Court allows executor resignation due to conflict of interest but dismisses claim for half estate share.

Neutral Citation Number [2012] IEHC 140

THE HIGH COURT

[2009 No. 3286P]

IN THE MATTER OF THE ESTATE OF BRIAN RHATIGAN DECEASED, LATE OF "CHANTILLY", BALLYBRIDE ROAD, RATHMICHAEL IN

THE COUNTY OF DUBLIN

BETWEEN

SHARON SCALLY

PLAINTIFF

AND

ODILLA RHATIGAN

DEFENDANT

Judgment of Miss Justice Laffoy delivered on 28th day of March, 2012.

1. The issues/pleading

1.1 In my judgment in this matter delivered on 21st December, 2010 [2011] 1 I.R. 639 (the 2010 Judgment), I dealt, by consent of

the parties, with the first three issues to be tried in this matter and I found:

(a) that the will dated 19th May, 2005 (the Will) of Brian Rhatigan (the Testator) was executed in accordance with the

formalities required by s. 78 of the Succession Act 1965 (the Act of 1965);

(b) that the Testator knew and approved of the contents of the Will; and

(c) that at the time of executing the Will the Testator was of sound disposing mind and had capacity to make a valid will.

1.2 While the second module of the proceedings with which judgment is concerned was expected to deal with the remainder of the

issues, which, having regard to the manner in which the case was pleaded, were all raised in the defendant's counterclaim and which,

as I had stated in the 2010 Judgment (at para. 2), go beyond the issues which would usually be raised in a probate action, in fact,

the focus at the hearing of the second module was much narrower. Accordingly, having regard to the position adopted by the parties

at the hearing, the principal issue which requires to be determined at this stage is whether the Court should make an order in the

terms sought in paragraph 5 of the prayer in the counterclaim, in which the defendant seeks an order declaring that, by her conduct,

the plaintiff is not an appropriate person to act as an executor of the Testator's estate. If the Court makes a declaration to that

effect, obviously, the Court has to address the question of to whom letters of administration with the Will of the Testator annexed

should issue, given that the plaintiff is the sole surviving executrix of the Testator, the other executor nominated by the Testator,

Dan O'Donoghue, having died on 6th April, 2008. In that connection, one of the reliefs which the defendant has sought in the

counterclaim is an order giving the defendant liberty to apply for and extract a grant of letters of administration.

1.3 The basis on which it was asserted that the plaintiff is not an appropriate person to act as executor of the Testator's estate, as

pleaded in the counterclaim, was, in part, as follows:

(a) that the firm of Amorys, Solicitors, of which the plaintiff is the principal and has at all relevant times been a partner,

at all times acted in connection with all of the property transactions carried on in Ireland for and on behalf of the

Testator, in his personal capacity, and for and on behalf of companies, including, inter alia, York Securities Ltd. (York),

TAM Enterprises Ltd. (TAM) and Unit 33 Nominees Ltd. (Unit 33), which are controlled by, or used as nominees for

transactions by, the Golden Promise Trust; and

(b) that the plaintiff, by reason of her personal involvement in the affairs of the Testator prior to his death and, in

particular, having acted on behalf of the Testator in his personal capacity and for and on behalf of the companies in

which the Testator had an interest and which are connected with the Golden Promise Trust, has a conflict of interest in

acting as executor of the estate of the Testator and is not an appropriate person to carry out the necessary inquiries for

and on behalf of the Testator's estate.

1.4 In addition to the allegation of a conflict of interest, which, it is contended, renders her inappropriate to act as executor of the

Testator's will, it was also pleaded in the counterclaim that, while the plaintiff had full details of all the property held directly or

indirectly by the Golden Promise Trust, the associated companies, the structure behind the Golden Promise Trust and the terms of the

trust, she had failed to disclose the full extent of the Testator's assets, failed to carry out all relevant inquiries, and failed to gather

in the Testator's assets and that she had demonstrated that she was not willing to conduct the necessary inquiries and to take the

necessary steps to recover the Testator's assets for the benefit of the estate.

1.5 I have emphasised the distinct bases on which it was pleaded that the plaintiff is not an appropriate person to act as executor of

the Testator's estate because, while the issues as set out in the Master's order of 5th May, 2010, which was made with the consent

of the parties, raise questions as to whether the plaintiff has failed to carry out proper inquiries into the extent of, or has failed to

take reasonable or sufficient steps to recover, the assets of the Testator, or has been guilty of gross, inordinate and inexcusable

delay in the administration of the Testator's estate, the focus of the evidence adduced on behalf of the defendant at the hearing of

the second module of the proceedings was on the plaintiff being unsuitable to fulfil the role of executor because, it was contended,

she is conflicted in her professional capacity. Accordingly, it is that contention which will be primarily addressed in this judgment.

1.6. In the reply and defence to counterclaim delivered by the plaintiff, issue was joined with all of the assertions made by the

defendant in her defence. As regards the elements of the counterclaim which are now being addressed, it was admitted that the

plaintiff was instructed in respect of property transactions by the Testator, in his stated capacity as project manager engaged by

York and in his personal capacity, and also in respect of property transactions concluded by, inter alia, York, TAM and Unit 33,

although it was stated that it was not known whether she acted in respect of all such property transactions carried out in Ireland.

Further, it was admitted that the plaintiff acted for the Testator in his personal capacity during his lifetime and that she acted for

companies with whom the Testator had an association, although it was not admitted that he had an "interest" in the said companies.

However, it was denied that the plaintiff had any conflict of interest by reason of the foregoing or otherwise in acting as executrix of

the Testator and it was denied that the circumstances pleaded in the counterclaim disclosed any such conflict of interest. As regards

the allegations that the plaintiff failed to carry out the necessary inquiries and failed to take the necessary steps to recover the

Testator's assets, it was admitted that the plaintiff had not completed her inquiries into the extent of the Testator's assets, by

reason, inter alia, of the fact that they had been interrupted or hampered by the institution of these proceedings. It was denied that

she had failed to carry out such inquiries as might reasonably have been expected.

2. The law

2.1 Before considering the relevant authorities, I think it is pertinent to reiterate that under the terms of the Will, as recorded at

para. 14 of the 2010 Judgment, the plaintiff was appointed both executor and trustee of the Will. As regards the Testator's residuary

estate, the executors and trustees thereby appointed were given the type of broad discretions and the type of broad powers one

would expect to find in a discretionary trust established to distribute the residuary estate among the beneficiaries of the trust, whom

I have identified at para. 18 of the 2010 Judgment. Given the ongoing Revenue investigation referred to at para. 11 of the 2010

judgment, it is not possible to form a view at this stage as to the extent of the assets of the residuary estate, if any, which will be

subject to the discretionary trusts created by the Will. Indeed, the plaintiff expressed the view that there is a significant chance that

the estate may be insolvent. In any event, as I have stated, the primary issue for consideration at this juncture is whether a grant of

probate of the Will should issue to the plaintiff.

2.2 The powers of the High Court in relation to granting probate are governed by ss. 26 and 27 of the Act of 1965. Section 26(1)

confers power on the High Court to grant probate to one or more executors of a deceased person, and the grant may be limited in

any way the Court thinks fit. Section 27(4) provides that where by reason of any special circumstances it appears to the High Court

to be necessary or expedient to do so, the Court may order that administration be granted to such person as it thinks fit. Section 10

(3) of the Act of 1965 provides:

"The personal representatives shall be the representatives of the deceased in regard to his real and personal estate and

shall hold the estate as trustees for the persons by law entitled thereto."

