See the new ‘Mediation of Probate & Trust Disputes’ page at www.carlislam.co.uk:
– Benefits.
– Tax-efficient efficient settlement of probate and trust disputes.
– Process.
– Mediation Agreement.
– Time-Zone Management.
– Pre-Mediation Zoom/TEAMS Calls.
– Preparation.
– Starting the conversation.
– Offers.
– Executing a Settlement Agreement.
– Tomlin Orders.
– Enforcement of Settlement Agreements.
‘In my experience and opinion, the cut and thrust world of contentious probate and trust litigation has very little to do with abstract notions of justice, and is actually more about perceptions and calculation. So, unless a party needs a court determination to move forward, e.g. as to whether a trust is valid or void, or the court must be involved, i.e. because the case involves children or other vulnerable beneficiaries, then why not do a deal instead? … Mediation is also an opportunity to transform an acrimonious probate dispute into a joint problem-solving exercise, by applying estate and business succession planning principles, to discover and unlock tax efficiency post-death, resulting in the consequential enlargement of the estate or trust fund pie for settlement. … The overwhelming majority of contentious probate/trust disputes never reach trial, because parties agree the structure and terms of a legally robust compromise. Between 92.3 – 94.4% settle, see paragraph 1.3 of my book, the Contentious Probate Handbook.’

In Teasdale v Carter [2023] EWHC 490 Fam, the High Court dismissed the claimant’s proprietary estoppel claim against her husband and daughter over the ownership of a farm outbuilding. Moor J stated: ‘I have to say that this is one of the most regrettable pieces of litigation that I have ever come across. It is not just because this family has become so fractured as a result. The total costs of the litigation at the conclusion of the hearing below were approximately £828,000. The costs of this appeal are £220,000. These figures do not include the costs of the financial remedy proceedings. The house at the heart of the dispute, Cow House, is worth £245,000, after a 20% reduction for an agricultural occupation restriction. When the appeal was opened, it was said that, if I allowed the appeal, the matter would have to be re-heard at further vast expense, as an appeal court clearly could not substitute different findings of fact for those found by the judge below. The final reason that the position is so regrettable is that the parties agreed a way forward on 7 October 2020 which would have obviated the need for all this litigation. Unfortunately, the agreement was subsequently repudiated by the Appellant, on the basis that the First Respondent had enlarged her claim in other respects. The case was then litigated for nine days before HHJ Shelton. It has been heard for two days before me, although that time estimate included only half a day of reading time and absolutely no judgment writing time.’
At the conclusion of a Mediation, it is critical to execute a legally binding settlement agreement that is comprehensive, i.e. which clearly and coherently states all of the material terms of the deal that has been agreed.
As I explain in paragraph 22.13 of my book the ‘Contentious Probate Handbook’ (published by the Law Society in July 2020),
‘[It] is not the normal practice of the Judges or Masters of the Chancery Division to inspect schedules or agreements annexed to Tomlin Orders. The judge who makes the order undertakes no responsibility for the scheduled terms and cannot be taken to have approved them. In other words once a contract has been agreed the parties will be bound by it’s terms. Therefore, until all material terms of settlement have been agreed, and expressed in terms that are capable of legal implementation, it would not be prudent to sign a binding agreement, whether in the form of heads of agreement, or a detailed schedule of terms.’
Consequently, in a one-day Mediation of a Contentious Probate dispute, the drafting of a comprehensive, coherent and legally binding settlement agreement, not infrequently consumes around 30% of the Mediation Day, i.e. between 5.30pm-10pm – which is the time when the participants are most vulnerable to the making of mistakes that subsequently can result in ‘buyer’s remorse’ – because they are exhausted. 

https://www.bailii.org/ew/cases/EWHC/Fam/2023/490.html

The Singapore Convention will come into force in the UK six months after the UK has deposited its instrument of ratification with the UN Headquarters in New York. The UK will champion the Convention internationally to encourage further ratifications: Government response to the Consultation on the United Nations Convention on International Settlement Agreements Resulting from Mediation (New York, 2018).

