Scottish Court of Session Decisions

Robert Charles Brown and others, the testamentary trustees of the late James Brown of Barlay, pursuers and real raisers, brought an action of multiplepoinding and exoneration against Miss Christina Isabella Brown and others to determine questions relating to the distribution of the estate of James Brown.

The testator died domiciled in Scotland on 12th March 1912 predeceased by his wife but survived by seven children, of whom one, Oswald Stanley Brown, was killed in action on 22nd December 1915.

James Brown (the testator) left a trust-disposition and settlement, dated 5th March 1901, which conveyed to the pursuers and real raisers his whole estate, means, and effects, heritable and moveable, wherever situated, for a variety of purposes, which included in the fourth place the following:—“I leave and bequeath the whole residue of my estate, means, and effects hereby conveyed equally among all my children who shall survive me, … declaring that if any child shall predecease me leaving lawful issue such issue shall be entitled equally among them to the share which their deceased parent would have taken had he or she survived me; and I declare … that the provisions above written conceived in favour of my children shall be accepted by them in full of legitim, portion natural, bairns' part of gear, executry or others whatsoever, which they or any of them can ask or demand by or through my decease or in any other manner of way; and if any of them shall repudiate this settlement and claim their legal rights, or shall in any way prevent this settlement taking effect, then such child or children shall forfeit all right to any share of that part of my estate, means, and effects which I may dispose of by law, and they shall have right only to their respective legal provisions, and the share or shares of such child or children shall in that event accresce and belong equally to my other children or their issue.”

A codicil, dated 20th November 1901, was in the following terms:—“I direct my trustees, instead of paying and making over to my daughter Mrs Mary Brown or Gregson the share of residue of my estate, means, and effects bequeathed to her in the fourth purpose of said trust-disposition and settlement, to hold the said share and invest it in their own names for her behoof, and to pay the free income thereof to my said daughter during her life, or in their discretion to pay and apply the said income, or so much thereof as they may consider necessary for her behoof, and said income shall, if paid to my said daughter, be payable on her own receipt without the consent of her husband, and it shall be an alimentary provision and not affectable by her debts or deeds or the diligence of her creditors or by debts or deeds or diligence of the creditors of her husband: And on the death of my said daughter the share of residue retained as aforesaid, and any accumulations of income thereon in the hands of my trustees, shall be equally divided among the children of my said daughter then alive and the issue of any who may have predeceased per stirpes, and failing issue of my said daughter it shall be divided equally among my own children then alive and the issue of any who may have predeceased per stirpes.”

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The following narrative of the facts of the case is taken from the opinion of the Lord Ordinary ( Hunter):—“According to the statements made by the trustees of the settlement the truster left heritable property situated in the Argentine Republic valued at about £110,000. He also left moveable estate in the Argentine and moveable and heritable property in Scotland, the value of which was about £90,000. Mrs Gregson repudiated the provisions made in her favour by the trust-disposition and settlement and codicil of her father, and claimed her legitim out of her father's moveable estate in this country and in the Argentine. After the death of the truster testamentary proceedings were instituted in the Argentine Republic, in which it was decided by the Court that the testamentary writings were null in so far as regards the Argentine immoveable estate, and that that estate fell to be divided equally among the seven children of the truster. Mrs Gregson accordingly received one-seventh of this estate in addition to her legitim out of her father's moveable estate. In a Special Case decided on 12th November 1915 ( 1916 S.C. 97, 53 S.L.R. 80) it was held by the First Division of the Court—(1) that the election by Mrs Gregson to claim her legal rights did not involve forfeiture by her children of the provisions in their favour contained in the codicil, and (2) that the trustees were bound during the lifetime of Mrs Gregson to pay to the other children of the truster equally among them the interest accruing on Mrs Gregson's share. It is not disputed that the truster's estate other than the Argentine immoveable estate, and under deduction of the amount payable to Mrs Gregson in name of legitim, is divisible into seven parts, one-seventh share being held subject to the judgment in the said Special Case for Mrs Gregson's children. Considerable payments have been made by the trustees to the different members of the truster's family other than Mrs Gregson to account of their shares of residue.”

