Scottish Court of Session Decisions

By bond of provision, dated 9th June 1834, Robert Downie the elder, Esquire of Appin, on the narrative that for his love, favour, and affection for his children he had resolved to execute the irrevocable bond of provision for their benefit therein written, bound himself to pay to trustees for the benefit of his “sons and daughters after mentioned, and their issue and heirs as after stated,” certain principal sums and annuities. He bound himself to pay to trustees, to be held by them for the benefit of his three daughters “Georgina Frances, Roberta Harriet, and Rose Downie, and their issue and successors,” as therein pointed out, the principal sum of £36,000. This capital sum was declared payable in manner after mentioned—that is to say, if the whole of his said three daughters should remain unmarried at the period of his death, then the said capital sum of £36,000 sterling should bear interest from and after the day on which that event should take place. For the maintenance and support of his said three unmarried daughters, till the foresaid capital sum for their benefit and that of their issue and successors should become payable, Mr Downie bound himself to make payment to said trustees in behalf of his said daughters, but subject to the conditions therein and after mentioned, of a clear yearly annuity of £420 sterling for each, at the terms and with penalty and interest as therein mentioned, it being declared that the same should come to an end at his death, or as to each daughter on her marriage; and he also bound himself to make payment to said trustees, for the benefit of his son Robert Downie, of a clear yearly annuity of £440 per annum during his own lifetime. It was further provided that in the event of the marriage of any of his said three daughters, the sum of £12,000 should, in the case of each daughter, provided the marriage were approved of by the trustees or a majority of them, be settled and secured on each of said daughters respectively in liferent and their issue respectively in fee, or in the event of their leaving no issue in manner thereinafter mentioned. It was further provided that, on the death of any of his said daughters leaving lawful issue, the fee of the said sum of £12,000, and accumulation of annuities and interest due to her, should vest in her child or children, with a power of apportionment to their mother. The bond of provision thereafter proceeded to provide for the event of any of said daughters surviving their father and dying unmarried, and declared that the daughter so dying should be entitled by will, or other deed under her hand, to dispose of £3000 sterling, part of the foresaid provision of £12,000, and the whole of any accumulation of annuity or interest which may have arisen on her provision; and that in the event of any of his daughters dying after him unmarried, and leaving such will disposing of the £3000, or any part thereof, the remainder of the said sum of £12,000 so destined for her and her children shall accresce and belong to her then surviving sister or sisters before named, and to her brother Robert Downie, all in equal proportions. The bond also provided for the event of any of said daughters dying before their father without having executed any will, when it was declared that the said £12,000 and accumulations shall accresce and belong to her surviving brother and sisters. After providing for the case of any of the said daughters being married and dying without issue, there followed a declaration that in regard to any share or shares of the said several provisions of £12,000 which might devolve on any of said daughters who might survive through the decease of any one or other of them, and through the occurrence of any one of the foresaid events, and in consequence of any of the provisions made as aforesaid, then such share or shares of the said principal provisions so devolving in such events on the surviving sisters or sister should fall and be held for them or her by the said trustees in liferent, and for the children of such daughter or daughters respectively in fee; and that the said liferent should be exclusive of the jus mariti and right of administration of their husbands, should be purely alimentary, and not liable to be arrested by creditors;

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and should generally in all respects be subject to the same rules as are above laid down with regard to the principal provisions of £12,000 to such daughter before mentioned. The clauses of the bond of provision are quoted ad longum in their Lordships' opinions ( infra).

Mr Downie died on 10th September 1841, survived by a son and four daughters, three of whom were unmarried. Mrs Leny, the married daughter, was not a beneficiary under the bond of provision. He left a trust-disposition and settlement dated 11th April 1840. Miss Rose Downie died in 1842 leaving a trust-disposition and settlement of her whole estate. Robert Downie younger of Appin died in 1843 unmarried and intestate. Miss Roberta Harriet Downie died in 1859, unmarried leaving a disposition and settlement by which she conveyed her whole estate to her surviving sister Georgina, who died on 12th May 1881 unmarried, leaving a trust-disposition and settlement by which she conveyed her whole estate to trustees, including her whole interest under the bond of provision.