Earlier ‘Consultation on the United Nations Convention on International Settlement Agreement Resulting from Mediation’ (02.03.2023) stated:

‘Mediation is an important means of resolving cross‑border disputes, by enabling the disputing parties to reach a suitable and mutually acceptable resolution themselves, without having to go to court, saving valuable time and money. It is a process which the Government considers ought to be integral to the Justice system, and it is estimated that mediation can save businesses around £4.6 billion per year in management time, relationships, productivity, and legal fees. …

The Singapore Convention on Mediation aims to provide a harmonised framework to enable parties seeking to enforce a cross-border commercial settlement agreement to apply directly to a Competent Authority (usually a Court) for the enforcement of that agreement. …

The Convention may also present opportunities to establish new relationships in the Indo-Pacific, Middle East and Africa, as well as strengthening existing relationships with parties to the Convention, many of whom are members of the Hague Conference on Private International Law. This would align with the Government’s Integrated Review of 16 March 2021, which outlines its vision for the UK’s role in the world over the next decade and the action that will be taken to 2025. It is noted that several countries mentioned in the Integrated Review are already signatories to the Singapore Convention, including 18 Commonwealth nations with senior Commonwealth leaders continuing to encourage their members to sign the Convention, as well as key UK trading partners USA, China and India. …’

The Consultation Response stated:

‘The Government has concluded that it is the right time for the UK to become a Party to the Singapore Convention on Mediation, as a clear signal to our international partners that the UK is committed to maintaining and strengthening its position as a centre for dispute resolution and to promote the UK’s flourishing legal and mediation sectors. 6.2 Mediation is a dispute resolution process which is integral to the UK justice system, and it is estimated that commercial mediation can save businesses around £5.9 billion per year in management time, relationships, productivity, and legal fees with the value of UK mediated cases each year being estimated at approximately £20bn as of February 2023. The Centre for Effective Dispute Resolution (CEDR) noted the emergence of online mediation in its Ninth Mediation Audit in 2021 and predicted that this will serve to increase the overall level of mediation activity, and cross[1]border mediation in particular, 2 in the future. CEDR stated that online mediation is here to stay and that ‘the nature of the field has permanently changed’ in their latest Audit of 1 February 2023. 3 In England & Wales, the Government has also set out its vision to integrate mediation as an essential step within the court process for civil claims. Commercial mediation can support businesses who may be looking for more cost-effective methods of resolving their disputes, outside of the traditional routes of litigation and arbitration, with aspirations of preserving their important and potentially long-standing business relationships by reaching an amicable and mutually agreed resolution. The uniform framework for the effective recognition and enforcement of international mediated settlement agreements, which the Convention provides, will increase confidence to trade across borders and between different legal jurisdictions, by providing a clear and expedited process for resolving commercial disputes through mediation.’
Government response to the Consultation on the United Nations Convention on International Settlement Agreements Resulting from Mediation (New York, 2018) – GOV.UK (www.gov.uk)

https://www.gov.uk/government/consultations/the-singapore-convention-on-mediation/consultation-on-the-united-nations-convention-on-international-settlement-agreements-resulting-from-mediation-new-york-2018

I am delighted to announce that today I became a CMC Registered Mediator. See: https://lnkd.in/eiaGqWQ2 . I would like to take this opportunity to thank everyone who has helped me along the way to full registration. I specialise in the Mediation of Contentious Probate, Trust, Tax, Art and Cultural Heritage Disputes. For more information please visit www.carlislam.co.uk

To request a copy of any of the following articles posted on the ‘Publications’ page at www.carlislam.co.uk please send an email to carl@ihtbar.com:

– ‘Follow the Yellow Brick Road – Off to Mediation with HMRC – Part 2.’  Published in ‘Taxation’ by Tolley, 05.01.2023.

– ‘Follow the Yellow Brick Road – Off to Mediation with HMRC – Part 1’. Published in ‘Taxation’ by Tolley on 15.12.2022.

– ‘Mediating Probate and Trust Disputes – Process Challenges and Tools – Part 1.’ Published by Oxford University Press in Trusts & Trustees in February 2023 (https://lnkd.in/e-a658_b) . Part 2 will be written in 2023.

– ‘Back to the future’ – Part 2 – Mediation and Estate/Business Succession Planning. Taxation (Tolley) 08.03.2022.

– ‘Back to the future’ – Part 1 – Mediation and the tax-efficient settlement of probate disputes. Taxation (Tolley) 01.03.2022.

I am currently working on Part 2 of the article for Trusts & Trustees. I am also writing the 2nd edition of the ‘Contentious Probate Handbook’ for publication by the Law Society in 2024, which contains a detailed chapter about JENE and Mediation. Today I also launched the ‘Mediating Cultural Heritage Disputes’ page (which is a work in progress) at www.diplomaticlawguide.com. This is the subject of an essay I am writing for the Diploma in Art Law course at the Institute of Art & Law in London. The drafts of all three essays are available to view on the ‘Mediation of Art & Cultural heritage Disputes’ page at www.carlislam.co.uk

