Scottish Court of Session Decisions

Mr Robert Urquhart died at Aberdeen on Nov. 8, 1877, leaving a holograph mortis causa settlement dated Nov. 13, 1876. The clauses of that deed, so far as they need be quoted, were as follows—“ Aberdeen, 13 th April 1876.—This morning I have received a telegram intimating the sudden death of my only surviving brother James; and before leaving for London, I desire to appoint my nephew Dr John Urquhart my executor, considering it fitting to do so from my being so long almost exclusively connected with his father and his family, but with power to him (Dr Urquhar t) to assume such other executor or executors as he may consider fit; and instruct that after paying all my lawful debts, £500 to each of the surviving children of my sister Jessy (Mrs Dewar), and making provision for the payment of £100 a-year to Mrs Urquhart, the widow of my now deceased brother James, during her life, and £20 a-year during her life to my faithful and kind friend Bell Brewster, the residue of my estate shall be divided equally among the surviving children of my late brother John, or if any of them should predecease me and leave a family, their share shall go to their family, and payment shall be made as after directed… . As the business of Marshall & Company has been paying about £1500 a-year for some years, it is recommended that a thoroughly competent business man be put into it to assist Mr Ledingham in the management of it, provided the following arrangement is carried out—In consideration of Mr Ledingham's faithful and devoted service to me for so many years, for which I feel deep gratitude to him, I desire that he shall have not less than one-half share of the profits, after deducting interest of capital at 4 per cent, and the usual expenses of management, and he shall have also £200 a-year as salary, which shall be a part of the expenses of management to be deducted from the profits before division, the other half of the business to belong to my nephew and trustee Dr John Urquhart. In the event of Dr John Urquhart not wishing to connect himself with the business, Mr Ledingham shall be allowed to continue the business, either by himself or by assuming a partner or partners, and to pay up the capital annually at the rate of not less than £1500 a-year, with interest on said capital of not more than 4J per cent, per annum, in the event of Mr Ledingham getting security for the due payment of the instalments to the satisfaction of Dr Urquhart, my trustee; and it is specially conditioned that he shall not be responsible to any of the legatees for any failure of the security or of Mr Ledingham to pay such instalments. The legacies to my sister Jessy's children shall be paid first in full, when funds are realised sufficient for the purpose; and the residuary legatees shall only be entitled to receive payment from year to year as the funds come in. In consideration of the trouble Dr Urquhart will have as trustee, I so far alter the foregoing provisions as to an equal division of the residue, and provide that he shall have double the share of his sisters. All debts due to me by William Dewar, my brother-in-law, to be considered cancelled, and are hereby cancelled.”

Dr John Urquhart, the executor under the deed, raised an action of declarator against Mr W. Dewar, the heir-at-law, concluding for a finding that the said holograph deed contained a valid general conveyance, “not only of the whole move—able property, but also of the whole heritable property,” of the testator. Besides the premises in which the business was carried on, that included dwelling-houses in Aberdeen.

The decision of the question involved the construction of the 20th section of the Titles to Land Consolidation (Scotland) Act 1868—“From and after the commencement of this Act it shall be competent to any owner of lands to settle the same, in the event of his death, not only by conveyances de pratsenti, according to the existing law and practice, but likewise by testamentary or mortis causa deeds or writings, and no testamentary or mortis causa deed or writing purporting to convey or bequeath lands which shall have been granted by any person alive at the commencement of the Act, or which shall be granted by any person after the commencement of this Act, shall be held to be invalid as a settlement of the lands to which such deed or writing applies on the ground that the gran ter has not used with reference to such lands the word ‘dispone,’ or other word or words importing a conveyance de prmsenti; and where such deed or writing shall not be expressed in the terms required by the existing law or practice for the conveyance of lands, but shall contain, with reference to such lands, any word or words which would, if used in a will or testament with reference to moveables, be sufficient to confer upon the executor of the granter, or upon the grantee or legatee of such moveables, a right to claim and receive the same, such deed or writing …. shall be deemed and taken to be equivalent to a general disposition of such lands within the meaning of the 19th section hereof by the granter of such deed or writing in favour of the grantee thereof.”

