Scottish Court of Session Decisions

Mrs Isabella Masson or Smellie, 62 Craiglea Drive, Edinburgh, died on 23rd August 1902 leaving a holograph will whereby she gave (1) her furniture and personal effects, and the liferent of a house and of a bond for £500, to her step-daughter Margaret Smellie; (2) the fee of the house and of the bond to the children of her step-son; and (3) £100 to each of three nieces; and, finally, provided as follows:—“Any money in banks, after paying my lawful debts, funeral expenses, &c., I give over to my step-daughter Margaret Smellie.” The will contained no further directions as to the disposal of Mrs Smellie's estate.

At the date of Mrs Smellie's will she had £30 at her credit with the Edinburgh Savings Bank. At the date of her death she had nothing at her credit with the Savings Bank. Prior and subsequent to, but not at the date of the will, Mrs Smellie had an account-current with the Union Bank of Scotland, Limited. At the date of her death there was a sum of £6 belonging to Mrs Smellie at the credit of an account-current with the Union Bank in the name of Miss Smellie. In addition to the £30 mentioned above, Mrs Smellie's estate at the date of her will consisted of a house and furniture and £800 in money.

Mrs Smellie was predeceased by her brother John Paterson Masson, who died on 21st February 1902 leaving a holograph will, whereby he bequeathed three-fourths of the residue of his estate to Mrs Smellie and the other one-fourth to his brother the Rev. Alexander Masson.

At the date of her brother's death Mrs Smellie was so ill that she could not be informed thereof, and thereafter she was never able to transact business, and she died in ignorance of his death and of her rights under his will.

The amount of Mrs Smellie's share of the estate of John Paterson Masson due to her at the date of her death was £1313, 7s. 3d. Certain payments were made therefrom by Mr Masson's executors on Mrs Smellie's behalf during her last illness, and in the course of administration of the executry estate the executors set aside a sum of £1200 towards payment of her share. As Mrs Smellie was unable to grant a receipt for this sum it was placed in bank by the agents in the executry on deposit-receipt, the receipt being in the following terms:—“Received from Messrs Hope, Todd, and Kirk, for Mrs Isabella Smellie, one thousand two hundred pounds, which is placed to their credit in deposit-receipt.”

An action of multiplepoinding was thereafter raised, in which the fund in medio consisted of the sum of £1200 referred to and certain other sums which need not be specified for the purposes of this report. Claims were lodged by (1) Miss Margaret Smellie, and (2) the Rev. Alexander Masson and others, the whole heirs in mobilibus of Mrs Smellie.

Miss Margaret Smellie claimed to be ranked and preferred as residuary legatee to the whole fund in medio, less sums due in payment of legacies, debts, &c., or alternatively “as a special legatee to the extent of £1200 and accruing interest thereon, under deduction of the deceased's debts, &c.”

The Reverend Alexander Masson and others claimed the whole balance of the fund in medio as intestate moveable succession.

On 12th June 1903 the Lord Ordinary ( Stormonth Darling) pronounced an interlocutor in the following terms:—“ Secundo loco, ranks and prefers the claimant Miss Margaret Smellie in terms of her alternative claim as a special legatee to the sum of £1200 contained in the deposit-receipt by the Bank of Scotland, dated 9th July 1902, in name of Messrs Hope, Todd, & Kirk, for Mrs Isabella Smellie, with accruing interest thereon, but under deduction of the lawful debts, funeral expenses, &c., and tertio loco, ranks and prefers the claimants the Rev. Alexander Masson and others to the balance, if any, of the fund in medio.”

Opinion.—The testatrix here made her holograph will on 25th April 1901. She died on 23rd August 1902, and in the meantime her means had largely increased through the death of a brother on 21st February 1902. The two different situations were these—at the date of her will she was owner of the house she lived in, the furniture in it, and about £800 of

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money; at the date of her death she was owner of the house and furniture and about £2100 in money. Now, the only fact which requires to be mentioned is one which is common ground between the parties, that during the interval between her brother's death and her own death she was too ill to know that she had fallen heir to this sum of money, and that in consequence of her illness the trustees of her brother were not in a position to get from her a discharge. Accordingly on 9th July 1902 the greater part of the succession was put on deposit-receipt in the Bank of Scotland in the name of the agents of her brother's executry, but the deposit-receipt bears in gremio that the money had been deposited by these gentlemen, Messrs Hope, Todd, & Kirk, for Mrs Isabella Smellie.

