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Scottish Court of Session Decisions
You are here: BAILII >> Databases >> Scottish Court of Session Decisions >> Stirling's Trustees v. Stirling [1898] ScotLR 36_194 (6 December 1898)
URL: http://www.bailii.org/scot/cases/ScotCS/1898/36SLR0194.html
Cite as: [1898] SLR 36_194, [1898] ScotLR 36_194
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SCOTTISH_SLR_Court_of_Session
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Court of Session Inner House Second Division.
v.
Facts:
In a marriage-contract it was provided that upon the decease of the husband the trustees should uplift certain life policies conveyed to them and invest the proceeds for behoof of the persons interested in the trust; that they should pay the income to the wife if
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she survived the husband (as she did), and upon her second marriage or death should pay one-half of the fee to the children of the husband by a former marriage, and to the survivors or survivor of them, reserving power to the husband and wife jointly, and to the survivor of them, to apportion the fee among the children of the husband's former marriage. The spouses executed a deed of appointment, whereby they apportioned one-half of the estate, less the sum of £10, to the children of the former marriage (excepting one of them, A) equally among them, share and share alike, and to A the sum of £10, the children of any child deceasing before the period of payment taking equally the share which their parent would have taken. All the children of the former marriage, who were living at the date of the deed of appointment, viz., A, B, and C, survived the husband, but one of them, C, predeceased the widow without issue. Held (1) that the fee of the fund destined to the children of the former marriage vested at the death of the widow; (2) that the power of appointment had been effectually exercised, in so far as it appointed the estate among the objects of the power; and (3) ( diss. Lord Young) that the share which C would have taken if he had survived the widow did not accresce to B, but fell to be divided equally between A and B.
On 15th August 1853 John Stirling, grocer in Edinburgh, and Euphemia Scougal, afterwards his wife, entered into an antenuptial contract of marriage, whereby the said John Stirling assigned, disponed, and conveyed certain policies of assurance to trustees in trust for behoof of the said Euphemia Scougal in liferent for her liferent use allenarly, exclusive of his jus mariti and right of administration, and for the use and behoof of the parties thereinafter named in fee. By the contract it was directed that the trustees, upon the decease of the said John Stirling, should uplift and invest the proceeds of the policies, taking the writs, titles, or transfers to and in favour of themselves and survivors or survivor of them in trust for behoof of the persons interested in the marriage-contract trust according to their respective rights and interests. The marriage-contract then proceeded as follows: — “I [ i.e. the said John Stirling) direct said trustees to pay to the said Euphemia Scougal, in case she shall survive me, the free yearly rents, interests, income, and profits to be received by them from the said investments, and that in liferent for her liferent use allenarly during all the days of her lifetime and while she shall remain my widow and unmarried, and upon her second marriage or death, whichever event shall first happen, I direct my trustees to pay or apply the fee of the principal sums so to be invested as follows:—One-half thereof to the children procreated of my former marriage with the deceased Flora M'Intosh or Stirling, and to the survivors or survivor of them, and the other half thereof I direct my said trustees to pay to the children to be procreated of my intended marriage, whom failing to myself, my heirs and assignees, reserving always to myself and the said Euphemia Scougal jointly, and to the survivor of us, to apportion and divide the fee of said provisions amongst the children of my former and present marriage according to the exact proportions hereby settled upon them respectively.”
On 4th May 1870 John Stirling and Euphemia Scougal or Stirling, in virtue of the powers contained in the antenuptial contract of marriage, executed a deed of appointment of new trustees and apportionment of provisions.
The deed, after narrating the provisions of the marriage-contract immediately above set forth, proceeded as follows:—“Therefore we do nereby apportion and divide the said sums as follows, viz.:—One-half of the same to the children of the said marriage between us, the said John Stirling and Euphemia Scougal, now Stirling, equally among them, share and share alike, and the other half of the same, except the sum of £10, to the children of the marriage between me the said John Stirling and the said Flora M'Intosh or Stirling (excepting Mrs Isabella Stirling now Donaldson, the eldest daughter of the said marriage) equally among them, share and share alike, and to the said Isabella Stirling now Donaldson the sum of £10, the children of any child deceasing before the period of payment taking equally among them, share and share alike, the share which the parent would have taken had he or she survived; and we direct the above named trustees, original and hereby assumed under the said contract of marriage, to make payment of the said sums accordingly, and we consent to the registration hereof for preservation: And we reserve power to us jointly, or to the survivor of us solely, to alter, innovate, or revoke these presents in whole or in part, and to appoint new trustees in place of or additional to those above named, as also to apportion and divide the sums above mentioned in such other way and manner as to us jointly, or the survivor of us solely, may seem fit.”
