Scottish Court of Session Decisions

This was an action of declarator brought by Henry Flowerdew, Edinburgh, against William Lowson, merchant in Dundee, in the following circumstances:—Both parties were beneficiaries under the will of the deceased James Gray Flowerdew, a native of Dundee, and a partner in the firm of Hewitt, Flowerdew & Company, merchants in the city of Portland, in the State of Oregon, United States of America, where he died on the 22d July 1872. The said James Gray Flowerdew's last will and testament was as follows:—“In the name of God, Amen.—I, James G. Flowerdew, of the city of Portland, in the county of Multnomah, and State of Oregon, of the age of thirty-seven years, and being of sound mind and memory, do make, publish, and declare this my last will and testament in the manner following, that is to say:— First, I desire all my debts and liabilities to be paid. Second, After the payment of my debts as aforesaid, I give and bequeath to Henry Hewitt, my partner in the firm business of Hewitt, Flowerdew & Co., the sum of fifteen hundred dolls. Third, It is my direction to my executor that he loan to Henry Hewitt the sum of two thousand five hundred dolls., on three years' time, with interest at the rate of five per cent. per annum, without security. Fourth, I give and bequeath to Trinity Church, at the city of Portland, the sum of one-hundred and seventy-five dollars. Fifth, I give and bequeath to the Right Revd. B. Wistar Morris the sum of two hundred and twenty-five dolls., to be by him used either for religious or charitable purposes. Sixth, I request and direct my executor to use and expend the sum of seventy-five dolls, in the purchase of a diamond ring in token of the esteem I hold to him, and the same keep in remembrance of me; also to use a like sum for the purchase of a diamond ring, and the same to present to my esteemed friend Mr Edwin Russell; also to use a like sum for the purchase of a diamond ring, and the same to present to my esteemed friend J. D. Walker, of the firm of Faulkner, Bell & Co., of San Francisco, California. Seventh, After the payment of the bequests herein-before mentioned, I wish and direct the remainder of the money which may remain out of what may be collected of my life policy of insurance to be paid over to James D. Walker, Esq., who I will and direct to invest the same upon interest, payable semi-annually, and the interest so accruing and arising from the use of the said remainder to remit to William Lowson, Esq., for the benefit of my uncle Henry Flowerdew, so long as he may live, and upon the death of my said uncle Henry Flowerdew I will and bequeath of such remainder the sum of two thousand dollars to my brother William Flowerdew, now residing at Monte Video, Buenos Ayres, and the sum of two thousand dollars to my sister Mrs George Park M'Intire, wife of George Park M'Intire, of Glasgow, Scotland. Eighth, Upon the payment of the loan of Henry Hewitt of twenty-five hundred dollars, and upon the realisation of any moneys that may be due to me as a partner and member of the firm of Hewitt, Flowerdew & Co., I will and bequeath the same to my sister Ellen, wife of the aforesaid William Lowson, Esq., and of such moneys I desire her, at her discretion, to use the sum of two hundred dollars in dispensing charity in my native town. Ninth, I give and bequeath to Ivan R. Dawson the writing-desk now in my room, and to my friend George Good the table therein, and I give and bequeath to my sister, the wife of William Lowson, Esq., the watch I wear. Tenth, I give and bequeath to Henry Hewitt all the remainder of my furniture, also my clothing, jewellery, and paraphernalia, to be by him used and disposed of at his pleasure. Eleventh, All the property I have or may be entitled to in Scotland I give and bequeth to Wm. Lowson aforesaid, to be administered and disposed of as he may deem best, whether the same be real or personal property. I hereby nominate and appoint my friend Ivan R. Dawson to be my sole executor this my last will and testament, and for the discharge

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of the trust hereby reposed in him it is my will that he shall not be required to give bonds. In witness whereof I have hereunto set my hand and seal this 15th day of July, A.D., 1872, one thousand eight hundred and seventy-two.”

