Administrator auditions

Thursday, 01 May 2014
Nadine Whyte discusses the appointment of an administrator for the estate of a member of a BVI company who died intestate and domiciled outside of the BVI.

The vast majority of BVI companies are owned by persons who are not domiciled in the BVI. When those persons pass away, the shares in that BVI company will normally form part of their estate, and fall to be distributed in accordance with the law of the place where the deceased is domiciled. However, the law of the place where the shares are located determines procedural issues, such as who has the right to apply for the relevant grant of representation.

If there is a will in place, then it is clear that the executor named in the will has that right. If there is no will and there is no agreement among the beneficiaries as to who should apply for the grant, then the court must decide who has the right to apply for the grant of letters of administration.

In a landmark judgment,1  Justice Vicki Ellis, in the High Court in the BVI, set out the guiding principles in relation to the application for the appointment of an administrator for the estate of a member of a BVI company who died intestate and domiciled outside of the BVI.

The NCPR apply

The laws of the BVI are silent as to the order of priority for the entitlement to apply for letters of administration, and, therefore, by virtue of s11 of the West Indies Associated States Supreme Court (Virgin Islands) Act, the BVI court must exercise its jurisdiction in conformity with the law and practice administered for the time being in the High Court in England and Wales. As such, the BVI Court held that relevant practice and procedure for the appointment of an administrator within the BVI are governed by the English and Welsh Non-Contentious Probate Rules (the NCPR).2

The Court indicated that, where a person dies domiciled outside of the BVI, NCPR 30 applies, and that NCPR 30 does not fix an order of priority where a person dies intestate and domiciled outside the territory; rather the Court may appoint any person who either has been entrusted with the administration of the estate by a court of the deceased’s domicile or, where there is no such person, anyone who is beneficially entitled to the estate under the law of the place where the deceased died domiciled or any person the court deems fit.

Appointment of an administrator when all are equally entitled

In this case, no one was entrusted with the administration of the estate by a court of the deceased’s domicile. However, the parties were all beneficially entitled to the deceased’s estate and the claimant and the defendant/counterclaimant applied to be appointed administrator.

The Court had to contemplate the criteria that must be taken into account when considering the appointment of an administrator from among persons who are equally entitled. The criteria that the Court considered are summarised below:

  • the grant should be made to the person who is likely to best convert the deceased’s estate to the advantage of the beneficiaries;
  • the court will exclude an applicant if they (i) are shown to be bankrupt or insolvent; (ii) are shown to be of extreme ill health or incapacity; or (iii) lack probity or good character;
  • the court will exclude an applicant if they are shown to have an interest incompatible with the due administration of the estate;
  • the court will prefer the applicant who has the largest beneficial interest or, alternatively, the one who is selected by the majority of the other parties interested; and
  • if all the factors mentioned above are equal, the court will prefer the first applicant simply on the basis that they applied first.

The judgment

In the instant case, the Court found that not only was the claimant the first to apply for the grant, but she also had the majority interest. Nevertheless, the Court found the evidence in opposition to her appointment was not cogent enough to militate against her being appointed administrator of the deceased’s estate.

Applying the criteria above, the Court denied the defendant’s counterclaim to be appointed administrator on the basis there was compelling evidence that he would not convert the deceased’s estate to the interest of the beneficiaries and that he had not acted in the best interest of the estate.

The defendant, in his alternative claim, requested that an independent administrator be appointed instead of the claimant. The Court accepted that it had discretion to appoint an independent administrator pursuant to NCPR 30(1)(c), but refused to do so.

This judgment makes it clear that the English and Welsh NCPR apply in the BVI as regards the appointment of an administrator for the estate of a deceased who died intestate outside the BVI and who held shares in a BVI company. 

  • 1 Unreported judgment, delivered on 2 July 2013. Claim No.BVI2011/222
  • 2SI 1987/2024
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Nadine Whyte

Nadine Whyte is a Senior Associate at O’Neal Webster.

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