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United Kingdom House of Lords Decisions
You are here: BAILII >> Databases >> United Kingdom House of Lords Decisions >> Colonel Alastair M'Donald of Dalchosnie v. John Alan M'Donald and Others [1875] UKHL 635 (15 July 1875)
URL: http://www.bailii.org/uk/cases/UKHL/1875/12SLR0635.html
Cite as: [1875] UKHL 635, 12 ScotLR 635
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SCOTTISH_SLR_House_of_Lords
Page: 635↓
House of Lords.
(Before
v.
Subject_Marriage-Contract — Deed of Division — Entail — Construction.
Facts:
Terms of deed of division and facts and circumstances in which held that a power of apportionment contained in an antenuptial marriage-contract had been validly exercised by the spouses.
This was an appeal from a decision of the Second Division of the Court of Session. An action of
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multiplepoinding and exoneration was raised by the trustees of the late Sir John M'Donald against the appellant and respondents. There was a competition for a sum of £50,000 in 1826. Sir John M'Donald of Dalchosnie married Miss M'Inroy, who was entitled to £50,000 under her father's will. By antenuptial contract the estate of Dalchosnie was conveyed to himself and wife in conjunct fee and liferent and the heirs-male of Sir John. Power was reserved to execute an entail of the whole or any part of the estate, provided the same heirs were first called, and that Lady M'Donald's liferent should not be defeated. Lady M'Donald also conveyed to the trustees her money for the purposes stated in the deed, and after the death of the surviving parent the property was to be assigned to such children as the parents by any joint deed might appoint. The shares of the children were not to become vested interests until the death of the surviving parent. There were seven children of the marriage, of whom two predeceased Lady M'Donald. In 1837 a deed of entail was executed, and a joint deed of division also. In 1866 Sir John died, survived by his wife, who died in 1872. The chief dispute raised under the deeds was whether the parents had validly exercised the power of division and apportionment reserved in the autenuptial contract of marriage. The Lord Ordinary (Gifford) found that this power had not been validly exercised, that the estate of Lady M'Donald fell to be divided among the surviving children as if no apportionment had been made, and the share of each son was to be in proportion as six to four, and none of the daughters were to be entitled to more than £10,000. This interlocutor was reclaimed against by the eldest son, Colonel M'Donald, and after hearing parties the Second Division appointed the cause to be re-heard before seven Judges, when, by a majority of five to two, the Lord Ordinary's interlocutor was adhered to. Colonel M'Donald appealed against this judgment, and the respondents also asked that the judgment should be altered in part. For the appellant it was mainly contended that the appointment of a sum of £25,000 under the joint deed of division was valid, and not void as was held by the Court below.
At advising—
At the outset I may say that I certainly do not give any weight to an argument which, somewhat late in the progress of the case, was addressed to your Lordships in favour of the respondents, and in opposition to the view of the appellant—the argument, namely, that because the joint deed of division purported to give to Sir John M'Donald, in the event of his surviving his wife, a life interest in the whole of the trust-property, therefore all that was done by way of appointment subsequently to that life interest was invalid. It might perhaps have been sufficient to say that this point does not appear to have been argued in the Court below, and certainly is not disclosed in the case for the respondents, who, again, have presented no crossappeal. But putting aside these technical difficulties in the way of the respondents, it appears to me that the argument itself in substance has no foundation. The deed of trust, the antenuptial marriage-contract, provided that the trust-funds in question should not be divisible until the death of the survivor of the spouses; and then, when the joint deed of division came to be executed, although of course it was beyond the power of the spouses to give to Sir John, who was not an object of the power, anything beyond what the settlement had given him, and the settlement had given him only a limited interest of £750 a-year for his life, still the joint deed of division did nothing more than this—it declared that it was the will of the spouses that in the event of Sir John M'Donald surviving Lady M'Donald he should have and enjoy the liferent use of “my” (Lady M'Donald's) “whole property during all the days of his life,” “just as I myself would have if I survived him.” Now, there was not here any attempt to delay the distribution of the fund to a period longer than that assigned by the deed; for it was not, as I have said, to be distributed until the death of the survivor of the spouses. There was an attempt to give the whole of the income to Sir John during his life, but it was carefully guarded in this way—it was to be, as it necessarily must be, only in the event of Sir John M'Donald's surviving Lady M'Donald. In point of fact he did not survive Lady M'Donald. Under these circumstances it appears to me it would be entirely contrary to reason, and, as far as I know, quite without authority, to hold that an attempted disposition, not in any way interfering with that which was legitimately within the object of the power of distribution of the property, and only to take effect in an event which never has happened, should in any way militate against the validity of the subsequent disposition in the appointment.
