The High Court’s decision in Dorothy House v Helme [2026] EWHC 75 (Ch) confirms that executors who defend removal applications on their own behalf, rather than for the estate’s benefit, have no right to an indemnity from the estate for their litigation costs.
Background
The claim concerned the administration of the estate of Mary Organ, who died in December 2017. Her will appointed the first defendant, a solicitor employed by Richard T Bate & Co, and the second defendant, her first cousin once removed, as her executors and trustees [§7-9]. The estate was substantial, valued for probate at £4,717,302 net [§8]. The claimants, two charities, were the sole residuary beneficiaries.
The administration was characterised by significant delay. The defendants did not notify the claimants of their interest under the will; although this was not a breach of legal duty, it undermined the claimants’ confidence in the administration [§11, §14, §45, §56]. Instead, the claimants learned of their entitlement from a third party, Mr Outlaw, in August 2020, over two and a half years after the death [§11]. A grant of probate was not extracted until April 2022 [§11]. The defendants attributed the delays to complexities within the estate, including investigating lifetime gifts and dealing with the conduct of Mr Outlaw [§12-13].
A central issue arose concerning the sale of the main estate asset, Church Farm. In June 2024, an offer of £2.2 million was received from Simon Evans and his wife [§19]. Mr Evans was a first cousin once removed of the deceased, making him the second defendant’s second cousin [§7, §19]. Critically, Mr and Mrs Evans were also clients of the first defendant’s law firm, and the firm proposed to act for both the estate and the purchasers in the transaction [§19-21]. Despite repeated requests from the claimants from August 2024 onwards to re-market the property when the purchasers could not demonstrate available funds, the defendants persisted with the sale for approximately 18 months without putting the property back on the open market [§22-27, §65-67].
Frustrated by the lack of progress and concerned about conflicts of interest, the claimants’ solicitors wrote to the defendants on 13 August 2025, enclosing a draft consent order inviting them to step down without having to pay the claimants’ costs [§26]. This offer was refused. Following further correspondence, on 10 December 2025, the claimants threatened to apply for an injunction if undertakings to preserve estate assets were not provided by 11 December [§30]. No undertakings were given.
On 12 December 2025, the claimants issued proceedings seeking the removal of the defendants as personal representatives and the appointment of Stone King Trust Corporation Limited in their place [§1]. They simultaneously applied for an interim injunction to preserve the estate’s assets. Notably, on the morning of the same day, the defendants exchanged contracts for the sale of Church Farm without prior notice to the claimants [§32]. The defendants’ solicitors had stated in correspondence on 8 December that exchange would take place “at the beginning of next week” [§29, §68]. The court drew the inference that the sale was accelerated to avoid the possibility that an injunction would be granted on 15 December [§69].
The injunction application was heard on 15 December 2025. The defendants consented to an injunction preventing them from disposing of or diminishing estate assets, and directions were given for a disposal hearing [§34]. By the time of the disposal hearing on 7 January 2026, the defendants conceded that they should be removed and replaced [§4]. The contested issues before the court were therefore limited to costs.
Costs Issues Before the Court
Following the defendants’ concession on their removal, the court was required to determine three specific costs issues [§5]:
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- Whether the defendants should be ordered to pay the claimants’ costs of the claim and the injunction application.
- If so, whether those costs should be assessed on the indemnity basis rather than the standard basis.
- Whether the defendants were entitled to an indemnity from the estate for their own legal costs and for any costs they were ordered to pay to the claimants.
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These issues required the court to consider the defendants’ conduct both in the administration of the estate and in the litigation itself. The judge distinguished between these two categories of conduct in his analysis [§72].
The Parties’ Positions
The Claimants’ Position: The claimants argued that they were the successful parties and that the defendants should pay their costs [§72]. They contended that an award of indemnity costs was justified due to the defendants’ conduct in the litigation, which was “out of the norm” [§72]. This conduct included accelerating the exchange of contracts for the Farm after being put on notice of the injunction application, failing to serve evidence in a complete and timely manner, and unreasonably refusing earlier offers to step down without a costs order [§73].
Regarding the indemnity, the claimants submitted that the defendants were not entitled to an indemnity from the estate for any costs [§75]. They argued that the litigation was hostile, and the defendants had incurred costs in defending their own positions, not in acting for the benefit of the estate [§75].