2.3 The leading authority in this jurisdiction on the jurisdiction of the Court to remove an executor is the decision of the Supreme

Court in Dunne v. Heffernan [1997] 3 I.R. 431. In that case, the defendant, who was the sole surviving executrix of the estate of the

testatrix in issue, had extracted a grant of probate. The plaintiff, who was a beneficiary on a partial intestacy of property of the

testatrix which was not dealt with in the will, sought an order revoking and cancelling the grant of probate which had issued to the

defendant. The dispute between the plaintiff and the defendant centred on the fact that the defendant had valued preference shares

in a company, Dunnes Holding Company, which passed under the will of the testatrix, at IR£265 on the Inland Revenue affidavit

furnished to the Revenue Commissioners, which the plaintiff, who had been a preference shareholder of that company, contended was

a gross undervalue and exposed him to capital gains tax liability in relation to the sale of his preference shares in the company for

several million pounds, which had occurred prior to the death of the testatrix. In setting out his conclusions, Lynch J., with whom the

other judges of the Supreme Court concurred, quoted from the judgment at first instance in which the trial judge had referred to the

fact that, notwithstanding "severe differences between the litigants", the defendant had not renounced her right to probate, and

stated that the trial judge had approached the matter from the wrong perspective, that the executrix should have renounced in

favour of some stranger to the family, and continued (at p. 442):

"The factors referred to, namely family differences, might well induce an independent executor such as the family's

solicitor or a friend of the family, if appointed, to renounce rather than risk getting embroiled in the family disputes. Such

a person might reasonably decide to leave it to a member of the family to sort out such matters. The factors referred to

by the learned trial judge are no reason at all why the defendant, a sister of the testatrix, should have contemplated

renouncing rather than extracting probate. Moreover, these factors existed prior to the death of the testatrix who,

nevertheless, chose the defendant to be her executrix."

Later, in his judgment (at p. 442), Lynch J. summarised the law as follows:

"An order removing the defendant as executrix (which would be made by virtue of s. 26, sub-s. 2 and not s. 27, sub-s. 4

of the Succession Act, 1965) and appointing some other person as administrator with the will annexed by virtue of s. 27,

sub-s. 4, is a very serious step to take. It is not justified because one of the beneficiaries appears to have felt frustrated

and excluded from what he considered his legitimate concerns. It would require serious misconduct and/or serious special

circumstances on the part of the executrix to justify such a drastic step."

In this case, counsel for the parties were in agreement that the onus of establishing "serious misconduct" or "serious special

circumstances" on the part of the plaintiff lies with the defendant.

2.4 One of the grounds which had been relied on by the plaintiff in Dunne v. Heffernan was that the defendant was "in a position of

fundamental conflict of interest as executrix of the estate having regard to her position as a shareholder in, and director of Dunnes

Holding Company ... and as a beneficiary of the trust". In relation to that ground, Lynch J. stated that he found it difficult to discern

any conflict of interest. Later he summarised the position as follows (at p. 447):

"A fact of the matter is that the defendant has done nothing wrong in her capacity as executrix and the mistaken

perception of the plaintiff that she has done wrong, cannot alter the position that she has not. The alleged conflict of

interest is flimsy in the extreme. Any family business can raise similar situations to those arising in this case and it would

be a strange state of affairs if a parent or a member of the family was not entitled to entrust the administration of their

estate to a child or brother or sister just because of the nature and complications of the business enterprise."

2.5 The principles laid down in Dunne v. Heffernan were applied by the High Court (Macken J.) in Flood v. Flood [1999] 2 I.R. 234. The

defendant in that case was the executor of the will of the testator to whom a grant of probate had issued. The basis on which the

plaintiff beneficiaries sought to have the grant revoked was that the defendant had borrowed monies from the deceased, which he

was then refusing to pay back to the estate, and this created a conflict of interest between the defendant's role as executor of the

estate and as a possible debtor to that estate. Macken J. removed the defendant as executor holding that it was not possible to

accept the defendant's argument that no cause of action could exist. She stated (at p. 244):

"Having regard to the decision of the Supreme Court in Dunne v. Heffernan ... above and although I am reluctant to take

steps which would in any way have the effect of depleting the value of the estate, nevertheless I am also satisfied that a

very serious matter arises in the administration of the estate, and the only way in which that can be dealt with is to

remove the defendant as executor ... and appoint an alternative to the defendant, pursuant to s. 27(4) ...."

2.6 The decision of the High Court (Barron J.) in Spencer v. Kinsella [1996] 2 ILRM 401 concerned an application to remove, as a

body, the trustees of land in the town of Gorey used as showgrounds, which were the subject of trusts pursuant to a scheme made

under the Irish Land Act 1903, as amended, on the grounds that they had persistently refused to act when called upon to do so. In

his judgment, Barron J., having commented that, in all cases of trust, it is a truism to say that no trustee should allow his interests to

conflict with his duty, went on to state (at p. 409):

"A trust is set up for the welfare of its beneficiaries. In my view, therefore before determining whether or not any trustee

should be removed from his or her office it is necessary to determine whether his or her continuation in that office will be

detrimental to such welfare.

In the present case the main problem lies in the failure of the trustees to execute agreements with the users of the trust.

There is also the further problem that some of the trustees are too closely identified with the interests of some of those

users to be regarded as being capable of being truly impartial in any decision making process involving the trustees. None

of these faults have resulted from any deliberate or conscious conduct or misconduct on the part of the trustees.

Nevertheless where a conflict of interest arises it is doubtful that a continuation by such persons in office could be

remedied.

. . . The welfare of the beneficiaries is being affected by the present situation. There is a conflict of interest which I have

identified and it would be difficult to reorganise with such conflict on the part of some of the trustees continuing to exist.

It is accordingly appropriate that such persons should step down. It will however serve no purpose if they step down, but

at the same time no other reorganisation takes place."

Having stated that what was needed was the appointment of trustees who would be, so far as possible, impartial as between the

user of the grounds, Barron J. stated that he did not propose to exercise the powers of the court at that point in time. As he saw it,

it was essentially a matter for the people of Gorey and the Department of Agriculture, Forestry and Food to reorganise the

administration of the trust and, accordingly, he adjourned the matter for six months to enable the administration of the trust to be

placed on a proper footing. He made it clear that it was only if that could not be done that the court would consider how the exercise

of its powers could be alleviate the then situation.

2.7 It is commented in Delany in Equity and the Law of Trusts in Ireland (5th Ed.) at p. 436 that the judgment of Barron J. is useful in

that it confirms that the overriding principle to which the Court must have regard in exercising its power to remove trustees is the

welfare of the beneficiaries, although it is implicit in the comment in footnote 38 on the same page that the approach adopted by the

Supreme Court in Dunne v. Heffernan in relation to the removal of an executor is a stricter approach. Be that as it may, the feature

which distinguishes this case from the authorities to which I have referred is that the basis upon which it is alleged that the plaintiff is

conflicted in this case is that she is conflicted in her professional capacity, rather than in any personal capacity or because of any

personal interest.

2.8 Of the authorities on which counsel for the defendant has relied, which address a conflict of interest in a professional capacity,

that which I have found most helpful is the decision of the House of Lords in Hilton v. Barker Booth [2005] 1 All ER 651. What is

interesting and instructive about that case is the manner in which the House of Lords applied the principles laid down in Moody v. Cox

[1917] 2 Ch. 71. However, in order to understand those principles, it is necessary to explain the factual background to the earlier

decision. The plaintiff, Moody, had contracted to purchase from Cox and Hatt, who were trustees, a portion of the trust property.

Hatt was a solicitor and Cox was his managing clerk. Throughout the transaction, Hatt acted (through Cox) as solicitor for both

vendors and purchaser. The purchaser was allowed to rescind because the evidence of Cox was that he knew that the price the

client, Moody, was paying for the property was a good deal more than the value that had been placed on the property for probate

purposes and that he, Cox, had not told the client, Moody, the amount of the probate valuation, on the basis that his duty to the

vendors precluded him from so doing.