When I was a teenage political science undergraduate at University, I was taught that ‘the more institutions there are the more stable society is’. In order for fascism to displace democracy, institutions must first crumble – which is a slow and gradual process. Mussolini compared accumulating power to ‘plucking a chicken one feather at a time, go slowly and no one notices’. As the late Madeleine Albright, former US Secretary of State, argues in ‘Fascism: A Warning’ (2019), fascism in pre-World War II Europe did not happen all of a sudden. It was incremental. Step-by-step democracy was undermined by eroding liberty. There was no overt overthrow. It can begin with the dehumanising of vulnerable people. In their book, ‘How Democracies Die – What History Reveals About Our Future’ (2018), Professors of Government at Harvard University, Stephens Levitsky & David Ziblatt argue, ‘Democracies may die at the hands not of generals but of elected leaders – presidents or prime ministers who subvert the very process that brought them to power … More often … Democracies erode slowly, in barely visible steps. … Many government efforts to subvert democracy are legal, in the sense that they are approved by the legislature or accepted by the courts. They may even be portrayed as efforts to improve democracy – making the judiciary more efficient, combating corruption, or cleaning up the electoral process. … People do not immediately realise what is happening. Many continue to believe they are living under a democracy. … Because there is no single moment- no coup, declaration of martial law, or suspension of the constitution -in which the regime obviously crosses the line into dictatorship, nothing may set off society’s alarm bells. Those who denounce government abuse may be dismissed as exaggerating or crying wolf. Democracy’s erosion is, for many, almost imperceptible. … The tragic paradox of the electoral route to authoritarianism is that democracy’s assassins use the very institutions of democracy – gradually, subtly, and even legally – to kill it.’ The professors developed a set of 4 behavioural warning signs which can help us to recognise an authoritarian when we see one – ‘we should worry when a politician (1) rejects in words or actions, the democratic rules of the game, (2) denies the legitimacy of opponents, (3) tolerates or encourages violence, or (4) indicates a willingness to curtail the civil liberties of opponents. … A politician who meets even one of these criteria is cause for concern.’ So one day, and without realising what has been happening over a period of years, you may wake up and find that you are living in an autocracy. That is why speaking out is critical to the resilience of democracy and safeguarding the rule of law so that politicians who are not above the law are held to account for their rhetoric and actions which are destructive of the institutions that bind society together in a democracy.

See:

Madeleine Albright on the slow rise of fascism | CNN

My article – ‘Mediating probate and trust disputes—process challenges and tools: part 1’ has been published in print in Trusts & Trustees, Volume 29, Issue 1, February 2023, Pages 19-27: https://academic.oup.com/tandt/issue/29/1

I am currently writing part 2 for publication by Oxford University Press. The Abstract for Part 2 states:

‘Although life can only be understood backwards, it must be lived forwards. Litigation is a backwards looking process, at the end of which a Judge must make a binary choice between competing narratives. Mediation is a forward-looking process in which the participants (‘P’s’) work out their own solution through a process of engagement. Therefore, the first challenge for a Mediator (‘M’) is to understand what each P wants, needs, and prioritizes, and why. This requires empathy and affirmation. The second is to facilitate engagement. As discussed in Part 1, the ‘hook’ is the making of an ‘interesting offer’. On paper, a theoretical settlement zone exists somewhere in the gap between:

(i)     the maximum net capital value of each P’s claim; and

(ii)     each P’s BATNA (‘best alternative to a negotiated agreement’) – which in litigation is trial, i.e. the amount below which P will walk away from the table. The challenge in reducing the size of the gap is to make adjustments. …

In this Part, the author discusses the challenges and tools available to a Mediator during the Mediation Day, to help the P’s:

·       overcome psychological barriers to engagement; and

·       develop their own simple or complex solution through engagement with M in private sessions, and with each other in plenary sessions,

in order to agree and sign-off on binding terms of a Settlement Agreement in overall and final settlement of their dispute.

Mediation is the art of knowing how, when and why to ask questions which can bring about a ‘cognitive shift’ in each P’s thinking and behaviour, i.e. a paradigm shift about what they perceive to be at stake and the value of settling. This includes each P’s analysis and evaluation of potential:

(i)         gains;

(ii)        opportunities;

(iii)       risks;

(iv)       costs (including intangibles e.g. health, relationships, reputation); and

(v)        losses (including the time-value of money).

Metaphorically, ‘questions’ are the ‘steering-wheel,’ whereby M can navigate a ‘difficult conversation’ with each P in order to bring closure by helping each P to sort out their dispute for and by themselves. … [T]he author has attempted to set out a Mediator’s Toolkit, i.e. a ‘conceptual framework’ for the structuring of questions by M whilst conducting private sessions with each P, using tools to respond to the challenges that typically arise in the Mediation of a Probate/Trust Dispute.’

