One of Britain’s finest stately homes, Tottenham House, will be sold to a mystery buyer for £11.25 million – despite the fierce objections of the Earl of Cardigan – after the Court of Appeal ruled that estate trustees had acted reasonably in their attempts to obtain the best available deal.
The earl argued that the listed house, its stable block and hundreds of surrounding acres – which together form the major assets of his ancestral Savernake Estate, near Marlborough – had been under-valued and were worth up to £15 million.
The estate is owned by a family trust, of which the earl and his son are the main beneficiaries. Tottenham House had been empty since 1992, and was ‘decaying fast’, and the stable block, also listed, was ‘extremely dilapidated’.
The trustees had conditionally agreed the sale with an unidentified buyer – Mr A – in August 2013; however, completion of the sale was held up as the earl fought to have the trustees removed from office. He employed his own expert, who said that an international marketing campaign could have yielded a much better price.
Another potential buyer, Mr B, had offered £11.5 million for the estate, as well as a £575,000 non-returnable deposit and an ‘advantageous’ £5 million loan to the trust. However, the Court noted that that offer was subject to planning permission being obtained for a hotel and residential development.
Dismissing the earl’s appeal against an earlier decision to like effect, the Court noted that the history of Tottenham House was ‘chequered indeed’. It had been on and off the market for some time and had been shown to be a commercially questionable proposition by a failed hotel and golf course project.
Estate agents had taken the view that an open market campaign to find the highest bidder would be ‘risky and undesirable’. The higher valuation put forward by the earl ‘lacked any kind of specificity’ and the Court was also ‘much struck’ by arguments that a conditional contract had already been entered into and that, if the earl’s challenge succeeded, ‘the trust would be in an impossible bind’.
Recognising that the trustees’ decision was ‘indeed a momentous one’, the Court emphasised that it was ‘not a rubber stamp’. However, it was not the Court’s role to place ‘insurmountable obstacles’ in the path of the sale to Mr A. The trustees had rightly been concerned to get the best available price for Tottenham House ‘as speedily and unconditionally as possible’.
The Court concluded, “Their decision to enter into and complete the intended sale to Mr A was one which reasonable trustees could properly take in the interests of the beneficiaries.”