Scottish Court of Session Decisions

Alexander Campbell, merchant in Greenock, and Helen Turner or Campbell, in contemplation of their marriage, on 29th April 1861 executed an antenuptial contract of marriage whereby inter alia Helen Turner or Campbell, with her intended husband's consent, conveyed to six trustees her whole estates then belonging to her, or that should pertain and be owing to her during the subsistence of the marriage, for the purposes set forth in the deed, which were to pay the free yearly interest of the estate to her as an alimentary provision during her life and the fee to the child or children of the marriage, if any, and failing any in such manner as she should direct.

Mrs Campbell had an uncle, Alexander Turner, who by his trust-disposition and settlement, recorded 6th June 1868, left to her a legacy of £2000 along with a share of the residue of his estate, which were to be exclusive of her husband's jus mariti and right of administration. On 12th November 1868 Mrs Campbell, on the narrative of her uncle's settlement, of her desire to secure the sums therein left her to her own use and benefit, and of her love and affection for her children, executed a postnuptial trust conveyance by which she conveyed to three of the six trustees appointed under the antenuptial contract, as trustees, the legacy of £2000 and the share of the residue of Alexander Turner's estate. The purposes were for payment to her of £200 if the trustees deemed proper (which was done), seclusive of the jus mariti and of the income of the remainder for her liferent allenarly exclusive of the jus mariti, and to the children in fee. The liferent to Mrs Campbell under this deed was not declared to be alimentary. The trustees accepted office and acted in the trust.

In May 1871 Alexander Campbell borrowed from Mrs Ann Morris or Whyte, widow of Robert Whyte, the sum of £400. In security of the loan, and without prejudice to Mr Campbell's personal obligation, a bond and assignation in security was granted by Mr and Mrs Campbell, which assigned to Mrs Whyte (1) the liferent right and interest which Mrs Campbell had in the sums of money conveyed to trustees by her by the trust-conveyance of 1868; and (2) a policy of insurance on Mrs Campbell's life. This bond and assignation was duly intimated to the trustees acting under the postnuptial trust conveyance of 1868 on 30th May 1871.

Mr Campbell's estates were sequestrated in January 1878.

Mrs Whyte applied to the trustees acting under the trust conveyance of 1868 for payment of the capital sum of £400 with interest due thereon, and for the amounts paid by her for premiums on the said policy since Mr Campbell's bankruptcy, amounting in all to £507, 11s. 3d. _ A claim, however, was also put forward by the trustees nominated under Mr and Mrs Campbell's antenuptial contract of marriage. Mrs Whyte then, in order to have the question determined, raised, in the name of the trustees under the trust-disposition of 1868, this action of multiplepoinding,

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the fund in medio in which was the trust fund in the conveyance of 1868, and the income thereof since 1871. In the original condescendence for the nominal raisers it was stated that the marriage-contract trustees of 1861 accepted and acted. In the Inner House, however, it appeared from a minute and answers which were given in, that until shortly before this action was raised, when certain of these accepted and acted, none of the trustees of the marriage-contract had ever accepted the trust, and nothing had been done therein. The assignation in it of Mrs Campbell acquirenda had never been intimated to her uncle's trustees or to the trustee under the trust-disposition of 1868.

The marriage-contract trustees claimed the whole fund in medio, amounting to about £2853. They averred that the money borrowed by Mr Campbell was in no sense a debt of Mrs Campbell's, and that they were never made aware of any legacy having been left to Mrs Campbell, or of the trust of 1868, or the assignation on which Mrs Whyte founded.

They pleaded (1)—“In respect of the conveyance by Mrs Campbell of her whole estates acquisita et acquirenda contained in the said marriage-contract, the claimants are entitled to the fund in medio. (3) The conveyance to the claimants having been prior to the conveyance by Mrs Campbell to the trustees under the private trust; and the claimant and real raiser [Mrs Whyte] taking only in virtue of said trust, the claimants ought to be preferred to the claimant and real raiser.”

