Second, he seeks to rely on disclosure in these proceedings which is said to suggest that he owns a 25% beneficial interest in the Marton land and says it is not safe for the court to make any findings on this point and best to leave the parties to litigate the matter if necessary. Third, he is concerned that he should not be called upon to account to his parents’ estates upon the dissolution of any alleged partnership with his parents. He asks the court to declare that he is not liable to his parents’ estates upon the dissolution of any alleged partnership with his parents and that he may continue to use the business assets at North Cowton.

In written submissions filed after the remedy hearing, Richard submitted that in circumstances where the court considered it fair to have regard to the golf course monies but did not know how much would be recovered, it could award him a beneficial interest in the estate’s share of the golf course monies but subject to a cap. Richard suggests that the court might direct the transfer of North Cowton to him, impose a liability on him for half of the Lloyds debt at the time of the split in 2017 (being about £600,000) and award him a 50% interest in the golf course monies, subject to a cap. So, for example, if the golf course monies are £2 million, Richard would recover £900,000 (from which to discharge bank debt of £600,000), with the estate receiving £1.1 million. If the golf course monies are £3 million, Richard would still receive the capped amount of £900,000 and the estate would recover £2.1 million. In the event that no golf course monies were received, Richard would be left to bear Lloyds liabilities of £1.5 million and so would the estate.