Mustafa Erdem Baldudak v Mark Matteo (Costs)
[2024] EWHC 301 (Ch)
Rollerteam Limited v Linda Riley
30 October 2024
[2024] EWHC 2736 (Ch)
High Court
A company (Rollerteam) sued a trustee (Linda) for not giving back a property as agreed. The company got some money for the legal costs wasted because of the delay (£7,165.56), but not for other losses. The trustee's attempt to get money back for property expenses also mostly failed.
Key Facts
- •Rollerteam Limited (Rollerteam) sued Linda Riley (Linda) for breach of trust relating to a property (Parkgate) held in trust for Rollerteam.
- •Linda held Parkgate on trust for Rollerteam until November 2022.
- •Linda breached the trust by failing to transfer or sell Parkgate with vacant possession as requested by Rollerteam in 2015 and 2017.
- •Rollerteam claimed equitable compensation for mortgage interest payments, lost opportunity to benefit from vacant possession, and wasted legal costs.
- •Linda defended on the grounds of Rollerteam's conduct and sought relief from liability under section 61 of the Trustee Act 1925.
Legal Principles
The 'but for' test for causation in equitable compensation claims.
Target Holdings v Redferns [1996] AC 421
Equitable compensation aims to place the beneficiary in the position they would have been in 'but for' the breach of trust.
Maguire v Makaronis [1997] 188 CLR 449
Assessment of lost chance in equitable compensation.
Perry v Raleys Solicitors [2020] AC 352
A trustee's right to indemnity for expenses properly incurred in carrying out their duties.
Hardoon v Belilios [1901] AC 118
Relief from liability under section 61 of the Trustee Act 1925 requires honest and reasonable conduct by the trustee.
Santander UK Plc v R A Legal Solicitors [2014] EWCA Civ 183
Outcomes
Rollerteam's claim for equitable compensation for mortgage interest payments failed.
The payments were made by John (Rollerteam's director) personally, not by Rollerteam, and arose from his personal obligation, not Rollerteam's.
Rollerteam's claim for lost rental income due to delayed vacant possession failed.
The court found the most probable outcome 'but for' the breach would have been a sale of Parkgate, not rental.
Rollerteam was awarded £7,500 equitable compensation for wasted legal costs.
Costs incurred in pursuing a transfer of Parkgate were considered abortive due to Linda's breach.
Linda's counterclaim for reimbursement of repair and insurance costs largely failed.
The court found these costs were not properly incurred given Linda's breach and that the principle of equitable set-off applied.
Linda's counterclaim for reimbursement of service and utility costs failed.
Insufficient evidence was presented to demonstrate that Linda made the payments.
Rollerteam was awarded judgment against Linda in the sum of £7,165.56.
This reflects the equitable compensation awarded, less the small set-off for Linda's insurance costs for 2015.