Scottish Court of Session Decisions

James Dick, gutta-percha boot and shoe manufacturer, Glasgow, died on March 7, 1902, leaving a trust-disposition and settlement dated March 4, and registered in the Books of Council and Session March 11, 1902, whereby he conveyed to William Robertson Copland, civil engineer, Glasgow, and others, as trustees thereunder, his whole means and estate for the purposes therein specified. The provisions of the deed so far as necessary are quoted supra in rubric. The testator had also executed settlements in 1891, 1899, and 1901, which had not been destroyed, and there was no clause in the trust-disposition and settlement of 1902 revoking prior settlements.

Doubts having arisen as to the validity and effect of the testator's testamentary writings the trustees acting under the settlement of 1902 brought a multiplepoinding in which they themselves claimed. The truster's heirs in mobilibus lodged claims, and the various sets of trustees under the prior settlements executed by the truster also lodged claims. The two questions at issue were (1) whether the bequest of residue in the settlement of 1902 was void from uncertainty, and (2) whether the settlement of 1902 revoked the prior settlements, or were these in whole or in part, as might be, to be given effect to.

The facts appear from the opinion ( infra) of the Lord Ordinary ( Dundas), who on July 28, 1906, pronounced an interlocutor finding (1) that the bequest of residue contained in the trust-disposition and settlement dated March 4, 1902, was not void from uncertainty; (2) that the said settlement operated as a revocation of the prior settlements executed by the truster.

Opinion.—“The fund in medio in this action of multiplepoinding is the residue of the estate left by the late James Dick, gutta-percha boot and shoe manufacturer in Glasgow, falling under the directions for disposal of residue contained in his trust-disposition and settlement, dated 4th, and registered in the Books of Council and Session 11th, both days of March 1902. Mr Dick died on 7th March 1902. He was a wealthy man, and the residue in question amounts to over £600,000. The main question for decision is whether or not the bequest of residue contained in the said settlement is void from uncertainty. The testator's heirs ab intestato contend in the affirmative, while the validity of the bequest is maintained by the trustees appointed by and acting under the settlement. I have arrived, without much difficulty, at the conclusion that the bequest of residue is not void from uncertainty. The principal points urged by the next-of-kin were—(1) That no sufficiently defined class of objects of the testator's bounty had been prescribed by him; (2) that the persons who might make selections among such objects are not indicated with sufficient precision; and (3) that the testator has not appointed any limit whatever of time within which the estate is to be realised or distributed. I shall deal with these points in their order.

1. In my opinion the keynote is struck by the testator where, ‘in the last place,’ he narrates his belief that he would be carrying out, not only his own wishes, but those which inspired his late brother, in bestowing the residue of his estate in the form of donations and bequests ‘of a benevolent and charitable character.’ It is legitimate, I think, to observe that similar words occur in each of his prior settlements, to which I shall afterwards refer, dated in 1891, 1899, and 1901 respectively. Now, if Mr Dick had simply left it to his trustees to distribute the residue amongst such institutions or purposes ‘of a benevolent and charitable character’ as they might think proper, it would, I think, have been clear upon authority that the bequest was valid. Thus, for example, in Hill, 1826, 2 W. & S. 180, the words used were ‘institutions for charitable and benevolent purposes;’ in Miller, 1837, 2 S. & M. 866, ‘such benevolent and charitable purposes as they think proper;’ in Cobb, 1894, 21 R. 638, ‘such useful, benevolent, and charitable institutions,’ &c.; and in Blair, 1901, 4 Fr. (H.L.) 1, Lord Shand alluded to ‘charitable and benevolent purposes’ as ‘objects of peculiar favour in the law both of Scotland and England.’ But the testator, after the above narrative, proceeds with his bequest. He begins by leaving specific legacies, ‘payable at such times as my trustees may find it convenient,’ to named institutions, nearly all in Glasgow. He goes on to direct his trustees—I quote merely the words descriptive