The said John Stirling died on the 28th day of July 1873 survived by his widow, the said Euphemia Scougal or Stirling, and by the following children of his first marriage, viz.—Robert Stirling (now deceased), James Stirling, and Mrs Isabella Stirling or Donaldson. He was also survived by three children of his second marriage. On his decease his marriage contract trustees, in terms of the directions in the contract, uplifted the sums falling due on his death under the before-mentioned policies of assurance, invested the same, and paid the income thereof to his widow, the said Euphemia Scougal or Stirling, during her lifetime. The amount of the funds held by the trustees was £942, 3s. 10d.
Mrs Euphemia Scougal or Stirling died on 11th August 1897. At the date of her death the only children surviving of the
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first marriage were James Stirling and Mrs Isabella Stirling or Donaldson. Robert Stirling died intestate on 16th May 1877 having survived his father, but having predeceased Mrs Euphemia Scougal or Stirling. He left no children, but was survived by his wife Mrs Isabella Wilson or Stirling or Reid. James Stirling and Mrs Isabella Stirling or Donaldson were his sole next-of-kin. Mrs Isabella Wilson or Stirling or Reid was married to her second husband Andrew Reid on 12th April 1882. Upon the death of Mrs Euphemia Scougal or Stirling, the period for the division of the funds held by the marriage-contract trustees arrived. No question arose as to the division of the share thereof falling to the children of the second marriage, but certain questions arose as to the division of the share falling to the children of the first marriage, and accordingly the present special case was presented for the opinion and judgment of the Court.
The parties to the special case were—(1) The marriage-contract trustees, (2) James Stirling, (3) Mrs Isabella Stirling or Donaldson, and (4) Mrs Isabella Wilson or Stirling or Reid, formerly widow of Robert Stirling.
The second party maintained (1) that the interest of Robert Stirling in the fund falling to the children of the first marriage lapsed through his predeceasing the period of division, and that the whole of that fund fell to be divided between the second and the third parties, who were the only children of the first marriage surviving at the death of Mrs Euphemia Scougal or Stirling, that being the term of vesting of the children's provisions; and (2) that the effect of the deed of apportionment was to carry to him the whole fund with the exception of £10, which fell to the third party. The third party (1) adopted the contention of the second party as to the term of vesting and the effect of Robert Stirling's predecease, but (2) she maintained that the deed of apportionment was ab initio invalid, in respect lit did not have regard to the clause of survivorship in the contract of marriage, or otherwise that the validity of the deed of apportionment depended on all the children to whom the apportionment thereby made applied being alive at the term of vesting, and that in consequence of Robert Stirling's predecease the apportionment as a whole became ineffectual, and that in either view the fund fell by virtue of the marriage-contract to be divided equally between her and the second party. Alternatively, she maintained (3) that in any view the share, being half the fund, less £10, appointed to Robert Stirling by the deed of appointment must be treated as unappointed, and fell by virtue of the marriage-contract to be divided equally between her and the second party. The fourth party maintained (1) that under the marriage-contract the provisions in favour of the children of the first marriage vested at the dissolution of the second marriage; (2) that by the deed of apportionment one-half of the fund destined to the children of the first marriage, less £10, was validly apportioned to Robert Stirling, her husband, and that he acquired a vested right thereto, and (3) that the fourth party as his widow was entitled to one-half of his said provision as jus relictæ, the other half thereof falling to the second and third parties in equal shares as his next-of-kin.
The second and third parties admitted that the share apportioned to Robert Stirling was divisible in this manner if vesting took place at the dissolution of the second marriage.
The following were the questions of law for the opinion and judgment of the Court:—“(1) Did the provisions conceived by the marriage-contract between the said John Stirling and Mrs, Euphemia Scougal or Stirling, his second wife, in favour of the children of his first marriage, vest in said children at the dissolution of his second marriage, or at the death of the said Mrs Euphemia Scougal or Stirling? (2) In the event of it being held that said provisions did not vest until Mrs Stirling's death, is the apportionment of said provisions by the said John Stirling and Mrs Euphemia Scougal or Stirling effectual; or was it invalid ab initio; or did it lapse on the death of the appointee Robert Stirling? (3) In the event of said apportionment being held effectual, is the second party entitled to the whole provision except £10, or does the half of the fund (under deduction of £10) apportioned to Robert Stirling, fall to be divided equally between the second and third parties?”
Although it was not stated in the case, it was conceded and assumed that the three children above mentioned were the only children of the first marriage alive at the date of the deed of appointment.”
