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You are here: BAILII >> Databases >> Scottish Court of Session Decisions >> Veitoh'a Trustees v. Rutherford and Others [1913] ScotLR 150 (12 December 1913) URL: http://www.bailii.org/scot/cases/ScotCS/1913/51SLR0150.html Cite as: [1913] SLR 150, [1913] ScotLR 150 |
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Page: 150↓
A testator left the residue of his estate to trustees “for behoof of” two ladies, and enjoined them, the trustees, “to put not a shilling at risk during the life” of the two beneficiaries.
Held that the bequest conferred an absolute right of fee vesting a morte, that the trust purposes were repugnant, and that, accordingly, the beneficiaries were entitled to immediate payment of the residue equally between them.
On 26th September 1912 W. G. Turnbull, farmer, Spittal-on-Rule, Roxburghshire, and another, the testamentary trustees of the Reverend William Veitch, LL.D., Circus Place, Edinburgh, first parties; Mrs A. R. Turnbull or Rutherford, widow of John Rutherford, farmer, Jedburgh, and Mrs A. E. Rutherford or Bywater, wife of J. T. A. Bywater, Nisbethill, Ancrum, with the consent of her husband as her curator and administrator-in-law, the beneficiaries named in the residue clause after mentioned, second parties; Mrs J. E. Turnbull or Brown, wife of D. G. Brown, Ballarat, Victoria, with the advice and consent of her husband, and another, the representatives of the testator's next-of-kin and heirs in mobilibus as at the date of his death, third parties; and the said W. G. Turnbull and others, the surviving original trustee and the representatives of the deceased trustee under the said residuary clause, fourth parties, brought a Special Case for the determination of the rights of the second parties in the residue of Dr Veitch's estate.
The Case stated—“1. The late Reverend William Veitch, LL.D., … died on 8th July 1885, leaving a holograph will dated 4th July 1878, … and registered in the
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Books of Council and Session 20th January 1886.… 2. As regards the residue of the testator's estate the said will provides as follows—‘The residue I leave to my relation and friend Professor William Rutherford and Mr William Turnbull, Spittal, for behoof of Mrs John Rutherford, Thickside, and Mrs Bywater (Annie Rutherford), and enjoin on them to put not a shilling at risk during the life of the two ladies.’
3. At or about the end of the year 1885 the executor appointed by the said will paid over the residue of the testator's estate to the said Professor Rutherford and William Turnbull, … as trustees under the said residuary clause. The said Professor Rutherford has since died.… The trustees, since the said residue was paid over to them in 1885, have held and invested the capital thereof, which at the present value of the investments amounts to about £6400, and have paid the annual income to the said Mrs Rutherford and Mrs By water equally.…
4. The second parties … maintain that under the said will the residue of the testator's estate has vested in them in fee, and that they are now entitled to have the same paid to them equally. Alternatively they maintain that the said residue has vested in them in fee, subject only to the limitation that during their lifetime it falls to be administered by the first parties for their respective use and behoof. If it be held that their interest is one of liferent, they maintain that in addition to said interest each of them has a power of disposal mortis causa of one half of the residue. If it be held that their interest in the residue is limited to one of liferent only, they maintain that on the death of the first deceaser of Mrs John Rutherford and Mrs Bywater, the fee of the half of the residue which had been liferented by her will thereafter be liferented by the survivor.…
“7. The first, third, and fourth parties maintain that under the said will the second parties are not now entitled to have the said residue paid to them, but are entitled only to the liferent of said residue.…”
The questions of law were—“1. Is the residue vested in fee in the second parties equally? 2. If the first question be answered in the affirmative, ( a) are the second parties now entitled to payment of the said residue equally between them, or ( b) does it fall to be administered by the first parties during their lifetime for their respective use and behoof? 3. If the first question be answered in the negative, has each of the second parties a power of disposal mortis causa of one-half of the said residue in addition to her liferent interest? 4. If the right of the second parties be limited to one of liferent only, on the death of the first deceaser of Mrs John Rutherford and Mrs By water will the fee of the half of the residue which had been liferented by her be thereafter liferented by the survivor?”
A note was subsequently lodged in process by the parties setting forth, inter alia, that both Mrs Rutherford and Mrs By water (the second parties) were married prior to the passing of the Married Women's Property (Scotland) Act 1881; that no provision by irrevocable deed was ever made by Mr Rutherford for his wife in the event (which happened) of her surviving him; that Mr By water died on 10th September 1913 leaving a trust-disposition and settlement, by which he, inter alia, renounced his jus mariti with regard to any funds that might be acquired by his wife, and that accordingly both of the second parties took the residuary bequest referred to as their separate estate.
