Scottish Court of Session Decisions

Mrs Margaret Lietke died on the 23rd July 1906 leaving a trust-disposition and settlement dated 23rd November 1899, in the following terms—“I, Margaret Bell Graham or Lietke, wife of and residing with Andrew Alfred Lietke, do hereby assign and dispone to and in favour of the said Andrew Alfred Lietke, Robert Graham … and John Abercrombie … and such other person or persons as I may hereafter appoint, or as shall be assumed to act in the trust hereby constituted, and to the acceptors and acceptor, survivors and survivor, of them, and to the heir of the survivor (the major number accepting, surviving and resident in the United Kingdom, being always a quorum) as trustees and trustee for executing the trust hereby constituted, and to their and his assignees, all and sundry the whole means and estate, heritable and moveable, real and personal, which shall belong to me at the time of my decease, including therein all means and estate over which I may have powers of disposal by will or otherwise, and particularly, but without prejudice to said generality, the share of the estate of my late father Thomas Graham, … destined to me by his trust-disposition and settlement: … And further, I appoint my trustees, and the survivors and acceptors and survivor and acceptor of them (with quorum as aforesaid) to be my sole executors and executor, and also to be tutors and curators and tutor and curator to such of the beneficiaries under these presents, or any codicil thereto, as may be in pupillarity or minority at and after my decease: But these presents are granted in trust always for the ends, uses, and purposes following, vizt.—( First) for payment of all my just and lawful debts, and sickbed and funeral expenses; ( Second) In the event of my husband surviving me, I direct my trustees to hold, apply, pay, and convey the said share of my father's estate destined to me as aforesaid for behoof of my husband in liferent for his liferent alimentary use only, and the children of our marriage equally among them in fee, and failing issue of our marriage, I direct my trustees on the death of my said husband to hold, apply, pay, and convey said share to and for behoof of and equally between the children of my said brother Robert Graham and the children of my sister Ann Andrews Graham or Donald, wife of David Patrick Donald, engineer in Johnstone, the division being per stirpes: Declaring that the shares of my children shall become vested interests in their persons respectively at and only upon their attaining majority, and that if any of them shall predecease said period of vesting leaving issue, such issue shall succeed equally among them, if more than one, to the share their parent would have taken on survivance; ( Third) In the event of my husband surviving me, I direct my trustees to pay and convey to him in absolute property the residue of my estate, exclusive of my said share of my father's estate; and ( Fourth) In the event of my husband predeceasing me, I direct my trustees to hold, apply, pay, and convey the said share of my father's estate destined to me as aforesaid, and the residue of my estate, to and for behoof of and equally among the children of our marriage, and failing issue of our marriage, to and for behoof of and equally between the children of my said brother Robert Graham and the children of my said sister Ann Andrews Graham or Donald, the division being per stirpes: Declaring that the shares of my children shall become vested interests in their persons respectively at and only upon

Page: 258↓

their attaining majority, and that if any of them shall predecease said period of vesting leaving issue, such issue shall succeed equally among them, if more than one, to the share their parent would have taken on survivance: And I direct my trustees to apply the annual income and produce of the shares of my estate falling, or prospectively falling, to my children who may be in minority, towards their upbringing, maintenance, or education respectively, or otherwise for their behoof or advantage: And notwithstanding the foregoing liferent provision in favour of my husband and the period of vesting foresaid, I empower my trustees to apply, even during the lifetime and without the consent of my husband, so much of the fee or capital as they in their sole discretion may consider necessary or proper of the shares of my estate, or of said share of my father's estate, falling or prospectively falling to my children who may be in minority, towards their upbringing, maintenance, or education respectively, or otherwise for their behoof or advantage: Which provisions in favour of my husband and children are and shall be in full of all that he or they can claim by or through my decease in respect of courtesy, jus relicti, and legitim, or any other legal claims competent to them respectively. …”

The testatrix was predeceased by her husband and had no issue.

Two of the trustees appointed by her survived her and signed the following minute of acceptance—“We, Robert Graham, and John Abercrombie, the surviving trustees named and designed in the foregoing trust-disposition and settlement, do hereby accept the offices of trustee and executor thereby conferred on us.”

In terms of her settlement her whole estate fell to be divided into two shares, one share going to Margaret Alexander Graham, aged eleven years, the child of her brother Robert Graham, the other going to Graham Donald, aged ten years, and Andrew Patrick Donald, aged seven years, the children of her sister Mrs Ann Andrews Graham or Donald.

Certain questions having arisen as to the time, &c., of payment of these shares a special case was presented to the Court, the first parties to which were Robert Graham and John Abercrombie, the accepting and surviving trustees under Mrs Lietke's trust-disposition and settlement, the second parties being Robert Graham and David Donald, as tutors and administrators-in-law to their respective children.

The following statement is taken from the special case—“Questions have arisen between the parties hereto as to the right of the second parties to obtain payment of ( a) the shares falling to their respective children, or otherwise ( b) the income therefrom. The first parties are willing, if they can lawfully do so, to wind up said estate and pay over the same in equal shares to the second parties. The first parties are advised, however, that they cannot safely do so in respect that the office of tutor and curator conferred upon them may be held not a proper tutory or curatory, but an office inseparable from the office of trustee and executor under said settlement and minute of acceptance, and that accordingly they are bound as trustees foresaid to hold said estate until the fiars respectively attain majority. The second parties, on the other hand, maintain that they are entitled, as tutors and administrators-in-law for their respective children, to receive payment of the shares of the capital of the trust estate which vested in the beneficiaries a morte testatoris.”

The following questions were submitted to the Court—“(1) Are the first parties, having accepted the office of trustees and executors foresaid, bound to act as tutors and curators under the said trust-disposition and settlement, or to administer the estate until the beneficiaries respectively attain majority. (2) In the event of the first question being answered in the negative, are the second parties entitled, as tutors and administrators-in-law for their respective children, to immediate payment of ( a) the capital of the shares falling to their children, or ( b) of only the income of said shares? (3) In the event of the second question being answered in the negative, are the first parties bound, on the said children respectively attaining puberty, to pay over to them with the consent of the second parties ( a) the capital of said shares, or ( b) the income only of said shares?’

Argued for the first parties—Admittedly a stranger could appoint tutors and curators to pupils and minors only with regard to funds conveyed by himself, and only where there was a continuing trust— Johnston v. Johnston's Trustees, November 16, 1892, 20 R. 46, 30 S.L.R. 97; Fraser, Parent and Child, 3rd edition, p. 240; Bell's Principles, sec. 2071. Here, however, the appointment of the trustees to be tutors and curators to such of the beneficiaries as might be in pupillarity at the date of the testatrix's death, taken along with the direction to “hold,” constituted inferentially a continuing trust and a direction to retain and administer the shares of all minor beneficiaries, including the children of the brother and sister, until they attained majority. Miller's Trustees v. Miller, December 19, 1890, 18 R. 301, 28 S.L.R. 236, had no bearing on the case of minor beneficiaries. The fact that the trustees had not accepted office as tutors and curators was immaterial. They were willing so to act if ordered by the Court— Hill v. City of Glasgow Bank, October 24, 1879, 7 R. 68, at 76, 17 S.L.R. 17.

Argued for the second parties—It was plain from the settlement, construed as a whole, that the appointment of the trustees to be tutors and curators applied only to the testatrix's own children, and not to those of her brother and sister. As regarded the latter, accordingly, there was no continuing trust, and nothing to prevent immediate payment to their respective fathers, who were their legal tutors and administrators-in-law— Dumbreck v. Stevenson, 1861, 4 Macq. 86.