Bhusate v Patel


Reference:
[2018] EWHC 2362

Date:
13th September 2018

Court:
High Court

Facts:

The recent decision of the High Court in Bhusate v Patel should be a warning to all those who remain in the marital home after the death of their spouse. The claimant Mrs Bhusate ended up receiving nothing from the estate of her late husband, and having no interest in the marital home, due to a combination of the equitable rules on self-dealing and the Limitation Act 1980.

 

Mr Bhusate survived his first wife who died in 1971, and then himself died intestate in 1990, leaving five children by his first marriage, and one child by his second wife, the claimant. His estate was principally comprised in the matrimonial home, which he had assented to himself beneficially after his wife’s death. Letters of administration were granted to Mrs Bhusate in 1991, but the property remained registered in the deceased’s name.

 

As surviving spouse, Mrs Bhusate was entitled to a statutory legacy of £75,000 and a life interest in one half of his estate, plus interest at 6%. The remainder was held on the statutory trusts for Mr Bhusate’s children. She exercised her right to capitalise her life interest by a notice in 1992. There were discussions between her and the children of the first marriage with respect to the distribution of the estate, but ultimately no agreement was reached, nor was the property ever assented to her.

 

Although the property was briefly put on the market in 1992 it was never sold, and Mrs Bhusate and her son continued living in the property for another 26 years. Mrs Bhusate alleged that various assurances were given to her that she could stay in the property, but ultimately the Court found that none of these was sufficiently unequivocal to give rise to a proprietary estoppel or common intention constructive trust.

 

Following a hearing in June 2018, Chief Master Marsh dismissed the claimant’s claims to a beneficial interest in the property, and also replaced her as administratrix of her husband’s estate. He concluded that:

1)     The claimant as a surviving spouse was only entitled to her statutory legacy and capitalised life interest. That claim arose upon her husband’s death, and became statute-barred after 12 years pursuant to s.22 Limitation Act 1980.

2)     The claimant had no beneficial interest in the matrimonial home. There had been no appropriation or assent of the property to her, and even if there had been one it would probably be liable to be set aside under the rule against self-dealing – see Kane v Radley-Kane [1999] Ch 274.

3)     The fact that the claimant had maintained the property for 26 years did not avail her; she was under a fiduciary duty to administer the estate, which included keeping the property in repair.

4)     The claimant had not shown any resulting or common intention constructive trust between her and the beneficiaries which would give her some interest in the property.

 

The result was that the claimant was left with no inheritance from her husband’s estate and no interest in the matrimonial home. She was reduced to making a claim under the Inheritance (Provision for Family and Dependants) Act 1975 some 27 years out of time.

 


Judge:
Chief Master Marsh

Comment:

Although the result of this case seems extraordinary, the basic facts are not uncommon: a property in the sole name of a husband who dies intestate, and a widow who never assents the property and simply allows the years to pass by. Few such clients would imagine that after 12 years they would suddenly lose their interest in the estate. For deaths after 1st October 2014, the spouse will now receive an absolute entitlement to the residue, so this issue will no longer apply, but such cases may still arise for decades to come, if wily practitioners (or venal children) are able to spot them.

 

Associated Members:

Practice Areas:

© New Square Chambers Ltd