Scottish Court of Session Decisions

Robert Haldane, druggist in Stirling, died on 9th December 1882 leaving a trust-disposition and settlement dated 7th September 1875, whereby he directed his trustees to deal with the residue of his estate as follows:—“And lastly, whatever rest, residue, and remainder there may be of my said whole estate, after said expenses and the foresaid legacies have been paid, I direct and appoint my trustees to hold and retain, or pay, invest, or apply in manner after mentioned, for behoof of the whole brothers and sisters of my late mother, equally among them, share and share alike; but declaring always that if any of the said brothers and sisters of my said mother have already predeceased or may yet predecease me leaving lawful issue of his, her, or their bodies, then such issue shall be entitled to take and receive their deceased parent's share, equally amongst them, share and share alike; and further declaring that the provision hereinbefore conceived in favour of the said brothers and sisters, and the issue of any deceased brother and sister of my said mother, shall not be held to have vested in them or any of them so as to give such residuary legatee power to assign his or her share under these presents, nor shall the same be assignable or arrestable or affectable by the diligence of their or any of their creditors, or the creditors of the husband of any female residuary legatee who may be married, for debts contracted or which may be hereafter contracted by them; nor shall the same be subject to the jus mariti or right of administration of

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such husband, all such rights and claims being hereby excluded and debarred, the said provisions being intended by me as purely alimentary, and not alienable by the said residuary legatee's acts or deeds: And I hereby give my trustees the most full and ample control over and discretionary power in regard to the disposal of the shares falling to my residuary legatees before specified for their behoof, and either to pay over the capital of the shares at once to them or any of them, and to take their, his, or her discharge for the same, which shall be a complete exoneration to my trustees, or to invest such shares in their own names for behoof of all or of such of my residuary legatees in regard to whose shares they may think it most prudent to adopt this course, and when so invested, pay and apply the annual income or interest derived therefrom for or on their account, either yearly or half-yearly or otherwise, or to purchase in some respectable and responsible life assurance company annuities with the principal sums of said shares, to be taken in the name or names of said residuary legatee or legatees, or to pay or apply the money forming such shares for behoof of such residuary legatee or legatees in such way and manner as they may deem prudent or consider judicious in their circumstances: And as to the expediency and extent of such payments, and manner of making the same, my trustees shall, and they are hereby declared to be the sole judges, without any interference being competent by any of such residuary legatees: And in the event of any residue or portion of the capital or of the income arising therefrom of the share of any of my said residuary legatees remaining in my trustees' hands at the period of the death of the recipients thereof, then my trustees shall be bound to account for and pay over the same to such deceased legatee's heirs in mobilibus, and take their discharges therefor.”

George Sharp, one of the residuary legatees, survived the testator, and was entitled to one-eighth of the residue of his estate. The trustees, in exercise of the power given them, did not pay the share to Sharp at once, but made advances to him out of capital and income. Sharp died unmarried and without issue upon 5th June 1886, and at the date of his death the unexpended portion of his share in the hands of the trustees amounted to £782, 8s. 4d. He had no estate other than his interest in this residue. He left a trust-disposition and settlement, by which he directed his trustees, after paying his debts, to make payment of certain legacies.

In these circumstances this Special Case was presented by (1) Haldane's trustees, and (2) Sharp's trustee, and the following questions were submitted for the opinion and judgment of the Court—“First, Is the unexpended balance of the share of the late Robert Haldane's trust-estate which fell to the deceased George Sharp, and which at the date of death of the said George Sharp remained in the hands of the trustees of the deceased Robert Haldane, conveyed by the trust-disposition and settlement of the said George Sharp, and does it now fall to be paid to the second party to be administered by him in terms of the trust-disposition and settlement of the said George Sharp? Or, second, Are the heirs in mobilibus according to the law of intestate succession to moveable estate of the said George Sharp now entitled to payment of said unexpended balance from the trustees of the said Robert Haldane? Or, third, Are the legatees mentioned in the trust-disposition and settlement of the said George Sharp now entitled to payment of said unexpended balance from the trustees of the said Robert Haldane, and that in equal shares?”

The first party argued—The provision in Haldane's settlement clearly suspended vesting in the beneficiaries unless the sum due was actually paid over to them. The trustees had power to refuse to pay over anything to Sharp, and they had refused, and therefore nothing had vested in him— Smith's Trustees v. Smith, July 11, 1883, 10 R. 1144; Paterson's Trustee v. Paterson, January 29, 1870, 8 Macph. 449. Heirs in mobilibus in the first of the deed was equivalent to heirs ab intestato.

The second party argued—There was vesting a morte testatoris. Discretionary powers of trustees had never been held to postpone the period of vesting— Scott, &c., v. Scott's Executrix, January 27, 1877, 4 R. 384. The only purpose for which it could be maintained that vesting was prevented in this case was to prevent the beneficiaries assigning his share to his own prejudice. As regarded the question of whether the heirs in mobilibus spoken of in the last clause of Haldane's trust-deed were heirs ab intestato, or the heirs under Sharp's trust, the latter was the proper reading. It was simply an invocation to the law of intestacy. The word “remaining” only related to what had not been disposed by Sharp's testament— Dalgleish's Trustees v. Bannerman's Executors, March 6, 1889, 16 R. 559.

At advising—