Beddoe Order – What is it and when do you need one?

A trustee or personal representative may find themselves engaged in litigation on behalf of the trust or estate. In those circumstances, issues can arise as to how their legal costs should be funded.  It is well established that the best way of ensuring that costs will be met by the estate or trust fund is to seek a Beddoe order from the court.  

How to obtain a Beddoe order? 

To obtain a Beddoe order, a Beddoe application needs to be made under Part 64 of the Civil Procedure Rules. The application seeks the Court’s directions on whether the trustee(s) or personal representative(s) should bring or defend, or continue to bring or defend, legal proceedings that are for the benefit of the trust or estate.   

 The application is named after the case of Re Beddoe [1893] 1 Ch 547, where LJ Lindley held that:  

“A trustee who, without the sanction of the Court, commences an action or defends an action unsuccessfully, does so at his own risk as regards the costs, even if he acts on counsel’s opinion; and when the trustee seeks to obtain such costs out of his trust estate, he ought not to be allowed to charge them against his [beneficiaries] unless under very exceptional circumstances.” 

How does the court decide to grant a Beddoe order or not? 

In deciding whether or not to grant a Beddoe order, the court decides whether the costs of the action should be recoverable by the trustee(s) or personal representative(s) from the trust or estate.   

If the order is granted, it provides an indemnity to the trustee(s) or personal representative(s) for any costs they incur in relation to the litigation, including any adverse costs.

When do you need a Beddoe order?

If a trustee or personal representative does not make a Beddoe application and they lose the proceedings they are engaged in, they may be personally liable for both their own and the other parties’ costs.

Whilst it may be possible to establish that these costs were properly incurred and should be charged to the trust or estate, making a Beddoe application removes any uncertainty as to recovery of costs. It can also be made at the outset of any proceedings to give certainty on their costs position.  

Before significant costs have been incurred in litigation, trustees and personal representatives should always consider whether it would be appropriate to apply for a Beddoe order. If you are a trustee or personal representative and would like advice on making a Beddoe application, please contact the Civil Litigation Team at Anthony Gold by email at mail@anthonygold.co.uk or call us on 020 7940 4060. 

On 24 April 2024, Anthony Gold partner David Wedgwood and solicitor Christopher Hatton will be hosting a seminar with Radcliffe Chambers to discuss when estates get out of hand. To register, click on the banner below: