The family of a painter and decorator who died of an asbestos-related condition have been granted a proof before answer in their damages claim against the executor of the estate of a deceased partner in the former firm which employed the tradesman.

The defender had sought dismissal of the action, but a judge in the Court of Session allowed the claim to proceed after ruling that the pursuers’ case was “competent and relevant”.

Lord Clark heard that Mary Forbes, widow of the late Frederick Forbes, along with their four children and three grandchildren, raised an action for damages under section 4(3)(b) of the Damages (Scotland) Act 2011 and made claims for loss of support and loss of personal services, following the death of Mr Forbes on Christmas Eve in 2014, as a result, the pursuers averred, of his exposure to asbestos dust and fibres during the course of his employment and his consequent development of mesothelioma.

‘Case bound to fail’

The pursers sued the defender Enos McLean is his capacity as the executor on the estate of his late father, Enos McLean (Senior),who was a partner in a now dissolved partnership which carried on business as painters and decorators, where Mr Forbes worked from about 1957 to 1964.

The central issue for the court was whether a relevant claim was made against the defender in his capacity as executor, if the estate had been ingathered and distributed and he had been discharged as executor.

The defender sought dismissal of the action, arguing that the pursuers’ case was irrelevant and lacking in specification and therefore “bound to fail”, as any liability on the part of the late father of the defender had ended when the estate was distributed to beneficiaries under his will, which occurred long before the action was raised.

What happened after confirmation was granted in 1994 “was lost” to the defender, but it could be presumed, given the passage of time, that debts were paid and the remainder of the estate was distributed, meaning the estate was gone and “nothing remained”.

It was submitted that the claim being made by the pursuers was an “illiquid claim” against the defender who, as executor, merely stood in the shoes of his late father, but his office had come to an end on distribution of the estate.

‘Lacuna in the law’

However, the pursuers’ position was that the pleadings made clear that the purpose of the action was to constitute a claim against the estate of the deceased, who was a former partner in the firm.

The defender was relying upon an “assumption” of ingathering and distribution of the estate, but the court could not make that assumption - The pursuers did not admit that the estate had been ingathered and distributed and that issue, and the concomitant question of implied discharge, was therefore a matter for proof, it was submitted.

The purpose was not to claim against the beneficiaries, but rather to constitute a claim against the estate so that the insurers would require to meet it.

The situation was not unlike that of restoring a dissolved company to the Register of Companies in order to bring proceedings such as the present; in effect, what was sought was restoration of the executry so that if the action was successful the insurers would pay out.

The judge observed that the central issue was whether or not Scots law recognised a remedy against an executor in circumstances such as the present, albeit solely to constitute a claim against the estate, but added that there was a “wider practical and policy question”: where an employee claims to have suffered personal injury at the time of his employment and the employer was either a partner in a partnership or was a sole trader, who has died, can the former employee (or his family members if he is also now deceased) sue the executor of the former partner or sole trader, perhaps long after the executor has ingathered and distributed the estate, as a means of seeking to cause the insurers under the employers’ liability insurance policy to meet the claim?

Lord Clark continued: “If the injured person was employed by a company which was later dissolved, the company can of course be restored to the Register of Companies for the purposes of proceedings being raised. It was implicit in the pursuers’ position that, where the employer was a partnership or a sole trader, the law should allow proceedings to be taken against the former executor of a deceased partner in the partnership or of the deceased sole trader, because otherwise there would be a potentially significant lacuna in the provision of means of redress under Scots law.”

‘Competent and relevant claim’

Allowing a proof before answer, the judge pointed to certain key cases arising from the failure of the City of Glasgow Bank in 1878 which dealt with the central issue and provided authority for the proposition that the pursuers’ claim was competent.

In a written opinion, Lord Clark said: “The textbooks to which I was referred treat the central issue in the present case as having been determined by the decisions in Assets Co Limited v Falla’s Trustee and the first of the Assets Co Limited v Bain’s Trustees cases ((1904) 6F 676). In the Stair Memorial Encyclopaedia of Scots Law (re-issue), on Trusts, Trustees and Judicial Factors, at paragraph 216, it is stated: ‘Where a trustee has distributed the whole trust estate and been discharged by the beneficiaries, it is competent for a creditor to sue him for the purpose of constituting a claim against the trust estate’. In Wilson and Duncan, Trusts, Trustees and Executors, at 449, Assets Co Limited v Falla’s Trustee is founded upon to support the proposition that: ‘A trustee who has been discharged by the beneficiaries can be sued in order to constitute a claim against the trust-estate’. I am in no doubt that these propositions are supported by the cases founded upon.

“The second of the decisions of the Inner House in Assets Co Limited v Bain’s Trustees (that is, the decision of the court of seven judges which followed upon the proof) is not referred to in support of the propositions in the textbooks. I assume the reason to be that, as is explained above, it proceeded, so far as three members of the majority of the court were concerned, on the basis that the pursuer offered to prove that the estate had not all been ingathered…It can therefore be said that the second of the decisions of the Inner House in Assets Co Limited v Bain’s Trustees is not directly authoritative on the issue in the present case. However, the other two decisions of the Inner House (in Assets Co Ltd v Falla’s Trustee and the first of the Assets Co Ltd v Bain’s Trustees appeals) are in my view conclusive and, moreover, are binding on me.”

He added: “Of course, if executors or trustees can be sued in that capacity many years after their roles have, as they see it, terminated, that may be viewed as an unfortunate burden facing such persons…However, all that the authorities founded upon by the pursuers concern is the question of suing for the purposes of constituting a claim against the estate and it may be that a person sued in that context would not see any need to defend the claim.

“In my view, no sound reasons exist for concluding that the claim in the present case, which, based on the authorities, is competent, can be said to be nonetheless irrelevant. I conclude that the pursuers’ case is competent and relevant.”

In relation to the pursuers’ contention on the secondary issue, namely, the need for proof on the question of whether the defender had been discharged as executor, the judge considered it necessary for the circumstances giving rise to the implicit or presumed discharge to be dealt with in evidence.

Lord Clark said: “Accordingly, had I not been of the view that the pursuers’ claim against the executor, even if discharged, is competent and relevant, I would have accepted the pursuers’ submission that whether there has been a discharge and its legal effect in circumstances such as the present are matters to be dealt with after proof.”