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of the objects of his bounty—to pay over or divide the residue ‘to or amongst such local or Scottish charitable institutions and schemes already constituted, or which may hereafter be constituted (and which may include these hereinbefore named), as they may select, or any one or more of such institutions and schemes, and that at such time, in such manner, and in such proportions, all as they in their absolute discretion may deem proper.’ I reject as palpably untenable the argument of the next-of-kin that the word ‘charitable’ must be read in connection only with ‘Scottish,’ and not with ‘local.’ In my judgment the meaning is just as if the truster had said ‘such charitable institutions and schemes, local or throughout Scotland.’ I think that ‘local’ may fairly be held as equivalent to the words which occurred in Hill's case ( cit. sup.), ‘in the city of Glasgow or neighbourhood thereof.’ The extension to ‘Scottish’ institutions and schemes is not, in my opinion, so wide as to involve uncertainty. In several of the cases a bequest was held good though there was no limitation of area at all, e.g., Kelland, 1863, 2 Macph. 150; Crichton, 1828, 3 W. & S. 329; Dundas, 1837, 15 S. 427. Then, counsel for the next-of-kin founded upon the words ‘constituted or which may hereafter be constituted,’ but these appear to be exactly equivalent to the words in Hill's case, ‘established or to be established.’ I do not think that it can be said that this bequest of residue fails from uncertainty as to the class of ‘benevolent and charitable’ objects among which a selection may be made. There is no need to enter into an elaborate analysis of the numerous cases upon this branch of the law. At the root of them all lies, I think, the doctrine expressed by Lord Lyndhurst in an often-quoted passage in his judgment in Crichton's case ( sup. cit. at pp. 338–9). His Lordship there states the question, ‘Whether it is competent for the disposer, by a deed of this description, to point out particular classes of persons and objects which are intended to be objects of his favour, and then to leave it to an individual, or a body of individuals, after his death, to select out of those classes the particular individuals or the particular objects to whom the bounty of the testator shall be applied?’ His answer is, ‘I apprehend that, according to the authorities in the law of Scotland, it is quite clear a party has this power.’ It is settled law that charitable purposes form a particular class in this conjunction. The cases to which I have referred—and there are many others — afford examples of the latitude with which the scope of this class may be expressed. Perhaps the best illustration is seen in the case of Dundas ( sup. cit.), where a holograph will was sustained which was couched in these brief and simple terms:—‘Any money left after paying all expenses I wish may be laid out on charities. I leave and bequeath to A B £200, with power to see this will executed.’ The cases in which a charitable bequest has been held void from uncertainty have been those in which the word ‘charitable’ was coupled disjunctively with some adjective so vague and indeterminate as to leave the trustees absolutely unfettered, and without instruction or direction as to the disposal of the estate, e.g., ‘public’ ( Blair, sup. cit.), or ‘religious’ ( Grimond's Trustees, 1904, 6 Fr. 285, rev. 1905, 7 Fr. (H.L.) 90; Shaw's Trustees, 1905, 8 Fr. 52). In the present case no difficulty of that sort appears to arise. I am therefore of opinion that the first of the objections stated by the next-of-kin cannot be sustained.

2. The second objection is to the effect that the truster has failed to indicate with sufficient precision the persons by whom the selection of beneficiaries is to be made within the class, assuming the latter to be properly designated. In my opinion this objection is quite groundless. The truster by his settlement conveys his whole estate to the trustees whom he names, ‘and to any other person or persons whom I may hereafter nominate and appoint, or who may be assumed into the trust hereby created, and to the acceptors and survivors, acceptor and survivor of them … and to the heir of the longest liver of them.’ In the residue clause the direction is addressed to ‘my trustees, original or assumed or otherwise appointed.’ There are admittedly at present trustees accepting and acting in the trust. But the next-of-kin maintain that the sentences which I have quoted are uncertain and inept, because the trustees, original and assumed, may die out, and a trustee or trustees may come to be ‘otherwise appointed,’ i.e., by the Court. Assuming all these events to have occurred, I am unable to appreciate the force of the argument. It seems to me that Mr Dick has provided perfectly sufficient machinery for the carrying out of his trust. Counsel for the next-of-kin founded upon the case of Robbie's Judicial Factor, 1893, 20 R. 358; but that case does not, in my judgment, help them in the least. All that it decided was, as I understand, that a judicial factor, who is a nominee and officer of the Court, cannot exercise discretionary powers conferred by a truster upon executors or trustees whom he has himself named or indicated. The dicta in the case seem to be adverse to, and not in favour of, the argument now under consideration.

