Scottish Court of Session Decisions

Robertson Gillies, silk mercer, Edinburgh, died on 12th October 1871. He was survived by his wife Mrs Sarah Gillespie or Gillies, and by two children, viz., a son, Thomas James Gillies, who survived his father only about a month, having died in pupillarity on 11th November 1871, and a daughter Mary M. Gillies, who was in minority at the date of her father's death.

Robertson Gillies left a trust-disposition and settlement dated 26th January 1871, by which he conveyed his whole estate to trustees in trust for the following purposes—1st, For payment of the testator's debts and funeral expenses and the expenses of the trust; 2nd, for payment of an annuity and certain other provisions to the truster's widow; 3rd, for payment of various legacies and annuities to relatives and friends of the truster, said legacies amounting in all to £1275, and the annuities

Page: 652↓

to £26 a-year; and by the fourth purpose he directed the capital of the residue of his estate to be held by his trustees for the purpose of being divided, after the death of his children, among the issue of his children per stirpes, the respective shares to be paid over as the issue of said children respectively arrived at the age of twenty-one. He further directed an allowance to be made from the income of the said residue to his children, the said Thomas James Gillies and Mary Margaret Gillies, during their respective lives, the remainder of the income of the said residue to be accumulated along with the capital, and applied in the same manner as the capital. He further conferred powers on his trustees to make in their discretion certain advances from the capital of the said residue to his children. The trust-disposition and settlement also contained a declaration to the effect that if any of the truster's children should repudiate the provisions thereby made for them, the child or children so repudiating the same and the issue of such children should forfeit and lose all right and interest whatever under the said trust-disposition and settlement and in the estates thereby conveyed, and that the provisions thereby made for and left to such child or children so repudiating, and his, her, or their issue, should pass entirely to and be held for, the children abiding by the said settlement and their issue, as if the provisions had been destined to them alone. The trust-settlement further contained a declaration with regard to the shares of the residue of the testator's estate destined to the issue of his said children, that these should vest in said issue at the periods of payment thereof respectively and not sooner. The total value of the estate left by the deceased Robertson Gillies was a little over £11,000. It consisted entirely of moveable estate.

There had been no marriage-contract between Robertson Gillies and his wife, and upon her husband's death, accordingly, the widow claimed her legal rights and repudiated the provision made for her in the trust-settlement. In respect of said claim and repudiation, the trustees paid over to Mrs Gillies one-third of her husband's free moveable estate in name of jus relictæ.

On 19th June 1880 the daughter Mary M. Gillies attained majority, and she thereupon intimated to the trustees that she elected to claim her legal rights and to repudiate the provisions made for her in her father's trust-disposition. At the same time, she, in conjunction with her mother, made a claim upon the trustees for payment of the whole balance of the trust-estate in their hands, after payment of debts, legacies, annuities, and jus relictæ. This claim was based upon the alternative footing that either (1) assuming the deceased son Thomas James Gillies to be held to have elected to take legitim, the whole share of the estate so vested in him as legitim would go to his sister and mother as his heirs ab intestato, while as regards the remaining “dead's part” in such case there would be intestacy through forfeiture, and it would go to the daughter, with her mother's possible participation (as heir of her deceased son) to a certain extent; or else (2) assuming that Thomas James Gillies was to be held to have accepted his father's provisions, the daughter would be entitled to take her legitim, while as regards the remainder of the estate, in such case there would be intestacy through failure of the heirs of Thomas James Gillies, and it would go to the daughter as heir ab intestato of her father. In answer to these claims, the testamentary trustees declined to hand over the trust-estate without judicial authority, and maintained that the forfeiture of the shares originally destined to any issue that might be born to Mary Margaret Gillies in favour of the issue of other children of the testator having failed, they were bound, in the due administration of the trust, to retain the unexhausted portion of the “dead's part” for behoof of any children that might be born to the said Mary Margaret Gillies.

In consequence of these questions regarding the extent of the rights of Miss Gillies and her mother to the undistributed portion of the trust-estate, a special case was presented to the Second Division of the Court. In this special case the said Mrs Sarah Gillespie or Gillies and Mary Margaret Gillies were parties of the first part (they having agreed to adjust their respective claims inter se), and the testamentary trustees were parties of the second part.

The questions put to the Court were—1st, Whether the parties of the first part thereto were entitled to have paid over to them the whole remaining residue of the estate of Robertson Gillies? and 2nd, Whether the trustees were entitled or bound to retain the whole or any part of the residue of the said estate for behoof of any issue that might be born to Mary Margaret Gillies—and if a part, what part?