The pursuer averred that the whole debts and liabilities of the deceased were paid by the executor nominated in the will out of the proceeds received by him under the policy of insurance on the life of Mr Flowerdew for 10,000 dollars, granted by the Life Insurance Company of America. The pursuer also averred that Mr Flowerdew was indebted to his firm of Hewitt, Flowerdew & Company at the time of his death, and had no other funds in America, and no other estate except the property in Scotland bequeathed to the defender. The pursuer accordingly, who was liferenter of the remainder of the proceeds of the policy of insurance, brought this action, which concluded inter alia for declarator that “the said property of the said James Gray Flowerdew, belonging or to which he might be entitled in Scotland, and which has been given and bequeathed by him, under the 11th head or article of his said last will and testament, to the defender the said William Lowson, is liable for the debts and obligations of the deceased James Gray Flowerdew, and that the said William Lowson is, in respect of said bequest, or otherwise, bound to relieve the said insurance money from said debts and obligations to the full extent of said property; or otherwise that he is bound to bear a proportionate part of the deceased's debts and obligations along with the beneficiaries in said insurance money.

The Lord Ordinary ( Mackenzie), pronounced the following interlocutors:—

“ Edinburgh, 27 th May 1874.—The Lord Ordinary having heard the counsel for the parties and considered the closed record, and last will and testament of the deceased James Gray Flowerdew, of which No. 20 of process is an official copy, under the hand of the clerk and registrar of the County Court of Multnomah, State of Oregon, United States of America, in which the original will is filed and recorded,—Finds that, according to the true construction of the said last will and testament, all the property which the said James Gray Flowerdew had, or was entitled to in Scotland, at the time of his death, on 22d July 1872, and which was given and bequeathed to the defender by the eleventh article of the said last will and testament, is, in a question with the pursuer, not liable in payment of the debts and liabilities of the said James Gray Flowerdew, or of any part thereof: Reserves all questions of exponses; and appoints the cause to be put in the motion roll of 29th instant for the disposal of the conclusions of the summons.

Note.—The parties are at variance as to the domicile of the deceased Mr Flowerdew, the pursuer averring that he died a domiciled Scotchman, and the defender maintaining that when he died in the city of Portland, in the State of Oregon, he was permanently resident in the United States of America. But both parties concurred in asking the decision of the Lord Ordinary as to the construction of Mr Flowerdew's last will and testament according to the law of Scotland, and by joint minute, No. 25 of process, they concur in stating that the rules of the law of Oregon for the construction of that will do not differ from those of the law of Scotland, and on this footing they dispense with probation on the subject of domicile.

The whole debts and liabilities of the deceased have been, the pursuer avers, paid by the executor nominated in the will out of the proceeds received by him under a policy of insurance on the life of Mr Flowerdew for 10,000 dollars, granted by the Life Insurance Company of America. And it is alleged that Mr Flowerdew was indebted to his firm of Hewitt, Flowerdew, & Company at the time of his death, and had no other funds or property in America except twenty dollars found in his possession, and no other estate except certain property in Scotland. The present action has been raised by the pursuer as the liferenter of the remainder of the proceeds of the policy of insurance, for the purpose of having the whole debts and liabilities defrayed out of the property in Scotland belonging to Mr Flowerdew at the time of his decease, which is given and bequeathed by the will to the defender, or, at all events, of having a proportionate part of said debts and liabilities paid by the defender as legatee of the properly in Scotland, along with the beneficiaries in the insurance money.

The Lord Ordinary is of opinion, as in a question between the pursuer and the defender, both being beneficiaries under Mr Flowerdew's last will and testament, that, according to the true construction and legal effect of the last will and testament by the law of Scotland, the property in Scotland bequeathed to the defender is not liable in payment of Mr Flowerdew's debts and liabilities, or of any part thereof, but that the same fall to be borne by the proceeds received under the policy of insurance on his life.