“Now, let us see what the will itself says. It is in the simplest terms. It gives the furniture and the testatrix's personal effects absolutely to her stepdaughter. It gives her also the liferent of the house and the interest of the largest investment which she had, namely, a bond for £500. After her death the house and bond were to go to the children of her late stepson, who, I presume, was a brother of Miss Smellie. So far she had given nothing to her own blood relations at all, but then she proceeded to give £100 to each of three nieces, and then she concluded by saying—‘Any money in banks, after paying-my lawful debts, funeral expenses, &c., I give over to my step-daughter Margaret Smellie.’ Miss Smellie was thus by much the largest beneficiary under the will. For some of her next-of-kin the testatrix made no provision at all.

Now, the first question arising under this last bequest in favour of Miss Smellie is, whether it carries the whole residue, and I am free to confess that there is a good deal to be said for the view that probably the testatrix so intended—that is to say, at the date of her will it is extremely probable, from all we know of her affairs, that she had no residue except the money lying in bank out of which her lawful debts, funeral expenses, and so on could conveniently be paid; and accordingly it looks as if she meant that, after paying these necessary outlays, the residue of her estate was all to go to Miss Smellie. And if the substantive which she used had been a generic one and not specific, I think I should have been inclined to sustain this as equivalent to a gift of residue. But then the substantive is not generic—it is controlled by the words “in banks”—and that being so, it seems impossible, on any reasonable canon of construction, to hold that it includes any money or any property which is not in bank. The amount of money in this position is small, but so far as it goes I think the conclusion must be that it is intestate succession and must go to the next of kin.

Next there arises the question whether the words are apt to include the deposit-receipt for £1200. There I think Miss Smellie is undoubtedly right. It is said against her that the testatrix had not this money in view either when she made her will or when she died, because she died as I have said without ever being in a condition to learn of the succession. That does not seem to me to be a consideration which can affect the construction of the will. We cannot speculate as to what this lady would have done had she known of her succession, and we can only gather from the words which she has actually used what is to be done with it. Now, so far as can be gathered from the general conception of the will, the presumption is that if the testatrix had known of this windfall she would have desired Miss Smellie to get the benefit of it. But really that is all in the region of speculation. The sole question is what the words are fit to cover, and there the only objection to Miss Smellie's claim is that this money—although the old lady was the sole beneficiary—was not hers in the sense that she had at the moment a title to it. My answer to that is, that a testatrix making her will does not concern herself with questions of title—she deals with the property to which she has right, or believes herself to have right, which is available for her debts, and the balance of which she believes herself free to dispose of as she pleases. Now this money satisfies all that. It stood in the bank, not indeed in her name but for her behoof. The trust was constituted by the very document which formed the title to the money, namely, the deposit-receipt; and Messrs Hope, Todd, & Kirk, although possessing the legal title, possessed it in the character of trustees for the testatrix. When a testatrix uses about property in that position a phrase like the present, one must not make too curious inquiries as to the process by which she or her executors could reduce the money to possession. The question is one of right, and it is enough that she, and she alone, had the right to this money.

It seems to me clear that this £1200 and accruing interest is covered by the words ‘any money in banks.’ I shall therefore sustain the alternative claim for Miss Smellie.”

The claimants, the Reverend Alexander Masson and others, reclaimed and argued—The bequest of “money in banks” covered only sums with regard to which the relationship of debtor and creditor existed between the testatrix and a bank. What was done with the £1200 in question by Mr Masson's executors in the course of administration of his estate could not affect the character of that sum for the purposes of the will of the testatrix.— Macfarlane v. Greig, February 26, 1895, 22 R. 405, Lord M'Laren at p. 409, 32 S.L.R. 299; Campbell v. Grant, December 1, 1869, 8 Macph. 227, 7 S.L.R. 133. The testatrix could not have uplifted the sum in question. She died in ignorance of its existence, and could not be said to have expressed any intention with regard to it. This sum therefore fell into intestacy.

Argued for the claimant and respondent Miss Margaret Smellie—At the date of the death of the testatrix, which was the date from which her will spoke, the

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sum in question was “in bank”; it was deposited “for” her; though not in her name, she could have assigned it, or her creditors could have arrested it. The deposit-receipt was earmarked, and under it the testatrix could have recovered from the bank; the sum deposited was therefore carried by the bequest of “money in banks.”

At advising—