Scottish Court of Session Decisions

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Cite as: [1867] ScotLR 3_108, [1867] SLR 3_108

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SCOTTISH_SLR_Court_of_Session

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Court of Session Inner House Second Division.

Monro Gibson Young Duncan Skelton Lord Neaves

3 SLR 108

Nolan

v.

Hartley's Trustees.

Subject_1Trust
Subject_2Vesting
Subject_3Lapse of Trust
Subject_4Denuding.
Facts:

A lady by her settlement directed the whole of her estate to be realised at her death and divided among her five grandsons on their respectively attaining majority; and by a codicil she granted the liferent of part of her estate to her daughter, and directed that at her daughter's death the subjects liferented, along with the remainder of her trust-effects, should be divided among her grandsons as directed in the trust-deed. The daughter survived all the grandsons and their issue. Held (diss. Lord Neaves), in a question betwixt the daughter and certain assignees of some of the grandsons, that nothing had vested in the grandsons, and that the daughter was entitled to call upon the trustees to denude in her favour as heir-at-law of her mother.

Headnote:

By her trust-deed of 26th December 1833, the deceased Mrs Hartley directed her trustees “immediately after my death, or so soon thereafter as the same can be advantageously effected, to sell and dispose of and realise my whole heritable and moveable property;” and she proceeded to declare, “I hereby direct and appoint my said trustees and their foresaids to apportion and divide my said trust-estate when so realised (after deduction of the provisions under the first condition of this trust) equally among my five grandsons, whose names and designations then follow; and the truster then goes on to say that they are to receive the property “share and share alike, upon their respectively attaining majority, or twenty-one years complete; declaring that in the event of any of my sais grandsons dying without leaving lawful issue of their own bodies, such deceaser's share shall be equally divided among the survivors; but if the deceaser shall leave lawful issue of his body, such issue shall.be entitled to their parents' share of my said trust-estate; declaring farther, that in the event of any of my said grandchildren, or their issue, being under age at the period of my said trustees realising and finally winding up my said trust-estate, then, and in that event, my said trustees shall set apart the share of such child or children under age until he or they shall have attained majority, my said trustees having full power either to advance or accumulate the interest during such minority as they may see expedient and proper.” By an after clause she instructed her trustees “to let my dwelling-house at such rent as they may think proper, until it can be advantageously sold, dividing the free rent obtained therefor among my said grandsons and their foresaids equally, share and share alike.”

But by a codicil of 18th April 1834, Mrs Hartley recalled and altered her settlement to the following effect:—“I do hereby give, grant, and dispone to my daughter all and whole my dwelling-house and pertinents situated in Stafford Street, Edinburgh, specially within described, with the whole household furniture of whatever denomination, boob, plate, and bed and table linen, which may be found therein at the time of my death, in life-rent, for her liferent use allenarly, and to my within-written trustees, for the special ends, uses, and purposes within mentioned, in fee; it being my wish and intention that my said daughter shall have the liferent use of my said dwelling-house and furniture, &c., if she survives me, and that at her death the whole shall be realised, along with the remainder of my trust-effects, and divided among my five grandsons within named, in manner particularly within directed; and in so far as not expressly and effectually altered by this codicil, or these presents, I do hereby ratify, approve, and confirm the within-written trust-disposition and deed of settlement in its whole heads, tenor, clauses, and contents.”

All of Mrs Hartley's grandsons are now dead, only one of them (William Dick Macfarlane) having left children, who are also all now dead. Under these circumstances Mrs Nolan, the only surviving child of the testator, claims the whole estate as intestate succession, and brings the present action of declarator of trust and denuding against the trustees of her late mother. Three of the grandsons of the testator, however, had before their death assigned their shares to certain parties who now claim their cedents' shares in respect that these vested in them at the date of Mrs Hartley's death, and that the trust has not therefore lapsed.

The Lord Ordinary (Kinloch) found that according to the sound construction of the trust-disposition and settlement and codicil the right thereby given to the grandchildren of the testatrix and their issue did not vest till the death of her daughter, the pursuer, and that all the said grand-children and their issue being dead, the right to the whole property, heritable and moveable, belonging to the testatrix, was now vested in the pursuer, her only child and heir-at-law.

The assignees reclaimed.

Judgment:

Monro and Gibson, for them, argued—The effect of the codicil was mere1 to give a legacy to the pursuer of the liferent of the house, and it cannot be contended that the testatrix meant to postpone the realisation of the whole trust-estate, the words “remainder of trust-effects” referring only to the balance of trust-funds that might necessarily remain in the hands of the trustees. Even although it be held that the realisation of the estate was postponed by the codicil, it does not necessarily follow that the time of vesting should be altered also. The words of the codicil are not wide enough to infer so extensive an alteration in the provisions of the original trust-deed, especially if, as was contended, the time of vesting was fixed in the trust-deed at the majority of each of the beneficiaries respectively. But supposing the time of vesting to be fixed at the expiry of the liferent, in the event of the death of all the beneficiaries before that period, the estate would not vest in the last survivor, the clause of survivorship being merely intended to regulate the rights of the beneficiaries inter se, and not involving a condition of survivance of the liferent— Boyle v. Lord Glasgow's Trustees, 20 D. 925; Maitland's Trustees, 23 D. 732; Newton, 11 D. 452 (Lord Fullerton's opinion.)

Young and Duncan, for the pursuer, answered—The estate vested under the original trust-deed at the death of the testatrix and the consequent realisation of the trust-estate. The effect of the codicil was to postpone the realisation of the whole estate to the expiry of the liferent, rod therefore

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necessarily to postpone the period of vesting. Until that period none of the beneficiaries acquired my indefeasible right, and consequently by their predecease Mrs Hartley's trust resulted in favour of the heir ab intestato.

Skelton appeared for the trustees.

The Court, by a majority, adhered to the interlocutor of the Lord Ordinary. They were of opinion that the effect of the codicil was to remove the punctum temporis at which vesting took place in the grandsons to the death of the liferentrix. The settlement was framed first on the footing that a realisation and division indicated the time of vesting. No doubt the testatrix did not contemplate that her grandsons would all die in the interval, but that could not affect the meaning of the terms employed.

Lord Neaves differed. He thought the majority were giving an effect and importance to the codicil, as overruling the principal deed, which was never contemplated by the testatrix, and was not fairly deducible from its own terms.

Solicitors: Agent for Pursuer— John Walker, W.S.

Agent for Assignees— William Mitchell, S.S.C.

Agents for Trustees— Tods, Murray, & Jamieson, W.S.

1867