I am currently writing the 2nd edition of the ‘Contentious Probate Handbook’ for the Law Society for publication in 2024, which will include an extended chapter on ADR in contentious probate disputes, including JENE and mediation. There is a link to the article on the ‘Publications’ Page at www.carlislam.co.uk

In his article, ’Museums Restitution And The New Charities Act’, published in Art Antiquity and Law, Vol. XXVII. Issue 3, October 2022, Alexander Herman, who is the Director of the Institute of Art and Law in London, and also my tutor for the Diploma in Art Law course at IAL’s wrote, ‘The Charities Act 2022 was passed this year. … The entry into force of the legislation [is] not immediate, but instead [will] be staggered over the course of 2022 and 2023 according to its commencement provision. The legislation does not represent a complete overhaul of charity law in the way the Charities Act 2011 repealed and replaced its predecessor, the Charities Act 1993. Instead, the new act will make targeted changes to the Charities Act 2011, which will remain the primary legislation in this area. Some of the new changes include giving charities additional powers and flexibility in amending their governing documents, in deciding how to procure goods and services, and in borrowing from their permanent endowments in specific circumstances. But the most important change in the context of art and antiquities – that is, the change that could have a significant impact for years to come on the museum sector – will be the expanded situations in which charity trustees can make ex-gratia applications of charity property.’

At the IAL’s training forum on 25.02.2023 I asked about section 331A of the Charities Act 2022 – ‘Limited power for charity trustees to make ex-gratia payments’. Subsection (4) states, ‘The power conferred by this section may be restricted or excluded by the trusts of the charity.’ My question was – ‘Can this provision be applied in order to vary the terms of a governing trust deed so as to provide that determination of the existence of a moral duty to take action (see the conditions in subsection (3)), may be determined by an expert panel for the purposes of the trustees obtaining independent legal advice upon which they may rely, either with or without the authorisation/blessing of the Charity Commission/Attorney General/Court, for the purposes of making a decision about repatriation?’ In commenting on my question Alex noted that a model exists as a precedent – the ‘Spoliation Advisory Panel’ (‘SAP’). In his article Alex mentions  that following the decision in Re Snowden and the making of a claim to the SAP, ‘Parliament introduced legislation to override the restrictions imposed on trustees of national institutions insofar as they affected their ability to return art looted in the Nazi era to claimants.’ Therefore, provided such an expert panel were created, it appears that a practical model exists, which has been successful, to make determinations/provide guidance about the ethical question – ‘What is the right thing to do?’, after a repatriation request has been made on moral grounds.

This is the title of one of my three essay for the Diploma in Art Law Course at the Institute of Art & Law in London, see the ‘Mediation of Art & Cultural Heritage Disputes’ page at www.carlislam.co.uk. ‘In determining whether a person is a fiduciary, it is first necessary to consider whether that person is in a relationship with another that falls within one of the recognized categories of fiduciary relationships. If it does not, it is then necessary to examine the factual circumstances of the relationship to determine whether there are sufficient hallmarks of a fiduciary relationship to enable the court to conclude that the relationship is indeed fiduciary. Once it has been recognized that the defendant is a fiduciary in a fiduciary relationship, it is necessary to consider the nature and ambit of the fiduciary duties to which he is subject. Outside of the paradigm settled cases, the content of fiduciary duties is flexible and fact-sensitive. In that context, it is therefore necessary to examine with some care what is the precise content of the particular fiduciary obligations arising in the specific circumstances of the individual case. Fiduciary duties only subsist as long as the fiduciary holds the office or position that gives rise to them.’ (My article – ‘Breach of fiduciary duty claims and the quiet fiduciary thesis’, published by Oxford University Press in ‘Trusts & Trustees’, March 2019). There is a link to the article of the ‘Publications’ page at www.carlislam.co.uk. Breach of FD, third party (including accessorial liability), and equitable remedies are discussed in my book the ‘Contentious Trusts Handbook’, published by the Law Society in 2020. In the essay I will also discuss accessorial liability arising from breach of the self-dealing rule by an executor/beneficiary who purchases a work of art e.g. a painting by/owned by the deceased testator (which is an estate asset) at an undervalue, and who then consigns it for sale, and the equitable remedies available to restrain a sale. This along with ‘Freezing Orders’, will also be discussed in the 2nd edition of my book, the ‘Contentious Probate Handbook’, which I am writing for publication by the Law Society in 2024.

