Scottish Court of Session Decisions

At advising on 21st November 1957,—

LORD PRESIDENT (Clyde).—This is a special case in regard to the construction to be given to a provision in the last will and settlement of Mr W. D. Boyd of Dirichurachan, Inverfarigaig, Inverness-shire, who died on 29th September 1955. He left a last will and settlement dated in 1951. Under the third purpose he directed his trustees to sell the residue of his estate and to divide the proceeds equally between William J. Shaw and Sween Shaw "declaring that if either of them should predecease me, then the share of the predeceaser shall pass to his issue equally amongst them if more than one." The whole question in the case is whether this means a division equally among the issue per capita or equally per stirpes.

The first party in the case is the sole surviving trustee and executor under the will. "Sween Shaw," referred to in the third purpose, survived the testator and there is no question as to his right to a one-half share of the residue. The question in the case arises in regard to the other half, destined originally to William J. Shaw. He died on 21st August 1953 and therefore predeceased the testator. But he had a large family. One child predeceased him without issue and can be disregarded for the purposes of the present case. Three children of William J. Shaw survive, and his daughter Annie, who predeceased her father, is survived by an only son, Ian, who is thus a grandchild of William J. Shaw. The three surviving children and the grandchild are the second parties to the case. William J. Shaw had another child, who predeceased him but is survived by two daughters and a son who are thus grandchildren of William J. Shaw. They constitute the third parties to the case. The second parties contend for the division of William J. Shaw's one-half of the residue among his issue per stirpes. The result would be that each of them would receive a one-fifth share thereof, the remaining one-fifth share going to the third parties equally among them. The third parties, however, contend that this one-half of the residue should be divided among each one of the issue per capita, so that each of the second parties would only get a one-seventh thereof, and each of the third parties would be entitled to a one-seventh also. The problem has arisen in this case owing to the fact that the issue who take are not all in the same degree of propinquity to William J.Shaw, the third parties only qualifying as issue because their father predeceased. If the division is per stirpes, the third parties, as they belong to a single stirps, would between them only take an amount equal to that payable to each of the other stirpes. If the division is per capita, each of the third parties would take a share equal to that payable to each of the other individuals claiming as issue.

The language of the settlement does not by itself conclusively determine the question one way or the other. It is necessary, therefore, to consider the principles upon which the law of Scotland has proceeded in solving such matters. It is now well settled that, when a legacy is given to a plurality of individuals, the natural and simple mode of distribution is that which gives each legatee an equal share per capita in the subject of the gift, unless the will supplies evidence of a contrary intention—Henderson on Vesting, (2nd ed.) p. 218. Similarly a gift to a class of persons called under a class description (e.g., the children of A, the children of B and the children of C) does not prima facie warrant a departure from the general rule of per capita division—M'Kenzie v. Holte's Legatees . This is because according to the conception of the gift all the members of the class are equally favoured and because the destination can only receive effect by means of an arithmetical division among the objects of the class—M'Laren on Wills and Succession, (3rd ed.) vol. ii, p. 780, par. 1418.

But this presumption for division per capita is displaced if the form or language of the gift indicates that the legatees are to take, not as individuals merely, but as representing, and on the failure of, their parents—Henderson on Vesting, p. 220. For in that event the legatees take in a representative capacity what their parents would have taken, and it would be anomalous that under such a gift they should take more than their parents would have taken, had the parents survived. The division in such a case is stirpital.

In the present case we are concerned, not with a gift to a plurality of legatees, nor with an ordinary class gift, but with a bequest where,, in my opinion, the element of representation necessitates a stirpital division. I have reached this conclusion in the light of two separate considerations, each of which precludes a per capita division of the fund, in question.

In the first place, the use of the word "issue" in the present case involves the introduction of representation of parents, since the second and third parties, who make up the issue, are not all in the same degree of propinquity to the person whose issue they constitute. Although at one time the position may have been otherwise, it is now well settled that the word "issue" in Scotland is not limited to immediate children. It now also includes remoter descendants to any extent—Turner's Trustees v. Turner . But in Scotland this has never meant that the term "issue" includes all descendants. The remoter descendants of a surviving descendant are excluded, and only those persons can qualify as the issue of A who have no surviving ascendant between them and A. It seems necessarily therefore to follow that where, as in the present case, there are some immediate issue, and some remoter issue whose parent has predeceased, those remoter issue take as representing and as coming in place of the predeceasing parent. The third parties in the present case take as representing and as coming in place of their deceased parent, and together, therefore, take no more than he would have taken had he survived. He would have taken a share equal to what each of his brother and sisters is entitled to take. The division in this case must consequently be a division among the sons and daughters of the deceased William J. Shaw and issue of predeceasers equally per stirpes. Apart from clear language indicating the contrary it is inconceivable in this settlement that the testator meant the third parties to take a larger share than their father would have taken had he survived, or that he meant the shares of the other stirpes to be reduced because the third parties father predeceased leaving more than one child. Had it been possible to construe the term issue as including every descendant of whatever degree, then the result might have been different. But it is well settled that such a construction never is given to that term in testamentary provisions in Scotland.

