England and Wales Court of Appeal (Civil Division) Decisions

IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL
ON APPEAL FROM THE HIGH COURT OF JUSTICE
CHANCERY DIVISION (GROUP B)
MR_JUSTICE WHITFORD)

		Royal Courts of Justice.
		1st November 1977.

THE MASTER OF THE ROLLS: In 1910 Sir Adolph Tuck was made a baronet. He was rightly proud of this dignity. It was hereditary and on his death would pass to his successors in the male line of descent.

Being a Jew himself, he was anxious to ensure that his successors to the title should all be of Jewish blood and Jewish faith. To do this he wanted his son to marry a wife who was Jewish; and his grandson likewise to marry a Jewish wife: and so on. So in 1912 he made a settlement by which he sought to ensure that each baronet in succession should marry an "approved wife". He put money in trust for "the Baronet for the time being if and when and so long as he shall be of the Jewish faith and be married to an approved wife". In the settlement, this was the definition of "an approved wife"; "An approved wife' means a wife of Jewish blood by one or both of her parents and who has been brought up in and has never departed from and at the date of her marriage continues to worship according to the Jewish faith". Then he added this significant clause: "as to which facts in case of dispute or doubt, the decision of the Chief Rabbi in London of either the Portuguese or Anglo-German Community (known respectively as the Sephardim and the Ashkenazim Communities) shall be conclusive".

Sir Adolph himself died on 3rd July, 1926, leaving two sons and three daughters. He was succeeded by his eldest son, Sir William Tuck. He married an approved wife and had a son and daughter. Sir William died on 12th May, 1954, and was succeeded by his son, Sir Bruce Tuck. Sir Bruce married first an approved wife and had two sons. But in 1964 there was a divorce. In 1968 he married a lady who was not an approved wife.

Now a question arises whether the settlement is valid or not. If it is valid, the fund will go to Sir Bruce Tuck and his two sons. If it is invalid, it will go to Sir Adolph's estate.

Mr. Dillon, Q. C. submitted that the definition of "approved wife" was so uncertain as to be void for uncertainty: that this uncertainty could not be cured by referring the matter to the Chief Rabbi: and that in consequence all the provisions in the settlement referring to an "approved wife" must be disregarded.

If this argument is correct, it means that the intentions of the settlor, Sir Adolph, have been completely defeated by the ingenuity of the lawyers: first, in discovering the uncertainty: and, secondly, in refusing to allow it to be cured by reference to the Chief Rabbi. I will deal with these two points in order.

In making his submissions, Mr. Dillon, Q. C. used two phrases which have begun to fascinate Chancery lawyers. They are "conceptual uncertainty" and "evidential uncertainty". After a little probing, I began to understand a little about them. "Conceptual uncertainty" arises where a testator or settlor makes a bequest or gift upon a condition in which he has not expressed himself clearly enough. He has used words which are too vague and indistinct for a court to apply. They are not sufficiently precise. So the court discards the condition as meaningless. It makes it of no effect, at any rate when it is a condition subsequent.

"Evidential uncertainty" arises where the testator or settlor, in making the condition, has expressed himself clearly enough. The words are sufficiently precise. But the court has difficulty in applying them in any given situation because of the uncertainty of the facts. It has to resort to extrinsic evidence to discover the facts, for instance to ascertain those whom the testator or settlor intended to benefit and those whom he did not. Evidential uncertainty never renders the condition meaningless. The Court never discards it on that account. It applies the condition as best it can on the evidence available.

This dichotomy between "conceptual" and "evidential" uncertainty was adumbrated by Jenkins J. in Re Coxen (1948) Chancery at pages 761/2. It is implicit in Lord Upjohn's speech in Re Gulbenkian [1970] AC 508 at page 525 and accepted by Lord Wilberforce in Re Baden's Deed Trusts [1971] AC 424 page 457. I must confess that I find the dichotomy most unfortunate. It has led the courts to discordant decisions. I will give some relevant instances. On the one hand, a condition that a person shall "not be of Jewish parentage" has been held by the House of Lords to be void for conceptual uncertainty, at any rate in a condition subsequent, see Clayton v. Ramsden [1943] A.C. 320 : and a condition that a person shall be "of the Jewish race" was held by Mr. Justice Dankwerts to be void for conceptual uncertainty, even in a condition precedent, see Re Tarnpolsk [1958] 1 WLR 1157 . The reason in each case being that the testator had given no information or clue as to what percentage or proportion of Jewish blood would satisfy the requirement. Is it to be 100 per cent, or will 75 per cent or 50 per cent be sufficient? The words do not enable any definite answer to be given.

