Scottish Court of Session Decisions

Walter Logan, merchant in Glasgow, died on 20th May 1843, predeceased by his wife Mrs Margaret Mitchell or Logan, who died on 15th October 1841, leaving a trust-disposition and settlement dated 2nd May 1832, and three codicils appended thereto, whereby, on the narrative that he had by his contract of marriage with his wife, dated 19th June 1792, become bound, inter alia, to provide and pay to the children of the marriage the sum of £1700 sterling, which was to include their mother's tocher, and which sum was to be apportioned among the children according as he might direct, and that he was desirous that the obligations which he had come under by the said contract should be implemented, he gave, granted, and disponed, under the burdens, provisions, reservations, and powers, and faculty thereinafter mentioned, to certain trustees, his whole estate, heritable and moveable, and particularly and without prejudice to the said generality, his 426 shares of the stock of the Shotts Iron Company, and certain other moveable estate.

In the third place, the truster provided, in the event, which happened, of the predecease of his wife, that the annual proceeds of the free surplus of his estate should, after deduction of so much of the capital as might be equal to the payment of the special legacies of £500 thereinafter bequeathed to each of his children, belong and be paid in equal proportions to such of his daughters other than his daughter Margaret as should be in life and unmarried at the time, so long as any two of his daughters should remain unmarried, but that in the event of his unmarried daughters other than Margaret being reduced to one she was to receive in place of the said free proceeds a restricted free annuity of £150 so long as she continued unmarried.

In the fourth place, the truster burdened his trustees and the subjects disponed by him with payment of legacies of £500 each to each of his children nominatim.

In the last place, the truster provided that the residue of his estate after providing for the said special legacies should belong to and be divided among his said children in equal proportions, and that as soon as the number of his unmarried daughters other than Margaret, who might survive him and his wife, should be reduced to one, his trustees in that case setting aside a sufficient sum for securing the aforesaid restricted annuity of £150 to such unmarried daughter, and taking the writings thereof conceived to her in liferent, and to her and his other children in liferent and fee in the terms hereinbefore and after provided, “it being hereby specially declared with regard to the haill provisions before written conceived in favour of my said daughters, that as the same are intended as alimentary provisions for them the jus mariti in or right of administration thereof by their present or any future husbands is hereby expressly secluded; and further, that the same shall not be affectable by any of their debts or deeds, nor assignable by my said daughters, my said trustees being hereby specially ordained either to divide and appropriate my said estate among my said children, so as to answer the purposes of these presents without converting it into money, or otherwise to sell and dispose of the same and convert it into money, and thereafter to lay out and invest the said special legacies and shares of the residuum of my estate in the purchase of heritable property, or to lend out the same upon undoubted heritable or personal security as they may judge best, taking the writing thereof conceived in favour of my said daughters, to the extent of their interests respectively, in liferent for their liferent use allenarly, and to the child or children lawfully procreated or to be procreated of their bodies in fee, share and share alike, and failing such child or children, then the same at their death to return in equal proportions to their unmarried sisters, if any, and failing thereof to the surviving married sisters in the like proportions, and in both cases in liferent for their liferent use allenarly, and upon the other conditions aforesaid as to their creditors, and likewise as to their husbands, present or future, and to the child or children lawfully procreated or to be procreated of their bodies, share and share alike, and failing thereof, to their next-of-kin or assignees in fee, saving and excepting always any other and different destination that may now exist in regard to the said provisions, or any part thereof, and may be found to be contained in the contracts of marriage of any of my said children to which I am a party.” In like manner he declared that the provisions thereinbefore conceived in favour of his said sons being intended by him as alimentary

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provisions for them, the same should not be affectable by their debts or deeds, or attachable by their creditors, and he directed his trustees “to invest or otherwise secure the same as aforesaid, taking the writings thereof conceived in favour of my said sons according to their interests in liferent for their liferent use allenarly, and to the child or children lawfully procreated or to be procreated of their bodies in equal proportions, and failing such child or children, to their next-of-kin or assignees in fee.” He further declared that in the event of any of his said children predeceasing him, the provisions therein contained in favour of any deceaser or deceasers should fall and pertain in equal proportions to his or her children, and failing thereof, should devolve to their brothers and sisters who should survive him in the like proportions, upon the terms and conditions before stipulated as to the investiture thereof, and so as effectually to secure to his said children the intended alimentary provisions.

The foresaid provisions by the truster in favour of his children were declared by him to be in full contentation to them of all provisions conceived by him in their favour by the contract of marriage betwixt him and their said mother, or in any of their own contracts of marriage to which he was or might become a party, as well as of all they could ask, claim, or succeed to by or through his death in any manner of way. But he introduced into the testing clause of his said trust-disposition and settlement this declaration as to the foresaid sum of £1700 provided to his children by his contract of marriage, that it was his intention “that the same should belong to and be divided among them in equal proportions.”

