Scottish Court of Session Decisions

Mrs Margaret Mary Gratia Borland or Lees and others, trustees and executors of John Borland senior, first parties; Mrs Isabella Thom or Borland, widow of John Borland junior, only son of John Borland senior, as executrix-dative of her husband, second party; Mrs Borland as an individual, third party; Mrs Lees, who was the daughter of JohnBorland senior, as an individual, fourth party; Mrs Marion Wilson Hood Borland or Currie, and Mrs Agnes Margaret Elizabeth Borland or Aiton, the daughters of John Borland junior, with consents, fifth parties; and John Borland, only son of John Borland junior, sixth party, brought a Special Case for the determination of questions as to which of the subjects forming part of John Borland senior's trust estate were liable to the third party's jus relictæ.

John Borland senior died on 10th July 1900 leaving a trust-disposition and settlement dated 19th October 1896, which after conveying his whole means and estate to trustees, directing the payment at his death of a legacy of £500 to the fourth party, making bequests of furniture to various persons, and giving his wife the liferent of the residue of his estate, provided—“In the eighth place, upon the deathof the survivor of me and my said spouse I direct my trustees to transfer and convey over the house in London Road, Kilmarnock, belonging to me, and known as Navarra, to my daughter the said Mrs Margaret Mary Gratia Borland or Lees, and in addition thereto to transfer and convey over to her such portions of my estate not otherwise disposed of as they shall consider proper, amounting in value to the sum of six thousand pounds sterling (over and above the specific and pecuniary legacies hereinbefore bequeathed to her) according to values to be put thereon by my said trustees or by any competent valuator to be named by them, including in said sum the principal sum of three thousand two hundred pounds contained in and due by a bond and disposition in security held by me for that amount over property in Glasgow belonging to her husband the said Dr Robert Cowan Lees, dated fourteenth and recorded in Division of the Register of Sasines applicable to the County and Regality of Glasgow sixteenth May Eighteen hundred and ninety-four, or otherwise to realise and convert into cash such portion of my means and estate as will, along with the principal sum contained in the said bond, make up the foresaid sum of Six thousand pounds sterling, which sum so to be realised my said trustees shall accordingly pay over to her. In the ninth place, on the death of the survivor of me and my said spouse I further direct my trustees to dispone and convey to my said son John Borland junior the dwelling-house, offices, garden, and pertinents called Etruria, presently occupied by me in Portland Terrace, Kilmarnock, and also the whole heritable subjects belonging to me in King Street and Sandbed Street, Kilmarnock, or between these said streets, with the whole fittings, fixtures, and pertinents thereto belonging, and likewise the whole free residue and remainder of my said means and estate.… And 1 empower my trustees in the execution of the offices of trust and executry hereby committed to them to make up and complete titles in their persons in due and competent form to the means and estate hereby conveyed to them; to sell either publicly or privately the trust subjects or portions thereof; to invest, call up, and re invest the trust funds in such way and manner and upon such securities as they may approve of. …”

In a codicil dated 15th January 1900 he further provided—“As I do not consider the amount of money which I have bequeathed to my daughter, now Mrs Cowan Lees, sufficient, I hereby bequeath to her an additional sum of two thousand pounds to be paid to her out of my estate on the decease of me and my wife.”

The Special Case set forth—“(1) John Borland senior … left estates, heritable and moveable, of the approximate value of £21,000. Part thereof consisted of lands in the province of Manitoba, Canada, as after mentioned, which were held by the truster in fee simple, and on 23rd February 1901 probate of the said trust-disposition and settlement and administration of all and

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singular the estate and effects, rights and credits of the deceased in any way concerning the same was granted by the Surrogate Court of the Eastern Judicial District of the Province of Manitoba to the deceased's executors. The grant of probate was registered in the Land Titles Office for Morden, Manitoba, on 14th March 1901. … (3) The said John Borland senior was survived by his widow Mrs Agnes Hood Borland, who died on 25th July 1915, a daughter Mrs Margaret Mary Gratia Borland or Lees, the fourth party (who is also the executrix and general disponee under the will of the said Mrs Agnes Hood Borland), and a son, the said John Borland junior. The said John Borland junior died intestate on 29th September 1904 (thus surviving his father the testator, and predeceasing his mother the liferentrix). He left estate of considerable value apart from his interest in the succession to his father under the said ninth trust purpose. He was survived by a widow Mrs Isabella Thom or Borland, the third party, and three children, viz., the said Mrs Marion Wilson Hood Borland or Currie, and the said Mrs Agnes Margaret Elizabeth Borland or Aiton, the fifth parties, and the said John Borland, who was born on 12th October 1901. (4) The items of the estate of the said John Borland senior as at the date of his death on 10th July 1900 (including therein the sum of £8000 bequeathed to the fourth party and the specific bequests of furniture), which remained in the hands of his trustees, after deduction of charges against capital, and after satisfying the legacies directed to be transferred and paid at the death, were as follows:—