In my essay ‘Mediating Cultural Heritage Disputes’ (NB the working draft appears on the ‘Mediation of Art & Cultural Heritage Disputes’ page at www.carlislam.co.uk), I am developing a ‘Matrix of Ethical Principles’ which include the following principles extracted from ‘DCMS Guidance for the Care of Human Remains in Museums’, as these principles appear to have a wider application to the deaccessioning and repatriation of cultural property held in museums generally. At the Institute of Art & Law Training Day on Saturday, I will ask – ‘As a tool for starting the Mediation conversation/engine -what generic ethical principles can a Mediator invite the participants to discuss at the start of the Mediation Day in order to identify both common ground and constraints?’

The Ethical Principles set out in the Matrix in my essay are:

·       ‘Non-Maleficence – doing no harm’

Avoiding doing harm wherever possible to an individual, a community or the general public, e.g. by not taking an action that would cause distress to a particular community.

·       ‘Respect for diversity of belief – respect for diverse religious, spiritual and cultural beliefs and attitudes to cultural property – i.e. tolerance and respect.’

This requires demonstration of humility and modesty regarding one’s own opinions, and the showing of respect for individuals, cultures, groups and communities. Decision-makers must be seen and heard to give consideration to the cultural and historical backgrounds, beliefs and values relevant to all parties concerned. E.G. it would require a museum to recognize and respect that a community may place a particular cultural value on cultural property that is not shared by others.

·      ‘Respect for the value of research and science.’

·      ‘Solidarity – furthering humanity through co-operation and consensus in relation to cultural property.’

The principle of solidarity recognizes that we all have a shared humanity and an interest in furthering common goals and tolerating differences that respect fundamental human rights. Mutual respect, understanding and cooperation promote solidarity by fostering goodwill and a recognition of our shared humanity. This principle emphasizes the importance of rising above our differences to find common ground, co-operation and consensus. It would be reflected, for example by seeking to find a consensus in relation to competing claims over cultural property that all parties can accept.

·       ‘Beneficence – doing good, providing benefits to individuals, communities or the public in general.’

Beneficence would dictate that your actions have good outcomes wherever possible. This might include advancing knowledge that is of benefit to humanity, for example, by using human remains for scientific research, or respecting the wishes of an individual for example, by returning the remains of their relative for the burial.

The exercise of:

(a)     following the original asset; and

(b)     then tracing that asset into a substitute,

are distinct processes. The goal of tracing is to identify substitutions. Substitutions locate the value of the original assets in the form of the substitute. What is being traced is not the physical asset itself but the value inherent in it.

Once:

(a)     tracing is completed; and

(b)     the value inherent in the original asset is identified in its proceeds,

the question which then arises is what claims to those proceeds can be made. Tracing enables the claimant to substitute the traceable proceeds for the original asset as the subject matter of his claim. It does not affect or establish his claim.  The content of the claim will depend on various other factors. Therefore, there is nothing inherently legal or equitable about tracing. Consequently, the rules of tracing must be the same, whatever:

(a)     the basis of the claimant’s claim to the original asset; or

(b)     the content of the claim he eventually makes to the substitute.

There is a distinction between tracing at:

(a)     common law, which adopts a ‘materialistic’ approach; and

(b)     in equity, which adopts a more ‘metaphysical’ approach, which allows tracing into a mixture of money, whereas the more rigid, ‘physical stance’ of the common law does not.

To ground an equitable proprietary claim, an equitable ‘proprietary base’ is required. (Christopher Clarke J. In OJSC Oil Company Yugraneft (in liquidation) v. Abramovich [2008] EWHC 2613 (Comm), at [349]). A beneficiary under an express, resulting, or constructive trust clearly has an equitable proprietary right. Such a right may arise as a result of there being a vitiating factor, such as misrepresentation or mistake. But an equitable proprietary base may also arise under other circumstances such as proprietary estoppel.  The governing principles were stated by Lord Millett in the leading case of Foskett v. McKeown [2001] 1 AC 102.

For a discussion of the governing principles and proprietary remedies which are available to beneficiaries against the trust property or its traceable proceeds, see paragraph 8.8 of my book the ‘Contentious Trusts Handbook’ published by the Law Society in 2020.

Where, as in Tang Ying Loi v. Tang & Others [2016] the fiduciary has treated the trust fund as his personal bank account, even if he repays the money to the estate, the principal still has the right to elect and
trace into anything else the fiduciary purchased with that money which is now of higher value, e.g. another property/shares. The judgment in that case is discussed in my article ‘Electing between equitable remedies’ published in Trusts & Trustees by Oxford University Press – to which there is a link on the ‘Publications’ page at www.carlislam.co.uk.

A judge who puts a claimant to an early election before making a finding about breach (i.e. at trial), would appear to be acting in excess of their case management powers.