Doubts having arisen as to the rights of the beneficiaries under the several deeds above mentioned, an action of multiplepoinding was instituted at the instance of the testamentary trustees shortly after Mr Downie's death. In that action— Downie and Others v. Mackillop and Others, December 5, 1843, 6 D. 180—it was held that the bond of provision of 1834 was a delivered and irrevocable deed. The trustees of Miss Rose were preferred to the sum of £3000, being part of the principal sum on which she had power to test, and to the further sum of £1440, being her proportion of the accumulated arrears of annuity. The executor of Mr Robert Downie the younger lodged a claim in said process, and obtained decree for the sum of £3000, being one-third of £9000, the remainder of the said provision destined for his sister Miss Rose Downie and her issue, which accresced to him and her two surviving unmarried sisters under the said bond of provision by the death of his said sister.

It was also found to be unnecessary to give any judgment in that process as to the claim to the residue of the fund in said bond in the event of the whole children dying without issue, and the said claim was reserved till the period for determining in what manner it was to be disposed of should arrive, i. e., till the death of the last survivor.

This period had now arrived in consequence of the death of Georgina, and the question whether the fund in medio fell on the death of all the daughters into Mr Downie's estate, or whether it belonged to Miss Georgina Frances Downie as the last survivor, was now raised between Mr Downie's trustees and Miss Downie's trustees.

The Lord Ordinary (Rutherfurd Clark) held that it formed part of Mr Downie's estate, and gave effect to this finding in his interlocutor. He added this opinion—“The leading question in this, case is, Whether the fund in medio, subject to the powers of testing given to the daughters of Mr Downie by his bond of provision, falls, on the death of all the daughters, into his estate, or whether it belonged to Miss Downie as the last survivor? In my opinion it forms part of Mr Downie's estate.

“By the bond Mr Downie intended to make a provision for his daughters. He binds himself to pay the trustees therein mentioned the sum of £36,000, to be held for the benefit of his daughters and their issue, ‘as afterwards pointed out.’ I do not think that any right of fee is given to any of the daughters, and in the meantime I am speaking only of original shares. They are empowered, if they die unmarried, to test on £3000; if any one marries, £12,000, or a third of the whole provision, is to be settled on her in liferent and her children in fee.

“Hence the unmarried daughters have only a power of testing to a limited extent, and a married daughter who has issue has a liferent only. If she dies without issue she has only a power of testing on one-fourth of the principal sum which on her marriage was settled on her and her children for their respective rights of liferent and fee.

These provisions seem to me to be inconsistent with the idea that any fee vested in the daughters. It seems to me to be out of the question to hold that they have a fee in money over which they could only test to a limited extent, and which in the event of their being married and having issue was settled on the issue in fee. It is hardly necessary to advert to the further provision, which declares that on the death of a daughter unmarried or without issue her share—subject to a limited power of testing—devolves on the survivors and her brother.

But it is said that the share of a deceasing daughter without issue ‘accresced and belonged’ to the daughters, and that these words necessarily imply a right of fee. But the son takes an equal share with the surviving daughters in the devolving share, and there is a marked distinction between the right of the son and the right of the daughters. For the son takes an undoubted fee, while in regard to any share which may devolve on the daughters it is declared that it was only to be held by them in liferent and their children in fee.

“Whatever force might be in the previous words, which declared that a devolving share should ‘accresce and belong’ to the surviving daughters and their brother, is taken out of them by the subsequent declaration that the daughters are to take a liferent only.

“The true view of the bond therefore seems to be that the daughters had a right to income only, with a limited power of testing on the capital.”

Miss Georgina Frances Downie's trustees reclaimed, and argued—That the provision secured in the bond being accepted in lieu of legitim, the bond itself was an onerous deed, and Mr Downie was divested of the provision. There being no clause of return in the bond, the effect was to confer a fee upon daughters dying unmarried and without issue, subject to a restriction on the power of such daughters to test in favour of the “survivors.” That restriction became inoperative in the case of the last survivor, who was thus a fiar with uncontrolled power of testamentary disposition, there being no destination-over. The clauses in the bond which restricted the provision to a mere liferent in the person of the daughters were limited to the event of marriage—an event which had not occurred.

Argued for the respondents—The whole scope of the deed is to provide a liferent.

Authorities— Ramsay v. Beveridge, March 3, 1854, 16 D. 764; Ferguson's Trustees v. Hamilton

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and Others, July 13, 1860, 22 D. 1442— aff. 4 Macq. 397; Menzies' Lectures, 3d edit. 460; Macreadie, M. 4402; Fisher v. Dixon, June 16, 1840, 2 D. 1121.