Passing bye that, I come to what was done with regard to the children of the marriage. Now, the facts which your Lordships will have to hear in mind with reference to that part of the case are merely these—Lady M'Donald had a very considerable property of her own, amounting to over £50,000. Shortly after the marriage Sir John and Lady M'Donald thought it would be desirable to purchase two properties neighbouring to that which belonged to Sir John M'Donald at Dalchosnie, namely, the properties of Loch Garry and Kinloch-Rannoch, and Sir John purchased these properties for a sum of, I think, £28,000. He borrowed in order to pay for these properties £25,000 of the trust-money which represented the property of Lady M'Donald, and he gave to her trustees a heritable bond over the properties which he had purchased, namely, Loch Garry and Kinloch-Rannoch. When the spouses came to consider the appointment they should jointly make of Lady M'Donald's property they took notice of the state of the landed property. A new entail was made of the Dalchosnie family property, and at the same time an entail was made of the Loch Garry and Kinloch-Rannoch properties. They entailed the whole three upon their eldest son and their other sons in course of entail, and then upon other persons.
Now, there is not the least doubt upon the view which must be taken of the whole of the joint deed of division, coupled with the deed entailing
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Now, what they did in order to accomplish the intention which they had in view was this—Under the second head of the deed they provided in these words. “That it is our will that the said sum of £25,000 secured over the said estates of Loch Garry and Kinloch-Rannoch, shall be settled on and belong to our eldest son and other members of our family in succession, being heirs in possession of the entailed estate;”—that was the first part of the clause. The second is this—“The sum of £25,000, being the share of my (the said Adriana M'Donald's) property which we, the said John M'Donald and Adriana M'Inroy or M'Donald, have allotted and apportioned, and do hereby allot and apportion as the share of our eldest son, or failing him of the heir of entail succeeding to the said entailed estate;”—that is the second. The third is this—“It being our desire and appointment that the said trustees under our marriage-contract before narrated, or the survivors of them, should immediately on the death of the survivor of us renounce and discharge the said heritable bond, and disburden the said lands and estates of Loch Garry and Kinloch-Rannoch of the same.”
Now, as regards the first clause of this second head of the deed, “it is our will that the said sum of £25,000 secured over the said estates of Loch Garry and Kinloch-Rannoch shall be settled on and belong to our eldest son, and other members of our family in succession, being heirs in possession of the entailed estate,” if that stood alone, if the deed contained nothing more than that, it would, as it seems to me, be open to this observation,—There is a direction to take £25,000 of the trust-funds, and to settle it on the eldest son—to make it belong to the eldest son,—a person then in existence, a person spoken of, a persona designata by the title which then he filled. And if you add the words, “and other members of our family in succession, being heirs in possession of the entailed estate,” the most favourable view for the respondents that could be taken of that clause would be this—that while the eldest son was to take in the first place, the other persons who were heirs in the course of the entail were to take afterwards in the same way in which they were to take the estates themselves afterwards, that is to say, the eldest son was to take that which was money in the way in which he was to take the land as heir of entail, or what we should term the tenant in tail, and that he should take it therefore as the fiar, with a simple destination to those who afterwards might become fiars in succession. Your Lordships will readily see that if that were to be the construction, it would make the eldest son the absolute owner of the money, because, of course, the money could not be subject to fetters which would keep it from his absolute dominium.