2.9 That evidence of Cox lead to the passage from the judgment of Scrutton L.J. which was quoted by Lord Scott in Hilton v. Barker

Booth. Scrutton L.J., having summarised the evidence of Cox to the effect that he told Moody that the property was worth the

purchase price, although he knew that it was not because he had been advised that it was worth a good deal less, and that he knew

the value had depreciated since the probate valuation, but did not tell Cox the amount of the probate valuation, stated (at p. 91):

"A man who says that admits in the plainest terms that he is not fulfilling the duty which lies upon him as a solicitor acting

for a client. But it is said that he could not disclose that information consistently with his duty to his other clients, the

cestuis que trust. It may be that a solicitor who tries to act for both parties puts himself in such a position that he must

be liable to one or the other, whatever he does. The case has been put of a solicitor acting for vendor and purchaser who

knows of a flaw in the title by reason of his acting for the vendor, and who, if he discloses that flaw in the title which he

knows as acting for the vendor, may be liable to an action by his vendor, and who, if he does not disclose the flaw in the

title, may be liable to an action by the purchaser for not doing his duty as solicitor for him. It will be his fault for mixing

himself up with a transaction in which he has two entirely inconsistent interests, and solicitors who try to act for both

vendors and purchasers must appreciate that they run a very serious risk of liability to one or the other owing to the

duties and obligations which such curious relation puts upon them."

Lord Scott made the following comment on the principles expressed in that passage in Hilton v. Barker Booth (at p. 655):

"The reasoning in Moody v Cox did not depend on the circumstance that actual misrepresentations might have been made

by the solicitors to their client. It depended on the failure by the solicitors to disclose to their client information that it

was their contractual duty to him to disclose. The fact that the disclosure of the information would, or might, have placed

the solicitors in breach of duties they owed to others did not relieve them of the contractual duties they had undertaken

or of the legal consequences of their breach of those contractual duties."

2.10 In Hilton v. Barker Booth, Lord Walker also quoted a passage from Moody v. Cox, being a passage from the judgment of Cozens-

Hardy M.R. (at p. 81) to the following effect:

"A man may have a duty on one side and an interest on another. A solicitor who puts himself in that position takes upon

himself a grievous responsibility. A solicitor may have a duty on one side and a duty on the other, namely, a duty to his

client as solicitor on the one side and a duty to his beneficiaries on the other; but if he chooses to put himself in that

position it does not lie in his mouth to say to the client 'I have not discharged that which the law says is my duty towards

you, my client, because I owe a duty to the beneficiaries on the other side'. The answer is that if a solicitor involves

himself in that dilemma it is his own fault. He ought before putting himself in that position to inform the client of his

conflicting duties, and either obtain from that client an agreement that he should not perform his full duties of disclosure

or say - which would be much better - 'I cannot accept this business'. I think it would be the worst thing to say that a

solicitor can escape from the obligations, imposed upon him as solicitor, of disclosure if he can prove that it is not a case

of duty on one side and of interest on the other, but a case of duty on both sides and therefore impossible to perform."

In Hilton v. Barker Booth (at p. 664), Lord Walker went on to make the following comment on that passage:

"The thrust of this passage, and of all three judgments in Moody v Cox, is that if a solicitor puts himself in a position of

having two irreconcilable duties (in that case, to his beneficiaries and to his client, Moody) it is his own fault. If he has a

personal financial interest which conflicts with his duty, he is even more obviously at fault."

2.11 The decision of the House of Lords in Hilton v. Barker Booth was considered in the Supreme Court by Hardiman J. in O'Carroll v.

Diamond [2005] 4 I.R. 41 where he stated (at p. 52):

"There, a firm of solicitors acted for two separate persons engaged in a property development. The firm was privy to

information about one of those persons (that he had served a prison sentence for a commercial offence) in respect of

which they owed him a duty of confidentiality. Accordingly, they did not disclose it to their other client. The House of

Lords held that if a solicitor put himself into a position of having two irreconcilable duties, that was his own fault. The

solicitor who had conflicting duties to two clients could not prefer one to the other. He had to perform both as best he

could and 'this may involve performing one duty to the letter of the obligation, and paying compensation for his failure to

perform the other. But in any case the fact that he has chosen to put himself in an impossible position does not

exonerate him from liability'. I have no doubt that this is correct. ... The impossible position referred to in Hilton v. Barker

Booth ..., and in other cases dating back to Moody v. Cox ... , is that of accepting instructions from two persons with

conflicting interests without disclosing that state of affairs."

2.12 Counsel for the defendant also relied on a passage from the judgment of Barron J., giving judgment in the Supreme Court, in

Carroll v. Carroll [1999] 4 I.R. 241. That case concerned an action by the personal representatives of a deceased donor to set aside

a voluntary transaction made by the donor during his lifetime on the grounds that it was procured by undue influence and that it was

an improvident transaction. There was evidence that the donor had not received independent legal advice. Counsel for the defendant

emphasised that the role of a solicitor and what a solicitor should not do was outlined by Barron J. in the following passage, in which

he addressed the position of the donee's solicitor (at p. 266):

"Even if he had been the donor's solicitor, what he did would not have saved the transaction. As I said before, a solicitor

or other professional person does not fulfil his obligation to his client or patient by simply doing what he is asked or

instructed to do. He owes such person a duty to exercise his professional skill and judgment and he does not fulfil that

duty by blithely following instructions without stopping to consider whether to do so is appropriate. Having done so, he

must then give advice as to whether or not what is required of him is proper. Here, his duty was to advise the donor to

obtain independent advice. In the present case, whatever independence [the donee's solicitor] may have had has been

destroyed by his acting in the present proceedings as solicitor to the personal representative of the donee."

That passage was echoed in the following passage from the judgment of Hardiman J. in O'Carroll v. Diamond where, having

distinguished the facts of the case before him from the facts in Carroll v. Carroll, he stated (at p. 54):

"My decision should not be taken as implying that, in other circumstances, a solicitor necessarily discharges his duty

merely by urging a person to take independent advice and blandly accepting a decision not to do so. Depending on the

circumstances his obligations may be much greater and may include declining to act until such advice is taken."

2.13 Notwithstanding that the main thrust of the defendant's case was that the plaintiff is professionally conflicted, in their

submissions counsel for the defendant addressed the fiduciary status of the plaintiff in her role as executrix of the Testator. In

essence, what the plaintiff seeks in this case is the affirmation by the Court of her fiduciary status by the Court granting probate of

the Will of the Testator to her. The position of a solicitor in a fiduciary capacity was considered by the Court of Appeal of England

and Wales in Bristol and West BS v. Mothew [1996]4 All ER 698. Of particular relevance for present purposes is the following

observation from the judgment of Millett L.J. (at p. 713):

"Finally, the fiduciary must take care not to find himself in a position where there is an actual conflict of duty so that he

cannot fulfil his obligations to one principal without failing in his obligations to the other: see Moody v. Cox ... If he does,

he may have no alternative but to cease to act for at least one and preferably both. The fact that he cannot fulfil his

obligations to one principal without being in breach of his obligations to the other will not absolve him from liability. I shall

call this 'the actual conflict rule'."

3. Whether the plaintiff conflicted- the evidence

3.1 As stated at para. 10 of the 2010 Judgment, on the basis of the evidence adduced in the first module of these proceedings, I

considered that it was reasonable to draw the following inferences:

(a) that the Testator had an interest, in the sense that he was in a position to determine the ultimate destination of its

assets, in the Golden Promise Trust, which had been set up in Cyprus in 1999;

(b) that he also had an interest in the assets of the trust known as the Dolphin Trust, which appeared to have been set

up in Guernsey in 1984.