Argued for the second party—(1) Although it might be that the dissolution of the marriage was the natural and presumable period of vesting in the case of provisions under a marriage-contract, yet that presumption must yield to the special terms of the need. Here there was a clause of survivorship which must be taken to refer to the period of payment. It was impossible to say who were the survivors until the period of payment. The period of vesting, therefore, in this marriage-contract was the death or re-marriage of the second wife— Blackburn's Trustees v. Blackburn, March 20, 1896, 23 R.698; Cuming's Trustee v. Cuming, November 14, 1896, 24 R. 153. [Lord Trayner referred to Young v. Robertson, February 14,1862, 4 Macq. 314.] (2) The deed of appointment was valid. It was said to be invalid because the clause as to the children of a deceasing child taking the share which their parent would have taken was inconsistent with the clause of survivorship in the marriage-contract. It might be that this provision was invalid, but as events had happened it was of no effect. It was consequently simply to be held pro non scripto, and it did not affect the validity of the rest of the deed, which was the only effective part of it as matters now stood— Wallace's Trustees v. Wallace, June 12, 1891, 18 R. 921; Wright's Trustees v. Wright,
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February 20, 1894, 21 R. 568. (3) There was nothing in the deed of appointment to show that it only contemplated the case of all the children surviving. There was no reference in the deed to the number of the children. On the other hand, there was a clear indication of intention that in any event the third party was not to get more than £10. Argued for the fourth party—(1) Counsel for the fourth party adopted the argument for the second party as to the validity of the deed of appointment. (2) The clause of survivorship in the marriage-contract referred to survivorship at the dissolution of the second marriage. Survivorship as at the date of death was a possible, though admittedly not a usual, reading for a claim of survivorship. The half of the fund, less £10, therefore vested in Robert at the date of the dissolution of the marriage, and the fourth party as his widow was entitled to one-half of his share.
Argued for the third party—(1) Counsel for the third party adopted the argument for the second party on the subject of vesting, and in addition pointed out that this was a gift by means of a direction to pay at a postponed period, which involved postponement of vesting till the period of payment— Bryson's Trustees v. Clark, November 20, 1880, 8 R. 142. (2) The deed of appointment was invalid and ineffectual. The true test was not whether it was valid in so far as it ultimately came to be operative, but whether it was a valid exercise of the power when the deed was originally executed. In that view it could not be maintained that the deed was a valid exercise of the power.—See Blackburn's Trustees v. Blackburn, cit., and Cuming's Trustee v. Cuming, cit. If the appointment was in part invalid, then the deed of appointment should not receive any effect whatever, because it was impossible to tell what the person entrusted with the power would have done if he had known that what he in fact did was to some extent inept— Baikie's Trustees v. Oxley, February 14, 1862, 24 D. 589; Gillon's Trustees v. Gillon, February 8, 1890, 17 R. 435, per Lord Rutherfurd Clark at p. 442. (3) Alternatively, the share appointed to Robert lapsed, and fell to be divided equally between the surviving children of the first marriage, in terms of the provision in the marriage-contract. Under the deed of appointment the second party could only take the share appointed to him—that was to say, one-half of the whole fund less £10. He could not take anything by accretion, in respect that there was here a gift to a plurality of persons sufficiently described for identification, viz., the children of the first marriage other than Mrs Donaldson the third party — Paxton's Trustees v. Cowie, July 16, 1886, 13 R. 1191; Wilson's Trustees v. Wilson's Trustees, November 16, 1894, 22 R. 62.
At advising—
The question now is, how in these circumstances is the one-half destined to the children of the first marriage to be disposed of. That involves more than one question. First, when did vesting take place. I am of opinion that it took place on the death of the widow. Second, does the apportionment stand to any effect. I am of opinion that it does, and that the daughter under that apportionment takes £10, and the only other child alive at the widow's death takes the one-half apportioned to him. Third, what is to be done with the remaining share in respect of the predecease of the one child. As regards that half, there is no disposal by the deed of apportionment that can take effect. The original bequest by the contract was to known and ascertained children and the survivors, and the children of such of them as should not survive the term of payment. The apportionment did not in dividing the fund declare any right in a survivor to the whole fund less the £10 to the daughter. In these circumstances it seems to me that that part which would have been taken by the deceasing child must be disposed of as directed by the contract, as if there had been no apportionment, and that it falls to be divided among the surviving children in terms of that contract. I do not find any expression of intention in favour of accretion. The result would be that it would be divided between the second and third parties.