The testator in his will deals separately with three descriptions of property. He first disposes of the sum to be received under his life policy. He then bequeaths the whole sums he expected would be received in respect of his interest in the firm of Hewitt, Flowerdew & Company, of which he was a partner. And he lastly bequeathed his whole property in Scotland. The terms of the will in regard to these three kinds of property are such as to show, the Lord Ordinary thinks, that it was his intention that the debts should be paid out of the proceeds of his life policy.

The testator, in the first place, desires all his ‘debts and liabilities to be paid.’ The will then proceeds: ‘Second, After the payment of my debts as aforesaid, I give and bequeath to Henry Hewitt, my partner, 1500 dollars. Third, It is my direction to my executor to loan to Henry Hewitt’ 2500 dollars for three years at 5 per cent. per annum. He then, by the fourth, fifth, and sixth articles of his will, bequeathed several small legacies, amounting in all to 625 dollars. The seventh article is in the following terms:—‘Seventh, After the payment of the bequests hereinbefore mentioned, I wish and direct the remainder of the money which may remain out of what may be collected of my life policy of insurance to be paid over to James D. Walker,’ who is directed to invest the same, and to pay the interest to the defender for the benefit of his uncle, the pursuer, during his life; and upon his death 2000 dollars of the said remainder are bequeathed to his brother William Flowerdew, and a like sum to his sister Mrs M'Intire.

There was thus only given to the pursuer the liferent of what should remain of the proceeds of the insurance policy, ‘after the payment of the bequests hereinbefore mentioned.’ Now, these be

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quests are only payable by the terms of the will after the payment of his debts, therefore the liferent which was given to the pursuer was a liferent of the residue of the proceeds of the policy which should remain after payment, not only of the bequests, but also of the testator's debts and liabilities.

The terms of the subsequent bequests of the interest as a partner, and of his property in Scotland, also, it is thought, confirm this view. The eighth article of his will bears, that upon repayment of the 2500 dollars directed to be lent for three years to Mr Hewitt, ‘and upon the realisation of any monies that may be due to me as a partner and member of the firm of Hewitt, Flowerdew & Company, I will and bequeath the same to my sister Mrs Lowson,’ that is, it is thought, the whole monies, without deduction, which might be due to him as a partner. The eleventh article of the will is to the following effect:—‘Eleventh, All the property I have or may be entitled to in Scotland I give and bequeath to Wm. Lowson aforesaid, to be administered and disposed of as he may deem best, whether the same be real or personal property.’

Further, this bequest of all the property which he had or was entitled to in Scotland, constitutes, the Lord Ordinary thinks, a specific legacy and title to the defender to the whole of such property, free from liability for the testator's debts as in a question with the beneficiaries entitled to the residue of the insurance money.”

“2 d June 1874.—The Lord Ordinary having heard counsel, and resumed consideration of the process, assoilzies the defender from the conclusions of the summons, and decerns. Finds the pursuer liable in expenses, of which allows an account to be given in, and remits the same, when lodged, to the Auditor to tax, and to report.”

The pursuer reclaimed, and argued—In any sense in which the bequest of the property was a special legacy, the other legacies were special also. For the policy paid was just as specially appropriated to the legatees upon it as the Scotch property was to Lowson, and in each case the legacy was of a specific quantity. Then the words “after payment of my debts” covered the whole bequests in the will and showed that whole property wherever situated was liable for the testator's debts.

The defender argued—The bequest of “all the property I have and may be entitled to in Scotland” was in the strictest sense of the term a specific or special legacy. The legacies, on the other hand, payable out of the policy fund were only legacies of a remainder. The testator treated the policy as residue, for he charged all his legacies (except this one specific legacy) on it. But if he charged all his legacies upon it, a fortiori all his debts were chargeable on it. The subject of a special legacy might be liable for payment of debt, but the subject of general legacies must first be exhausted before it could be touched.

At advising—