West Law Report

Bankruptcy of sole legatee

Posted in Times Law Report by mrkooenglish on December 9, 2008

From The Times
December 9, 2008
Bankruptcy of sole legatee

Chancery Division
Published December 9, 2008
In re Hemming (deceased)
Raymond Saul & Co (a Firm) v Holden and Another

Where a sole residuary legatee under a will became bankrupt but was automatically discharged from bankruptcy before the completion of the administration of the estate of the testator, the money and assets which were thereafter ascertained to form the net residuary estate were payable to his trustee in bankruptcy.

Mr Richard Snowden, QC, so held, sitting as a deputy Chancery Division judge, on November 12, 2008, when making a declaration, on the claim brought by Raymond Saul & Co, Aldgate, solicitors, that the entitlement of Bernard Hemming to his mother’s residuary estate, including the right to receive the assets comprising that residue as and when the administration of the estate was complete, vested in his trustee in bankruptcy, Louise Mary Britten.

HIS LORDSHIP said that when a residuary legatee became bankrupt, the chose in action which vested in his trustee in bankruptcy was the composite right that included the right to have the assets comprised in the residuary estate paid over to him at the end of the administration of the estate.

Once that right vested in the trustee, the right would not revest in the bankrupt unless and until his bankruptcy debts and costs had been paid.

That right would be capable of being asserted by the trustee in bankruptcy against the executors, so as to preclude them from giving priority to any rival claims to the assets comprising the residue at the end of the administration.

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