Barracks v Barracks & Anor

This case involves a dispute over the beneficial ownership of 45 Tentelow Lane, Norwood Green, Southall (“the Property”). The first defendant, Ralph Barracks (“Mr Barracks Senior”) lives in the property with his current wife and their daughter. The claimant, Paul Hugh Barracks (“Mr Barracks Junior”) is Mr Barracks Senior’s estranged son. The second defendant, Miss Alma Simmonds was at one point a partner of Mr Barracks Senior. She has played no part in these proceedings.

The property was purchased in 1986 by Mr Barracks Senior and his mother, Joanna Elizabeth Cummings. In the early 1990s Mr Barracks Senior wanted to set up and operate a care home in partnership with Miss Simmonds. For the purpose of raising funds the Property was mortgaged. As a result the legal estate was vested in Mr Barracks Senior and Miss Simmonds. With the assistance of funds realised by the mortgage Mr Barracks Senior acquired a further property (“the Second Property”) which was used for some time as a care home.

In the mid-1990s a dispute arose between Mr Barracks Senior and Miss Simmonds. Their partnership was brought to an end. Litigation ensued between them which touched on the ownership of both properties. Mrs Cummings was joined as a third party and she made claims of her own in those proceedings. In 2000 those proceedings were resolved, at least in part. On 18 April 2000 Mr Stanley Burnton QC (as he then was) gave judgment. His findings are relevant to some of the issues before me.

In May 1997 Mrs Cummings was moved by the local Social Services Department from the Property into a residential care home. She died in 2002. It appears that for the last four-and-a-half years of her life Mr Barracks Senior did not visit her, however, her grandson (Mr Barracks Junior) did. He seems to have been very attentive to his grandmother. In any event, in her Will, Mrs Cummings appointed her grandson as her sole executor and beneficiary of her estate.

Mr Barracks Junior brings these proceedings to recover his grandmother’s interest in the Property. His case is that the beneficial interest in it is, and always was, held by his grandmother and father as tenants in common, with each being entitled to a 50 per cent share. Mr Barracks Senior disputes this. He says that the beneficial interest was held as a joint tenancy and that, as a result, it all passed to him on the death of his mother.

At the hearing Mr Barracks Junior was represented by Mr Simon Wood of counsel. Mr Barracks Senior represented himself. As indicated above, Miss Simmonds played no part in these proceedings. She was not represented before me. Witness statements were served by both sides. Mr Barracks Senior and Mr Barracks Junior gave oral evidence and were cross-examined.

Mr Wood argues that there are four points in the chronology at which the parties’ respective cases can be assessed. He argues that the beneficial interest in the Property was always held by Mr Barracks Senior and his late mother as tenants in common, but even if that were not so, and the beneficial interest was originally held under a joint tenancy, the latter was severed at the time of the 1993 mortgage, or, if not then, at the time of Mrs Cummings’ involvement in the 1995 proceedings, or, if not then, as a result of the negotiations which followed Stanley Burnton’s 2000 judgment. He says that, if it was originally held as tenants in common or became so by severance, nothing was subsequently done to create or to recreate a joint tenancy. I shall consider the four stages in turn.

Mrs Cummings provided more than 50 per cent of the funds towards the purchase of the property. The Transfer Deed contains the wording that the survivor:

“Can give a valid receipt for capital money arising on a disposition of the land.”

I understand that Mr Barracks Senior relies on this as indicating that a joint tenancy was created. However, this is not the only thing he relies on. He tells me that it had always been agreed between his mother and him that they would hold the Property as joint tenants so that the survivor would take everything.

As far as the latter assertion is concerned, there is no documentary material to support it. Of course Mrs Cummings is now dead so evidence from her is not available, yet nothing in the history of this dispute suggests that she ever had any such understanding. Indeed, I am not persuaded that Mr Barracks Senior had this view until recently. As will be explained in greater detail below, when Mrs Cummings, or those acting on her behalf, asked for her share in the property, Mr Barracks Senior did not retort that they had always agreed that the Property should belong in its entirety to the survivor. On the contrary, he appears to have accepted that he was only entitled to a half-share, and negotiated on that basis.

The Transfer Deed also does not support Mr Barracks Senior’s case. Mr Wood draws my attention to Huntingford v Hobbs [1993] 1FLR 736, in which wording which was in substance identical to the wording relied on in this Transfer Deed, was under consideration. The Court of Appeal held that it did not create a joint tenancy. As Lord Justice Steyn said:

“Given the stringent tests governing the implication of terms, it was impossible in Harwood to imply a declaration of trust into the words contained in the detailed standard form transfer document.”

That applies as much here. There is nothing to suggest that Mr Barracks Senior or his mother ever turned their minds to the creation of a joint tenancy in respect to the beneficial interest in the Property, let alone determined to make a declaration of Trust to that effect. It follows that as of 1986 they held the beneficial interest in the Property as tenants in common. It is not suggested that anything was done subsequent to that date which would have created de novo a joint tenancy. It must follow that Mr Barracks Junior wins this action.

Notwithstanding that finding, I think it will be useful to consider the other arguments advanced by Mr Wood. He says that even if there had been a joint tenancy as at 1986, certainly that ceased to be the case in 1993. It will be recalled that, at that time, Mr Barracks Senior needed to raise capital to fund his care home venture. As Mr Stanley Burnton held in his 2000 judgment, £60,000 was raised by mortgage on the property. He found that this was half the equity. Mr Barracks Senior was in effect realising his half-share in the Property. In fact, the solicitors then employed by him and his mother advised that Miss Simmonds’ name be added to the deeds of the Property. This advice was criticised by Mr Stanley Burnton, but nothing turns on it for present purposes. What is important are the terms of the Deed of Transfer entered into at that time to facilitate the mortgage. It provides that the Property was to be transferred on terms that Mr Barracks Senior, Miss Simmonds and Mrs Cummings held it as tenants in common as to 50 per cent of the value of the Property for Joanna Elizabeth Cummings and as to 25 per cent each of the value of the Property for Ralph St Arben Barracks and Alma Violet Simmonds.

Mr Wood argues that Mr Barracks Senior’s attempts to raise capital on “his half” of the Property was effective to sever any joint tenancy, if one had existed at that time. In support of this, he relies on First National Security v Heggarty [1984] 1 All ER 139. He says that raising the mortgage to secure half the equity in the Property was a sufficient act of alienation to sever any joint tenancy. I agree. Second, he says that there is no material which would justify the court in going behind the declaration in the 1993 deed. I agree with that also. It follows that even if not before then, a tenancy in common was created in 1993.

The next important event is the 1995 proceedings. The issue on this is short. When Mrs Cummings was joined as a third party to the proceedings, she not only defended the claim against her, but she also raised a counterclaim. In her pleadings she referred to the fact that the Property was transferred to herself, her son and his partner, as tenants in common (see paragraph 5.1 of her pleading). She counterclaimed for inter alia:

“An Order that No. 45 be sold and that the net proceeds of sale be divided between the Third Party of the one part and the partners of the other part in equal shares.”

Mr Wood argues that the service of this pleading amounts to a written notice to sever under Section 36(2) of the Law of Property Act 1925. In support he relies on Re Drapers Conveyance [1960] 1 Ch 486. I agree with this submission. In fact, at this stage there appears to have been no dispute between Mr Barracks Senior and his mother that Mr Barracks Senior was only entitled to a half-share in the Property. This is confirmed by the contents of the third affidavit of Mr Barracks Senior, sworn and signed by him on 25 March 1997. A section of that affidavit bears the rubric “the parties’ respective interests in number 45 Tentelow Lane”. Mr Barracks Senior deposes to his view of the beneficial ownership of the Property. The affidavit is written in a strange style. He refers to himself in the third person and says as follows:

“16.

Mrs Cummings seems to contend that the result of the transfer of no. 45 into the names of all three parties was that she retained a one half interest in the property whilst the partners shared the remaining one half interest. As she puts it ‘in effect Mr Barracks [the Plaintiff] gave Mrs Simmonds [the Defendant] half his beneficial interest in No. 45’: see paragraph 4 of Mr Dear’s affidavit dated 17 February 1998.

17.

I have not seen my mother for some time. She now lives in accommodation provided by Social Services and it was once suggested that she wanted no. 45 to be sold so that she can realise her half interest and apply it towards the cost of the accommodation provided by Social Services. …

18.

The Plaintiff lives in no. 45 with his wife and small child. He accepts that his mother has a half-share in the property. He says that he is entitled to the remaining half share. He denies that the Defendant has any interest in the property at all. He opposes an order for sale. Whilst he appears to recognise that his mother is entitled to realise her share, he wants the sale of the property to be delayed. He hopes that when the partnership is wound up, his share of the assets will be sufficient to buy out his mother’s half share in no. 45: see paragraphs 8 and 9 of his affidavit dated 6 March 1998.”

Mr Barracks Senior attempted to explain this away by saying that the affidavit was drafted by lawyers. I do not accept that. As mentioned above, the version of events, he gave to me was that his mother and he had always agreed that the survivor would be entitled to retain all the interest in the Property. These passages say the opposite. I entertain no serious doubt that Mr Barracks Senior and his mother always wanted the beneficial interest in the Property to be held as tenants in common on a 50/50 basis. As Mr Wood says, had it truly been the agreement and the intention of Mr Barracks Senior to create a joint tenancy, he was remarkably unlucky in his choice of solicitors. The 1986 deed failed to refer to a joint tenancy. The 1993 deed said the exact opposite, and Mr Barracks Senior’s third affidavit also gave no hint of this alleged agreed tenancy. In my view, the truth is that the latter three documents accurately reflect what Mrs Cummings and her son had always intended, namely separate entitlement each to 50 per cent of the beneficial interest in the Property. Once again, the claimant wins on these points.

This leaves only Mr Wood’s last argument. He says that even if, contrary to all his earlier submissions, a joint tenancy in respect of the beneficial interest in the Property existed as at the date of Mr Stanley Burnton’s judgment, there was a mutual agreement to sever it thereafter. In support of this he has taken me through some correspondence which shows that Mrs Cummings and her son were negotiating for him to buy out her share in the Property. What is important for this purpose is the fact that there appears to have been no dispute between the parties that Mrs Cummings was entitled to 50 per cent of the beneficial interest. The only difference between them was as to the value of the Property and the timescale over which the interest would be purchased. I agree that the parties mutually agreed to treat the beneficial interest in the Property as if held as tenants in common. If a joint tenancy had existed at the beginning of 2000, it was severed by mutual agreement.

At the end of his submissions to me, Mr Barracks Senior asked that if there be a finding that the beneficial interest of the Property was held as tenants in common, some share other than 50/50 would be appropriate. In my view there is nothing which would justify that course. As a result I find for Mr Barracks Junior.

With regards to costs, the first defendant is to pay the claimant’s costs, subject to detailed assessment, if not agreed.