3. If my opinion in regard to the two questions with which I have now dealt is well founded, it appears to me to be a matter of subsidiary importance that the truster has given to his trustees wider powers than are usual as to the realisation and distribution of his estate. In many of the cases to which I have referred ( e.g., Dundas, sup. cit.) there was no limit of time imposed on the trustees at all, and in others ( e.g., Hill) a very wide, if not absolute, discretion was accorded to them. Moreover, there are manifest reasons why Mr Dick should have wished his trustees to have the greatest possible freedom as to time. He had executed, of even date with his settlement, a deed of arrangement regarding the business of R. & J. Dick, which is referred to in the settlement, and which

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bears hi gremio that it ‘shall form part the settlement of my affairs, as if the said arrangement had been embodied in my trust-disposition and settlement.’ A similar document had, it appears, been prepared in relation to his settlements of 1901 and 1899 respectively, while by the settlement of 1891 the trustees were empowered to make a provisional arrangement and agreement with his employees of a somewhat similar character. The scheme of the arrangement is to give certain of Mr Dick's employees, after his death, a prospective interest in his business, and elaborate provision, to which I need not refer in detail, is made for the gradual paying out of his capital. In certain events the trustees are empowered to wind up the business. It appears that nearly £300,000 of capital is at present locked up in this way, and it will probably be a long time before it becomes available for the purposes of Mr Dick's settlement. There is also I am told a large part of the residue of his estate which stands upon investment not capable of rapid realisation in the interests of the estate. These facts must I think be kept in view in considering the powers conferred by Mr Dick upon his trustees. They are directed to realise and convert into money the whole residue, ‘but that always at such time or times, and from time to time, as they may think proper, and always having special regard to’ the arrangement above referred to ‘and to the provisions hereinafter mentioned as to the realisation of my investments, shares, stock, and other assets,’ and later on ‘at any time or times, or from time to time as and when the said residue, or any part thereof, becomes available as they may deem proper, to pay over or divide the said residue or any part or parts thereof to … and that at such time, in such manner, or in such proportions, all as they in their absolute discretion may deem proper.’ I do not think that in the circumstances of this estate these directions are so remarkable as to call for comment. It is true, however, that further on in his settlement the truster confers powers of unusual latitude upon his trustees. Thus he gives them ‘the fullest powers of and in regard to realisation, investment, administration, management, and division, as if they were beneficial owners.’ He declares ‘that the time, manner, and propriety of selling and disposing of my means and estate, both heritable and moveable, shall be entirely at the discretion of my said trustees,’ and the trustees are authorised to retain existing investments ‘for such time or times as they may think fit or indefinitely.’ Wide, however, as these powers undoubtedly are, I am unable to see that their latitude ought to lead me to declare the bequest of residue void from uncertainty. The trustees are in the saddle, and there is, if the views which I have expressed are sound, a field of practical work open to them in regard to the residue. Of course any discretionary power may be abused. But this Court has, I apprehend, power to restrain abuses in the administration of trusts, even where wide discretion is conferred upon the trustees by their trust deed— Pemsel, 1891, A.C. 531–560; Hill, 2 W. & S. 80–91; Cobb, 1894, 21 R. 638–640. In my opinion, therefore, the arguments for the next-of-kin must fail, and I shall find that the bequest of this residue is not void from uncertainty.

Another question then arises which requires to be dealt with. Mr Dick, as I have already mentioned, left three prior settlements, dated respectively in 1891, 1899, and 1901. It is contended by certain of the claimants that these, not having been expressly revoked by the truster, are valid, and must be read along with, and as supplementary of, the settlement of 1902. The chief practical importance of the contention is that, if it is sound, there might be claims for more than one legacy in the case of a good many of the legatees. My opinion is adverse to this argument. Each of the settlements disposes of the universitas of Mr Dick's estate; they are all, roughly speaking, similar in general scope and purpose, and all contain legacies to relatives, friends, employees, &c., of the truster, rising higher and higher in aggregate amount as his wealth increased. Now, I think that, unless a contrary intention is evinced, the presumption must be that the latest of these universal settlements impliedly revokes the others. I am not aware of any case where two or more than two settlements were sustained as valid, both or all of which conveyed and disposed of the universitas. In Bertram's Trustees, 1888, 15 R. 572, the Lord Justice-Clerk observed that ‘it is an established rule that, unless there are some elements to the contrary, the second universal settlement revokes the first. They cannot both stand — see Sibbald's Trustees, 1871, 9 Macph. 399; Beattie, 1861, 23 D. 1163; M'Laren (3rd ed.), vol. i., p. 412 and p. 724. Here, moreover, I think that one sees indications in the language of the settlement of 1902 that the truster meant it to be the sole expression of his testamentary intentions. The declaration that the whole legacies, &c., ‘hereinbefore’ bequeathed, or which might ‘hereafter’ be bequeathed by him, should be free of Government duties, seems to point in that direction. So also I think does the declaration that the legacies ‘hereinbefore’ bequeathed are in addition to any donations or benefits which he had already given or might thereafter give to the parties benefited. Both declarations ignore the existence of any prior and subsisting testamentary writing. Lastly, I was informed from the Bar that the total amount of all the legacies contained in all the four settlements would considerably exceed that of the residue of Mr Dick's estate. I am therefore of opinion that the settlement of 1902 is the only subsisting testamentary writing of the truster.

