If you are an executor or trustee who is frustrated by a claimant who is dragging their feet, then you may wish to apply for a ‘put up or shut up’ order.
A ‘put up or shut up’ order imposes a time limit on someone who has threatened legal action against an estate. It means the claimant must either get on and issue a claim, or lose the right to do so.
We are quite often contacted by frustrated executors and trustees who have been notified of a potential claim against an estate which has never materialised. Executors and trustees are often left wondering whether to put the administration of the estate on hold until they hear further (which could take months, years, or may never happen) or take the risk of administering the estate and being held personally liable if a claim is subsequently made.
One option in this situation is for the executor or trustee to apply for a ‘put up or shut up’ order. This is also more formally known among lawyers as a Cobden-Ramsay order.
However, before applying for this type of order it is important to ensure that there are no other obstacles preventing the claim being commenced in court.
In the case of Parsons v Reid [2022] the court was asked to rule on a beneficiary’s claim against the trustees of her father’s estate. The beneficiary had questioned the amounts paid to another beneficiary, alleging that the trustees had breached their duties. The trustees had therefore responded by applying for a ‘put up or shut up’ order to impose a time limit on the beneficiary, thereby forcing her to issue her claim at court or give up her claim.
The beneficiary, argued that the trustees should first disclose all documentation detailing how their calculations had been reached.
While the court accepted it had jurisdiction to impose such an order, the judge agreed that the claimant needed to have all available documents made available to her before she could be expected to commence court proceedings.
The case illustrates that while a ‘put up or shut up’ order can provide frustrated executors and trustees with a solution when faced with claimants who are dragging their feet, they must still ensure they have provided reasonable disclosure before applying for an order and should consider the following factors:
- Whether the intimated claim is insubstantial, remote or speculative.
- The merits of the intimated claim.
- Whether the order will limit their liability.
