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Scottish Court of Session Decisions |
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You are here: BAILII >> Databases >> Scottish Court of Session Decisions >> Greenlees' Trustees v. Greenlees and Others [1894] ScotLR 32_106 (4 December 1894) URL: http://www.bailii.org/scot/cases/ScotCS/1894/32SLR0106.html Cite as: [1894] SLR 32_106, [1894] ScotLR 32_106 |
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Page: 106↓
A testator provided that his trustees should “divide, apply, pay, or convey or hold” the residue of his means and estate “to and equally among, or for the behoof of,” all his children; that the shares of residue falling to his sons should be paid to them at the date of the first annual balance of his business books occurring after his death, but that the trustees should hold the shares of residue falling to his daughters for behoof of the daughters or their children, and should pay the annual proceeds to them, but subject always to full powers of disposal on the part of the daughters by any deed to be executed by them in the way of family settlements. It was further provided that the trustees should have power to make advances to the daughters on their marriage, or on other proper occasion, as they might think requisite, and that should any of the children die before the period of division leaving children, these children should take the share which would have fallen to their parent, or should any of them die without issue, that the share of such deceaser should be divided equally among the survivors. there was no further disposal of the daughters' shares.
In a special case presented some years after the testator's death— held (1) that the fee of the daughters' shares vested in them a morte testatoris, and (2) that they were entitled to immediate payment of their shares, the direction to the trustees to retain being ineffectual.
Samuel Greenlees died on 12th May 1886, survived by his wife and eight children, two sons and six daughters. He left a trust-disposition and settlement dated 4th October 1882, by which he conveyed to trustees his whole estate heritable and moveable. After providing for an annuity to his wife, and certain legacies, the truster by the last purpose of the trust-disposition provided as follows—“In the last place, my said trustees and their foresaids shall divide, apply, pay, or convey or hold, as after mentioned, the whole rest and remainder of my means and estate, and the interest and other annual produce thereof, including the principal sum or sums which may be set apart to meet the annuities herein before provided, when and as the same or any part thereof may be set free by the death of my wife, the said Mrs Isabella Ralston or Greenlees, and my daughter, the said Agnes Greenlees, to and equally among or for behoof of all the children of me, the said Samuel Greenlees, viz., Agnes Greenlees, James, Samuel, Margaret, Martha, Isabella, Jessie, and Catherine. The share of said residue falling to my two sons shall be paid over to them by my said trustees at the date of the annual balance of the books of my business occurring first after my decease, or as near to that time as may be convenient; but in the case of the share of said residue falling to each of my daughters, I desire and direct my trustees either to hold in their own names in trust for behoof of my said daughters or their children, or by deed or conveyance to hold in the names of other trustees whom they may appoint, the shares of said residue falling to each of my said daughters respectively, and to pay and apply the interest, rent, or other annual proceeds thereof to them, but subject always to full powers of disposal on the part of our daughters of the said shares by any deed to be executed by them in the way of family settlements. Providing that my trustees have power, should they deem it expedient in the case of any of my daughters, to advance such sum out of the capital to any of my daughters on their marriage or other proper occasion as they may think requisite; and should any of my said children die before the period of division of said residue, leaving lawful children, these children shall take the share that would have fallen to their parent, or should any of them die without leaving issue, the share of such deceaser shall be equally divided among my surviving children (of both marriages) equally share and share alike.”
Miss Agnes Greenlees died on 27th December 1893 leaving a will dated 7th April 1891, by which she bequeathed her estate to James Greenlees, Samuel Greenlees, and Mrs Catherine Greenlees or Wilson. Questions having arisen as to whether this will was a “family settlement” in accordance with the terms of the last purpose of Mr Samuel Greenlees' trust-disposition, and generally with reference to the effect of that clause, a special case was presented by the said Samuel Greenlees' trustees and three of his daughters of the first part, Miss Agnes Greenlees' executors of the second part, and the two other daughters of Samuel Greenlees of the third part, to have it determined, inter alia, “(1) Did the testator's daughters, upon his death, acquire a vested right to the fee of their shares of residue?” (3) “If the first question is answered in the affirmative, are said daughters, and the second parties as representing Agnes, entitled to immediate payment of their said shares, under deduction of the sum necessary to secure the widow's annuity?”