The testator had eleven children, five sons and six daughters. Of the latter Margaret Logan died unmarried, leaving a testament whereby she appointed her sisters Mrs Thatcher and Miss Elizabeth Logan her residuary legatees.

Mrs Thatcher, who was predeceased by her husband, and died without issue, left a settlement by which she bequeathed the whole residue of her estate to her sister Elizabeth Logan.

Elizabeth Logan, who was the last survivor of all the children, died unmarried, leaving a will under which she appointed her nephew James Walter Ellis her sole executor.

The estate of the truster, which consisted at his death chiefly of Shotts Iron Company stock, was valued for inventory duty at £9286, 11s. l1d. The stock was retained by the trustees, and was with the exception of £4750 of it ultimately sold so advantageously that the estate, after paying debts and expenses, had realised in 1872 — excluding said sum of £4750 Shotts Iron Company stock still held—a nett sum of £28,825. The trustees retained the whole estate in their own names, and never made any special investment for the individual children either sons or daughters, and their issue, as directed by the trust-disposition and settlement.

After the truster's death various payments were made by the trustees in implement of the provisions of the will, to the issue of deceased children of the truster, but at the date of Elizabeth Logan's death there still remained in the hands of the trustees for final division a sum of nearly £10,000, besides £4750 Shotts Iron Company stock, the value of which could not be ascertained, and questions arose as to the manner in which this fund should be divided.

The present case was accordingly presented for the purpose of obtaining the opinion of the Court, inter alia, upon the following questions—“(1) Whether, in the circumstances which have occurred, the fee of the legacies of £500 each bequeathed by the truster to his daughters—Miss Margaret Logan, Mrs Thatcher, and Miss Elizabeth Logan, vested—(b) In Miss Margaret Logan, Mrs Thatcher, and Miss Elizabeth Logan respectively; or (c) in the children of Mrs Gill afterwards Lady Maxwell, and Mrs Ellis, equally per stirpes; or whether ( d) the fee of said legacies, in the circumstances which have occurred, vested in the next-of-kin of Miss Elizabeth Logan at her death, and in which? (3) Whether the fee of the shares of residue effeiring to Miss Margaret Logan, Mrs Thatcher, and Miss Elizabeth Logan, vested—(b) In Miss Margaret Logan, Mrs Thatcher, and Miss Elizabeth Logan respectively; or (c) in the children of Mrs Gill afterwards Lady Maxwell, and Mrs Ellis, equally per stirpes; or whether ( d) the fee of said shares of residue, in the circumstances which have occurred, vested … in the next-of-kin of Mrs Elizabeth Logan at her death, and in which?”

The parties to the case were—1st, James Walter Ellis and another, the testator's trustees; 2nd, James Walter Ellis, the executor of Elizabeth Logan; 3rd, the children or representatives of children of the testator's married daughters; 5th, the children or representatives of children of the testator's sons.

The second party maintained that the legacies and share of residue destined to Margaret Logan, Mrs Thatcher, and Elizabeth Logan vested in each of them, and that Margaret Logan and Mrs Thatcher having both left Elizabeth Logan their residuary legatee, were payable to him as Elizabeth Logan's executor.

The third parties maintained that the fee of the three legacies and shares of residue already mentioned vested in them, the third parties, and on Elizabeth Logan's death without issue became payable to them equally per stirpes.

The fifth parties maintained that in the circumstances which had occurred the fee of these legacies and of the four shares of residue vested in the next-of-kin of Elizabeth Logan at her death by virtue of the ultimate destination contained in the truster's settlement.

Argued for the second party—The case must be treated on the footing that the trustees had carried out the direction of the testator, and handed over the daughter's