Further, I noted that it had been established since his death that he was the beneficial owner of the assets of the trust known as the

Doni Trust, which had been set up in the Isle of Man in 2002. As I stated, it was not possible at that stage to disentangle the

labyrinthine network of offshore trusts, corporations, property developments and investments in which, prima facie, the Testator

would appear to have had an involvement during his lifetime. The evidence adduced over six days during the second module of the

proceedings has only marginally thrown further light on the assets in which the Testator had an interest, in the sense in which I have

already used that expression at (a) above.

3.2 For the purposes of determining whether the evidence has shown that the plaintiff, in her professional capacity, would have

conflicting duties, if a grant of probate of the Will was issued to her, the crucial task of the Court is to analyse and assess her

professional position vis á-vis two categories of beneficiaries of the Testator's bounty. Those categories are:

(a) the beneficiaries of assets the distribution of which falls to be determined in accordance with the terms of the Will, to

which I will refer as the "estate assets"; and

(b) the beneficiaries of assets settled, in the sense that he was the arbiter of their ultimate destination, by the Testator,

directly or indirectly, which do no fall within his estate, to which I will refer as "non-estate assets".

It is important to emphasise at the outset that the defendant, as one of the principal beneficiaries of the estate assets, is

vehemently opposed to a grant of probate issuing to the plaintiff.

3.3 The controversy between the defendant and the plaintiff commenced within six months of the death of the Testator. Although

she had been de facto separated from the Testator for approximately eight years at the date of his death, there was no formal

separation agreement in place between the defendant and the Testator, nor had any family law proceedings been initiated. As is set

out in paragraph 15 of the 2010 Judgment, the Testator, having devised and bequeathed all his estate to his executors upon trust for

sale, directed them, after payment and discharge of his funeral and testamentary expenses and debts, to "satisfy or provide for the

satisfaction of the statutory right" of the defendant under the provisions of the Act of 1965. In other words, the defendant was to be

the beneficiary of one-third share of the net estate of the Testator. The controversy between the defendant and the plaintiff was

triggered by a letter dated 20th July, 2006 from the defendant to the plaintiff. That letter was a long, complicated letter. It is

acknowledged that the defendant had the assistance of a solicitor in composing it.

3.4 In the letter of 20th July 2006, the defendant raised a large number of issues. However, I only propose adverting to some of them

and to the plaintiff's response, by letter dated 21st August 2006 from Amorys, in relation to those issues, as a preliminary to setting

out what the evidence discloses as to the manner in which those issues were dealt with after the death of the Testator and the

plaintiff's involvement in dealing with them. Before concentrating on those issues, however, it is appropriate to record a number of

exchanges which give a clear impression of how the plaintiff envisaged her professional role at the time. First, the defendant, who

contended that she was a director of York, sought up to date accounts and books and records of that company. The response of the

plaintiff, through the medium of Amorys, was that, whilst she acted for York, she had no power in her capacity as company solicitor

to provide the defendant with any accounts, books or records of the company. Secondly, the defendant contended that there

seemed to be "a substantial conflict of interest" and that the plaintiff appeared to be taking instructions from the Testator's partner,

Ms. Kiely. The response of the plaintiff was that there was absolutely no foundation for the assertion that there was a conflict of

interest and she denied that there was in fact any conflict of interest and, for the avoidance of doubt, she stated that she was not

"taking instructions from" Ms. Kiely either then nor had she been at any time. That statement has to be considered in the light of the

evidence at the hearing of the second module of the proceedings in relation to the sale of "Chantilly".

3.5 Apart from the plaintiff’s involvement in the sale of "Chantilly", the issues raised by the defendant which I propose considering in

the context of the alleged professional conflict are:

(a) the plaintiffs involvement in the sale of the property known as Kildare Enterprise Centre: and

(b) the discharge of a mortgage on the defendant's family home known as "Bri-Odi", Cabinteely in County Dublin.

3.6 The controversy continued after the defendant retained Matheson Ormsby Prentice (MOP) as her solicitors in June 2007. By letter

of 28th June, 2007 the plaintiff was notified that MOP were acting for the defendant. The plaintiff has made clear both in

correspondence and in her evidence that she is aggrieved by the acrimonious and confrontational tone of the correspondence which

emanated from MOP and in the evidence adduced at the hearing. It is also the position of the plaintiff that the defendant's solicitors

have withheld significant information of direct relevance to the administration of the estate from her. There is no doubt but that the

interaction between Amorys, on behalf of the plaintiff, and MOP, on behalf of defendant, has been very acrimonious. However, the

acrimony was there from the start and it is evident in both the letter of 20th July, 2006 from the defendant to the plaintiff and the

plaintiffs response in Amorys letter of 21st August, 2006. The acrimony was understandable because the defendant was contending

from the outset that the plaintiff was conflicted and that her interest as a beneficiary was not being protected, while the plaintiff was

denying that any such conflict existed.

3.7 Due to the efforts of MOP on her behalf, by virtue of a deed of appointment dated 15th July, 2009 made between Credit Suisse

Trust Ltd., the trustee of the settlement dated 14th May, 1984 under which the so-called Dolphin Trust was created, and the

defendant, the trustee appointed the Trust Fund, as defined in that settlement, to the defendant irrevocably and absolutely. The

evidence established that after discharge of tax liability and the legal costs, which arose in various jurisdictions, the balance of the

Trust Fund was, according to the defendant, split between her children and herself. In consequence, the defendant became solely

and absolutely beneficially entitled to a very substantial sum of money. That may have tax implications for the estate of the Testator,

which, in due course, may have to be addressed by his personal representative. However, I mention this aspect of the matter at this

juncture because of the documentation which MOP received in February 2010 in connection with the distribution of the assets of the

Dolphin Trust, which, apparently, was finalised in February 2010. MOP received files relevant to the assets of the Dolphin Trust from

the entity in the Isle of Man which had been administering the assets. Among the files was what MOP described as "a partially

executed copy of the Golden Promise Trust". While this document did not resolve the issue as to the identity of the settler of the

Golden Promise Trust, it clearly was, and is, of significance. It was furnished by MOP to the plaintiff with their letter of 28th April,

2010. The plaintiff has complained about the delay in furnishing this document, suggesting that it was a tactical move on the part of

the defendant and was intended to undermine her position as executrix. In my view, the evidence does not bear out that allegation.

3.8 The reality of these proceedings is that they reflect a major contest between the defendant, as one of the principal beneficiaries

of the very limited estate assets, on the one hand, and the beneficiaries of what appear to be very substantial non-estate assets, on

the other hand. Such a contest is inevitably going to be played out in an acrimonious fashion. So it has been and so it continues in

this case, in relation to the multiplicity of issues which have arisen between the defendant and the plaintiff in relation to assets over

which the Testator may or may not have had ultimate control. The three issues which I have chosen from the issues which have

arisen between the defendant and the plaintiff and between MOP and Amorys in assessing whether the plaintiff is professionally

conflicted are issues which relate to matters in which the plaintiff has been professionally involved, through the medium of Amorys,

since the death of the Testator. The firm Amorys have acted for the plaintiff in the prosecution of these proceedings.