The first parties maintained that the interest of the daughters was restricted to a right of liferent in their respective shares, with a power of disposal at their death, and that only in favour of their children; that no share of the fee had
Page: 107↓
vested in them; and that Miss Agnes Greenlees' will did not fall under the term “family settlement.” The second and third parties maintained that the daughters' shares of residue vested and became divisible at the date of the truster's death, subject only to a postponement in the division of such part of the capital as had to be retained to meet the annuity to his widow, and that the trustees were bound on demand to hand over their shares to the surviving daughters and to Miss Agnes Greenlees' representatives.
Argued for the first parties — There was no gift of fee to the daughters contained in the terms of the deed. It was not directly contained in the words used by the truster, nor could it he implied from the general tenor of the trust. The fact that the truster gave his daughters a limited power of disposal, and empowered his trustees to make advances at their discretion, was inconsistent with an intention on his part of making a direct gift of fee to them— Sanderson's Executors v. Kerr, December 21, 1860, 28 D. 227. In the cases relied on by the other parties there was a more direct gift of fee, followed by words of restriction. The term “family settlement” applied strictly to a settlement in favour of children by a married person, and could not be applied to a will in favour of selected brothers and sisters.
Argued for the second and third parties—There was no disposal of the fee unless it were to the daughters. The words “divide, apply, pay, or convey or hold … for behoof of,” did constitute such a gift. In the cases of Brown v. Broivn's Trustees, February 27, 1890, 17 R. 517, and Lawson's Trustees v. Lawson, July 17, 1890, 17 R. 1107, the words of disposal were similar to these, and were held to constitute a gift. If there were any repugnancy between the gift and the restrictions that followed, these would fly off, and would not be allowed to curtail the free gift assumed by law. The beneficiaries' power of disposal was inconsistent with the idea that they were mere liferenters. They were therefore entitled to be paid at once, and to get rid of the machinery of a trust which had merely been set up for administrative purposes— Brown v. Brown's Trustees, supra; Wilkie's Trustees v. Wight, November 30, 1893, 21 R. 199. In any view, Miss Agnes Greenlees' will was a “family settlement,” which was a wide expression, including even a marriage-contract by which she might have settled her share on herself. The possession of such a wide power was an additional argument in favour of a free gift of fee.
At advising—
Now, it appears to me from these provisions of the settlement that the period of division of the residue contemplated by the truster was the date of his death, and that thereafter the trustees were to pay to, or to hold for behoof of, each of the children the shares falling to them respectively. Thus the trustees are directed to pay the shares falling to the two sons at the date of the first annual balance of the business books occurring after the truster's death. But before this could be done, it is obvious that there must be a division of the residue into equal shares. It appears to me to be difficult to say that this is anything but the postponed payment of a share already vested.
Then, again, the trustees are directed to hold for behoof of his daughters the shares falling to each of them respectively subject to certain directions, but there is no further or other disposal of the fee of these shares. But it appears to me that a direction to pay to or to hold for behoof of a person is equivalent to a gift to that person, and that therefore the beneficial fee of these shares was all along in the daughters. I am therefore of opinion that a right to a fee in the residue of the truster's estate vested a morte testatoris, and that the first question ought to be answered in the affirmative.
If that be so, then the third question in the case arises, whether the surviving daughters and the representatives of the deceased daughter Agnes are entitled to immediate payment of their shares.
The facts which give rise to this question are that the trustees are directed to hold the shares, and to pay the annual proceeds only to the daughters, subject to a power to the daughters to dispone thereof by family settlements, and to the trustees to make advances to them out of capital. It appears to me that these directions amount to limitations on the full right of fee, which, as I have already said, I think is vested in the daughters, and therefore cannot receive effect. I think the case is ruled by the recent cases of Brown, Lawson's Trustees, and Wilkie's Trustees, to which we were referred, and which must be considered as settling the law in this respect. I am therefore of opinion that this question also should be answered in the affirmative, and that disposes of the whole questions in the case.
Page: 108↓
The Court answered the first and third questions in the affirmative.
Counsel for the First Parties— H. Johnston— Greenlees. Agents— Murray, Beith, & Murray, W.S.
Counsel for the Second Parties— C. S. Dickson — M'Clure. Agents — Ronald & Ritchie, S.S.C.
