Scottish Court of Session Decisions

By section 10 of the Trusts (Scotland) Act 1867 it is enacted:—“Any trustee entitled to resign his office may do so by minute of the trust entered in the sederunt book of the trust, and signed in such sederunt book by such trustee, and by the other trustee or trustees acting at the time, or he may do so by signing a minute of resignation in the form of the Schedule A to this Act annexed, or to the like effect, and may register the same in the Books of Council and Session, and in such case he shall be bound to intimate the same to his co-trustee or trustees, and the resignation shall be held to take effect from and after the expiry of one calendar month after the date of such intimation, or the last date thereof if more than one, if the trustee or trustees to whom such intimation was given is within Scotland, or otherwise, within three months from and after that date.”

Mr Gavin Fullarton of Keselaw, Ayrshire, died on 28th August 1876, leaving a trust-disposition and settlement by which he nominated certain persons as his testamentary trustees. In June 1882 Mr Francis Edward James, Georgetown, British Guiana, was by deed of assumption assumed as a trustee to act under this trust-disposition, and he continued to act along with the other trustees till August 1894. At that time, in consequence of a difference of opinion among the trustees as to the mode of managing certain of the trust properties, Mr James intimated to his co-trustees his desire to resign his office of trustee, and the agents of the trust were instructed to prepare a minute of resignation. This was done, and the minute was executed by Mr James on 11th August 1894. The minute, which was in the form prescribed by Schedule A of the Trusts Act of 1867, was in the following terms:—“I, Francis Edward James … do hereby resign, as at and from the date hereof, the office of trustee (as not approving of the course to be adopted with regard to the working of the West Indian estates by the other trustees) under the trust-disposition and settlement granted by the deceased Gavin Fullarton, Esq.…” On the same date this minute was intimated to the other trustees, and an acknowledgment of intimation was signed by them and annexed to the minute. The minute and acknowledgment of intimation were registered in the Books of Council and Session on 17th October 1894. On 20th October Mr James executed a minute of revocation of his resignation, in which, after narrating that he had executed the said resignation under a misapprehension, he proceeded:—“I am now desirous of revoking and cancelling the same; and whereas the said minute of resignation has not been recorded in … British Guiana, or in any way acted upon by me therein or with reference to the said estates; now, therefore,

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I … do hereby, as from the date thereof, revoke and cancel the said minute of resignation, and declare to continue and resume the said office of trustee.” The minute of revocation was intimated to the other trustees, who, however, were of opinion that Mr James was not entitled to withdraw his resignation, and accordingly a special case was presented to the Court by the trustees of the first part, and Mr James of the second part.

The question submitted to the Court was as follows:—“Is the party of the second part still entitled to act as a trustee? ”

Argued for the first parties—It was too late for the second party to revoke his resignation. (1) The resignation had not been made under the Act of 1867 at all. By the Trusts Act of 1861, section 1, power was given to a gratuitous trustee to resign office, and under that provision the resignation of the second party was effectual and final from its date. There was no necessity to appeal to the 10th section of the Act of 1867, or to introduce the qualification as to the time which must elapse before the resignation was to take effect, introduced by that section. There were two special methods provided by the latter Act, but that was not intended to prevent a trustee electing to resign, as had been done here, by neither of those methods, but in virtue of the general powers given in the earlier Act— Maxwell's Trustees v. Maxwell, November 4, 1874, 2 R. 71. This view was supported by the language of section 7 of the Trust Act of 1891, which spoke of a trustee resigning “in either of the modes provided by the Trust Act 1867 or otherwise.” (2) Moreover, even if it were held that the second party had resigned under section 10 of the 1867 Act, the provision in that section that the resignation should not take effect for three months did not affect the act of resignation, but the consequences of it, and had been framed in the interests of the remaining trustees, not to give the resigning trustee a chance of changing his mind— Sinclair v. City of Glasgow Bank, January 23, 1879, 6 R. 571; Tochetti v. City of Glasgow Bank, March 7, 1879, 6 R. 789. In this case the resignation had been accepted unico contextu by the trustees, and in the words of section 7 of the 1891 Act it had been “duly completed.”

Argued for the second party—The general power of resignation given by the 1861 Act was to be carried out by one of the two methods prescribed by section 10 of the 1867 Act, the two statutes being read together. The second of these two methods, which had been taken by the second party, allowed a trustee to resign in the manner followed in this case, but made it obligatory on him to intimate his resignation to his co-trustees, and provided that it should not take effect till three months had elapsed, some of the co-trustees being furth of Scotland. There had been no real acceptance on the part of the co-trustees, and no actings following on the resignation sufficient to prevent the second party revoking it. There was no reason why time should be given to the remaining trustees to consider the resignation, if it were not equally open to the resigning trustee to recal his resignation. If the latter could be held liable during those three months, it would be inequitable that he should have no corresponding right to reconsider his position on finding that he had resigned under a misapprehension.

At advising—