On this reasoning the condition in the Tuck settlement that an "approved wife" should be "of Jewish blood" would seem to be afflicted with conceptual uncertainty.

On the other hand, a condition that a person shall be "of the Jewish faith" has produced diverse views. Four out of five Law Lords thought that it was void for conceptual uncertainty, at any rate in a condition subsequent - see Clayton v. Ramsden [1943] A.C. 320 at pages 392, 334/5: but Lord Wright thought it was sufficiently clear and distinct to be able to be applied - see Clayton v. Ramsden [1943] A.C. 320 at page 331. Lord Cross of Chelsea afterwards agreed with him, see Blathwayt v. Baron Cawley (1976) AC 397 at page 429. So also did Mr. Justice Buckley, at any rate in a condition precedent - see Re Selby's Will Trusts (1966) 1 WLR 43. I should range myself with Lord Wright. His view is supported by reference to the cases on other religions. Thus a condition that a person should be or not be "of the Roman Catholic faith" is not open to objection on the ground of uncertainty, either in a condition precedent or a condition subsequent - see Blathwayt v. Baron Cawley (1976) AC 397 at pages 424/5 by Lord Wilberforce: nor a condition that he shall or shall not be an "adherent of the doctrine of the Church of England", at any rate in a condition precedent, see Re Allen (1953) Chancery 821: nor a condition that he shall be "of the Lutheran religion", see Patton v. Toronto (1930) AC 629. The reason being in each case that evidence can be given of the tenets of that religion or faith so as to see if the person is or is not an adherent of it.

On this reasoning the condition in the Tuck settlement about "Jewish faith" would seem to be valid and not avoided for conceptual uncertainty.

In addition to those troubles, there is another distinction to be found in the cases. It is between condition precedent and condition subsequent. Conceptual uncertainty may avoid a condition subsequent, but not a condition precedent. I fail to see the logic of this distinction. Treating the problem as one of construction of words, there is no sense in it. If the words are conceptually uncertain - so as to avoid a condition subsequent - they are just as conceptually uncertain in a condition precedent - and should avoid it also. But it is a distinction authorised by this court in Re Allen (1953) Chancery 810, and acknowledged by Lord Wilberforce in Blathwayt v. Baron Cawley (1976) AC 397 at pages 424/5.

I deplore both these dichotomies, for a simple reason and a good reason. They serve in avery case to defeat the intention of the testator or settlor. The courts say: "We are not going to give effect to his intentions - because he has not expressed h himself with sufficient distinctness or clearness". That assertion gives rise to argument without end as to whether his words were sufficiently clear and distinct: and whether the condition in which they occur was a condition precedent or a condition subsequent.

THE CHIEF RABBI'S CLAUSE

How is any testator or settlor to overcome these legal difficulties? And all the costs, expense and time expended in resolving them? Sir Adolph Tuck in this settlement said: "Let any dispute or doubt be decided by the Chief Rabbi". That seemed to him a good solution, and it seems to me a good solution. The Chief Rabbi should be able to decide - better than anyone else -whether a wife was "of Jewish blood" and had been brought up "according to the Jewish faith". But Mr. Dillon, Q. C. said that that was not an admissible solution. He submitted that, in a case where there was conceptual uncertainty (where the words were not clear enough for the court) it followed inexorably that they were not clear enough for a Rabbi either. He based this on the words of Mr. Justice Jenkins in Re Coxen (1948) 1 Chancery at page 761, and on Re Jones (1953) Chancery 125. Alternatively he said that, by entrusting the decision to a Rabbi instead of to he based this on Re Raven (1915) 1 Chancery 673; and Re Wynn (1952) 1 Chancery 271.

I cannot accept either of these submissions. Nor can I accept the decisions on which Mr. Dillon relies. All the cases on this subject need to be reconsidered in the light of Dundee General Hospitals Board of Management v. Walker [1952] 1 All England 896. A testator there gave money to a hospital provided that at his death it should not have been taken over by the State. He gave his trustees "sole and absolute discretion" to decide whether it had been taken over by the State. The House held that this entrusting to his trustees was perfectly valid: and their decision was to be upheld. It was a decision of the House of Lords in a Scottish case. It may not be binding on the English courts in an English case. But it is of the highest persuasive value. Donoghue v. Stevenson (1932) AC 562 was a Scottish appeal. But it transformed the law of England. I venture to suggest that, on questions of principle, it is most desirable that the laws of England and Scotland should be uniform: and, accordingly, that a decision of the House of Lords - when founded on principle and not on authority - should be regarded as applicable to both countries: unless the House itself says otherwise. Why otherwise should we have Scottish Law Lords sitting on English cases? or English Law Lords sitting on Scottish cases? The very constitution of the House shows that each system of law has much to learn from the other: and that a decision on a point of principle should reflect the best of both.