The Lord Ordinary ( Curriehill) the case having previously been before the Inner House, where a minute of admissions obviating a question of proof was put in] pronounced an interlocutor granting decree as asked. He added the following note:—

‘ Note.—The question raised in the present action is—Whether the holograph will or settlement of the deceased Robert Urquhart, which is dated 13th April 1876, is so expressed as to apply to his heritable estate in whole or in part, and carry the same to his executor? The leading portion of the will is in the following terms—[ His Lordship here quoted the first clause of the deed, supra] The pursuer Dr John Urquhart is the executor of the will. He is also one of the surviving children of the testator's brother John, and is therefore one of the residuary legatees. He maintains that the will is a settlement of the universitas of the testator's estate, heritable as well as move—able, and that he as executor is the general disponee

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of the testator. The defender is the eldest son of the testator's sister Jessy (Mrs Dewar), and is the testator's heir-at-law. He maintains that the settlement is so expressed as to apply only to the moveable estate of the testator, and not to his heritable estate.

Had the present been a will which had come into operation before the commencement of the Titles to Land Consolidation (Scotland) Act 1868, the contention of the defender would have been sound. Indeed, the present question could not have arisen. But as Mr Urquhart did not make his will till 1876, the question to be determined is — Whether the settlement is so expressed as to be equivalent to a general disposition of the testator's heritage, in whole or in part, within the sense and meaning of the 20th section of the statute?

The leading words of that enactment are as follows—[ II is Lordship here quoted the section of the Act, supra], This enactment removed what had long been a blot upon the law of real property in Scotland, as it enabled an owner of lands to settle such by testament in the same way as it had previously been competent for him to settle his moveable estate,—all that is required being that he should express his intention to transmit his heritable estate in words which if used in a testament regarding moveables would be sufficient to carry these. The settlement of Robert Urquhart, now under consideration, is undoubtedly so expressed as to carry to the pursuer, his executor, his whole moveable estate. The question is—Does the settlement embrace heritage as well as moveables? and if so, to what extent? The word ‘estate’ which the testator employs in the part of his will already quoted is a flexible term; it may include the whole heritable and moveable estate belonging to the testator, or it may be limited to his moveable estate, or to his heritable estate; and the construction to be put upon the word will generally depend upon the context of the writing in which it occurs. If there had been nothing more in this settlement than the passage already quoted, I should have had difficulty in holding that the words ‘residue of my estate’ imported anything more than the residue of that portion of the defunct's estate which properly falls under the administration of an executor, viz., the moveable estate. But the term is, as I have said, a comprehensive one; and its range is to be determined by the context. Let us see, therefore, whether in the remainder of the settlement there is any indication of the idea which was in the testator's mind when he wrote the words ‘the residue of my estate.’ On referring to the deed it will be seen that the subsequent part of the settlement mainly consists of directions as to the continuance and realisation of what the testator calls his ‘business.’ The words of the deed are”—[ His Lordship here quoted the words of the deed, supra].

Now, the business with which the testator here deals, and in which he was engaged at the date of his will and at the time of his death, was carried on by him in Aberdeen under the name of ‘Marshall & Company.’ The partners of that company were originally John Marshall and the testator; and until the death of Marshall in 1870 the business consisted of three branches, viz., a preserved — provision manufactory, a chemical match-work, and a pail or bucket manufactory, all of which were carried on in premises at Spring Gardens, east side of Jopp's Lane, and in George Street. These premises had been purchased by the firm at various times; and at the death of Marshall the titles to the whole stood in name of John Marshall and Robert Urquhart as trustees for the firm—the fact of the trust being expressed in some of the titles and ignored in others. The prices were paid out of the funds of the company. Until the dissolution of the partnership by Marshall's death in 1870 the premises were regularly included in the annual balance-sheets of the firm as part of the assets of the company, although no value seems to have been placed upon them. Prom and after 1870 the business was carried on by the testator Robert Urquhart for his own behoof, but under the old name of Marshall & Company until his death in 1877; and the premises seem to have been enlarged and improved from time to time by the erection of new buildings, paid for by the firm. In all the annual balance—sheets of the concern these premises are entered, not merely as assets, but assets of considerable value. Thus they are stated at upwards of £1370 in 1875, while the total profit for the year is only £1632, 15s. lid. In short, had these premises not been included as assets of the business the profit in 1875 would not have exceeded £234, and in other years it would have been nil.

It appears, then, to me that these balance—sheets and the other excerpts from the books of the concern, read along with the statements and admissions in the record, in the minute and answers for the pursuer and defender respectively lodged in the Inner House, and in the joint-minute lodged in process since the case returned to the Outer House, establish the fact that both before and after Marshall's death, and until the death of the testator Robert Urquhart in 1877, the premises in question were uniformly dealt with by the testator as forming assets, and valuable assets, of the company. The books further show that the annual outlay for taxes and repairs, and the rents of the property, both that part thereof let to tenants and the part thereof occupied by the company, were dealt with as items of the company accounts. It is true that in some of the private ledger accounts kept in name of Robert Urquhart after 1870 there are entries showing that the rents of portions of the premises let to tenants were credited to him; but as he was sole partner of the company, and ex hypothesi of the present case the sole owner of the subjects, the fact that he received the rents in question is not material.