I understood that the parties desired no more at this stage than findings upon the points which were argued to me, and these I shall accordingly make. Leave to reclaim will be granted.”

The next-of-kin and the trustees under the settlements of 1891, 1899, and 1901, reclaimed.

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Argued for the truster's next-of-kin—The provisions as to residue in the deceased's settlement of 1902 were void on account of uncertainty. No point of time was indicated when the trustees could be compelled to pay. They might never decide that the time of payment had come, nor could they be called to account. Their powers were too full, and in this the settlement fell short of what by law was required— Hill, &c. v. Burns, &c., April 14, 1826, 2 W. & S. 80, Lord Gifford, at p. 90. This power of delaying payment possessed by them was enlarged by their power to assume new trustees. Such assumed trustees would have no connection with the testator, still less would trustees “otherwise appointed.” A judicial factor could not exercise a discretion conferred by a testator— Bobbie's Judicial Factor v. Macrae, February 4, 1893, 20 R. 358, 30 S.L.R. 411. Further, the class indicated' in the settlement was too wide— Shaw's Trustees v. Esson's Trustees, November 2, 1905, 8 F. 52, Lord Stormonth Darling, at p. 54, 43 S. L.R. 21; Blair v. Duncan, December 17, 1901, 4 F. (H.L.) 1, 39 S.L.R. 212: Grimond or Macintyre v. Grimond's Trustees, March 6, 1905, 7 F (HL) 90, 42 S.L.R. 466. The bequest in question was equivalent to giving over the estate to the will of another, and so was not the will of the truster. It did not divest the next-of-kin by constituting valid beneficial rights in favour of third parties — M'Caig v. University of Glasgow, December 18, 1906, 1907 SC 231, Lord Kyllachy at p. 242, 44 S.L.R. 198. The bequest was therefore void and the Lord Ordinary's interlocutor should be recalled.

Argued for the trustees under the truster's prior settlements of 1891, 1899, and 1901—If the settlement of 1902 were in any part void, then those prior to it took effect to that extent— Kirkpatrick's Trustees v. Kirkpatrick, June 23, 1874, 1 R. (H.L.) 37, 11 S.L.R. 717; Richmond's Trustees v. Winton, &c., November 25, 1864, 3 Macph. 96. But even though it should be held not to be in any part void, the prior settlements fell, so far as might be, to be given effect to. The Lord Ordinary was wrong in holding that the settlement of 1902 was a disposition of the universitas of the truster's estate. The four settlements stood together, none revoking the other, but being practically the same will as to residue.

Argued for the pursuers and respondents, the trustees under the settlement of 1902—The bequest of residue was valid. It clearly conferred power on the trustees to distribute the fund among charities, and that was a valid testamentary act— Dundas v. Dundas, January 27, 1837, 15 S. 427. In Scotland “charitable purposes” were a sufficiently indicated class from which to select, apart from statute which favoured them in England— Crichton v. Grierson, July 25, 1828, 3 W. & S. 329, Lord Lyndhurst, p. 338; M'Lean v. Henderson's Trustees, February 24, 1880, 7 R. 601, 17 S.L.R. 457. As to the alleged uncertainty since assumed trustees might eventually administer the trust, Robbie's Judicial Factor v. Macrae, cit. sup., was not in point, since there the factor was appointed by the Court, and the Court would not exercise a discretionary power conferred on trustees if the trust lapsed— Dick v. Ferguson, 1758, M. 7446. As to the alleged uncertainty in the object, the words “Scottish or local” were limiting words, and as such had no urgent need of clearness— Blair v. Duncan, ut supra, Lord Davey, at p. 3. The construction of such words fell to the trustees — Cobb v. Cobb's Trustees, March 9, 1894, 21 R. 638, 31 S.L.R. 506. As to the alleged uncertainty in time, great latitude was necessarily left to the trustees in realising this truster's estate, which from its nature involved a lengthy period for realisation. If there was maladministration, the Court could call the trustees to account— Commissioners for Special Purposes of Income Tax v. Pemsel, [1891] AC 531, Lord Watson, at p. 560; and Cobb v. Cobb's Trustees, ut supra. Similar bequests had been held valid— Miller and Others v. Black's Trustees, July 14, 1837, 2 S. & M. 866; Hill and Others v. Burn and Others, ut supra; and Kelland, &c. v. Douglas, &c., November 28, 1863, 2 Macph. 150. The interlocutor of the Lord Ordinary should be affirmed.