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Mr Stirling died in 1873 survived by his second wife and by three children of his first marriage, one of whom (Robert) died in 1877 childless but leaving a widow. The second Mrs Stirling, who liferented the funds in dispute, died in 1897, and clearly and admittedly the time has thereby come for division of the capital, that is to say, of one-half of the sum of £942, 3s. 10d.
The first question on which the competing claimants desire our judgment, and which presents the dispute between the second and third parties on the one hand, and the fourth party on the other, is, when did the provision or bequest by the contract of 1857, to the children of Mr Stirling's first marriage, vest?
On this question the fourth party (the widow of Robert, who died in 1877) contends that the provision vested at the dissolution of the second marriage by the death of Mr Stirling in 1873, and this contention is her only ground of claim.
The second and third parties, while admitting that if this contention be sound the claim of the fourth party is good, concur in maintaining that the period of division, viz., the death of the liferentrix in 1897, is the term of vesting, and that a child dying before that term took nothing.
On this first question my opinion supports the view of the second and third parties. When the counsel for the fourth party had opened her case it was pointed out by one of your Lordships, with the concurrence of all of us, that the words which direct payment at a specified term to the children and to “the survivors or survivor of them” are on the authorities adverse to vesting before that term, and the counsel for the second and third parties were not required to speak to the first question. We must answer the first question accordingly, and such answer is admittedly conclusive against the claim of the fourth party.
The second and third parties, the only other claimants, concur, as is distinctly stated in the case, in this view of the vesting, which indeed, as I have already pointed out, is their answer and only answer to the claim of the fourth party. Their difference inter se must, I should think, necessarily and obviously be considered and decided in the same view—that is to say, in the view that under the direction to the trustees in the contract of 1857 there was no vesting in any child of the first marriage who predeceased the second Mrs Stirling. But this view (so far as the contract of 1857 goes) excludes Robert Stirling, who died in 1877. If it does not, the claim of the fourth party is confessedly good. It is thus, in my opinion, not doubtful that under the contract of 1857, taken by itself and irrespective of the subsequent deed of apportionment, the sum in question (one-half of £942, 3s. 10d.) is divisible equally between the second and third parties.
But of course regard must be had to this deed of apportionment, and the contest between the second and third parties depends on these questions — 1st, was the apportionment by this deed invalid ab initio? and if not, then, 2nd, did it lapse on the death of Robert Stirling in 1877? These constitute the second question in the case which, as expressed, and I presume as intended, proceeds on the assumption of the answer which I have given to the first, as the assumption on which the dispute between the second and third parties is to be determined.
As to the contention that the appointment was void ab initio, I think it unnecessary to say more than that it is so clearly untenable that we did not call for an answer to it. The alternative view that it lapsed on the death of Robert Stirling I individually thought equally untenable, but a possible difference of opinion on this point having been indicated I will state what occurs to me upon it.
The apportionment is by the spouses whose marriage-contract contains the bequest apportioned, which is indeed a contract bequest that the deed of apportionment reserves power to them jointly, or to the survivor solely, “to alter, innovate, or revoke these presents in whole or in part.” The apportionment is of the fund (half of £943, 3s. 10d.), “except the sum of £10,” to the children of the first marriage, “excepting Mrs Isabella Stirling now Donaldson” (the third party), equally among them, share and share alike, and to Mrs Donaldson “the sum of £10.”
The third party, to whom £10 only is thus apportioned, contends that “the validity of the said deed depended on all the children to whom the apportionment thereby made applied being alive at the term of vesting, and that in consequence of the said Robert Stirling's predecease the appointment as a whole became ineffectual.” I can see no reason or sense in this contention. Suppose the apportionment to Mrs Donaldson had been, as it lawfully might, of the whole fund “except the sum of £10,” and that £10 had been apportioned to the children “excepting Mrs Donaldson,” the corresponding contention that the whole apportionment depended on the survivance of all the children would not have been more untenable.
