COUNSEL: Wilfrid Hunt for the executors.

Wynn Parry K.C. and R. Gilbert for persons interested under the will.

 

SOLICITORS: Merton Jones, Lewsey & Jefferies; Vandercom, Stanton & Co.

 

JUDGE: SIMONDS J.

 

DATES: 1941 May 13.

 

[*390]

 

SIMONDS J. [having stated the question:] The material fact was that, at the date of his death, the testator was possessed of a large number of leasehold properties. There is no question but that his executors entered into possession of them and became, by virtue of the privity of estate thereby created, personally liable on the covenants contained in the leases. It is true that there are some limitations upon this personal liability of an executor, notably he may not be liable for the full rent reserved by the lease, but only for the letting value of the premises therein comprised, but he is under a personal liability and to protect him from that personal liability the court will decree that a sufficient sum be retained for his protection. Where he is under no personal liability, but is

 

(1) (1861) 1 Dr. & Sm. 575.

 

(2) [1904] 1 Ch. 638.

 

(3) [1939] Ch. 232. [*391]

 

only under a liability as executor, the court will not decree that a fund is to be set aside for his protection. That is clear from the cases which have been cited, the last of which, I think, was In re Nixon. Gray v. Bell (1), which I had occasion to review myself in the recent case of In re Lewis. Jennings v. Hemsley (2). But this is a case where, apart from s. 26 of the Trustee Act, 1925, it would be proper to order that a fund should be set aside for the protection of the executors.

 

It is said, however, that the section is a sufficient safeguard and that no fund need be set aside. I cannot take that view. The section is as follows. [His Lordship read the section and continued:] It is clear to me that the section deals only with the liability of the executor as such and it is not intended to cover the cases where the executor has entered into possession of the testator’s leaseholds and thereby incurred, in addition to his liability as executor, the personal liability of an assignee of the term. The section which I am now considering adopts, with certain modifications, the provisions of ss. 27 and 28 of the Law of Property (Amendment) Act, 1859 (Lord St. Leonard’s Act), in regard to which it had never been suggested that it covered the personal liability of the executor who had entered into possession of his testator’s leaseholds. That view is taken and, in my opinion, correctly taken by the text books, Wolstenholme and Cherry’s Conveyancing Statutes, 12th ed., p. 1307, and Carson’s Real Property Statutes, 3rd ed., p. 1046. Accordingly, since the section does not protect the executors, it is necessary to follow the old practice of the court and to decree that a sufficient indemnity be set aside for their protection.

 

I have not got the materials to determine what the amount of that protection should be, and it must be referred back to chambers to ascertain what is a sufficient sum to set aside.

 

(1) [1904] 1 Ch. 638.

 

(2) [1939] Ch. 232.