The fund in medio consisted of the balance of the testator's estate other than the Argentine immoveable estate, and amounted to £6474, 4s. 11d.

Miss Christina Isabella Brown and others, five of the seven children of James Brown, claimants, claimed each to be ranked and preferred upon the fund in medio for such sum as should, along with such sums as they respectively had already received to account of their respective shares of that part of James Brown's estate, the succession to which was regulated by the law of Scotland, amount to a one-seventh share of the residue of the said part of James Brown's estate. They pleaded—“(2) The claimants not being required in the circumstances condescended on to elect between their legal shares of the testator's immoveable estate in Argentina and the benefits conferred upon them under the testator's testamentary writings, they should be ranked and preferred in terms of their claim.”

George Birrell Carruthers and others, executors of Oswald Stanley Brown, claimants, claimed to be ranked and preferred on the fund in medio for such sum as would, with any sums paid to Oswald Stanley Brown by the pursuers and real raisers out of the estate under their charge, amount to an equal one-seventh share of the residue of the said estate. They pleaded—“(2) The claimants not being required in the circumstances condescended on to elect between their legal shares of the truster's immoveable estate in the Argentine and the benefits conferred upon them under the truster's testamentary writings, they should be ranked and preferred in terms of their claim. (3) The truster's trust-disposition and settlement being null and void quoad his immoveable estate situated in the Argentine Republic, his children were not put to their election as between their rights in the said estate and the benefits conferred on them in the said deed, and the funds and property which passed to the pursuers and real raisers fell to be administered and divided by them without reference to the said immoveable property. (4) The said Oswald Stanley Brown was not put to his election between his legal right in the said Argentine property and the bequest to him in the said trust-disposition and settlement, in respect that he had no power to make his said right available for the purposes of the said deed, et separatim that it was not competent for the pursuers and real raisers to acquire and administer the same in terms of that deed. (5) These claimants having no right or title to any part of the said immoveable property in the Argentine, no question of election arises quoad their claim.”

Anita Mary Angelica Latham Gregson and another, the children of Mrs Mary Brown or Gregson, claimants, claimed—“( c) That the pursuers and real raisers should be ranked and preferred to a one-seventh share of the residue of said trust estate, including a one-seventh share of the said six one-seventh shares of the Argentine immoveable property or the proceeds or value thereof, to be held by them (subject to the rights of the parties entitled to the income thereof during the lifetime of the said Mrs Mary Brown or Gregson) in trust for the children of the said Mrs Gregson who may be alive at her death, and the issue of any who may have predeceased per stirpes.” They pleaded—“(2) The children of the truster, other than Mrs Gregson, having elected to accept the provisions in their favour contained in the said trust-disposition and settlement and codicils, and having approbated the said trust-disposition and settlement and codicils, are not entitled to reprobate the same with regard to the disposal by the truster therein of the Argentine immoveable property, and the claimants are entitled to have the six one-seventh shares of said property claimed and possessed by the said children, or the proceeds or value thereof, brought into account in the division of the residue of the trust estate, or at least to have one-seventh of said six-sevenths or of the value or proceeds thereof surrendered to the trustees for administration and distribution in terms of the will. (3) The other claimants or their authors or predecessors having elected to accept the provisions in their favour under the said

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trust-disposition and settlement and relative codicils, and being able to bring into account for the purpose of distribution by the trustees under the provisions of the said trust-disposition and settlement and codicils the six one-seventh shares of the said immoveable property in the Argentine, or alternatively one-seventh of said six-seventh shares or of the value or proceeds thereof, are bound to do so, and these claimants are accordingly entitled to be ranked and preferred in terms of their claim.”

On 3rd September 1918 the Lord Ordinary, after a proof, repelled the pleas-in-law stated for the claimants Anita Mary Angelica Latham Gregson and another, and found the other claimants were not required to elect between their legal shares of the testator's immoveable estates in the Argentine and the benefits conferred upon them by the testator's testamentary writings; continued the cause and granted leave to reclaim.

Opinion.—[ After the narrative quoted supra]—“It is maintained on behalf of Mrs Gregson's children that the final division of the trust-estate should be made upon the footing that the children of the truster taking under his settlement are entitled only to one-seventh each of the six shares of the Argentine immoveable estate taken by them, and that the value of the remaining seventh of the six shares should be taken into account in computing the amount of the share to be held for them.