I see no reason why a testator or settlor should not provide that any dispute or doubt should be resolved by his executors or trustees, or even by a third person. To prove this, I will first state the law in regard to contracts. Here the general principle is that whenever persons agree together to refer a matter to a third person for decision, and further agree that his decision is to be final and binding upon them, then, so long as he arrives at his decision honestly and in good faith, the two parties are bound by it. They cannot reopen it for mistakes or errors on his part, either in fact or of law, or for any reason other than fraud or collusion. I collected the cases together in Arenson v. Arenson (1973) Chancery at pages 362/4, especially in regard to awards by arbitrators, certificates of architects and engineers, and valuations by experts, and this was followed in Campbell v. Edwards (1976) 1 WLR 433. Even if his decision involves points of law as well as of fact, his decision is binding on the two parties. This is especially the case where his decision involves the interpretation of words used in the business in which he is expert. Such an agreement (to abide by the decision of a third person) does not oust the jurisdiction of the courts. It only offends when the parties go further and seek by their agreement to take the law out of the hands of the courts and put it into the hands of a private tribunal without any recourse to the courts in. case of error of law, see Czarnikow v. Roth, Schmidt &_Co. (1922) 2 King's Bench 428; Lee v. The Showmen's Guild of G. B. (1952) 2 Queen's Bench at page 342.

If two contracting parties can by agreement leave a doubt or difficulty to be decided by a third person, I see no reason why a testator or settlor should not leave the decision to his trustees or to a third party. He does not thereby oust the jurisdiction of the court. If the appointed person should find difficulty in the actual wording of the will or settlement, the executors or trustees can always apply to the court for directions so as to assist in the interpretation of it. But, if the appointed person is ready and willing to resolve the doubt or difficulty, I see no reason why he should not do so. So long as he does not misconduct himself or come to a decision which is wholly unreasonable, I think his decision should stand. After all, that was plainly the intention of the testator or settlor. He or his advisers knew that only too often in the past a testator's intentions have been defeated by various rules of construction adopted by the courts: and that the solution of them has in any case been attended by much delay and expense in having them decided by the courts. In modern times the courts have been much more sensible. Ever since Perrin v. Morgan (1943) AC 399 and Re Jebb (1966) Chancery 666. But still the testator may even today think that the Courts of Law are not really the most suitable means of deciding the dispute or doubt. He would be quite right. As this very case shows, the courts may get bogged down in distinctions between conceptual uncertainty and evidential uncertainty: and between conditions subsequent and conditions precedent. The testator may want to cut out all that cackle, and let someone decide it who really will understand what the testator is talking about: and thus save an expensive journey to the lawyers and the courts. For my part, I would not blame him. I would give effect to his intentions. Take this very case: Who better to decide these questions of "Jewish blood" and "Jewish faith" than a Chief Rabbi? The settlor mentions two Chief Rabbis. It is not necessary to ask both of them. Either one will suffice. I venture to suggest that his decision would be much more acceptable to all concerned than the decision of a Court of Law. I would let him decide it.

CONCLUSION

So it comes to this: If there is any conceptual uncertainty in the provisions of this settlement, it is cured by the Chief Rabbi clause. That was the view of Mr. Justice Whitford, and I agree with it. If the Chief Rabbi clause is inoperative, then I would so construe the settlement as to hold that there is no conceptual uncertainty. This is the view of Lord Russell of Killowen, Whose judgment in a moment will be read. And I agree with it, too. In either case I would hold that the settlement is valid in all its provisions. I would, therefore, dismiss the appeal.

Lord Russell cannot be here this morning, so I will ask Lord Justice Eveleigh to read his judgment.

(LORD JUSTICE EVELEIGH READ THE JUDGMENT OF LORD RUSSELL AS FOLLOWS)

LORD RUSSELL: The question in this appeal is whether a settlement is ineffective because of uncertainty introduced by conditions concerning Jewish blood and Jewish faith.