But, my Lords, we have further information in the second clause, which is this—“The sum of £25,000, being the share of my (the said Adriana M'Donald's) property, which we, the said John M'Donald and Adriana M'Inroy or M'Donald, have allotted and apportioned, and do hereby allot and apportion as the share of our eldest son, or failing him of the heir of entail succeeding to the said entailed estate.” I again say, if this clause stood alone it would appear to me to be the clearest possible apportionment and appointment of the £25,000 as the share of the eldest son, and under the words “or failing him” if he were not there at the time when the succession opened at the death of the survivor of the spouses, there would be an indication that the heir of entail succeeding to the entailed estate was to come in his place as substitute for him. There again, if that were to be the construction of the second clause, the eldest son being there would be entitled as the object of the appointment to take the money, and the circumstance that there was an alternative limitation, which never came into existence, to a person who might not have been an object of the power, could not in any way defeat or invalidate the appointment to the eldest son, who was an object of the power.
I have pointed out what appears to me to be the only two constructions which these two clauses admit of. There is either an appointment to the eldest son with an appointment by way of succession to the next owners in tail, making both of them fiars, the one a fiar in the first instance with a simple destination to the others afterwards, or there is an appointment to the eldest son if he is alive at the death of the survivor of the spouses, with a conditional substitution of the next heir of entail if the eldest son should not then be alive. In either case the eldest son would be entitled to the dominium, the possession of the money.
Then the third clause is this:—“It being our desire and appointment that the said trustees under our marriage contract before narrated, or the survivors of them, should immediately on the death of the survivor of us renounce and discharge the said heritable bond, and disburden the said lands and estates of Loch Garry and Kinloch Rannoch of the same.”—That is the expression of what I began by saying was without doubt the general intention of the spouses, that by means of the land being disburdened of the heritable bond it should be left to go in succession to the heirs of entail
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My Lords, that is the construction which, as it appears to me, ought to be put upon the deed, and if so the rule of law which is applicable to the subject is beyond all doubt.
It was not in any way disputed at your Lordships' bar. It is a rule to be derived from the authority of Carver v. Bowles and the numerous class of cases of the same kind, and also from those cases (of which Laxennes v. Tierney may be taken as an example) which, though not relating to powers, but to gifts and legacies, raise questions almost identical with those which are raised in the cases of which Carver v. Bowles is an example. From all those cases the plain rule is be derived, that if you cannot disconnect that which is imposed by way of condition or mode of enjoyment from a gift, the gift itself may be found to be involved in conditions so much beyond the power that it becomes void. But where that is not so, where you have a gift to an object of the power, and where you have nothing alleged to invalidate that gift but conditions which are attempted to be imposed as to the mode in which that object of the power is to enjoy what is given to him, then the gift may be valid and take effect without reference to those conditions.
My Lords, here it appears to me that there is a clear gift in the events which have happened to the eldest son. There is nothing whatever attempted to be added by way of checking his enjoyment of the property but the injunction to the trustees (that is to the other parties) to destroy the security by means of which the money appointed to the eldest son was secured.
The trustees, of course, could not do that without the consent of the person to whom the money was given. It appears to me that there was no authority whatever which would warrant your Lordships in holding that a direction of that kind could invalidate an absolute gift.
That being so, the deed of division appears to me to be entirely efficacious for the purpose of vesting in the eldest son the right to receive the £25,000, and I shall therefore take leave to submit to your Lordships the motion that the interlocutors which are appealed from should be reversed, and that a declaration should be made that the appellant under the settlement and deed of division executed by Sir John and Lady M'Donald is entitled as from the death of Lady M'Donald to the gift of £25,000, secured by heritable bond over the estates of Loch Garry and Kinloch-Rannoch, and that with this declaration the case should be remitted to the Court of Session.
I cannot doubt, My Lords, that there was a desire on the part of the husband and the wife that those estates, which had been bought mainly with the property of the wife, and which were to be the subject of disposition, should be added on to the original family estates, and that inasmuch as £25,000, part of the wife's fortune, had been employed in buying those estates, both the eldest son should be entitled, in the first instance, under the deed by which those estates had been settled to the enjoyment of the property, and if it could be lawfully done, his successors in the entailed estates should have the advantage of enjoying the estates so purchased with the £25,000 discharged from that sum. That appears clearly and undoubtedly from one provision in this deed.