1. 99 ordinary and 80 preference shares, each £10 fully paid of Glenfield & Kennedy, Limited (of which 28 preference shares, valued at £280, being part of a second issue, were taken up by the trustees)	£1,814	0	0
2. Principal sums in Scottish bonds and dispositions in security	7,380	0	0
3. Value of Manitoban lands as ascertained on realisation	2,464	11	6
4. Value of heritable properties in Scotland at pre sent valuations	8,625	0	0
5. Furniture, valued at	272	1	0
	£20,555	12	6

As at the date of the death of the said John Borland junior, on 29th September 1904, the items of the estate (excluding furniture) in the hands of the trustees of the said John Borland senior were as follows:—

1. 99 ordinary and 80 preference shares of Glenfield & Kennedy, Limited	£1,814	0	0
2. Principal sums in Scottish bonds and dispositions in security as above	7,380	0	0
3. Additional investments in Scottish bond and disposition in security made out of proceeds of Manitoban lands sold	1,100	0	0
	£10,294	0	0
4. Value of Manitoban lands unsold …	938	8	0
5. Manitoban mortgage taken as after-mentioned in respect of lands sold	198	14	10
6. Value of heritable properties in Scotland	8,625	0	0
7. Cash, including sum on deposit receipt	288	6	0
	£20,344	8	10

(5) The said John Borland senior died infeft in the bonds and dispositions in security or assignations thereof, and heritable properties in Scotland which formed part of his estate at his death. There were no special destinations affecting the same. The said bonds and dispositions in security or assignations thereof were in favour of the said John Borland senior, and his executors or assignees whomsoever, and the titles of the said heritable properties in Scotland were in favour of himself and his heirs and assignees whomsoever. Shortly after. his death, his testamentary trustees completed their title to the said securities and heritable properties by notarial instruments in ordinary form duly recorded in the appropriate Register of Sasines, and they continued to be infeft and seised therein (with the exception of heritable securities to the extent of £1200 which were realised immediately after the death of John Borland senior) at the date of the death of the said John Borland junior.”

By a minute of amendment it was conceded—“(1) That the provisions made in favour of the deceased John Borland junior by the ninth purpose of said trust-disposition and settlement vested in John Borland junior as at the death of John Borland senior.”

The following question of law was submitted:—“(1) In calculating the amount of the third party's claim for jus relictæ, do there fall to be taken into account ( a) the sums invested in bonds and dispositions in security which belonged to the testator at his death; ( b) the sums representing the amount of bonds and dispositions in security realised by the first parties and reinvested by them in bonds and dispositions in security?”

Argued for the fifth parties—John Borland junior took the whole residue of his father's estate burdened with an obligation to pay the legacy of £8000 to his sister, the fourth party. John Borland senior had provided for the method of payment of that legacy; part was to be paid out of the bond specified. The balance might be paid by transferring specifically sufficient securities at a valuation or by realising so much of the testator's estate as was sufficient to meet the balance. The balance was primarily payable out of moveables, and only in so far as the moveables were insufficient was it necessary to have recourse to the latter alternative. But only in so far as the latter alternative was necessary was the estate converted— Buchanan v. Angus, 1862, 4 Macq. 374, per Westbury, Lord Chancellor, at p. 379; Theobald, Wills (7th edn.),

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p. 256. Quoad ultra John Borland junior was entitled to have the bonds conveyed to him in forma specifica, and therefore his right to the bonds was of the same character as the bonds themselves, and was not subject to jus relictæ—Titles to Land Consolidation (Scotland) Act 1868 (31 and 32 Vict. cap. 101), section 117. Gilligan v. Gilligan, 1891, 18 R. 387, 28 S.L.R. 172, was distinguished from the present case. Here one individual took the whole residue of the trust estate. Further, Lord Rutherfurd Clark's opinion at p. 389 was obiter, and section 3 defining “creditor” in the sense of the Act of 1868 was not quoted. Question 1 ( a) should be answered in the negative. Question 1 ( b) should also be answered in the negative; the reinvestment was a pure act of trust management and could not affect John Borland junior's succession.

Counsel for the other parties were not called upon.