In 1912, a baronetcy having been conferred upon Sir Adolph Tuck ("the Settlor"), he was minded to settle a fund to support the holders of that dignity from time to time during a Royal Lives perpetuity period. His reasons are best taken from the first recital to the relevant settlement dated 23rd October 1912:

"Whereas His Majesty having conferred upon the said Sir Adolph Tuck the dignity of a Baronetcy of the United Kingdom he considers that the same is an honour not merely to himself but to the Jewish race of which he is a member and that it is incumbent upon him to make such provision as may tend to keep the said dignity in the hands of successors of Jewish faith and born of parents both of whom shall be of Jewish blood and Jewish faith and also to make due provision for the upholding of the said dignity for so long a period as the law allows".

The beneficial trusts of the settlement are complicated and somewhat convoluted and I will attempt to restate them in a simplified form. The first trust was for accumulation during the settlor's life. The settlor by a later settlement and by his will added to the trust fund, but nothing turns on that. Initially however it is necessary to set out the definition of an "approved wife":

"An approved wife means a wife of Jewish blood by one or both of her parents and who has been brought up in and has never departed from and at the date of her marriage continues to worship according to the Jewish faith as to which facts in case of dispute or doubt the decision of the Chief Rabbi in London of cither the Portuguese or Anglo German Community (known respectively as the Sephardim and the Ashkenzim Communities) shall be conclusive".

The income of the fund after the Settlor's death is payable to the then Baronet while the following circumstances co-exist: (a) He is of the Jewish faith. (b) He is married and to an approved wife. (c) He is living with her unless one of the Rabbis mentioned certifies that their separation was not caused by his fault.

As a qualification to (b) the Baronet is entitled to the income of the fund for 18 months after the marriage ends by the death of the approved wife or otherwise.

Additionally the Baronet is thereafter entitled to the income during the minority of an heir apparent born of an approved wife he is maintaining and educating the latter thereout.

There is then provision directly for an heir apparent over 21 years old after the death of his "approved wife" mother of £400 per annum increased to one third of the trust income if and when he marries an approved wife: and the same clause during the joint lives of the Baronet and such adult heir apparent extends (so to speak) the income interest of the Baronet beyond the 18 months by giving during those joint lives to the latter the balance of the income until the Baronet marries a woman not an approved wife.

It will be observed that thus far no provision is made for a Baronet while not of the Jewish faith, or while a bachelor, or while married to someone not an approved wife, or while a widower other than for 18 months after the death of an approved wife, or while separated from an approved wife through his own fault: though as stated some extra rights are given to him on, so to speak, the back of an heir apparent during widowerhood. Clause 3(e) in substance reflects and in part remedies this position by giving the Baronet £400 per annum and no more if he be "a pervert from the Jewish faith... until he shall be received again formally into the Jewish faith": or while he is a bachelor: or while he is married to someone not an approved wife: or while he is separated from an approved wife through his own fault: or while he is a widower under the age of 55 without male issue born of an approved wife whose wife has been dead for 18 months. The balance of income from time to time over and above those yearly sums of £400 for the Baronet (subject to the provision for an heir apparent already mentioned) is directed to be applied as to half in trust for the Settlor his executors etc. and as to the other half for Jewish religious charitable purposes.

Although some of the language of clause 3(e) is suggestive of conditions subsequent, in my opinion the substance of the clause is to release the Baronet up to £400 from the need to fulfil the qualifying conditions or conditions precedent in the earlier part of the settlement: accordingly in my judgment the question of uncertainty must be decided upon the footing that we are here concerned with conditions precedent.

The main burden of the appellants' argument that the settlement must be struck down for uncertainty rested on the description of "an approved wife" as a person "of Jewish blood by one or both of her parents". What, it was asked, is involved in the concept "of Jewish blood"? Now one thing appears to me plain as a matter of construction of this settlement that the Settlor did not intend by the phrase 100 per cent Jewish blood: for he in the recital expects and hopes that successive Baronets shall be born of parents both of whom shall be of Jewish blood. But the approved wife (mother of the next Baronet) need not have any Jewish blood from one of her parents. He envisages therefore the possibility of there being only some Jewish blood in the parents of a Baronet. Every Baronet must of course have some Jewish blood by male descent from the settlor: but that could be increasingly diluted through the generations by marriages to wives of whom it could not be said that their blood was wholly Jewish. I therefore consider that marriage to a wife of Jewish blood means a wife with some Jewish blood. It was argued that the Settlor could not conceivably have intended or envisaged a woman with some very small proportion of Jewish blood by descent: but I think here the second requirement that she "has been brought up in and has never departed from and at the date of her marriage continues to worship according to the Jewish faith" may well have been considered by the Settlor, as a practical matter, a sufficient safeguard against undue dilution of Jewish blood in the Baronetcy: for though it is theoretically possible that a girl should be brought up in the Jewish faith when her parents between them could only produce one remote ancestor with Jewish blood, it is almost inconceivable. It was also contended that if any amount of Jewish blood, however small, would qualify a wife as an approved wife it might be impossible to establish that it existed: but if that were so the fulfilment of the qualifying or precedent condition would not be established. If I am right in construing the requirement in this case as only that the approved wife should have some Jewish blood there are not the problems met with in a case in which it is required simply that X should be "of Jewish blood" or "of Jewish parentage".