But they had paramount to that, and as their primary intention in the execution of the deed, the desire to settle definitely, onerously, irrevocably, and mutually the whole of the said estates of Dalchosnie, Loch Garry, and Kinloch-Rannoch belonging to the husband, and it was also their clear intent “to divide, apportion, and settle the whole property, heritable and moveable, including the said sum of £25,000 secured over the said lands of Loch Garry and Kinloch-Rannoch,” belonging to the wife, “on ourselves and our family, and, failing our heirs-male, so far to alter the destination in the marriage-contract with regard to Dalchosnie as to settle it with the other lands on heirs-female of the present marriage, giving them a preference and priority to heirs-male of any subsequent marriage.” They appear to have thought in making the apportionment some arrangement might be made with reference to the disposition of the property passing on to the heir in the same manner as the original property of the husband was settled, yet the intent to dispose of the whole property over which they had power was undoubtedly and clearly the leading intent of these two persons.
And when they come to dispose of it they do so
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However, the real difficulty of the case has been this,—What is to be done with reference to the disposition that is made of the £25,000? The spouses say that it is their will that the £25,000 that is secured over these estates “shall be settled on and belong to our eldest son and other members of our family in succession, being heirs in possession of the entailed estate.” That would have been their desire if they could have effected it as regards the sum of personality—at least what we should call personality—this sum of £25,000. But in doing that, if they had settled it upon the eldest son, and settled it with the same limitations as were expressed with reference to the landed property, the result would have been that it would have gone to him absolutely. And if they had stopped there, he, being alive at the death of the survivor of the two spouses, would have taken the sum absolutely, and would have had it free from any possible claim on the part of those who might come after him, inasmuch as it was not subject to the fetters and limitations imposed by the Act of 1685. But they do not stop there; the words of the deed make it still more plain as they proceed, “the sum of £25,000 being what the share of my” (the wife's) “property which we” (the spouses) “have allotted and apportioned, and do hereby allot and apportion as the share of our eldest son.” I cannot conceive any words of appointment more clear than these. I cannot conceive any words (to follow Lord Cottenham's dictum in Laxennes v. Tierney) that would more completely and clearly and neatly sever one share from the rest of the fund, whether that fund be a testator's general reserve, as in the case of a will, or, as in this case, a fund in which an appointment is made existing in the hands of trustees in one large mass. The fund amounts in the present case to £50,000, and out of it the sum of £25,000 is plainly severed.
That distinguishes this case and the case of Laxennes v. Tierney from a case like one which was referred to before myself, namely, Ruckie v. Schoefield, and from all the cases in which you find the gift only, in a continuance of limitations expressed in the instrument without any complete severance of the share at once, and in which you find a subsequent dealing with that share, and interest allotted and apportioned in it to the parties intended to be benefitted, and in those cases if those parties be out of the range of the power the appointment becomes vitiated because you cannot separate it from a continued series of limitations, but here we have a share taken out of the general trust fund, and it is allotted to the eldest son, or failing him to the heir in possession of the entailed estate. He did not fail. At the death of the survivor of the spouses there he was found,— and there was his share found for him,—it was allotted and apportioned for him,— it was taken out of the estate. The case therefore appears to fall as clearly within the case of Carver v. Bowles as any case that can be conceived.
No doubt, my Lords, the spouses proceed to say after that that they wish the trustees to renounce and discharge the said heritable bond, and disburden the said lands and estates of Loch Garry and Kinloch-Rannoch of the same.” That is a condition superadded to the clear and plain allotment of the share which had been made to the eldest son, and being a condition by which he is not fettered or bound, the condition itself becomes simply a void conclusion as against him, and he takes the property as he would have taken it under the former limitation if it had been a limitation to him by way of settlement in the same manner as the estates were settled, it not being subject to fetters for the reasons I have already assigned.