It may be noted that the decision of the Argentine Court declaring the late Mr Brown's testamentary writings null in so far as regarded the Argentine immoveable estate, and handing over that property to his children equally, had the effect of giving those children other than Mrs Gregson the exact share, neither more nor less, of that property which the truster under his trust-disposition and settlement intended them to receive. The terms of the codicil under which Mrs Gregson's children take do not indicate that it was the truster's intention in any way to cut down the shares of residue given under his settlement to the different members of his family. On the contrary, the truster clearly indicates that what his trustees are to hold for Mrs Gregson's family is the share of residue given to her under the fourth purpose of his settlement. So far as the Argentine immoveable property was concerned, the succession to which fell to be determined according to the law of that country, this share was the seventh part of that property, which Mrs Gregson has taken absolutely. Counsel for the Gregson family, however, argued that I was bound to give effect to their contention in consequence of the decision of the First Division in the Special Case, and the application of the equitable doctrine of approbate and reprobate. According to the latter doctrine, no one can take benefit under a document, and refuse the fullest effect they are able to give it—a requirement which, it is contended, necessitates the six members of the truster's family, who claim their provisions under his settlement, bringing into account, in the division of the residue of the trust estate the shares of the Argentine immoveable property taken by them.

The doctrine of approbate and reprobate in Scotland is identical with that of election in England. The principle upon which the doctrine is founded, and the earlier leading cases in which it has been applied, are fully considered in the opinions of Lord Atkinson and Lord Shaw in the case of Crum Ewing's Trustees v. Bayly's Trustees ( 1911 S.C. (H.L.) 18, 47 S.L.R. 876. In that case a testator in his trust-disposition and settlement directed his trustees to hold a share of his estate for behoof of his daughter in liferent and her issue in fee, in such proportions as she might direct, and failing such direction equally among them. The daughter professed to exercise this power by a settlement under which she conveyed to trustees (1) this share of her father's estate; (2) a sum settled by her marriage-contract on her in liferent and her children in fee, subject to a power of apportionment by her; and (3) her own estate; and directed the trustees to hold the sums conveyed to them for her children in liferent for their liferent alimentary uses only and for their children in fee. So far as the share of her father's estate was concerned the appointment was bad, as it restricted the children's interest to a liferent, and conferred the fee upon persons who were not objects of the power. It was held that by the doctrine of approbate and reprobate the children could not by setting aside their mother's appointment take the fee of their grandfather's estate and at the same time take the benefits conferred on them by their mother's settlement with regard to the other estate dealt with therein.

At page 21 of the report to which I have referred Lord Atkinson says—‘It must I should think be assumed that every donor who executes a deed, and every testator who makes a will, intends that the gifts he purports to make and the benefits he purports to confer should be taken and enjoyed by those for whom he designs them, and none others, so that a beneficiary who asserts a claim to something given to another by their common benefactor necessarily defeats pro tanto the intention of that benefactor.’ At page 23 the same learned judge quotes the following passage from Lord Eldon's opinion in Ker v. Wauchope, 1 Bli. 1, at p. 21:—‘It is equally settled in the law of Scotland and of England that no person can accept and reject the same instrument. If a testator gives his estate to A, and gives A's estate to B, courts of equity hold it to be against conscience that A should take the estate bequeathed to him and at the same time refuse to effectuate the implied condition in the will of the testator. The Court will not permit him to take that which cannot be his but by virtue of the disposition of the will, and at the same time to keep what by the same will is given or intended to be given to another person.’

Lord Shaw, who traces the doctrine in the civil law and deals with the state of the Scottish authorities, says—‘In short, the

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endeavour was simply to get at the real mind of the testator with regard to whether or not it was meant that the specific thing or its equivalent was to go in all the circumstances to the legatee.’ The review of the previous authorities in Crum Ewing's case was undertaken with a view to show that the circumstance whether or not the beneficiaries' mother knew that her appointment of their grandfather's estate was bad was immaterial in considering whether a question of election had arisen.

