Scottish Court of Session Decisions

George Robertson Chaplin of Collision died on 8th May 1869, leaving a trust-disposition and settlement dated 29th September 1864, and codicils. By these deeds he disponed, first, to David Souter Robertson of Lawhead, now deceased, in liferent for his liferent use allenarly, and after his death to George Robertson Chaplin, now of Murlingden, in the county of Forfar (therein named and designed George Souter Robertson, youngest son of David Souter Robertson), also in liferent for his liferent use allenarly, and to the heirs of the body of George Robertson Chaplin of Murlingden in fee, whom failing to Thomas Robertson Chaplin, now of Lawhead, in the county of Lanark (therein named and designed Thomas Chaplin Souter Robertson, third son of David Souter Robertson), in liferent for his liferent use allenarly, and to the heirs of his body in fee, whom failing to Katharine Robertson Kirkland or Hoile for her liferent use allenarly, and to the heirs of her body in fee, whom failing to the heirs of the body of David Souter Robertson of Lawhead, now deceased, whom failing to the heirs of the body of Mrs Margaret Souter or Kirkland in fee, the lands and estate of Cookston and Unthank. He further disponed to David Souter Robertson in liferent for his liferent use allenarly, and after his death to Thomas Robertson Chaplin in liferent for his liferent use allenarly, and to the heirs of his body in fee, whom failing to George Robertson Chaplin in liferent for his liferent use allenarly, and the heirs of his body in fee, whom failing to the heirs of the body of David Souter Robertson of Lawhead in fee, whom failing to the heirs of the body of Mrs Margaret Souter or Kirkland in fee, the lands and estate of Bowhouse. He further disponed to David Souter Robertson in liferent for his liferent use allenarly, and after his death to George Robertson Chaplin, his son, in liferent for his liferent use allenarly, and to the heirs of his body in fee, whom failing to Stewart Souter Robertson, his brother, in liferent for his liferent use allenarly, and to the heirs of his body in fee, whom failing to David Souter Robertson, the younger brother of Stewart Souter Robertson, in liferent for his liferent use allenarly, and to the heirs of his body in fee, whom failing to the heirs of the body of David Souter Robertson of Lawhead in fee, whom failing to the heirs of the body of Mrs Margaret Souter Robertson or Kirkland in fee, the lands of Auchingray.

The disposition was granted under certain conditions, which were declared to be inherent qualities of the conveyance, and, inter alia, under the conditions that “all

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parties who shall at my death, or at any time thereafter, have any beneficial interest contingent or otherwise under this settlement, are thereby prohibited from selling, mortgaging, or otherwise disposing of such interest, excepting always sales or mortgages by parties who are absolute fiars of any of the said estates, and it is thereby stipulated and provided that such sales or mortgages, if made, shall be void, and all deeds or instruments purporting to be a sale or mortgage of such interest, or any part thereof, shall be null and void, and all parties signing such deeds or instruments shall thereby forfeit and lose all right and benefit under this settlement, and shall give place to the next in succession who shall be entitled to come in the right and place of the party signing such deeds or instruments.”

On the testator's death David Souter Robertson entered into the possession of the several lands, and enjoyed the liferent thereof till his death on 10th November 1878.

George Robertson Chaplin of Murlingden then succeeded to the lands of Cookston and Unthank and Auchingray in liferent, and Thomas Robertson Chaplin succeeded to the lands of Bowhouse in liferent. They were both unmarried. Their affairs having become embarrassed, they each granted a trust-disposition and settlement for behoof of their creditors, by which they conveyed to the pursuers, as trustees for behoof of their creditors, their whole means, estate, and effects, heritable and moveable, real and personal, including their rights of liferent of the above-mentioned lands, declaring that the trustees should have power, inter alia, to sell and dispose of the lands and estate falling under the trust.

The trustees entered into possession and management of the estates, and proposed to sell and dispose of the liferent right and interest of George Robertson Chaplin and Thomas Robertson Chaplin in the lands of Cookston and Unthank and Bowhouse, and of George Robertson Chaplin of Murlingden in the lands of Auchingray.

This proposal was challenged by Mrs Hoile and her children and Stewart Souter Robertson and his eldest son, and the trustees raised this action against these parties to have it declared that the pursuers were entitled to sell these liferent rights without incurring any irritancy thereof in consequence of the terms of the trust-disposition of the late George Robertson Chaplin above quoted.

The pursuers pleaded—“(1) The said liferent rights not being protected against creditors, the pursuers, as trustees for behoof of creditors, are entitled to sell and dispose of the same. (2) The pursuers are entitled to decree as libelled, in respect that the conveyance of the said liferent rights to them did not fall, and a sale thereof by them would not fall, within the conditions and restrictions of the trust-disposition and settlement of the said George Robertson Chaplin.”