Then comes a passage which has been much commented upon. It expresses the same view as the passage preceding with regard to the desire of the spouses that the estates should go in the manner they described. In the subsequent passage, with regard to a surplus after giving £10,000 to each of the younger children, nothing is said that could, I think, afford a ground for the respondent's construction of the previous gift of the eldest son's share.—Indeed it was only pressed into the argument in order to show the general intent upon the whole deed (which I do not dispute) that if it could be so the estates of Loch Garry and Kinloch-Rannoch should pass on with Dalchosnie to the eldest son and his successors in possession of the entailed estate without the encumbrance of the £25,000.
Concurrently with that there was undoubtedly also a desire that a full and complete disposition should be made of the funds over which they had the power of appointing. In the exercise of that power I think they have made a sufficient disposition in the events which have happened to the eldest son, and I think the subsequent direction in which they attempt to impose a condition upon the trustees, a condition which the trustees could not with any propriety have fulfilled to release the estate from the bond, fails to take effect. This is in accordance with the authority of cases which have been decided over and over again in the English Courts, the principle of which is co-incident with that which is supported by the learned Judges in the Court below, although they have differed in their argument as to the conditions. I think, therefore, my Lords, that the conclusion
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So reading the deed, there is, first, an appointment (in the events which have happened) to the eldest son, as fiar, of the whole £25,000. All that follows is but a superadded wish, desire, or condition, having in view the settlement or the release to the owners of the entailed estates of, the sum so appointed, which ulterior purpose might be accomplished, and could only be accomplished, through the medium of the estate and interest vested in the eldest son by virtue of this appointment. That wish, desire, or condition not being authorised by the power, must necessarily fail unless the appointee (whether bound to elect or not, by reason of other benefits given to him independently of the power), should elect to give effect thereto; but the appointment itself is not therefore vitiated. The authorities of which Carver v. Bowles is an example, have determined (on principles which if sound in England must be equally so in Scotland), that an ulterior purpose of this kind, which is ultra vires only, and not also a fraud on the power, that it may have operated as a motive to the appointment in the mind of the appointee will, nevertheless, not prevent an object of the power from taking for his own benefit the estate appointed to him, if the words used, according to their proper construction, which must itself be independent of any peculiar doctrines of law applicable to powers, are sufficient to execute the power, and to vest the property in the appointee.
The context of this deed satisfies me not only that, on sound principles of construction this was its real effect, but that the appointors intended to do the very thing which in law they did; and that they well understood that it was necessary that the deed should so operate in order to make it possible that their ulterior wishes should be capable of accomplishment. The declaration and appointment which they made was expressed to be “in consideration of the said deed of entail,” ( i.e. the entail of the Loch Garry and Kinloch-Rannoch estates), as well as “of the powers possessed by us under the said contract of marriage,” and after disposing of the £25,000 in the way which has raised this controversy they proceeded to appoint the rest of Lady M'Donald's settled property equally among their “younger children exclusive of the heir” to the extent of £10,000 each, directing that if there were any excess above that amount such excess should all fall to the “eldest son or heir of entail as above mentioned.” Here also they superadded the expression of an ulterior wish, to be effectuated through that appointment by the words which followed “with a view to its being laid out in the purchase of lands and entailed with the other estates, upon him and the heirs called in the aforesaid deed of entail through the whole course of succession.” And afterwards in two places they referred to the £25,000 as being by this deed “settled on the heir of entail,” words which are nearly in those places applicable to the eldest son, as well as to any other heir of entail who, (in different events from those which happened), might have succeeded on the deaths of the appointors to the entailed estates. A comparison of all the passages in which the appointee of the £25,000 is thus spoken of in the singular number, seems to me to make it quite clear that one individual person (to be ascertained with reference to the state of the title to and possession of the entailed estate immediately after the death of the survivor of the appointors), and one person only, was intended to take the 25,000 by way of appointment.
That being so, I agree with your Lordships that the opinion of the minority of the learned Judges in the Court of Session was correct; and that this appeal ought to be allowed.
Interlocutors reversed, and cause remitted with a declaration.
Counsel for the Appellant— Collyer, Martin, Q.C. and Cotton, Q.C. Agents— Loch & Maclaurin, Westminster, and A. P. Purves, W.S.
Counsel for the Respondents— Pearson, Q.C., and Kay, Q.C. Agents— Grahames & Wardlaw, Westminster, and Dewar & Deas, W.S.