Among the earlier cases founded on by counsel for the Gregson family the only one which I need consider in detail is the case of Dundas v. Dundas, 4 W. & S. 460, referred to by Lord Cullen in the note to his interlocutor allowing a proof by the competing claimants as to Argentine law. In that case a settlement, probative according to the law of Scotland, was defective in point of form as to the conveyance of estate in England, and therefore null and void as regards its intended operation in England. It was held that the heir could not take that estate and at the same time claim a provision made to him in the trust deed.

On behalf of the children who survived the truster, other than Mrs Gregson, it was maintained that they were never put to an election so as to impose upon them any obligation to communicate any benefit received by them outwith the settlement, and that by the law of the Argentine Republic which governs the succession to heritable estate situated in that country it was not in their power to surrender that estate for the purposes of the settlement. It appears to me that their contentions are well founded. As I read the decision of the Argentine Court these claimants did not repudiate the will. The proceedings, which led to a decree of nullity of the settlement so far as the Argentine estate was concerned were taken at the instance of Mrs Gregson and the public official who occupies in the Argentine a position somewhat similar to that of the Attorney-General in England. This circumstance seems to constitute a distinguishing feature between the present case and the other cases to which I was referred in which the doctrine of election was recognised.

Upon the other point raised by these claimants, to the establishment of which proof on the Argentine law was allowed, I think it is proved that Argentine law does not recognise either in a direct or an indirect way a trust system such as we have in Scotland. According to the evidence given by Dr Palacios, a doctor of law of the National University of Buenos Ayres, anything preventing the free exploitation of property is prohibited by Argentine law, and it is not competent to bind yourself by contract not to part with property. In cross examination he explained that the spirit of the Argentine law is to prevent any difficulty in the transmission freely and easily of the property by the owner, and for that reason the owner is prohibited from binding himself not to dispose of the property, from mortgaging for more than ten years, and from leasing for more than five or ten years, while a testator may not appoint heirs to an heir. He further explained that it is so clear that a trust cannot be enforced in Argentina ‘that most of the wills made in England regarding Argentina property have trust systems, and no one so far has been carried out.’ The result of what I understand from the proof to be Argentine law is that the children could not surrender Argentine property to the purposes of the settlement. No doubt, in so far as they were sui juris, they might have sold the heritable property in the Argentine, and, if such an obligation had been imposed upon them, collated the free proceeds of sale as a condition of their participating in the residue quoad ultra. I was not, however, referred to any authority where a similar obligation had been imposed upon claimants under a will. The children of the truster claiming under his settlement founded upon the case of Hewit's Trustees v. Lawson, 1891, 18 R. 793, 28 S.L.R. 528. It was there held that a legatee who has also a claim ex lege to part of the testator's estate, included by that testator in a general settlement, cannot be called on to make his election between the legacy and his legal right if by his abandonment of his legal right the estate to which that right entitles him will not be surrendered to the uses of the will but will be treated as undisposed of. The truster had in that case directed that the residue of his estate should be divided among certain charities. Part of the estate consisted of English heritage. By an English statute neither that heritage nor the proceeds thereof could pass under the settlement to charities, while if the heir waived his right to it the effect of that statute was that the heritage would be treated as undisposed of. In these circumstances the heir, who was also a legatee, was held not to be put to an election.

Lord Kinnear, the Lord Ordinary, in Hewit's Trustees, at p. 798 of the report, said—‘It is obvious and elementary that a nullity can neither be reprobated nor homologated. The plea of approbate and reprobate assumes, as the Lord President explains in Douglas v. Douglas, 24 D. 1207, “the power of making an election and a consequent obligation to make an election,” and his Lordship adds, that “to make a proper case of election the facts of the case must be such as to satisfy three conditions. In the first place the person making the election must have a free choice. In the second place the necessity of making the election must arise from the will, express or implied, of someone who has power to bind the person put to his election; and, in the third place, the result of the election of one or other of the alternatives must be to give legal effect and operation to the will so expressed or implied.”’