Argued for the second parties—The right of the second parties in the residue was one of fee, not of liferent. Each therefore was entitled to immediate payment of her share— Miller's Trustees v. Miller, December 19, 1890, 18 R. 301, 28 S.L.R. 236; Greenlees' Trustees v. Greenlees, December 4, 1894; 22 R. 136, 32 S.L.R. 106; Ballantyne's Trustees v. Kidd, February 18, 1898, 25 R. 621, 35 S.L.R. 488; Gillies' Trustees v. Hodge, December 7, 1900, 3 F. 238, 38 S.L.R. 150; Yuill's Trustees v. Thomson, May 29, 1902, 4 F. 815, 39 S.L.R. 668; Tweeddale's Trustees v. Tweeddale, December 16, 1905, 8 F. 264, 43 S.L.R. 193. The cases of Christie's Trustees v. Murray's Trustees, July 3, 1889, 16 R. 913, 26 S.L.R. 611, and Chambers' Trustees v. Smiths, April 15, 1878, 5 R. (H.L.) 151, 15 S.L.R. 541, were distinguishable, for in both the fee was defeasible, and in Forrest's Trustees v. Reid, November 25, 1904, 8 F. 142, 42 S.L.R. 133, there was a destination-over to heirs. In the present case the fee given was an absolute one, for there was no further destination and no resolutive conditions, nor were there other interests involved which might require the retention of the money in the trustees' hands. [As to the possibility of a protected fee, Lord Johnston referred to Gibson's Trustees v. Ross, July 12, 1877, 4 R. 1038, 14 S.L.R. 694, and to Massy v. Scott's Trustees, December 5, 1872, 11 Macph. 173, 10 S.L.R. 111.] Esto, however, that the right of the second parties was merely one of liferent, the survivor was entitled to a liferent of the whole— Barber v. Findlater, February 6, 1835, 13 S. 422; Paxton's Trustees v. Cowie, July 16, 1886, 13 R. 1191, per the Lord President at p. 1197, 23 S.L.R. 830. [Counsel for the parties admitted that the third question—viz., that as to the power of disposal—did not arise at present. It was also conceded by the third and fourth parties that in the event of the Court holding the right of the second parties to be one of liferent, the survivor would be entitled to a liferent of the whole.]
Argued for the first, third, and fourth parties—The bequest was one of liferent. The words “for behoof of” did not necessarily imply a gift of fee. They were equivalent to “for the use of.” There was no direction to pay, and no absolute gift in initio as in Greenlees ( cit.)
At advising—
Page: 152↓
Now we have here before us, as I think, a clear case for the application of the principle so laid down, for the residue clause of Dr Veitch's holograph settlement runs thus—“The residue I leave to my relation and friend Professor William Rutherford and Mr William Turnbull, Spittal, for behoof of Mrs John Rutherford, Thickside, and Mrs Bywater (Annie Rutherford), and enjoin them to put not a shilling at risk during the life of the two ladies.” I cannot construe these words otherwise than as conferring a clear, unqualified, and indefeasible right of fee on these two ladies. And it is nothing to the purpose to say that these words are followed by an injunction to the trustees to put not a shilling at risk during the life of the two ladies, because that is no more than a direction to place the money in a safe investment where no loss can take place. It is, I think, impossible to contend that the import of these words is to reduce the right of fee to a right of mere liferent, and if they have not that effect, then it was not maintained to us that they had any other effect. The first and third parties to this case were, I think, well advised in not maintaining in face of the judgment in Yuill's Trustees and Miller's Trustees that the effect of these words was to enable the trustees to retain and to manage this vested provision.
It appears to me, as the result of the authorities to which I have referred, and as the result of the principle which I take to be firmly embedded in our law, that a beneficiary cannot be denied an immediate payment of his provision unless there are trust purposes in the settlement, to secure which it is essential that the trustees retain in their own hands the right which is vested in the beneficiary. Now in the case before us there are no such trust purposes, and therefore I think that these ladies are entitled to the immediate payment of the provision made for them in the residue clause of this will.
I propose to your Lordships, therefore, turning to the questions, that we should answer the first question in the affirmative, the first part of the second question in the affirmative, and the second part of the second question in the negative. The third question is superseded, and the fourth question is abandoned.
As the two ladies both survived the testator, though the bequest was joint they each took a vested interest in one-half, and no question of accretion arose.
Mrs Rutherford was married in 1875, and the testator died in 1885. Her husband had made no provision for her before the passing of the Married Women's Property Act 1881. Hence by section 3 thereof Mrs Rutherford took her share of the residuary bequest in question as her separate estate.
Mrs By water was also married, in 1878, before the passing of the Act. Mr By water made a reasonable provision for her by antenuptial marriage contract, and therefore Mrs Bywater's interest in the bequest in question fell under his jus mariti. See also section three of the Act. But by his testamentary settlement he waived his right in favour of his widow. Hence Mrs By water's rights are not practically affected by her marriage.
The first, and the first branch of the second, question therefore fall to beanswered in the affirmative. The other questions do not require answer.
The Court answered the first question of law in the case, and the first branch of the second question, in the affirmative, and found it unnecessary to answer the remaining questions.
Counsel for the First Parties— A. M. Hamilton. Agents— Mackenzie & Wyllie, W.S.
Page: 153↓
Counsel for the Second Parties— Moncrieff, K.C.— J. H. Henderson. Agents— Bell, Bannerman, & Finlay, W.S.
Counsel for the Third Parties— Chree, K.C.— Shiell. Agents— Sharpe & Young, W.S.
Counsel for the Fourth Parties— Macquisten. Agent— J. D. Rutherford, W.S.