4. "Chantilly"

4.1 "Chantilly" was the house at Rathmichael, County Dublin in which the Testator and Ms. Kiely resided from December 1999 until the

Testator's death and from which the Testator carried on his business from January 2004 until his death. I have outlined to some

extent the title to "Chantilly" in the 2010 Judgment at para. 50 and, in particular, that it had been purchased in the name of Unit 33,

a company incorporated in the Isle of Man, with the aid of a loan from Anglo Irish Bank plc. (Anglo). The plaintiff's evidence in the first

module of these proceedings was that she became aware that "a trust called the Chantilly Trust" had been set up, but she was not

involved in setting it up. I have also outlined the circumstances in which in March 2005, the existing mortgage in favour of Anglo over

"Chantilly" was discharged in the 2010 Judgment: Doni Limited, the trustee of the Doni Trust, the assets of which were beneficially

owned by the Testator, granted a loan to Golden Promise Holding Ltd., the trustee of the Golden Promise Trust, in the sum of

€2,750,000, of which €1,757,219.30 was paid to Anglo on condition that Anglo released the mortgage over "Chantilly". That

happened. The position, is that from, apparently, March 2005 onwards, "Chantilly" was unencumbered. A certain amount of

information in relation to the sale of "Chantilly" after the death of the Testator emerged in the course of the evidence in the first

module of the proceedings. However, the position became much clearer in the evidence given by the plaintiff at the hearing of the

second module.

4.2 The contract for sale of "Chantilly" by Unit 33, as vendor, with the "Chantilly Trust", which was described by the plaintiff as "a

Charles Haccius scheme", as purchaser, was prepared by Amorys on instructions received in August 2005, that is to say, some three

months after the Will was executed. There was some delay, because the registration of the title to the property had to be completed.

The plaintiff’s evidence was that she received instructions that the property was going to be sold in November 2005 but the contract

was not signed or exchanged until after the death of the Testator in February 2006. As I understand it, the "Chantilly Trust" was not

a legal entity and the purchasers from Unit 33 were John Kiely, the father of Ms. Kiely, and his partner, Veronica Lloyd, as trustees.

The contract provided for a two year closing date. The purchase price was €3.5m. After the death of the Testator, "Chantilly" was

sold on by the trustees of the "Chantilly Trust" to an independent sub-purchaser for €5m. Amorys acted for Unit 33 in the sale to

"Chantilly Trust". The trustees of the "Chantilly Trust" were represented by a different firm of solicitors in the sub-sale. Both

transactions were closed in June 2006, whereupon Unit 33, a company known by the plaintiff to be part of the Golden Promise Trust

network, received the consideration of €3.5m less capital gains tax and legal and other costs. The evidence which is recorded in the

2010 Judgment (at para. 50) was that €3.3m was available for distribution to Unit 33. Amorys paid the money received by Unit 33 into

its bank account in this jurisdiction. Obviously, the trustees of the "Chantilly Trust" received the balance of the purchase price

payable by the sub-purchaser, that is to say, €1.5m, subject, of course, to whatever capital gains tax and legal and other costs were

payable out of it.

4.3 At the hearing of the first module of these proceedings, as I recorded in the 2010 Judgment (at para. 50), when it was put to her

in a cross-examination that Ms. Kiely was the ultimate beneficiary of the proceeds of the sale of "Chantilly", the plaintiffs response

was that she could not say that. However, her evidence on the hearing of the second module of the proceedings was that she

understood that Ms. Kiely got the benefit of some or maybe all of the sale proceeds of "Chantilly". Apparently, Unit 33 has since been

dissolved.

4.4 I think it is reasonable to infer that the motivation behind the procurement of the release of the mortgage on "Chantilly" and the

setting up of the "Chantilly Trust" and the putting in place of the contract between Unit 33 and the trustees of the "Chantilly Trust"

was to put in place a fund, of which, in due course, Ms. Kiely would become the sole beneficial owner. Moreover, I think it is

reasonable to infer that the "driver" of that project was the Testator during his life. Given that Ms. Kiely was a young mother with two

very young children, who was inevitably going to lose her partner in the short term, one can understand why those steps were taken.

However, the issue for the Court is whether the plaintiff’s role, as solicitor for Unit 33 in the sale, which was completed after the

Testator's death, was in conflict with her role as executor of the Will, and as trustee of the Testator's estate.

4.5 That issue leads to an issue raised on the defendant's counterclaim to which reference has not been made previously. One of the

reliefs claimed on the counterclaim is a declaration pursuant to s. 121 of the Act of 1965 that-

"... any assets settled by the (Testator] on settlements or trusts constitute a disposition within the meaning of section

121 ... and the dispositions are null and void and of no legal effect as they were made for the purposes of defeating or

substantially diminishing the legal right share of the [d]efendant."

In the defence to the counterclaim, it was expressly pleaded, inter alia, that the plaintiff "does not oppose the application pursuant

to s. 121 ... but does not admit any of the facts" pleaded by the defendant in support of that claim. Sub-section (1) of s. 121

provides that the section applies to a disposition of property under which the beneficial ownership of the property vests in possession

in the donee within three years before the death of the person who made it or on his death or later. Sub-section (2) in its original

unamended form provided as follows:

"If the court is satisfied that a disposition to which this section applies was made for the purpose of defeating or

substantially diminishing the share of the disponer's spouse, whether as a legal right or on intestacy, ... the court may

order that the disposition shall, in whole or in part, be deemed, for the purposes of Parts VI and IX, to be a devise or

bequest made by him by will and to form part of his estate, and to have had no other effect."

4.6 As these proceedings are presently constituted, it is impossible for the Court to adjudicate on the issue raised by the invocation

of s. 121, and it would be inappropriate to express any view on the outcome, if the claim based on s. 121 is persisted in, because the

estate of the Testator is not properly represented in the proceedings in the absence of a grant of probate of the Will of the Testator.

Apart from that, it would be necessary for the disponee of the disposition in issue to be a party to the counterclaim, either as a co-

defendant or as a notice party. However, as I have stated earlier, it has been established since the death of the Testator that he

was the beneficial owner of the assets of the Doni Trust and, accordingly, he was the beneficial owner of the monies used to pay off

the mortgage on "Chantilly" in favour of Anglo. Although the title to "Chantilly" was in the name of Unit 33, which was part of the

"network" of the Golden Promise Trust, which was constituted in Cyprus, it may be that the Testator was indirectly the beneficial

owner of that property. In any event, as the defendant's case is pleaded in the counterclaim, it is that the recovery of the loan from

the Doni Trust to the Golden Promise Trust, which was used in part to discharge Unit 33's indebtedness to Anglo, has to be pursued

as a debt owing to the estate of the Testator from the Golden Promise Trust. The full loan of €2,750,000 has, in fact, been included

in the Inland Revenue affidavit sworn by the plaintiff on 30th October, 2008 as a loan due for repayment by Golden Promise Trust to

the estate of the Testator. In a letter dated 30th October from Amorys to the Revenue Commissioners, which accompanied the Inland

Revenue affidavit, the position in relation to the debt of €2,750,000 was qualified as follows:

"With further reference to the sum of €2.75m referred to at paragraph 2 above, our client has been informed by a

representative of the Doni Trust (but not by the Trustees) that the [Testator] was unequivocally entitled to these monies

and that the same were loaned by him to the Golden Promise Trust on the instructions of the [Testator] in or around May

2005. This matter is also the subject of our client's inquiries with the Golden Promise Trust and has been referred to her

Cypriot lawyers. Unfortunately there does not seem to be any documentation to support either the existence of the loan

or the terms thereof, nor does our client have any information such would enable her to assess her chances of recovering

this asset for the benefit of the Estate, if indeed the Estate is entitled to the asset at all. We have nevertheless included

these assets as an asset of the Estate for the moment."

