Daniel v Drew - Case Summary

Daniel v Drew [2005] EWCA Civ 507

Trustee; undue influence; resignation

(337 words)

Facts

A Hampshire farm was left in trust to sisters Mss Drew and Daniel. The sisters gave away their interest to their respective sons. Thus Ms Drew’s son had half share, whereas Ms Daniel’s sons had one-quarter beneficial interest each. Ms Drew’s son acted as de facto trustee on his mother’s behalf. The farm was let to Ms Daniel’s elder son for a symbolic sum for years. However, at some stage, Mr Drew wanted rent from his cousin and was prepared to go to arbitration. Mr Daniel claimed repairs in turn. As a compromise, the Daniel brothers would have bought out Mr Drew’s interest and Ms Drew would have retired as trustee. However, Mr Drew changed his mind in the last minute. The elder Daniel brother then threatened his aunt with court proceedings. Ms Drew lied to her nephew and said she thought she had already resigned. Mr Daniel wanted a written confirmation, which Ms Drew – despite her reluctance.

Issues

Ms Drew – upon her son’s instigation – sued her nephew alleging that her nephew made her resign from her position as trustee of the family trust by undue influence. The first instance judge nullified the resignation. Mr Daniel appealed on the basis that his aunt did not wish to continue in her position as trustee as it was against her interests.

Decision/Outcome

The Court disagreed with Mr Daniel and held that Ms Drew would clearly have wanted to settle the identity of her successor before resigning and obviously wanted her son to replace her. However, Ms Drew was vulnerable and wanted to avoid legal confrontation at all costs. Mr Daniel, a forceful person, took advantage of this and obtained her signature in an unacceptable way. The key question in undue influence cases is whether the persuasion resulted in the invasion of the claimant’s free will. Leading is acceptable but the claimant must not be driven. Here, Ms Drew clearly was not acting at her own free will – as vulnerable as she was, she just wanted to avoid confrontation.