Background

The will

In 2016, Alexander Niven (“Mr Niven”) made a will appointing his wife and his solicitor Grant Johnston ("Mr Johnston”) as his executors and trustees. At the time, Mr Niven owned a half share in the matrimonial home, with his wife Irene Niven ("Mrs Niven”) owning the other half share.

In October 2022, the Inner House of the Court of Session released its decision in a petition by the executors of Sir Peter Hutchison (“the Deceased”), who died in 2019 and was domiciled in Scotland. The case dealt with the question of liability in the distribution of the estate of a deceased underwriting member of Lloyd’s of London (a “Name”).

The role of executors

Executors are crucial when it comes to managing a deceased’s estate. Executors are responsible for investigating the extent of the deceased’s estate; realising the same (including applying for Confirmation if necessary); settling all debts and liabilities due (including any inheritance tax) and thereafter distributing the estate in line with the deceased’s will (if there is one) and the law. Trustees also have similar duties and obligations when managing money or assets on behalf of trust beneficiaries.

Warranties and indemnities are contractual clauses that provide protection to buyers. In a typical sale and purchase agreement, it is the buyer who bears the risk that the asset they’re acquiring may turn out to be defective or less profitable than expected. The purpose of warranties and indemnities is to shift some of that risk back onto the seller, providing the buyer with more security. The extent of the protection offered will depend on the wording of the clause.

It is well-established that alternative dispute resolution (‘ADR’) can be an effective way to resolve disputes, particularly in commercial transactions. ADR is efficient, cost-effective, and capable of producing settlements that the courts cannot replicate. The solutions found through ADR tend to be more imaginative than judicial awards and can be tailored to suit the commercial needs of parties.

Breaches of contract occur when there is some form of non-performance of a contractual obligation. Before responding to a breach of a contract, an aggrieved party must determine whether the breach is material or immaterial. This will inform how the aggrieved party may respond, and the remedies that are available.

Notice clauses are an important element of a contract and should specify how and when notice must be served. They require parties to inform each other if a specific event has happened or is about to happen. In commercial agreements, it is common to demand notice:

Disputes that arise out of commercial contracts will often involve a disagreement on the meaning of a contractual term or the extent of a contractual obligation. The courts are tasked with determining the meaning of that contract or term, which involves balancing a number of competing principles.

The battle of the forms occurs when each party to a contract attempts to incorporate their own standard terms and conditions.