4.7 The evidence which emerged at the hearing of the second module raises further issues in relation to the transaction in which the

plaintiff acted for Unit 33, which ultimately resulted in "Chantilly" being converted into €5m, apart from the discharge of the mortgage

with a loan from the Doni Trust. The interest of the ultimate recipient of that money, which was facilitated by the sale by Unit 33 to

the trustees of the "Chantilly Trust", is in conflict with the interest of the defendant, as the surviving spouse of the Testator who,

both under the Will and as a matter of law, has an entitlement to one undivided third share of the estate of the Testator. Having

acted as a solicitor for Unit 33 in the first step of the sale of "Chantilly" unencumbered, in my view, the plaintiff would be

professionally conflicted in acting as personal representative of the Testator and as trustee of his estate, having regard to the claims

to which:

(a) the discharge of the mortgage on "Chantilly" with monies traceable to the Doni Trust,

(b) its effective transfer by the contract for sale to the trustees of the "Chantilly Trust", and

(c) the sale on by way of sub-sale,

may give rise at the suit of the beneficiaries of the estate assets.

5. Kildare Enterprise Centre

5.1 Kildare Enterprise Centre was a commercial property, the title to which was vested in TAM, a company registered in the Isle of

Man. In the interests of clarity, it is important to point out that the commercial units referred to as the Kildare Units in the 2010

Judgment (at para. 16) and which were devised by the Testator in the Will, do not form part of what is now referred to as the Kildare

Enterprise Centre. The defendant raised with the plaintiff the issue of the sale of the Kildare Enterprise Centre in her letter of 20th

July, 2006, where she stated that she had been told "through the grapevine" that the sale proceeds of the Kildare Enterprise Centre

were due in August and she sought information in that regard. The response of the plaintiff in Amory's letter of 21st August, 2006 was

as follows:

"Can you please also provide me with full details of precisely what you mean by the contents of paragraph 7 of your

letter? I would respectfully remind you that it is the duty of the Executors to call in and to collect all of the assets of the

testator and to account for same in the Inland Revenue Affidavit which must be presented to the Revenue Commissioners

before a Grant of Probate is applied for. It is imperative therefore that I have full information in regard to all of your late

husband's assets."

The defendant's evidence was that the source of the information she had was Mr. Paddy O'Sullivan, whose role in the Testator's

business is explained in the 2010 Judgment (at para. 30), who did not testify during the second module.

5.2 In any event, Amorys acted for TAM in the sale of the Kildare Enterprise Centre, which is what is relevant for present purposes.

The evidence of the plaintiff was that agreement in principle in relation to the sale had been reached before the Testator's death.

However, she did not get instructions to prepare the contract for sale until after the Testator's death, around June 2006, and the

contract was signed in June 2006. She received her instructions from York via Mr. O'Sullivan. The plaintiff testified that, in the

context of the defendant's letter of 20th July, 2006, she was "concerned" in relation to the sale by TAM. She took advice from a

senior counsel, who is not involved in these proceedings, as to whether, in the circumstances, where she was acting for TAM in the

sale, her position was any more difficult in view of the fact that she was the executrix of the Testator. Her evidence was that the

advice she got was that she had acted for TAM for many years, that company seemed to be the owner of the property, and that she

had no alternative but to go ahead and follow the instructions of her client and, if she did not, her client could change solicitors. The

sale by TAM closed in late November or early December 2006. The plaintiff’s position was that, if there was any question of her not

wanting to act, Mr. Tom Keane, the Cypriot lawyer, whom she described as the owner of TAM, "would have been in like a shot". The

plaintiff’s evidence was that she was not getting instructions from Mr. Keane; she was taking her instructions from York, which was

managing TAM. The net proceeds of the sale by TAM, which amounted to €5.7m, were lodged by Amorys to an account in the name

of TAM in this jurisdiction. Amorys also accounted to the Revenue Commissioners for capital gains tax in the sum of €1.25m in

connection with the transaction. While the evidence is somewhat unclear on this point, as I understand it, the full purchase price was

€10m and the sum of €3.05m, being the difference between that figure and €6.95m (€5.7m plus €1.25m) was used to discharge a

mortgage on the Kildare Enterprise Centre in favour of Irish Nationwide Building Society.

5.3 The plaintiff’s evidence was that, when TAM acquired the Kildare Enterprise Centre, circa. 2000, from Irish Nationwide Building

Society (INBS) which, apparently, had repossessed it on foot of a mortgage given by a company controlled by the Testator, she was

aware that TAM was owned by Golden Promise Holding Ltd., a Cyprus company, which, as I have recorded earlier, is the trustee of

the Golden Promise Trust.

5.4 It was submitted on behalf of the defendant that the Kildare Enterprise Centre seems to have been sold with unseemly haste by

Mr. O'Sullivan, acting for York, for a sum that was well below its true market value. The defendant adduced evidence of Mr. Rory

Lavelle, a chartered surveyor, who estimated the market value of the Kildare Enterprise Centre as being somewhere between €16m

and €20m in 2006. That evidence alone does not lead me to the conclusion that the property was sold by TAM at an undervalue in

2006. In any event, it is not pleaded by the defendant in the counterclaim that the Kildare Enterprise Centre was sold at an

undervalue.

5.5 However, I do think that the plaintiff, in being sufficiently concerned to take advice in relation to her position, as the solicitor

acting for TAM in the sale of the Kildare Enterprise Centre, as giving rise to a potential conflict with her role as executrix of the

Testator was being wholly realistic, because there was an issue of a potential conflict. Not only did the defendant, in the letter of

20th July, 2006, raise the issue of the closing of the sale of the Kildare Enterprise Centre, as I have already indicated, but she also

made the point that a schedule of assets prepared by the plaintiff on 30th March, 2006, which she had received, only contained "a

small portion" of the Testator's estate and she asserted that the Testator was "the beneficial owner and/or controller of various other

substantial Companies, trusts and assets". The plaintiff's response to that was that she needed "full details, instructions and

information" from the defendant. She pointed out that the schedule in question was only a "rough guesstimate" and did not constitute

the final position on the Testator's estate or indeed the extent of his assets.

5.6 I have come to the conclusion that the evidence shows that there was, and is, a conflict between the interest of the ultimate

beneficial owners of the assets of TAM, being non-estate assets, and the beneficial owners of the estate assets in accordance with

the terms of the Will. That conflict has the same ramifications as the conflict in relation to the monies used to procure the discharge

of the mortgage on "Chantilly" and the disbursement of the proceeds of the sale of that property, in that, by acting as solicitor for

TAM in the sale of the Kildare Enterprise Centre, the plaintiff has put herself in the position of being potentially conflicted in acting as

personal representative of the Testator and as trustee of the Will.

6. Discharge of the mortgage on "Bri-Odi"

6.1 "Bri-Odi" had been the family home of the Testator and the defendant for most of their married life until their separation. Initially,

the title had been in the sole name of the Testator, but after a business failure in the late 1980s, the title was transferred by the

Testator to the defendant solely. Subsequently, in 1994, the Testator needed money to finance a venture referred to as Customs

House Plaza, which, apparently, turned out to be very profitable. The defendant raised the money by way of loan from INBS and "Bri-

Odi" was mortgaged to INBS as security for the loan. The defendant then advanced the money to the Testator. The defendant's

evidence was that the loan was to be repaid within two years. However, after the Testator's death, when she began receiving

correspondence from INBS, the defendant realised that the loan had not been discharged and the mortgage still affected "Bri​ Odi".

This was one of the issues raised by her in the letter dated 20th July, 2006 to the plaintiff. The defendant stated that she wanted

the loan to be paid off forthwith. The response of the plaintiff in Amory's letter of 21st August, 2006 was, in part, as follows:

"For the purpose of clarity, I need to make it absolutely clear that the repayment of this loan is a matter for you to deal

with. I have no control over this issue. My function is as co-executor of the estate of your late husband and it is only in

that capacity that I will hopefully be in a position to assist at a much later stage when the affairs of your late husband

have been wound up leaving sufficient surpluses."