An alternative argument (and the only other) for the third party is stated in the case thus—“Alternatively she maintains that in any view the share, being half the fund less £10, appointed to Robert Stirling by said deed of appointment must be treated as unappointed, and falls by virtue of the marriage-contract to be divided equally between her and the second party.” Assuming the meaning of this to be that the apportionment is good in so far as it apportions the sum of £10 to the third party, but bad in so far as it apportions the fund, “except the sum of £10,“ to the children of the first marriage, excepting Mrs Isabella Stirling, now Donaldson (the third party), I think it is inconsistent with the plain—I should say very plain—import and meaning of the testator's language, because
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I have perhaps failed to comprehend the idea intended to be expressed by the words —“The share, being half the fund less £10, appointed to Robert Stirling by said deed of appointment must be treated as unappointed, and falls by virtue of the marriage-contract to be divided equally between her (the third party) and the second party.” The language is, I think, obviously erroneous. If Robert survived the period of vesting, whether by the contract alone, or by it and the deed of apportionment taken together, his share, whatever it is, now belongs one-half to his widow (the fourth party), and the other to the second and third parties as his next-of-kin. But as he clearly (and indeed by the second and third parties admittedly) did not, he had no share to go to anybody any more than if he had predeceased his father as well as his stepmother, or indeed had never been born. No doubt if he never existed, or having existed predeceased the term of vesting, the surviving children will benefit by the diminution of the divisor, but to speak of the division or apportionment of his share is erroneous and misleading language. The result is, that if the third party is not well excluded from the division and participation of the bequeathed fund (minus the £10 which she clearly enough takes), she is entitled to share it equally with the second party, and consequently to take out of the bequest £10 more than the second party does.
2. The objection stated to the validity of the apportionment, that it contained provisions ultra vires of the maker of it, does not seem to be sound. The provisions objected to never became operative, seeing that the persons in whose favour they were conceived never existed, and those provisions never interfered with what was lawfully done within the power. This view is in accordance with what was settled by the cases of Wright's Trustees (21 R. 568) and Macdonald 2 R. (H.L.) 125.
3. The third question put to us relates to the effect of the deed of apportionment. By it Mr Stirling apportioned £10 to his daughter Mrs Donaldson, and the remainder of the estate “to the children of the marriage between me the said John Stirling and the said Flora MIntosh or Stirling … equally among them, share and share alike.” When that deed was executed Mr Stirling had three children of his first marriage, who survived him, viz., Robert, James, and Mrs Donaldson. The apportionment, therefore, according to its terms which I have quoted, allotted £10 to Mrs Donaldson, and equal shares of the balance to each of the two sons. To each son, however, it only gives a share, it makes no provision for the case which has happened of one of the sons not surviving and taking his share. Mr Stirling could of
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Secondly, the apportionment of the provisions in favour of the children of the first marriage is effectual so far as it goes, that is, Mrs Donaldson is clearly entitled to £10, and James Stirling to one-half of the balance of the fund.
The third question, viz., how is the share destined to Robert Stirling to be disposed of, is more difficult. Does it go by accretion to James, or does it fall to be divided as unappointed between James Stirling and Mrs Donaldson, the survivors of the first family, in terms of the antenuptial marriage-contract?
The law is settled that, where a legacy is given to a plurality of persons named or sufficiently described tor identification, “equally among them” or “share and share alike,” there is (in the absence of expressions by the testator importing a contrary intention) no room for accretion. Now, here, although James and Robert are not named in the deed of appointment, they are sufficiently described for identification as the children of the first marriage, excepting Mrs Donaldson, as there were only three children of that marriage and could be no more. Therefore it is just as if the provision had run “to my sons Robert and James Stirling equally among them, share and share alike.”
The doubt which I have felt is whether the deed does not contain expressions of intention by the testator that there should be accretion. I think it is not improbable that he intended that in any event Mrs Donaldson should not get more than £10. But he has not said so. The gift is not to Robert and James “and the survivor,” which would have put the matter beyond doubt; and it is not certain that if he had contemplated the possibility of Robert predeceasing he would not have made a larger provision for Mrs Donaldson.
In this state of matters, although the question is very narrow, I think that Mrs Donaldson is entitled to the benefit of the doubt, and that the usual rule of construction should be applied. Even in that case, James, the second party, will get nearly three-fourths out of the fund—£700 out of £942.
The Court pronounced the following interlocutor:—
“Find, in answer to the first question therein stated, that the provisions there referred to vested at the death of Mrs Euphemia Stirling: Find, in answer to the second question, that the deed of apportionment was effectual when executed, in so far as it apportioned the estate among the objects of the power, and did not lapse on the death of Robert Stirling: And find, in answer to the third question, that the fund in question which would have been taken under the deed of apportionment by Robert Stirling had he survived falls to be divided equally between the second and third parties: Find and declare accordingly, and decern.”
Counsel for the First Parties— Kinloch. Agents— Donaldson & Nisbet, Solicitors.
Counsel for the Second Party — R. S. Horne. Agent— Irvine R. Stirling, S.S.C.
Counsel for the Third Party— Wilton. Agents— Donaldson & Nisbet, Solicitors.
Counsel for the Fourth Party— A. M. Anderson. Agents— Donaldson & Nisbet, Solicitors.