Mr. Dillon for the appellants accepted that if he could not succeed in his attack based on uncertainty in the requirement of Jewish blood in an approved wife he could not succeed on the basis of uncertainty in the various requirements of adherence to the Jewish faith as part of a condition precedent or qualifying condition* In this I think he was right despite the comments made in the context of a condition of defeasance in Clayton v. Ramsden [1943] A.C. 320 .

No doubt there are variations in rites, practices, and for ought I know beliefs among the different groups of Jews who practice their religious faith. But I would not wish to destroy a settlement and defeat a settlor's intentions on the supposition that adherence to the Jewish faith is an unintelligible concept, any more than had the reference been to Christianity however diverse have become attitudes to the latter.

Two matters I should mention. It was submitted that the distinction, in considering uncertainty in conditions, between those precedent or qualifying and those subsequent or forfeiting, is illogical and insupportable. Since in this case all the conditions have, as I have sought to indicate, the quality of the former, I do not propose to embark upon this problem, which in this Court appears to me to be concluded by the case of Re Allen (1953) Chancery 810. I have already indicated that, throughout, the nature of the conditions is precedent, so that the trustee should have no problem arising from the present Baronet having secondly married a lady who is admittedly not an approved wife. The second matter is the effect of the reference to a decision of the Chief Rabbi mentioned to solve problems that may arise: it was argued by the Respondents that this solved any question of uncertainty: for the Appellants it was argued that if the concept was uncertain this could not be a solution: if it was too uncertain for the court it was too uncertain for the Rabbis, who could not make a trust for the Settlor, or could not oust the jurisdiction of the court to decide. I do not propose to rule upon this. No problem may arise in the spheres allotted to the Rabbis: None has arisen yet.

The learned Judge indicated that he would have found the condition too uncertain but for the reference to the Rabbis. I do not so find it. I would accordingly dismiss the appeal.

LORD JUSTICE EVELEIGH: I agree for the reasons expressed by Lord Russell of Killowen that "Jewish blood" in the context of this settlement means some Jewish blood.

I also agree that the clauses which we have to consider are truly conditions precedent. This conclusion however is not in my view essential for the determination of this appeal in favour of the respondents, Clayton v. Ramsden (1943) AC 320 was concerned with the expression "Jewish faith" in isolation. There was no clue as to its precise meaning. Lord Romer at page 334 said:

"The testator has, however, failed to give any indication what degree of faith in the daughter's husband will avoid, and what degree will bring about, a forfeiture of her interest in his estate. In these circumstances the conditions requiring that a husband shall be of Jewish faith would, even if standing alone, be void for uncertainty".

Therefore it was left to the court to determine the meaning and the court could not do so with the necessary degree of certainty.

Where the expression is first encountered in the clauses of the present settlement the settlor has given an indication, for he has made reference to the opinion of the Chief Rabbi. He is in effect saying that his definition of "Jewish faith" is the same as the Chief Rabbi's definition. Different people may have different views or be doubtful as to what is "Jewish faith" but the Chief Rabbi knows and can say what meaning he attaches to the words. One does not need a letter from him to be sure of that?

I therefore do not regard the settlor as leaving it to the Chief Rabbi to discover what the settlor meant or to provide a meaning for the expression used by the settlor when the meaning is in doubt. The court itself will not do so and I doubt if the case of Dundee General Hospital Board of Management v. Walker [1952] 1 All ER 896 allows me to say that the court will permit the Chief Rabbi to do so. The fact is that the. Chief Rabbi knows what he means by "Jewish faith" and the testator has said that he means the same thing. There is no element of speculation here. Id certum est.

Furthermore in my opinion wherever else the expression "Jewish faith" appears, albeit without express mention of the Rabbi, it must be taken to have the same meaning.

I too would dismiss this appeal.

(Order: Appeal dismissed with costs. All costs except those of Appellant to come out of the estate. Leave to appeal to the House of Lords refused).