6.2 The defendant raised the matter again in her next letter to the plaintiff, which was also composed with the assistance of a

solicitor, and which was dated 27th September, 2006. She stated:

"I must insist that the Mortgage taken out by the [Testator] over my family home at his insistence and with regard to

which you took up the title deeds, must be added as a debt on his Estate given that he acknowledged the debt and

undertook to repay the Mortgage within two years of the monies being given to him in front of me, my daughter and

yourself. The Mortgage has now reached the level of €440,000 and no payments have been made on this Mortgage in a

number of years."

The response of the plaintiff was in a letter of 8th December, 2006, from Amorys to Noel Smyth & Partners, Solicitors, who, at the

time, were instructed by the defendant. The response was:

"As regards the outstanding mortgage in favour of INBS over your client's family home, our clients are making inquiries and

may consider your client's request that the INBS mortgage debt be admitted as a liability of the Estate. We will revert to

you in this regard at a later stage."

That letter was headed: "Our clients- Dan O'Donohoe (sic) and Anor", meaning, presumably, the executors named in the Will.

6.3 After MOP communicated to Amorys that they had been instructed by the defendant in relation to the estate of the Testator,

Amorys wrote directly to the defendant by letter dated 27th July, 2007. One of the matters dealt with in that letter was the

mortgage on "Bri-Odi". In this regard, Amorys stated:

"You will be aware that the Golden Promise Trust recently arranged to discharge a loan due to the Irish Nationwide

Building Society which loan was secured by a first legal mortgage over your family home at Bri-Odi .... This loan was

guaranteed by the [Testator]. We understand that you are in communication with the INBS regarding the formal release

of the Society's Mortgage. This loan should have been discharged from the proceeds of a life policy on the life of the

[Testator] which the [Testator] believed had been assigned to INBS but which had not in fact been properly assigned.

Our clients will therefore have to consider admitting the amount of the outstanding INBS loan as a debt due by the Estate

to the Golden Promise Trust. The amount was approximately €465,000."

It is also clear from the heading on the letter that by our "clients" Amorys meant the executors of the will of the Testator.

6.4 Thereafter, there was a considerable amount of correspondence backwards and forwards between MOP and Amorys in relation to

the discharge of the mortgage on "Bri-Odi". Eventually, when the plaintiff submitted the Inland Revenue Affidavit dated 30th October,

2008, to the Revenue Commissioners, which was qualified by the contents of the letter dated 30th October, 2008 referred to earlier,

the mortgage on "Bri-Odi" was dealt with as follows in the letter:

"The [Testator's] spouse [the defendant], raised a substantial loan of approximately IR£300,000 from Irish Nationwide

Building Society in or around 1998 using her dwelling house at "Bri-Odi" ... as security. She then lent this money to the

[Testator] who undertook to repay it to her. The Testator never repaid this amount. [The defendant's] loan, together

with accrued interest amounting to €456,535 was eventually repaid in or around 14th March, 2007 subsequent to the

[Testator's] death directly to Irish Nationwide Building Society by TAM ... , an Isle of Man registered company which our

client understands to be a wholly owned subsidiary of Golden Promise Holding Limited. This latter company is the

corporate trustee of the Golden Promise Trust and is a Cypriot registered company. Without further information it is

unclear as to whether this payment constitutes a taxable benefit of the Deceased's estate. Once again, our client's

inquiries, in this regard are continuing."

6.5 As the preceding paragraphs indicate, a variety of positions has been adopted by the plaintiff, as executor of the Testator, in

relation to the discharge of the mortgage. Eventually, she appears to have recognised that the Testator's estate was liable to

discharge the sum due to INBS in order to procure the release of the mortgage. However, the sum in question was not included as a

debt due by the estate on the Inland Revenue Affidavit, although she left open the question of the position of TAM, which it is

acknowledged was her client both before and after the Testator's death and, in particular, in 2006 in relation to the sale of the Kildare

Enterprise Centre, vis-á-vis the Testator's estate.

6.6 Normally there is no conflict of interest in an individual being both a beneficiary and a creditor of the estate of a deceased person,

as frequently happens. As regards the discharge of the mortgage on "Bri-Odi", however, unlike the normal situation, there could be an

issue of the entitlement of the defendant to have the loan from INBS repaid by a third party, whether out of estate assets or out of

non-estate assets. Having said that, I am not finding, and I am not even suggesting, that such an issue arises. I merely want to

emphasise that the real difficulty created by the discharge of the mortgage on "Bri-Odi" relates to identifying the source of the funds

used to discharge it and the beneficial ownership of those funds after the Testator's death. Any question as to whether liability for

the discharge of the mortgage on "Bri-Odi" attached to the estate assets or to the non-estate assets, gives rise to a conflict

between the beneficiaries of the estate assets, on the one hand, and the beneficiaries of the non-estate assets, whoever they may

be, and it would appear on the evidence that the defendant is not one of them, on the other hand. The fact that she was the

solicitor for the Testator from 1986 until his death and acted on the Testator's instructions for companies incorporated outside this

jurisdiction, for example, TAM and Unit 33, which companies are acknowledged as being subsidiaries of the Cypriot company, Golden

Promise Holding Ltd., which is the trustee of the Golden Promise Trust, it seems to me that the plaintiff must inevitably be drawn into

the conflict which such question may ignite, if she remains as executor of the Will and as trustee of his estate of the Testator. In

relation to the discharge of the loan secured on "Bri-Odi" the potential for conflict is compounded because Amorys acted both for the

Testator and the defendant in connection with the creation of the mortgage in favour of INBS and such independent evidence as the

defendant obtained in connection with that transaction was obtained from an assistant solicitor in that firm.

7. Conclusions on the conflict issue

7.1 In summary, the conclusions I have reached in relation to the plaintiff's involvement in the three matters with which I have dealt

with in paras. 4, 5 and 6 above are as follows:

(a) As regards the plaintiff's involvement as solicitor for Unit 33 in the sale of "Chantilly" unencumbered, I find that such

involvement must inevitably give rise to a professional conflict if she becomes the personal representative of the

Testator, the kernel of the conflict being the issue as to whether the sum of €1,757,219.30 used to discharge the

mortgage in favour of Anglo should be brought into the estate assets from the successors of Unit 33.

(b) As regards the plaintiffs involvement as solicitor for TAM in the sale of the Kildare Enterprise Centre, I find that such

involvement must inevitably give rise to a professional conflict if the plaintiff becomes the personal representative of the

Testator, the kernel of the conflict being whether the net proceeds of the sale should be brought into the estate on the

basis that the Testator, albeit through TAM, was the beneficial owner of the Kildare Enterprise Centre.

(c) As to the circumstances of the discharge of the mortgage on "Bri-Odi", with monies apparently provided by TAM, for

which she acted as solicitor both prior to and after the death of the Testator, I find that her involvement must inevitably

give rise to a professional conflict if she becomes the personal representative of the Testator, because the beneficial

owners of TAM may have a claim against the estate of the Testator for recovery of the sum of €465,000 of its monies

used in discharge of the defendant's indebtedness to INBS.

Those three examples clearly indicate that the plaintiff would be in a position of having irreconcilable duties to the beneficiaries of the

estate assets, on the one hand, and the beneficiaries of non-estate assets, on the other hand, if a grant of probate issued to her.

7.2 Apart from the foregoing examples, probably the most persistent and, I think it is fair to say, the most exasperating from the

perspective of the defendant and her legal advisers, complaint made against the plaintiff alleging that she is conflicted has arisen from

her non-acceptance of the fact that the Testator was the settlor, and the 36 sole person in control of the assets, of the Golden

Promise Trust. They contend that the refusal of the plaintiff to acknowledge that the Testator was the source of control of that trust

regulated in Cyprus, notwithstanding her involvement in the execution by the Testator of the "letter of wishes" in relation to the

Golden Promise Trust after the execution of the Will on 19th May, 2005 as outlined in para. 52 of the 2010 Judgment, underlines her

inability to act independently as executrix of the estate of the Testator. The position adopted by the plaintiff at the hearing of the

second module was that there is no doubt that the Testator had "a very close connection" with the Golden Promise Trust and she

accepted that there is probably a strong possibility that he will turn out legally to have been the settlor thereof. She also stated that

it was of no particular or personal interest to her if he was the settlor, although it is a matter of concern for the estate.