The defenders Mrs Hoile and children pleaded—“(1) The averments of the pursuers are irrelevant. (2) The action is incompetent. (3) The said George Robertson Chaplin of Murlingden and Thomas Robertson Chaplin of Lawhead having no title to sell the respective lands above mentioned, and the pursuers being their assignees, and having no higher right than themselves respectively, the pursuers are not entitled to declarator as concluded for. (4) On a sound construction of the said disposition and settlement of the said George Robertson Chaplin of Colliston, the liferent interests thereby respectively conveyed to the said George Robertson Chaplin of Murlingden and the said Thomas Robertson Chaplin of Lawhead in the respective lands above mentioned are alimentary rights not attachable by creditors, and cannot be sold, mortgaged, or otherwise disposed of without incurring the irritancy provided for in the said disposition and settlement.”

The defenders Stewart Souter Robertson and his son pleaded in similar terms.

Upon 20th March 1890 the Lord Ordinary ( Kyllachy) dismissed the action as irrelevant.

“ Opinion.—The pursuers in this case are the trustees under a trust-deed for creditors granted by George and Thomas Robertson Chaplin, and they bring this action to have it declared that as such trustees they are entitled to sell (1) certain liferents presently possessed by the two trusters over certain landed estates in Scotland; and (2) certain prospective liferent interests which the two trusters have in succession to each other over the same estates. The liferents in question were all created under the testamentary disposition of the late Mr Robertson Chaplin, and there being no express trust, the fee is in each case held by the liferenter in possession as a fiduciary fee for his children, and failing them for certain other persons named, including the defenders, who are parties to this record.

“The question arises upon the terms of a clause contained in the disposition and settlement by which the liferents in question were constituted, which clause declares that the disposition was granted under certain conditions declared to be inherent qualities of the conveyance, and, inter alia, under the condition ‘that all parties who shall at my death, or at any time thereafter, have any beneficial interest, contingent or otherwise, under this settlement, are hereby prohibited from selling, mortgaging, or otherwise disposing of such interest, excepting always sales or mortgages by parties who are absolute fiars of any of the said estates, and it is hereby stipulated and provided that such sales or mortgages if made shall be void, and all deeds or instruments purporting to be a sale or mortgage of such interest, or any part thereof, shall be null and void, and all parties signing such deeds or instruments shall thereby forfeit and lose all right and benefit under this settlement, and shall give place to the next in succession, who shall be entitled to come in the right and place of the party signing such deeds or instruments.’

“The pursuers contend that this clause of irritancy and forfeiture is wholly ineffectual

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(1) because it is not supported by trust, and (2) because it does not strike at gratuitous alienations or the diligence of creditors, but only at sales and mortgages. They refer to the case of White, 4 R. 786, and Kirkland, 13 R. 798, as authorities in their favour, and they maintain that there is no distinction in this matter between a right of fee and a right of liferent, it being, as they contend, equally impossible in both cases to restrict the owner's power of disposal.

“The defenders, on the other hand, contend that there is nothing incompetent in the creation of a temporary interest in land which shall in certain events last for life, and in certain other events last for a shorter period, and that it is of no moment whether the event which brings the temporary right to a close is some outside event or some act of the party concerned. They say, for example, that a liferent may be constituted terminable on the succession to some estate, or upon marriage, or upon second marriage, and that it can make no difference in principle that it should be terminable upon, e.g., the execution of some deed, whether a deed dealing with the liferent itself or any other deed. They admit, indeed, that if a right of fee is once given, it is impossible to fetter the fiar's power of disposal, because a fee necessarily involves the power of disposal, but they say that that doctrine has no application to limited interests, which must stand or fall according to their own limitations, and, in particular, that it has no application to liferents which are truly of the nature of burdens, and the subsistence of which may be made to depend on any conditions which the donor may choose to attach.

“The defenders further argue that in any case the forfeiture here must take effect as regards the liferents to which the trusters have only a prospective right—that is to say, a right on the failure of the issue of each other. And with respect to the cases of White and Kirkland, they point out that those cases did not, so far as decision went, touch the present question, and that any dicta in either which may be thought to favour the pursuers' view did not really contemplate the case (which is for the first time presented here) where there is not only a prohibition against alienation and a declaration that such alienation shall be null, but where it is an inherent quality of the liferent right that it shall terminate upon a sale or mortgage being attempted.

“The defenders maintain finally that the action is incompetent, in respect that it asks the Court to declare hypothetically the rights of the pursuers with respect to a course of action which they have not taken, and which they may never actually take, and they found upon the doctrine expressed in Mr Mackay's book, vol. ii. p. 93, and the case of the Earl of Galloway, 16 S. 1213, there referred to.