Mrs Whyte claimed the whole fund in medio, or at least the revenue thereof, subject to a liability to account for any balance after payment of the sum due under the bond and assignation in security. She averred that the £400 was obtained for Mrs Campbell's personal expenditure, and for household expenses, and was so used. She pleaded that she had acquired right to the fund in medio by the bond and assignation in her favour duly intimated, to the amount due thereunder, and that she was entitled to be ranked accordingly, and also that the marriage-contract being a latent deed never intimated to the trustees under the trust-deed of 1868 could not compete with her assignation.

By interlocutor of 15th December 1883 the Lord Ordinary ranked and preferred the marriage-contract trustees to the fund in medio in terms of their claim.

“ Opinion.—This case raises the question whether a married woman can under any circumstances grant an effectual security over the income of her estate, which is settled on her in alimentary liferent by her antenuptial contract. Mrs Helen Turner or Campbell, whose marriage-trustees are claimants, conveyed her whole estate acquisita et acquirenda to six trustees on certain trusts, the first of which is stated to be ‘to pay the free yearly interest of the estate of the said Mrs Helen Turner or Campbell as an alimentary provision to her during her life.’ Some years after her marriage Mrs Campbell became entitled to a legacy of £2000, with a share of residue out of the testamentary estate of her uncle Alexander Turner. This fund, the amount of which is set forth in the condescendence of the fund in medio, ought to have been paid to the six marriage-trustees, to be invested by them on the trusts of the marriage-contract. But, for some reason which is not explained, this was not done, and the legacy and share of residue were paid to the present holders of the fund, being three of the marriage-trustees upon trusts constituted by a deed dated 12th November 1868. The purposes of the postnuptial deed, so far as concerning the present question, are similar to those of the marriage-trust, except that the fund is not characterised as an alimentary fund, or limited to Mrs Campbell's alimentary use. In the result, Mrs Campbell's life interest is not ex facie of the postnuptial deed protected against her voluntary acts, and in the assumed absence of such protection the competing claimant, Mrs Whyte, accepted from Mrs Campbell an assignation of her life interest under the deed, in security of the obligation of Mrs Campbell's husband. The postnuptial trustees do not defend their trust, nor insist on retaining the trust-funds, and the question is, whether they are to pay over the funds to the marriage-trustees, to be held by them as an alimentary provision, or to pay to Mrs Whyte, the creditor in the bond and assignation in security. The marriage-trustees found on the circumstance that their right is prior in time; the creditor urges that her security is onerous. It does not appear to be open to dispute that a lady who is settling her properly with a view to marriage may by proper clauses deprive herself of the power of anticipating her income. The most usual mode of doing so is by a trust, in which the lady's interest during the marriage is limited to an alimentary liferent, the fee being otherwise settled. Such a settlement constitutes an exception to the ordinary rule that an individual cannot withdraw his funds from the diligence of his creditors by constituting an alimentary trust for his own benefit. The reason of the exception, as explained by Lord Cottenham in Rennie v. Ritchie, 4 Bell, 244–5, and by other Judges, is the expediency of protecting married women's property against marital influence, and there is authority for holding that on the dissolution of the marriage and the survivance of the wife the alimentary quality of the wife's interest will disappear,—I mean if it depends on the wife's own act, and is not a condition imposed by the will of some other person from whom the estate is derived.

It follows from these considerations that on the opening of the succession of Mr Turner (Mrs Campbell's uncle), the alimentary character impressed upon Mrs Campbell's estate by the marriage-trust attached to the bequest in her favour. The decisions apparently do not recognise any distinction between alimentary conveyances of specific estate and alimentary settlements of the wife's whole fortune. I should regret if it were necessary to take such a distinction. It is, I think, the most usual case of marriage-contract that the lady has no present fortune to settle, but has expectations from her parents or relatives, and it would be unfortunate if, from any defect of power, a settlement intended to render the lady's future acquisitions non-assignable during the marriage should fail of effect.