Lord M'Laren in the Inner House, at p. 804, said—‘In the cases raising an election it is in general not necessary that the heir or person having the adverse interest should take any active step to set up the will, it is enough that he makes no adverse claim, in which case the trustees or executors may proceed to administer the estate

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on the assumption that the testator's power of disposal is unchallenged. This much at least seems to be reasonably clear. In order to put a legatee to his election it must be in his power by waiving his objection to the will or adverse claim to perfect the right of the testamentary disponees.’

In my opinion, as I have already indicated, the claimants under the settlement were not in a position to perfect the trustees' right. I therefore consider that the case of Hewit's Trustees, which is binding upon me, is an authority for holding that in the present case the claimants under the will are not put to an election. I propose to pronounce an interlocutor repelling the pleas-in-law for Mrs Gregson's family, finding that the other claimants are not required to elect between their legal shares of the testator's immoveable estate in Argentina and the benefits conferred upon them by the testator's testamentary writings, and continue the cause. As I am deciding the case in vacation I reserve the question of expenses, and grant leave to reclaim.”

The claimants Anita Mary Angelica Latham Gregson and another reclaimed, and argued—The proof as to Argentine law did not disclose any difficulty, and certainly no impossibility, in making the Argentine immoveable property available for distribution in terms of James Brown's testamentary writings. No doubt the Argentine law would not admit of a trust with reference to immovables, and the pursuers and real raisers could not hold that property directly under the trust, but there was nothing to prevent the necessary heirs under Argentine law from conveying the immovables to the pursuers and real raisers as individuals absolutely, and receiving from them a back-letter embodying the trust purposes. Further, there was no difficulty in the necessary heirs giving the trustees a power of attorney embodying the directions in the trust, and empowering them to sell the immoveables and remit the proceeds to this country for distribution under James Brown's testamentary writings. Further there was nothing to prevent the necessary heirs themselves selling and remitting the proceeds for distribution to the pursuers and real raisers. Those expedients might have been more difficult if a continuing trust with reference to the Argentine immovables had been necessary or contemplated, but that difficulty was absent. No difficulty was caused by the fact that the trustees could not hold the Argentine immoveables upon a trust title. Trustees had constantly to take a title in their own names as individuals, as, e.g., in the case of consols, and the case of trustees making up a title through the heir under the former law was closely analogous to the present case. Such formal difficulties were not sufficient to exclude the operation of the broad equitable principle underlying the doctrine of approbate and reprobate— Cooper v. Cooper, 1874, L.R., 7 E. & I. App. 53, per cairns, L.C., at p. 63. James Brown's testamentary writings were clearly intended to take effect upon the Argentine immoveable property. The other claimants had taken the Argentine property as necessary heirs, i.e., on the footing that the Argentine property was not effectively disposed of by the testamentary writings. Their right to it was based upon intestacy, and involved a repudiation of the testamentary writings. But they could not approbate and reprobate, and consequently they must if they claimed anything under the testamentary writings, as they did in point of fact, make the Argentine estate or what represented it available for distribution under the testamentary writings. They must do everything in their power to make the Argentine estate available, and unless it was absolutely impossible to make that estate available, which was not the case here, the obligation to elect was not excluded— Davidson's Trustees v. Davidson, 1871, 9 Macph. 995, per Lord Cowan at p. 1006, 8 S.L.R. 646; Whistler v. Webster, 1794, 2 Ves. Jun. 366a, per Sir Richard Arden, M.R., at p. 369; In re Lord Chesham, 1886, 31 Ch. D. 466, per Chitty, J., at p. 471; Dundas v. Dundas, 1829, 7 S. 241, 1830, 4 W. & S. 460; Bennet v. Bennet's Trustees, 1829, 7 S. 817; Douglas-Menzies v. Umphelby, [1908] AC 224; Crum Ewing's Trustees v. Bayly's Trustees, 1910 S.C. 484, per Lord Johnston at p. 492, 47 S.L.R. 423, 1911 S.C. (H.L.) 18, per Lord Atkinson at p. 23 and Lord Shaw at p. 27 et seq., 48 S.L.R. 401. Hewit's Trustees v. Lawson, 1891, 18 R. 793, 28 S.L.R. 528, was distinguishable, for it was a case of impossibility—M'Laren, Wills and Succession, vol. i, p. 254. Douglas' Trustees v. Douglas, 1862, 24 D. 1191, was also a case of impossibility. But if either of those last cases did not turn upon impossibility they were inconsistent with Crum Ewing's case. Brown's Trustees v. M'Intosh, 1905, 13 S.L.T. 72, was not in point.