The important point is, that the way in which he caused these heritable subjects to be dealt with in keeping the books and striking the balances of the firm shows very clearly that he considered these subjects as forming an important part of the business of Marshall & Company. Indeed, as I have already pointed out, but for the value put upon these subjects in their annual balance—sheets, the amount of annual profit would in some years have disappeared, and would in every year have been greatly less than that brought out on paper; and would never have amounted to the sum of £1500, at which it is estimated in the settlement.

Now, in dealing with this business in the manner in which the testator has dealt with it in his settlement, and by vesting it in his executor and trustee Dr John Urquhart, with the large powers of administration and disposal already quoted, I

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think it is clear that he intended to include and did include the whole assets of the concern, and, inter alia, the heritable subjects now in question.

To hold otherwise would, in my opinion, render unavailable the anxious provisions which he makes for the preservation and continuance of the business, because in that view the heritable subjects would have fallen to the heir-at-law, who would have then had it in his power to put a stop to the whole business by refusing to allow it to be conducted in the premises which had been specially constructed for it by the testator himself. The settlement of Mr Urquhart thus deals with ‘lands’ in language admittedly effectual as a bequest of moveable estate; and I am therefore of opinion that the Statute of 1868 applies to this case, and that the settlement operates as a general conveyance of the subjects connected with the business in favour of the pursuer.

This being so, the only other question is—Whether the settlement includes the other heritable property belonging to the testator, viz., his house in Golden Square and certain dwelling—houses in George Street? Iam inclined to answer the question in the affirmative. I do not think that the testator intended any distinction to be drawn between these premises and the business premises, and that in bequeathing ‘the residue of my estate’ to the children of his brother John, he meant them to have the free residue of his whole estate, whether heritable or moveable. It is not unimportant to observe that the interest of his heir-at-law is not neglected in the settlement, for he gets a bequest of £500 as one of the children of Jessy Dewar, and the debts due by his father William Dewar to the testator are all cancelled. On the other hand, the testator plainly desired to favour the children of his brother James, and to confer a double share on the pursuer, for whom he seems to have had a special regard.

The present case may be usefully contrasted with that of Pitcairn, 8 Macph. 604. In that case the words of bequest were—‘I hereby declare that B, my brother, shall not inherit any of my effects, but that they shall all descend to my brother C.’ It was there held that these words were ineffectual to transmit heritage to C, because ‘effects’ is not a term which is applicable to heritable estate. But if the word had been ‘estate ‘or’ estates,’ it cannot, I think, be doubted that the decision would have been the other way, and that the will would have been held sufficient to carry the heritable estate as well as the moveable to C. In the present case the ‘estate’ which is bequeathed does include part at least of the testator's heritage. The will, therefore, does, within the meaning of the statute, apply to lands, and I do hot think there is anything in the context to limit the application of the deed to the subjects connected with the business. In my opinion, the testator's whole estate, heritable and moveabls, is conveyed to the pursuer, and decree is therefore given in his favour, with expenses which will include the Inner House expenses as part of the costs of the cause.”

The defender reclaimed, and argued that the testament was not sufficient to show the testator's intention of conveying his heritable as well as his moveable estate without going upon mere conjecture, which' was not sufficient to satisfy the clause in the Act. The fact that he used the word “estate” in speaking of the residue was not I sufficient to indicate that intention, unless it was strengthened by other words in the deed, while the fact that in the leading clause of the will he appointed an executor, sufficiently showed that lie meant only to convey moveables. The mere use cf the word “trustee” in the latter parts of the deed meant nothing, as an executor was truly a trustee, and the words were used as convertible terms.

Authorities — Pitcairn v. Pitcairn, Feb. 25, L870, 8 Macph. 604; Edmond v. Edmond, Jan. 30,1873,11 Macph. 348; Morrison v. Marshall, May 13, 1871, 9 Macph. 736; M'Leod v. M'Leod, Feb. 28, 1875, 2 It. 481; Pringle # Others, Nov. 14, 1877, 15 Scot. Law. Hep. 89.

The pursuer argued that the presumption was against partial intestacy, especially in the circumstances under which the will was made; and that from the use of technical words in the deed, such as “trustee” and “estate,” it was for the defenders to show that the conveyance was a limited one.

Authorities— Mayor of Hamilton v. Hodsdon, 6 Moore P.C. 76; M'Laren on Wills, i. 312; White v. Finlay, Nov. 15, 1861, 24 D. 38.

At advising—