Scottish Court of Session Decisions

James Douglas Oliver, rector of Selkirk Grammar School, who died in 1825, left a trust-deed and settlement executed in 1824, by which he disponed to trustees therein named his whole heritable and moveable estate, and in particular, inter alia, “All and whole the park or enclosure of land acquired by him from Walter Clerk, sometime carrier in Selkirk, thereafter tenant in Craigsfordmains, lying within the liberty and territory of the said burgh of Selkirk, and in that part thereof called Tait's Hole, and a small piece of land, 10 feet wide, extending from the King's highway to the foresaid park or enclosure, &c.” The trustees were directed, “if there should be any residue of the estate, to allow it to remain in bank, or otherwise invest it on security to their satisfaction, and add the interest of it annually to the rents of Taits Hole; and to let annually, or on lease for a period not exceeding seven years, to the best advantage, the park called Tait's Hole, for the interest of the Grammar School of Selkirk in all time after the truster's death.” It was declared that the said park should “never be sold nor disposed of,” nor ever let to the truster's successor in office, and that no burdens should be left or contracted upon it after his death.

It was further ordained that the rents of Tait's Hole and the interest of any residue should be applied for behoof of the Grammar School of Selkirk in the manner therein at length set forth, and in particular, “in educating a few docile children whose parents reside within the liberties and territories of the said burgh of Selkirk, and bear a good character, and who at the same time that they need such assistance for the education of their children (of which my said trustees are to be the sole judges) do not receive aid as paupers from the poor's funds of the burgh or parish of Selkirk, or any other parish or place.”

It was further stated in the petition that the park referred to under the name of Tait's Hole extended to rather more than an acre and a-half imperial measure, and was let from year to year at a rent of £5. The income from the rest of the trust-funds, which were invested as authorised under the trust-deed, amounted to about £24, and after defraying the expenses of management the balance of revenue was sufficient to educate about twenty children of the class referred to in the deed. The park was let at a full rent, but owing to the prosperity of the town of Selkirk, near which it lay, it had now become much more valuable for building purposes, and the trustees had recently received an offer to feu a portion thereof, extending to a-fourth of an acre, at the rate of £12 per acre. The trust-deed, however, contained no power to feu. The trustees had reason to believe that if they were empowered to grant feus they would soon be able to dispose of the whole ground at rates amounting at least to £12 an acre, thus adding £13 per annum to the income, to the material advantage of the trust, the usefulness of which would be much increased by this permanent addition, as it would put it in the power of the trustees to afford education to ten or twelve children above the present number.

The petition proceeded upon the Trusts (Scotland) Act 1867, sec. 3, which enacted that “it shall be competent to the Court of Session, on the petiton of the trustees under any trust-deed, to grant authority to the trustees to do any of the following acts, on being satisfied that the same is expedient for the execution of the trust, and not inconsistent with the intention thereof;—( inter alia) “2. To grant feus or long leases of the heritable estate, or any part of it.” It prayed the Court for authority to grant feus of these subjects, “such feus being beneficial and expedient in the execution of the trust, and not inconsistent with the intention thereof.” The Lord Ordinary pronounced the following interlocutor:—

“The Lord Ordinary having heard the counsel for the petitioners upon the petition and productions, and having considered the argument and whole process—Finds that the feuing of the heritable subjects called Tait's Hole, referred to in the petition, would be inconsistent with the intention of the trust represented by the petitioners as trustees: Therefore refuses the prayer of the petition, and decerns.

Note—Power to feu is not conferred by the trust-deed creating the trust, of which the petitioners are trustees; but by the Trusts (Scotland) Act 1867, section 3, it is made competent to the Court to grant such power ‘on being satisfied that the same is expedient for the execution of the trust, and not inconsistent with the intention thereof.’

The truster in this case ordained that his trustees should let annually or on lease, for a period not exceeding seven years, to the best advantage, his said park called Tait's Hole, for the interest of the Grammar School of Selkirk in all time after his death, declaring that the said park should never be sold nor disposed of, nor ever let to his successor in office, and that no burden should be left upon it or contracted upon it after his death.

There is, it may be, a sense in which the feuing of ground may be said to be compatible with the condition that the ground shall never be sold or disposed of, and were this the only obligation imposed on the petitioners in their administration of the property the Lord Ordinary might have hesitated before coming to the conclusion at which he has arrived. But there is another direction by which the course of the administration of this heritable subject has been prescribed. Tait's Hole is to be let annually or on lease for a period not exceeding seven years in all time after the truster's death. The fulfilment of this purpose is obviously incompatible with the feuing of the ground—that is to say, using the words of the Act of Parliament referred to, inconsistent with the intention of the trust. The prayer of the petition for authority to feu has therefore been refused.”

The petitioners reclaimed, and argued—The provisions of the Act would be complied with if the prayer were granted. (1) The expediency was undoubted. (2) The purpose of the Act

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was to give the Court power to grant authority to trustees to do things not in the contemplation of the truster. The truster here had in view the objects of the trust, not the means by which these were to be carried out. He only directed what seemed to him most advantageous at the time. In any case, all he intended was that the property should not pass out of the truster's hands, and if feuing was allowed that would not take place. There was no fixed purpose of the trust against feuing.

Authorities— Merchant Company v. Governors of Heriot's Hospital, M. 5750; Arkley and Others (Hay's Trustees) v. Miln, June 13, 1873, 11 Macph. 694.

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