In answer to the questions put by the special case, the Court on 23rd February 1881 found, in answer to the first question, “that the parties of the first part are not entitled to have now paid over to them the whole residue of the estate of the deceased Robertson Gillies;” and in answer to the second question, “that the parties of the second part are entitled and bound to retain for behoof of any issue that may be born to Mary Margaret Gillies, and to be administered by them, the parties of the second part, in terms of the directions of the trust-deed and according to law, so much of the said residue as shall be equivalent to one-third part thereof, minus the legacies and annuities bequeathed by the truster, and the expenses of the special case.” This case is reported, ante, February 23, 1881, vol. xviii. 323, 8 R. 505.

The effect of the judgment of the Court was that the direction in Mr Robertson Gillies' trust-disposition and settlement to the trustees to hold the residue of the estate, with accumulations of income, until the death of Mary Margaret Gillies, and

Page: 653↓

thereafter to pay the capital and accumulated income to the lawful issue of Mary Margaret Gillies on their attaining the age of twenty-one, became restricted to the “dead's part.”

Following upon this judgment, the trustees made out a state of the division of the said trust-estate upon a valuation obtained by them, and in respect thereof retained the sum of £3932, 7s. in their hands as the “dead's part,” being the amount directed to be set aside for the possible issue of Mary Margaret Gillies. The balance they paid over to Mary Margaret Gillies subject to any claims thereon by her mother, and were duly discharged.

On 19th April 1886 Mrs Sarah Gillespie or Gillies died, leaving a testament dated 29th August 1885, and a general settlement dated 20th March 1886. By the said testament and general settlement she bequeathed her whole estate to her daughter Mary M. Gillies, and made her sole executrix.

On 8th September 1886 Mary M. Gillies was married to the Rev. John M'Leod Bain. There was one child of the marriage, viz., Sarah Florence Bain, born in 1887. Prior to their marriage Mary M. Gillies and John M. Bain entered into an antenuptial general disposition and deed of trust and marriage settlement dated 7th September 1886. By this deed Mary M. Gillies, with consent of John M. Bain, conveyed and made over to trustees, for the purposes therein specified, her whole estate, heritable and moveable, coming to her under her father's said trust-disposition and settlement and her mother's said testament and general settlement, and also the whole estates, heritable and moveable, and right and interest of whatever kind, belonging to her as heir in heritage and moveables of her said father and mother and deceased brother, and generally the whole estate that she might succeed to during the subsistence of the marriage.

On 13th October 1889 the testamentary trustees of Robertson Gillies had been in possession of, and had been accumulating income on, the foresaid sum of £3932, 7s. for a period of twenty-one years. By the Thellusson Act (39 and 40 Geo. III. c. 98), however, accumulation of income beyond a period of twenty-one years from the date of a testator's death is forbidden, and questions arose whether the present was not a case to which that statute applied, and also as to whether, if the Thellusson Act did apply, the testamentary trustees were bound to pay over the future income of the fund in their hands during Mrs Bain's life to Sarah Florence Bain and her father as her curator, or to the marriage-contract trustees of Mr and Mrs Bain.

In these circumstances a special case was submitted for the opinion of the Court by (1) the testamentary trustees of Robertson Gillies; (2) Miss Sarah Florence Bain and her father and curator, the Rev. John M. Bain; and (3) the marriage-contract trustees of Mr and Mrs Bain.

The questions submitted for the judgment of the Court were—“(1) Has the Thellusson Act the effect of preventing further accumulations, after 13th October 1892, of the interest of the trust-funds held by the parties of the first part? (2) Assuming the first question to be answered in the affirmative, is the interest of the trust-funds payable during Mrs Bain's life to the parties of the second part or to the parties of the third part?”

The second parties maintained that the Thellusson Act took effect, and that as Miss Sarah Florence Bain was the only person entitled to the fee of the “dead's part” and the income thereof at the period of payment mentioned in the trust-disposition and settlement, she was also entitled to the income which, but for the provisions of the Thellusson Act, would have been accumulated for the sole benefit of the issue of her mother. They made this claim, however, on the footing that any other lawful issue who might hereafter be born to Mrs Bain would be entitled to participate with Miss Sarah Florence Bain.

The parties of the third part, on the other hand, maintained that the Thellusson Act applied, but that they, as standing in right of Mrs Bain, were entitled to the income in respect that it was pure intestacy, and Mrs Bain was sole heir ab intestato to the truster, her father— Cathcart's Trustees v. Heneage's Trustees, July 13, 1883, 10 R. 1205.

At advising—