Scottish Court of Session Decisions

The following declaration of trust was, on 10th May 1854, addressed by Miss Janet Thomson and Miss Marion Thomson to their three brothers William, Peter, and Richard Thomson “ Dear Brothers,—We, Janet and Marion Thomson, residing in Forres, considering that you have purchased, partly with your own funds, 235 shares of the capital stock of the Caledonian Banking Company of Inverness, and registered in the said Company's books, Nos. 932, 933, 935, and 941, and that although you have entered and vested the said stock in our names jointly, and the survivor of us, and the executors, administrators, and assignees of us, excluding the jus mariti of any husband we or either of us may marry, we nevertheless hereby declare that the said stock is so vested in our names, and held by us in trust, for the following purposes:—In the first place, to apply and pay the dividends and profits arising from said stock annually to our father and mother, and the survivor of them, in liferent, during all the days of their, his, or her lifetime, but for their, his, or her liferent use allenarly. Secondly, after the death of our father and mother, to hold the dividends and profits for our own behoof, jointly, during our joint lives, and for the survivor of us while we remain unmarried, but in the event of either of us marrying, the other shall be entitled to the liferent of the whole, and in the event of both of us marrying, then we shall again be entitled to a joint liferent, and to the survivor of us, as aforesaid; subject to which liferents the fee of said stock shall fall and belong, one-half to the lawful children of me the said Janet Thomson, and the other half to the children of me the said Marion Thomson, share and share alike, but with a power of apportionment among our children respectively, as we may think proper; and failing our having children, the fee of said stock shall fall and belong to you, our brothers, equally, or the survivor of you, but it is expressly declared that the jus mariti and right of administration of any husband we may marry is expressly excluded, and that the liferents in our favour are purely alimentary; and it is further expressly provided and declared that neither we jointly, nor the survivor of us, shall have any right or title to sell or otherwise dispose of said stock during our lives, unless with the written consent of you, our brothers, or the survivors or survivor or the majority of you which all survive, previously obtained,” &c.

The number of shares actually bought and registered in the name of the Misses Thomson was 230. The trust came into operation at the date of the declaration, and the dividends on the shares were paid to Mr and Mrs Thomson, the parents of the parties, during their lives. On the death of the survivor, Janet and Marion Thomson liferented the shares jointly, and on the death of Marion on June 8, 1891, Janet obtained a transfer of the shares into her own name, and enjoyed the liferent till her death on June 18, 1897.

Both sisters died unmarried. They left settlements dated April 15, 1899, in which they directed their executors to convey the shares to the person or persons legally entitled thereto, in accordance with the terms of the declaration of trust.

William Thomson died in August 1855 intestate. He was survived by a widow but left no children.

Page: 487↓

Richard Thomson died on 12th March 1873 without issue, leaving a widow to whom he bequeathed his whole estate.

Peter Thomson died on 3rd June 1875, leaving a last will and testament executed in 1852, by which he provided that in the event, which happened, of his leaving no family, one-third of his estate was to go to his widow, and the remaining two-thirds should be liferented by his unmarried sisters Janet and Marion Thomson, and that after their death the capital should be divided as follows—one-seventh to his brother William, whom failing to his lawful issue or their descendants; one-seventh to his married sister Mrs Hamblin, whom failing to her lawful issue or their descendants; and the residue to his brother Richard, whom failing to his issue. In consequence of the failure of the executors named in this will Mr Peter Gardner, W.S., was appointed judicial factor on his estate. Mrs Hamblin died leaving three children, one of whom assigned his interest in Peter Thomson's estate.

The widow of Peter Thomson on his death claimed her legal rights, and the judicial factor made over to her her one-half of the estate, and received her discharge, from which she excepted such portions of the estate as were not then realised. After her death her sister Mrs Bain, as surviving residuary legatee, became entitled to the sole interest in Mrs Peter Thomson's estate.

After the death of Miss Janet Thomson, the last survivor of the sisters and brothers who had executed the declaration of trust, a special case was presented to the Court by (1) the judicial factor on Peter Thomson's trust estate; (2) two of the children and the assignee of the third child of Mrs Hamblin; (3) the executors of Janet and Marion Thomson; (4) Mrs Bain, the residuary legatee of Mrs Peter Thomson; (5) the widow of Richard Thomson; (6) The widow of William Thomson; and (7) the executors of William Thomson. The parties agreed that for the purposes of the ease each of the parties to the declaration of trust should be held to have contributed one-fifth of the purchase price of the shares.

The following were the contentions of the parties as set out in the case—“(7) … The judicial factor on Peter Thomson's estate, the party of the first part, claims the shares on the ground that Peter Thomson was the last survivor of the three brothers, and that by the terms of the declaration of trust the fee of the stock was vested in him and forms part of his estate falling to be administered by the judicial factor. The second parties concur in this claim, and Mrs Bain, the party of the fourth part, also concurs in it. (8) Mrs Richard Thomson, the party of the fifth part, maintains that she is entitled to one-fifth of the value of the bank shares in right of her husband, the late Richard Thomson, on the ground that although no interest in the shares vested in her husband, yet as the purposes of the trust failed, the radical right in the trusters revived, and that accordingly to the extent of one-fifth of said shares it falls into the estate of her husband and is carried to her by his settlement. (9) Mrs William Thomson, the sixth party, claims as the widow of William Thomson to the extent of one-half of one-fifth share of the value of the said bank shares, on the same grounds as the party of the fifth part. By the law of Jamaica the widow of a husband dying intestate is entitled to one-half of his moveable estate. (10) The executors of Janet and Marion Thomson, parties of the third part, claim that they are entitled to the whole fund equally between them on the ground that it must be held that the shares were purchased for the two sisters, and became their absolute property, that the sisters, as absolute fiars, created the said trust, and that the trust having failed, the shares reverted to the sisters as the original fiars and trusters, and were carried by their settlements to their executors, to the exclusion of their brothers' representatives. Alternatively, the executors maintain that they are entitled to two-fifths of the value of the bank shares on the same grounds as the party of the fifth part.”

The parties submitted the following questions of law:—“(1) Whether the said 230 shares of the Caledonian Banking Company now belong to the first party as judicial factor on the estate of the late Peter Thomson? or (2) Whether the said shares belong to the first party, the fifth party, and the sixth and seventh parties, each to the extent of one-fifth thereof, and to the third parties to the extent of two-fifths thereof? or “(3) Whether the said shares belong to the third parties?”

The following cases were cited in support of the contentions of the parties— Begg's Trustees v. Reid, January 31, 1899, 1 F. 498; Gumming's Trustees v. Anderson, November 15, 1895, 23 R. 94; Steel's Trustees v. Steel, December 12, 1886, 16 R. 204; Taylor v. Gilbert's Trustees, July 12, 1878, 5 R. (H.L.) 217; Duncan's Trustees and Others, July 17, 1877, 4 R. 1093; Maitland's Trustees v. Macdermaid, March 15, 1861, 23 D. 732; Newton v. Thomson, January 27, 1849, 11 D. 452: White v. Baker, 29 L. J. Ch. 477.