Argued for the claimants Miss Christina Brown and others—Those claimants had not repudiated the testator's writings either actively or passively. It was not suggested that they were precluded from taking a benefit under those writings by the forfeiture clause. All that they had done was to take up a neutral position in probate proceedings in the Argentine, and they simply found themselves in possession of the Argentine estate as the result of the operation of Argentine law, and without taking any steps to produce that result. If, however, their action amounted to repudiation, and consequently there was an obligation upon them to bring in the benefit they had obtained by repudiation, that obligation was limited, for as beneficiaries they were only bound to bring in the Argentine estate so as to give effect to the expressed intention of the testator, and only in so far as they could carry out that intention were they liable to make the Argentine estate available. In that connection election and collation were sharply distinguished in origin and object. Collation was confined to intestate succession. The law having determined the heir in heritage and the heirs in moveables by positive rules allowed an heir in heritage to come in as amongst the heirs in moveables upon such conditions as it chose quite irrespective of any intention of the deceased. The conditions were fixed by the law by an appeal to equity, not as a matter of giving effect to

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the intentions of any testator, and when the heir could not bring in the land itself as in the case where it was entailed, the law allowed him to communicate its value. But election was applicable only to testate succession, it involved no question of equity, and it merely imposed upon a beneficiary who took under a will an obligation to make effective in so far as he could the expressed intention of the testator. That intention was the measure of the beneficiary's obligation. Here the testator's intention was that the trustees should hold the Argentine land for the purposes of the trust. Admittedly they could not do so, and nothing that those claimants could do would enable them to do so. The only methods of bringing the Argentine property under the will involved either a cash payment or the vesting of the trustees in the Argentine estate as individuals. A cash equivalent could not be demanded; there was no authority for such a proposition. Further, if it was sound it entirely eliminated the doctrine of impossibility, which was admittedly sound, for in the cases of Douglas, Lord Chesham, and Hewitt ( cit. sup.), the value of the estate taken could have been calculated and communicated. Further, the equity of allowing a cash valuation of an interest, which could not be otherwise communicated, recognised in collation could not be applied in election, for that was in substance asking the Court to make a new will for the testator. If the testator intended his trustees to deal with land, they could only ask land from the beneficiary and not money. The same objection applied to the other expedient of vesting the trustees in the Argentine estate as individuals. The device of an ex facie absolute conveyance qualified by a back-letter was unknown in Argentine law, and it was at least certain that that device could never create a trust as regards Argentine land. But the testator's intention was that his trustees should hold the Argentine land in their capacity as trustees just as much as any other property of his. That was not a mere question of form of title. If that expedient were adopted, the trustees' title would be precarious and open to defeat by heirs or creditors. The testator did not intend his trustees to hold upon such a title. Moreover, it could not be presumed that the testator knew Argentine law and had that in view, for a testator was only presumed to know the law of his domicile. The truth was that the testator's directions as regards the Argentine law were impossible of fulfilment, and must be treated pro non soripto—Bell's Comm. i, 143. The present case was ruled by the cases of Douglas, Lord Chesham, and Hewitt ( cit. sup.). Crum-Ewing's case ( cit. sup.), per Lord Shaw at pp. 31 and 32, did not overrule the cases of Douglas and Hewitt. The general object of the testator was not a relevant consideration. All the Court had to consider was his expressed intention.

Argued for the claimants, Oswald Stanley Brown's executors—Those claimants adopted the argument of the immediately foregoing claimants. But their author had taken his share of the Argentine estate and had subsequently died, and by the operation of Argentine law his share had descended to his widow and children. As his executors those claimants had no right to it and consequently could not surrender it.

Argued for the pursuers and real raisers—As trustees they merely intervened to suggest that if it should be held that the value of the Argentine estate must be communi cated for the purposes of the settlement, that could be done by a process of accounting with funds situated within this jurisdiction.

At advising—