I am confirmed in my construction of the language of this settlement by observations made from time to time in previous cases where this kind of situation has arisen, although it is true that the point has not hitherto been the subject of express decision by our Courts. I refer in particular to Robertson's Trustees v. Home, per the Lord President at p. 819 and Lord Mackenzie at p. 820;Stewart's Trustees v. Whitelaw, in which the Lord President says (at p. 713):

"A destination to a person's issue is a destination to that person's direct descendants of every degree per stirpes, unless the context necessitates a more limited construction"

; and Black's Trustees v. Nixon, per the Lord President at p. 594. The same view was indicated by Lord Hunter in the Outer House in the case of M'Meekan's Trustees v. M'Clelland (at p. 195).

It was contended, however, that we should disapprove of these judicial observations in the light of three cases which were said to point in an opposite direction. But on a consideration of these cases I can see no warrant for such disapproval, and indeed the three cases founded upon appear to me in no way to conflict with what I have said and were not concerned with the present problem at all.

The first of these cases was Campbell's Trustees v. Welsh . In that case the Lord President (Cooper), at p. 345, laid down the proposition that "in interpreting a bequest to a plurality of legatees Courts of construction have leaned towards a division per capita … Decisions both in Scotland and in England indicate that this prima facie view will not be displaced merely because the legatees are called under class descriptions and not nominatim …" From this it was argued that a gift to issue was a class gift, and consequently the presumption was in favour of division per capita. But, in the first place, the bequest under consideration in that case was not a class gift but a gift to a named niece and the two grand-daughters of a named cousin. The observation regarding class gifts was therefore obiter. But, apart from this altogether, a class gift in the sense in which that word is ordinarily used is a gift to a group of persons all standing in the same relationship to the testator—M'Laren on Wills and Succession, (3rd ed.) vol. i, p. 635, par. 1150—as, for instance, "my children," "my nephews and nieces," and it was no doubt a bequest of that kind to which the Lord President was referring. But a bequest to issue is in a different position and by its very nature may often involve persons in different degrees of propinquity, with the consequent introduction of an element of representation of predeceasers. A gift to issue is not strictly a class gift, as that term is normally used.

The second case referred to was Inglis v. M'Neils, and in particular the opinion of the Lord Ordinary, Lord Stormonth Darling, at p. 924, was founded upon. But the view which he expressed did not find favour in the Division, and indeed the second last paragraph of the Lord Justice-Clerk's opinion on p. 926 directly counters the Lord Ordinary's view.

Finally we were referred to Binnie's Trustees v. Prendergast . But that case was decided on the special terms of the particular deed and no general question of principle arose in it. The beneficiaries involved were all in the same degree of propinquity (see the report of the case in the Court of Session, at p. 738) and no question of representation could therefore arise. The case accordingly does not affect the present issue.

I now turn to the second of the two grounds upon which, in my opinion, the second parties' contention should succeed. The destination in the present case to the issue is a destination over to them in the event of William J. Shaw predeceasing the testator (as he did). This factor introduces a clear indication that the testator intended the issue to take in a representative capacity, on the failure only of their ascendant, William J. Shaw. Such a situation points unequivocally to a stirpital division. As M'Laren on Wills and Succession says at vol. ii, par. 1420, "A bequest to issue in the form of a gift of the fee of the shares previously given in liferent to the parents, implies an intention to distribute the fund per stirpes. And the same inference arises where issue are nominated as conditional institutes on the failure of their parents." In the case of Thomson v. Cumberland money was bequeathed to be divided between the children of the testator's sisters, whom failing, their descendants. "Descendants" in that case had just the meaning which "issue" has in the present case. The division was held to be stirpital. On the ratio of that decision, in my opinion, it follows that the division here should also be stirpital. For these reasons I move your Lordships that we answer question (a) in the negative, and question (b) in the affirmative.

LORD CARMONT .—I agree.

LORD RUSSELL .—I agree.

LORD SORN .—The scheme of the testator's residue clause is a simple one. His trustees are directed "to divide the same equally between the said William J. Shaw and Sween Shaw; Declaring that if either of them should predecease me, then the share of the predeceaser shall pass to his issue equally amongst them if more than one." William J. Shaw did predecease the testator, and he is survived by children and by children of deceased children. The question presented to us in the special case is whether his share should now be distributed per stirpes among the issue or equally per capita among the surviving children and the grandchildren.

In opening his argument in favour of distribution per stirpes,Mr Mackenzie Stuart made the broad proposition that any gift to issue (e.g., a gift "to the issue of A") implied an intention on the part of the testator that the distribution should be per stirpes. For this proposition he relied entirely on a dictum pronounced by Lord President Clyde in Stewart's Trustees v. Whitelaw, at p. 713. Now, it should be noticed that in the passage in question the Lord President was not at all considering the method of distributing a gift to issue but was considering only the different question of whether the word "issue" meant children, or meant descendants of every degree. In holding that it had the latter meaning he said, "A destination to a person's Issue is a destination to that person's direct descendants of every degree per stirpes, unless the context necessitates a more limited construction," and referred to the case of Turner's Trustees v. Turner . I think it very likely that he included the words "per stirpes" simply because these words are to be found in the rubric of that case. In that case, again, the question and the only question decided was that the word "issue" included descendants of every degree. There was no question as to the method of distribution among descendants and indeed there could not have been because the testator in that case had made a stirpital division of his estate and had expressly said that the gift to issue was to be per stirpes. There was thus in effect no authority quoted to support the broad proposition that a gift to issue means a gift to issue per stirpes and, in view of the presumption in favour of distribution per capita, it is a proposition which I would find it very difficult indeed to entertain. The point, however, does not require to be followed up because Mr Mackenzie Stuart had another proposition, which seems to me to be much better founded.