“I have felt the questions thus raised to be attended with some difficulty, especially in view of the dicta expressed in the case of Kirkland, where this very deed was before the Court. But I have come to be satisfied that the question which is now presented for decision was not really considered by the Court in that case, and did not require to be considered, and therefore that I am bound to deal with it as one of principle, and one which is still open. In that view I have come to the conclusion that the defenders are right, and substantially upon the grounds which I have endeavoured to express as their grounds of argument.

“I do not think it necessary to proceed upon the incompetency of the action, although I have, I confess, grave doubts whether the present case does not fall within the principle of that of Galloway. But on the merits I accept the defenders' distinction between an attempt to fetter the powers of disposal inherent in the owner of a fee, and a declaration such as we have here, that a right of liferent shall terminate if a sale or mortgage of the liferent (that is to say, of the future fruits which are the subject of the liferent) shall be attempted. I only desire to guard myself by saying that I by no means regard this as implying that if a grant of liferent or of an annuity be conceived in absolute terms, the right can be effectually restricted by a mere declaration that it shall be alimentary or incapable of alienation. Such a condition, I incline to agree with the pursuers, would be ineffectual, at least without the interposition of a trust, for the liferent or annuity would in that case have a fixed duration, and for its duration must be as much at the disposal of the owner as a right of fee is at the disposal of the fiar.

“With respect to the pursuers' argument that gratuitous conveyance is not struck at by the clause, and that adjudication is competent to creditors, I reserve my opinion. I do not at present, I confess, see any good answer to the pursuers' point, at least as regards the liferents in possession. But it is not necessary to decide any question of that kind here, because I see no reason in principle why a testator should not be at liberty to terminate a liferent or annuity on an attempt at sale or mortgage, and yet to leave it open to the liferenter or annuitant to alienate gratuitously, or to the creditors of the liferenter or annuitant to adjudge for debt. The testator in the present case may possibly have considered that gratuitous alienation inter vivos was not a very probable event, and may not have desired or may not have seen his way to exclude the diligence of creditors.

“On the whole, I dismiss the action as irrelevant, and I find the defenders entitled to expenses.”

The pursuers reclaimed, and argued—The action was competent. The pursuers desired to know the extent of their powers. The case of Earl of Galloway, 16 S. 1213, did not apply. The clause did not prevent the liferenter from alienating his liferent right. A creditor could adjudge the liferent right, and finally sell it. This was all that the trustees intended to do here, and it was not for the interest of the defenders to retard payment of the liferenter's debts. The clause could not prevent a fiar from selling,

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and it did not prevent the liferenter from exercising the full rights of property upon his more limited estate. A liferent was no doubt a limited estate, but so far as it went it was complete. The analogy of an heir of entail applied. The heir of entail could sell his liferent interest in the entailed estate for behoof of his creditors, and there was no reason why a liferenter even under a clause such as this should not have the same power. There was no trust or prohibition of gratuitous alienation or diligence of creditors, and therefore the clause did not prevent the creditors from taking the liferent nor the liferenters from selling them— Kirkland v. Kirkland's Trustees, March 18, 1886, 13 R. 798; Whyte's Trustees v. White, June 1, 1877, 4 R. 787; Jarman on Wills, ii. 23; Simson's Trustees v. Brown, March 11, 1890, 17 R. 531.

The respondents argued—The action was not competent. The trustees ought to know their duty, and the Court would not advise them upon it— Earl of Galloway v. Earl of Garlies, cited supra. The clause was quite imperative. There was no repugnancy. The disponer could attach to a right of liferent the conditions of its subsistence. A liferent was equivalent to a grant for a term of years, and it had been held that in various circumstances a grant for a term of years could be burdened with conditions upon its use— William Elliot v. Duke of Buccleuch, December 4, 1747, M. 10,329; Pirie v. Murray, January 14, 1766, M. 8248. The Juridical Styles in forms of deeds for the conveyance of liferents contained a clause against alienations, which shows that the practice has been to introduce limitations into these deeds— Fleeming v. Howden, July 16, 1868, 6 Macph. (H. of L.) 113. In the case of a conjunct fiar limitations had been introduced— Mason v. Mason, April 5, 1557, M. 7180. This estate would not have been covered by sequestration. This was an attempt to attach estate which even under section 102 of the Bankruptcy Act would not vest in a trustee— Kirkland v. Kirkland's Trustees, March 18, 1886, 13 R. 798; Trappes v. Meredith, November 3, 1871, 10 Macph. 38. Finally, by the Roman law a usufruct might be granted sub conditions—Pothier, 2 de Vente, part 6, ch. 3, art. 3.

At advising—