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shares impressed with the destination appointed in the settlement. The question then came to be what effect had the qualification contained in that destination upon the absolute gift both of the legacies and shares of residue which was contained in the earlier parts of the deed? No machinery was provided by the testator to give effect to successive liferents, such as a continuing trust, and the Court would not supply the want of such machinery— Allan's Trustees v. Allan, &c., December 12, 1872, 11 Macph. 216; Clouston's Trustees v. Balloch, July 5, 1889, 16 R. 937. The best means of reconciling the apparently repugnant provisions in the deed was by supposing the testator's intention to have been to restrict his daughters to a liferent allenarly for the benefit only of their issue. If a daughter died without any issue that limitation never operated, and there was a fee in the daughter, herself—Jarman on Wills, i. 472–475; Lindsay's Trustees v. Lindsay,&c., December 14, 1880, 8 R. 281; Dalgleish's Trustees v. Bannerman's Executor, March 6, 1889, 16 R. 539; Buchanan's Trustees v. Dalzeil's Trusteee, February 28, 1868, 6 Macph. 536. The case of Fulton's Trustees, infra, was not an authority contrary to Lindsay's Trustees v. Dalgleish's Trnstees, as the circumstances were not the same in that case, and the same question was not before the Court as in these two cases— Dalgleish's Trustees, opinion per Lord M'Laren. The destinations-overwere mere substitutions which had been evacuated by the settlements of Margaret Logan, Mrs Thatcher, and Elizabeth Logan. The only event in which the succession could have opened to the issue of married sisters was if their mothers had survived their unmarried sisters and taken the liferent of the accrescing shares, which event never occurred. There was no reason to read “surviving” as equivalent to “others” in the case of the married daughters— Forrest's Trustees v. Rae, December 20, 1884, 12 R. 389. There was no vesting in the next-of-kin a morte testatoris. If there was to be vesting in persons conditionally instituted a morte subject to defeasance, it was necessary that these persons should be known, and existing at the date of the testator's death— M'Lay v. Borland, July 10, 1876, 3 R. 1124; Snell's Trustees v. Morrison, November 4, 1875, 4 R. 709; Gilbert's Trustees v. Crerar, &c., November 3, 1875, 3 R. 49 (H. of L.) 5 R. 217; Bell v. Cheape, May 21, 1845, 7 D. 614; Haldane's Trustees v. Murphy, Dec. 15, 1882, 9 R. 269; Steel's Trustees v Steel, &c., December 12, 1888, 16 R. 204, per Lord President, 208. The arguments of the third and fifth parties involved the novel and inadmissible hypothesis of a series of fiduciary fees—first, in each daughter for her issue, and then in each sister taking accrescing liferent either for the children of married daughters or for the next-of-kin of the original liferentrices.

Argued for the third parties—There were only three classes of cases in which the gift of a liferent was held to carry more than a mere liferent:—(a) Where the destination was to a father in liferent and his children in fee; (b) Where property was left in liferent but the liferenter was given a jus disponendi; (c) Where although the beneficiary was restricted to a liferent only, the limitation was to take effect only on a certain event— cf. Lindsay's Trustees v. Lindsay, &c., supra. This was not a case in which there was any beneficial fee vested in the liferentrices. On the contrary, the clear intention of the testator was to restrict them to a liferent allenarly, so that any fee which they took could only be a fiduciary one— Fulton's Trustees v. Fulton, February 6, 1880, 7 R. 566; Dawson's Tmstees v. Dawson's Trustee, February 24, 1877, 4 R. 597; Duthie's Trustees v. Kinloch, June 5, 1878, 5 R. 858; Cumstie v. Cumstie's Trustees, June 30, 1876, 3 R. 921; Alves, &c. v. Alves, &c., March 8, 1861, 23 D. 712. The testator's intention was, in the first place, that each daughter should enjoy the liferent of her share, and that her children should take the fee. In the event of a daughter dying without issue, her liferent was to accresce to her unmarried sisters if any, and, lastly, if they died without issue, to the “surviving married sisters.” There were two periods of vesting of the fee. First, as regarded the original shares a fiduciary fee vested in each of the testator's daughters a morte. Secondly, as regarded the accrescing shares, a fiduciary fee vested in each daughter, when she took the liferent of an accrescing share, for the children of all daughters, “their bodies” referring to all the daughters, and “surviving,” in the case of married daughters, being merely the equivalent of others. The second party's interpretation of this clause, involved the anomalous assumption that the testator intended the share of the fee which his grandchildren were to take to depend upon the accident of their mother surviving her unmarried sisters.— Waite v. Little-wood, 1872, L.R., 8 Ch. 70; Lucena v. Lucena, 1877, L.R., 7 Ch. Div. 255; Ramsay's Trustees v. Ramsay, December 21, 1876, 4 R. 243. In the present case there was a destination-over beyond the children of married daughters, which was desiderated in Forrest's Trustees v. Rae.

The fifth parties concurred in the argument of the third parties so far as directed against the contention of the second parties, but argued that the fee of the three legacies and of the four shares of residue vested in the next-of-kin of Elizabeth Logan. There having always been a surviving unmarried daughter, no liferent of accrescing share had ever devolved on married daughters, and that being so the fee of such shares never vested in their children. The assignees could not take before the next-of-kin because no fee vested in the unmarried sisters— Bell v. Cheape, May 21, 1845, 7 D. 614; Maxwellv. Maxwell, December 24, 1864, 3 Macph. 318; Graham v. Hope, February 17, 1807, M., sub voce “Legacy,” App. 3.

At advising—