The second proposition was that the presumption in favour of per capita distribution was displaced in the present case by the fact that issue were called as conditional institutes to their parent. This, it was argued, indicated an intention on the part of the testator that the succession should be stirpital. After some hesitation as to whether there is enough here to displace the per capita presumption, I have come to think that there is and that this form of gift indicates a stirpital intention. The testator here divides his estate between two persons and in each case he calls issue to take if the person fails. In each case it seems to me that the gift in substance falls to be understood as a gift to the stirps of which the named person is the head. This seems to me to stamp the gift with a stirpital character and to imply an intention that, if the gift should devolve to issue, it should devolve among them stirpitally. There is little authority on the point but the law is stated to this effect in the passage already quoted from M'Laren on Wills and Succession, (3rd ed.) vol. ii, p. 781, par, 1420. This statement of the law appears to have gone unchallenged for a long period and I think its correctness may now be affirmed.

This is enough for the answering of the question put to us in the case, but I am bound to add that, even if we had taken the opposite view and held that the presumption in favour of distribution per capitahad not been displaced, I doubt whether it would have had the effect for which Mr Jauncey's clients contended. They contended that a gift to issue per capita means that the fund is divided equally among surviving issue although the issue may be of different degrees. They are grandchildren of the testator and the claim is that each grandchild is entitled to share equally with the surviving children. But there is another view as to the proper way of distributing an ordinary gift to issue (that is to say, a gift to issue as regards which the testator has not manifested an intention that distribution should be per stirpes and to which the ordinary presumption applies), and the key to this view lies in a concession made, and rightly made, in the course of the argument. Mr Jauncey conceded that under a simple destination to issue it could not be successfully contended that descendants whose parent was still in life should participate. They answer to the description of "issue" just as much as any other descendants and yet it was conceded that they were cut out by the existence of a parent nearer to the testator in degree. As Lord President Clyde put it in Black's Trustees v. Nixon, at p. 594, after referring to the general legal presumption in favour of the nearer as against the remoter heir, "A gift to the ‘issue’ of A (whose son together with that son's son survives the testator) is read to mean a gift to the son, not a gift to the son and grandson equally between them." What is the significance of this? It must mean that a testator who makes a simple gift to issue is deemed to invoke the common law to regulate the devolution; nor does this seem unnatural, for the testator who makes a gift to a person's issue is, in a sense, creating a succession. It is a rule of the common law, as the Lord President pointed out, that the nearer kin exclude the remoter, but that rule does not stop at the exclusion of remoter kin by the survival of their own parent; it extends to the exclusion of remoter kin by the survival of any kin nearer in degree. The rigour of this rule was softened by the Intestate Moveable Succession (Scotland) Act, 1855, so as to allow remoter issue whose parent was dead to take their parent's share on the principle of representation. In wills made after 1855 it would be reasonable to suppose that the testator intended to invoke the common law as amended, and this would entitle remoter kin such as Mr Jauncey's clients to participate. But it is only on the principle of representation that they could come in at all, and that limits them to the share their parent would have taken on survival. So, instead of asking for more than their parent's share on the basis of a per capita distribution, they should have been thankful that the common law has been so amended as to allow them to claim anything at all. If this view be the right one, as I think it is, it shows that the distribution under a gift to issue per stirpes (express or implied), and the distribution under a simple gift to issue to which the ordinary per capita presumption applies, is the same so long as there are issue of the first degree in existence, although thereafter it becomes different. If all the issue of the first degree survive, it is the same. If some survive and some predecease, survived by children, it is again the same though the approach is different; in a gift per stirpes the issue of the second degree take because the division is stirpital and in an ordinary per capita gift they take because they are no longer excluded by the common law and may move up and join the nearer kin on the principle of representation. But, if all the kin of the first degree have predeceased, then it is different. Under a per stirpes gift, the distribution is still by families. Under a per capita gift the distribution is equally per capita among all the kin of the second degree—subject of course to any right of representation possessed by still remoter kin. It thus appears that we could have answered the question, as Mr Mackenzie Stuart asks us to answer it, without deciding whether the testator had manifested an intention to displace the presumption in favour of per capita division or whether he had not—the result, in the circumstances of the present case, being exactly the same under either view. But as we have heard an argument on the point, and as we are agreed on it, I think it is preferable that we should decide the case on the ground that a gift to a person, whom failing his issue, is a stirpital gift and that the gift, for that reason, devolves stirpitally among the issue.