7.3 However, I think that misses the point. It is her past professional involvement as solicitor for the Testator and for the multiplicity

of corporate vehicles in which the assets of the Golden Promise Trust were vested which gives rise to the professional conflict,

coupled with the justified opposition of the defendant, as a major beneficiary of the estate assets, which, in my view, precludes the

plaintiff from acting as executor of the Will. That involvement goes way beyond the three examples I have addressed in detail in this

judgment. While one can understand that the plaintiff would like to fulfil the task which the Testator reposed in her, I am of the view

that it would be impossible for her to steer a non-conflicted passage between the beneficiaries of the estate assets, on the one

hand, and the interest of the beneficiaries of the non-estate assets, on the other hand, so as to take all of the steps in the

administration, including the protection of the assets, of the estate of the Testator and of the trusts created by the Will that require

to be taken by the personal representative.

7.4 If a grant of probate of the Will issued to the plaintiff she would not only be conflicted as to her professional duties as a solicitor,

but she would have a conflict of interest. As personal representative, she would hold the assets of the Testator as trustee for the

persons by law entitled thereto by virtue of s. 10(3) of the Act of 1965 quoted earlier. In that fiduciary capacity she would be

inevitably faced, as regards a myriad of issues, with making a choice between the beneficiaries of the estate assets, on the one

hand, and the beneficiaries of the non-estate assets, on the other hand, which, in my view, would amount to what Millett L.J. in

Bristol and West BS v. Mathew referred to as a breach of "the actual conflict rule". As Millett L. J. stated, although obiter, (at p.

712), the fiduciary must prove that he made full disclosure of all material facts. The plaintiff, as personal representative of the

Testator, would have to make full disclosure of all material facts in relation to the non-estate assets to and for the benefit of the

beneficiaries of the estate assets. Having regard to her past professional involvement, it is possible to conclude on the basis of a

probative standard that goes way beyond the standard which the defendant has to meet, that the plaintiff could not make full

disclosure without breaching her duty of confidentiality to clients for whom she has acted in the past. The Court cannot allow that

situation to arise.

7.5 I have no doubt that the conflicted position of the testatrix amounts to "serious special circumstances" in the sense intended by

Lynch J. in Dunne v. Heffernan and that the welfare of the beneficiaries of the estate assets would not be protected by the estate of

the Testator being administered by her. In the circumstances, I consider that it would be inappropriate to grant probate of the Will to

the plaintiff. Therefore, it will be necessary for the court, pursuant to its power under s. 27(4), to appoint some person other than

the plaintiff to administer the estate of the Testator.

8. Appointment of Administrator

8.1 While I have come to the conclusion that the plaintiff, who was chosen as executor by the Testator, has a conflict of duty and

would have a conflict of interest if probate issued to her, I have also come to the conclusion that the defendant, who was not

chosen by the Testator to administer his estate, has a conflict of interest, which precludes her acting in the administration of the

Testator's estate.

8.2 Therefore, I have come to the conclusion that the administrator should be a professional person who is wholly independent of the

beneficiaries of the estate assets and of the beneficiaries of the non-estate assets. Given the complex issues which are likely to arise

in the administration of the estate and, in particular, the fact that the Revenue investigation is ongoing, I have come to the

conclusion that the ideal situation would be that the personal representative is an accountant by profession. I do not, however;

consider that it would be appropriate to appoint a person who has had any previous professional relationship with either the

defendant or her children or a connection with a firm which had such relationship. I propose to adjourn the proceedings for a short

period in the hope that the parties can reach agreement on the choice of a suitable person, who is willing to act.

8.3 When an appropriate administrator has been identified, and evidence as to his or her suitability to act as administrator is put

before the court, I propose making an order under s. 27(4) of the Act of 1965 granting that person administration of the Testator's

estate with the Will annexed.

9. Other Issues

9.1 The second relief sought by the defendant in her counterclaim is a declaration that the Testator at the date of his death held one

half of his estate in trust for the defendant by reason of promises and representations made by the Testator to the defendant upon

which the defendant relied to her detriment. As with the s. 121 issue, which I have addressed in the context of the question whether

the plaintiff is conflicted, in my view, that issue cannot be determined in these proceedings as constituted because, there being no

grant of probate or administration, the estate of the Testator is not properly represented. However, as court time was taken up with

this issue, I propose to comment on it, although, obviously, not in a definitive manner.

9.2 The defendant's evidence was that after the death of their son, Brian Rhatigan, Junior, who died in April 2003, the defendant and

the Testator met in her daughter's house and the plaintiff was also there. The defendant described the purpose of the meeting as

being for her "to sign probate of my son's estate". I think the reality is that she was signing a renunciation of her entitlement to a

grant of administration intestate. In any event, her evidence was that she asked the Testator why she should sign the document and

what he was going to do for her. Her evidence was that his response was that she knew she was going to get "half of everything".

The defendant testified that she remembered jokingly saying "Is that half of Europe or half of a slice of cake", at which the Testator

winked at her. Her evidence was that the event occurred at a time after the Testator had become ill, but while he could still speak

and while they were on friendly terms. Although the defendant stated that the plaintiff was present on that occasion, what is alleged

to have happened was not put to the plaintiff. Moreover, the factual case made in the counterclaim on the basis of which it was

pleaded that the Testator was constituted a trustee of one half of his estate for the benefit of the defendant was entirely different

to the factual basis of the defendant's evidence on the issue.

9.3 While there was some level of ambiguity, the defendant's evidence, as I understand it, was that the occasion about which she

testified was the only time when there was a discussion between the defendant and the Testator about how he intended dealing with

his affairs. In particular, I consider that there was no evidence to support the argument made by counsel for the defendant in their

submissions that agreement was reached between the Testator and the defendant in 1998, at the time of their separation, that she

was entitled to half of his assets. Moreover, there is no basis on which one could conclude that, if it occurred, that the exchange

outlined in the preceding paragraph gave rise to a trust or an equitable estoppel of the type recognised by the Supreme Court in

Doran v. Thompson [1978] I.R. 223. Moreover, as I understand the evidence, the defendant did not act to her detriment as result of

what transpired on that occasion. She received her share of the estate of her deceased son and merely renounced her right to a

grant of administration. I mention this aspect of the evidence for the purpose of emphasizing that neither the facts pleaded in support

of the contention that a trust exists in respect of one half of the Testator's estate for the defendant, nor the evidence given by the

defendant in support of that claim, has informed the conclusion I have reached that the plaintiff is professionally conflicted to an

extent that she cannot act as executor of the estate of the Testator.

9.4 Further, in the interests of clarity, I would record that the issue which appears on the order of the Master, which was made by

consent of the parties, as to whether the defendant's claim to being the beneficiary of half of the estate is barred by operation of s.

9 of the Civil Liability Act 1961, was not addressed at all at the hearing of the second module.

9.5 In the light of the findings made as to her conflicted position, obviously, the plaintiff should resign as trustee of the Will. However,

it would be premature at this stage to consider whether it is necessary to appoint trustees of the residuary estate, until the extent of

the residuary estate is ascertained. Indeed, the position adopted by the parties was that the court should concentrate on the

executorship. Therefore, I propose adjourning the issue of the trusteeship of the Testator's residuary estate for further consideration

later, if necessary.