The Defendants’ Position: The defendants did not dispute that the claimants were the successful party, but resisted an order for indemnity costs [§72-73]. Critically, they argued that they were entitled to a full indemnity from the estate for both their own costs and any costs payable to the claimants [§75]. They submitted that their opposition to removal was undertaken in what they believed to be the best interests of the estate, specifically to facilitate the sale of the Farm. They relied on the principle, acknowledged in Shufflebotham v Shuff-Wentzel [2025] EWHC 3321 (Ch), that any doubt should be resolved in favour of the fiduciary [§53].
The Court’s Decision
The court ordered the defendants to pay the claimants’ costs and made determinations on the specific issues as follows.
1. Liability for Costs and the Indemnity Basis: Applying CPR rule 44.2, the judge held that the claimants were the successful party and there was no good reason to depart from the general rule [§72]. The judge then considered whether to award costs on the indemnity basis, guided by Excelsior Commercial & Industrial Holdings Ltd v Salisbury Hammer Aspden and Johnson [2002] EWCA Civ 879, which requires conduct or circumstances “out of the norm” [§54, §72].
The judge made clear that for this purpose he was not concerned with the defendants’ conduct of the administration as such; instead, he was looking simply at the claim and application made by the claimants, and the defendants’ conduct of their side of it [§72].
The judge found such conduct present [§73]. They had accelerated the exchange of contracts on the very morning they were served with the injunction application, having previously indicated exchange would occur “at the beginning of next week” [§68-69]. This was done without any plausible explanation and the court drew the inference that it was to avoid the possibility of an injunction [§69]. Furthermore, they had failed to serve their evidence completely by the agreed deadline and had served further evidence without permission [§35, §73]. Their refusal of more than one offer to retire without paying costs also contributed to this finding [§73]. The judge also noted that it may perhaps be that their solicitors did not have much experience of this kind of High Court litigation, but that was a matter between the defendants and their solicitors, and was not an answer to the claimants’ submission [§73]. Consequently, the defendants were ordered to pay the claimants’ costs on the indemnity basis [§73].
2. The Defendants’ Indemnity from the Estate: The judge analysed this issue by reference to the framework in Price v Saundry [2019] EWCA Civ 2261, the Trustee Act 2000, s.31(1), and CPR PD46, paragraph 1 [§50-53, §74].
There are two elements to the indemnity: first, that the expense was “properly incurred”; second, that it was incurred “when acting on behalf of the estate” [§74].
On the second element, the judge concluded that the defendants never incurred the costs of this litigation when acting on behalf of the estate [§76]. The character of the proceedings was hostile litigation from the outset. The defendants initially resisted removal vigorously, challenging all the claimants’ complaints about their behaviour and seeing no reason for their being removed [§76]. The fact that by 22 December 2025 they had offered to consent to removal (on terms including an indemnity) confirmed that they did not consider the estate’s best interests required their continuation in office [§75]. By the disposal hearing, they no longer opposed removal and were simply concerned to argue about costs and their indemnity [§75]. In these circumstances, the defendants were never entitled to an indemnity because they entered into and conducted the litigation on their own behalf, not on that of the estate [§76].
In the alternative, the judge held that even if the defendants had incurred the litigation costs on behalf of the estate, they would have been deprived of the indemnity because the costs were not “properly incurred” [§77]. Following Price v Saundry, “properly incurred” means “not improperly incurred”, and the right can be lost due to misconduct, which includes not only breach of duty but also unreasonable conduct [§50, §74].
The judge found the following misconduct in the defendants’ administration that was directly relevant to the litigation [§77]:
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- Inordinate and unjustified delay in selling the Farm, including taking an unjustified risk in waiting approximately 18 months for purchasers who did not have available funds [§58, §66-67];
- Unauthorised self-dealing through the sale of estate machinery to the second defendant without seeking the claimants’ consent [§60];
- Charging the estate at a professional solicitor rate for non-legal work, namely attending the Farm to water cattle [§61];
- Placing themselves in a position of acute conflict of interest by allowing their solicitors to act for both sides in the Farm sale, without obtaining the claimants’ fully informed consent until over 15 months after the offer was made [§62-64].
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This conduct amounted to breaches of duty and seriously unreasonable behaviour, more than mere mistake [§77]. Consequently, the defendants lost any right to an indemnity from the estate for their own costs or for the costs payable to the claimants [§77-78].
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