It is maintained for the claimant Mrs Whyte, that an assignation of aquirenda in a marriage-contract is in its inception nothing more than an obligation to assign; that, until the funds come into possession of the marriage-trustees, the

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conveyance remains in obligatione; and that in the meantime it is in the power of the wife to assign these funds, and to give a good title to the assignee in security. But, as I conceive, an assignee under a general conveyance is in a better position than a creditor in an obligation. He is a procurator in rem suam, and is in a position to demand payment without going to the cedent for a conveyance in implement. The difference is this, that in my view the clause of assignment in the marriage-contract took effect upon Mr Turner's succession as soon as the succession opened and the right came into existence. But if, instead of an assignment, there had been merely an obligation to assign, some further act on the part of Mrs Campbell would be necessary to transfer the fund from her to her marriage-trustees, and the omission of that act would leave the fund exposed to her voluntary acts, and to the diligence of her creditors.

The case does not, as I apprehend, raise any question of intimation, because intimation is not necessary in a question with the cedent. The fund was paid to Mrs Campbell herself or to her postnuptial trustees, who hold the income of the estate subject to her order and disposition, and the claim of the marriage-trustees is against them. For the reasons stated, I am of opinion that the marriage-contract took effect upon the fund when it came into existence; that Mrs Campbell was thus divested, and had no further interest in the fund than that of an alimentary liferenter under the marriage-trust. That being so, Mrs Campbell had not the power to assign her life interest in security of husband's debt, and the title of Mrs Whyte is therefore void.

If it were necessary to consider the case further, I should be of the same opinion on this further ground, that the funds were in fact received by three of the marriage-trustees, and that the postnuptial conveyance was to them. Now, these gentlemen having accepted the marriage-trust, and obtained possession of the funds, were bound to hold them subject to the marriage-trusts. They could not set up a title contrary to their fiducial obligation, and they could not accept the postnuptial conveyance in any other sense than as a corroborative title to that of the marriage-trust. In this view of the case, the omission of the word ‘alimentary’ in the trust of the postnuptial conveyance would not derogate from the effect of the marriage-trust. The postnuptial conveyance would stand good as a conveyance of funds for Mrs Campbell's liferent interest allenarly, subject to all conditions declared in the marriage-trust, to which in this view it is supplementary.

While I sustain the claim of the marriage—trustees, I do not mean to say that Mrs Campbell can honestly take advantage of that claim to evade the fulfilment of her engagements. The alimentary income will be paid to her by her trustees, and it will be in her power, if disposed to act justly, to make such payments as she can afford out of that fund in satisfaction of the debt for which she became security.”

Mrs Whyte reclaimed and argued—The question was one between an onerous assignee and antenuptial marriage-contract trustees who had never intimated their assignation or otherwise acted as trustees.

The marriage — contract trustees argued — To prefer Mrs Whyte's claim in the present case would be to set aside the whole benefit of the conveyance of acquirenda in the marriage-contract. The assignation in a marriage-contract differed from an ordinary assignation of moveables in this, that it dealt with something which the party had not, and might never have. Neither the wife nor her husband could invalidate the deed, and the money left by Mrs Campbell's uncle fell under its provisions. The trustees under the deed of 1868 could only hold for the marriage — contract trustees. If Mrs Whyte was allowed an advantage over the marriage-contract trustees because she completed her diligence while they were ignorant that the money had been left to Mrs Campbell, then the whole advantage conferred by the marriage-contracts would be done away with.

Authorities— Rollo v. Ramsay, Nov. 28, 1832, 11 Sh. 132; M'Dougal v. City of Glasgow Bank, June 28, 1879, 6 R. 1089; Miller v. Learmont, May 17, 1870, 42 S. Jur. 418; Bell's Pr. 1466.

It appeared from a minute and answers which were allowed by the Court to be given in that the marriage-contract trustees never accepted and acted till after the date of Mrs Whyte's intimated assignation and shortly before the date of this action, and that then three of them, of whom two are not those in the postnuptial deed of 1868, accepted office and claimed in this action.

At advising—