Scottish Court of Session Decisions

Thomas Best and Mrs Dunlop or Best were married in 1831. An antenuptial contract was entered into whereby Mrs Best conveyed to the marriage-contract trustees the whole property belonging to her for certain trust purposes; among these were, that the trustees should hold her property for behoof of herself and her husband and the survivor in liferent, and after the death of the survivor of the spouses pay over the fee to the children procreated of the marriage in such proportions as should be appointed by a writing executed jointly by the spouses, or by Mrs Best if she survived her husband, and failing any appointment then to pay to the children in equal shares.

On 7th December 1859 Mr and Mrs Best executed a joint deed of appointment, by which they appointed the estate above mentioned among the children of the marriage then alive, in certain proportions. This deed contained a power either to the spouses jointly or to Mrs Best, if she survived Mr Best, to alter or revoke the same, and the division thereby made, but under the declaration that in so far as not altered the same should be held as a valid deed of appointment and division.

There were five children of the marriage.

Thomas Best predeceased his wife.

In July 1875, after Mr Best's death, Mrs Best executed a deed of appointment and division by which she revoked the deed of 1859 and made a new appointment of her estate in certain proportions. In particular, she, with his own consent, directed that only one-half of the amount apportioned to her son William James Best should be payable to him, and that the other half should be divided equally between his two children, he having the liferent of that half. By this deed she gave a sum of £100 to John Paton Watson, husband of one of her daughters.

In 1880 Mrs Best executed another deed of appointment and division, which bore to revoke the joint deed of 1859 but did not bear to revoke the deed of 1875.

By this deed she appointed and divided her estate as follows, viz.—(1) £3000 equally between her grandchildren Thomas Alexander Vans Best and Louisa Vans Best, the children of her deceased son Alexander Vans Best; (2) £1000 equally between the two children of William James Best, the income being payable to him during his life; (3) £200 equally between Eric Grant Matheson and Ailsie Matheson, children of Mrs Louisa Cecilia Caroline Matheson or Best, widow of Alexander Vans Best; £100 to William Pirrie, M.D.; £50 to Jane Duncan, an

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old servant; and £50 to each of three charitable institutions.

The clause disposing of the residue was in these terms:—“After fulfilling or providing for the fulfilment of the above direction, the whole remainder of the trust funds and property shall be divided equally among or between the said Margaret Best, William James Best, and Andrew Vans Dunlop Best, my said children.”

No share was appointed by this deed to one of Mrs Best's daughters, Annie Best or Watson, wife of John Paton Watson.

After Mrs Best's death the present Special Case was adjusted to determine whether there was any valid and subsisting appointment by Mrs Best, and as to the construction and effect of the deeds above narrated. Mrs Best was survived by four children, namely, her daughters Mrs Watson, Margaret (Mrs Reid), and two sons William James Best and Andrew Vans Dunlop Best. The deceased son Alexander Vans Best was represented by his two children Thomas Alexander Vans Best and Louisa Vans Best.

The parties of the first part were the marriage-contract trustees.

The parties of the second part were ( a) Mrs Reid, William James Best, and Andrew Vans Dunlop Best, ( b) the two children of William James Best, and the two children of the deceased Alexander Vans Best.

The parties of the third part were Mrs Watson and her husband.

The parties of the fourth part were Eric Grant Matheson, Ailsie Matheson, Jane Duncan, and the three charitable institutions to whom legacies were provided in the deed of 1880. Dr Pirrie had predeceased Mrs Best.

The second parties maintained that the deed of 1880 was the ruling appointment; that its first and second heads validly appointed £4000 of the funds at Mrs Best's disposal; that its third, fourth, fifth, and sixth heads were in themselves invalid as appointments to, in all, a further £500 of said funds, the appointees being strangers to the power; but that the said sum so invalidly appointed fell into residue, and became divisible among the residuary appointees under the seventh head; that it was the intention of the residuary appointees, in the event of it being found that their construction of the deeds was correct, at their own hands to carry out the wishes of Mrs Best by making over the sums so added to residue to the persons and charities in whose favour the invalid appointments had been made; that in the event of the deed of 1880 being held to be invalid, the second parties maintained that the deed of 1875 was the ruling deed.

It was also narrated that the third parties maintained that there was no effectual appointment by any one of the said three deeds, in respect that the deeds of 1859 and 1875 were revoked, expressly or by implication, and that the deed of 1880 contained no appointment in favour of Mrs Watson, one of the objects of the power. Alternatively, they maintained that if the deed of 1880 was a valid and subsisting deed of appointment quoad its first, second, and seventh heads, it was invalid and ineffectual quoad its third, fourth, fifth, and sixth heads, and that the sum of £500 thereby attempted to be appointed to strangers to the power did not fall to be distributed as residue under the seventh head, but that there was a failure to appoint thereto, and consequently that the said sum of £500 fell to be distributed in terms of the marriage-contract equally among the objects of the power.

The fourth parties admitted that the appointments in their favour under the deed of 1880 were invalid.

A number of questions were submitted for the opinion of the Court, but counsel for the third parties having stated in the course of the debate that he gave up the contention that the deed of 1880 was not the ruling deed, the only questions which remained for decision were the following:—(I.) Whether any, and if so which, of the following deeds, viz., (1) the said joint-deed of appointment executed by Mr and Mrs Best on 7th December 1859; (2) the said deed of appointment executed by Mrs Best on 3d July 1875; and (3) the said deed of appointment executed by Mrs Best on 30th April 1880, constitutes a valid, subsisting, and the regulating appointment in whole or in part to the funds and estate of Mrs Best, held by the first parties under her marriage-contract? (II.) Assuming the third deed mentioned in question 1 [that of 1880] to be the regulating deed of appointment, and it being admitted by the fourth parties that the appointments thereby made in favour of the fourth parties and Dr Pirrie are not valid appointments, do the sums so invalidly appointed fall to be divided as residue under the seventh head of the said last-mentioned deed, or do they fall to be divided in terms of Mr and Mrs Best's marriage-contract?

Argued for the parties of the second part—The only question which remained for argument was, whether the legacies in the names of those who were strangers to the power in the deed of 1880, which amounted to £500, fell into the residuary appointment of that deed or fell into intestacy quoad Mrs Best, and were to be regulated by the marriage-contract. The question was a new one, for there was no reported case of a residuary clause occurring in a deed of appointment. It was, however, an inference from Mackie v. Gloag's Trustees, July 4, 1885, 12 R. 1230, that such an appointment did not fail in respect of such a clause, and must embrace the whole estate. The appointment, so far as taken to the objects of the power, must stand for the whole fund. The position of this sum was analogous to that of a lapsed legacy, which never fell into intestacy but always went to residue.

Other authorities— Watson v. Marjoribanks, February 17, 1837, 15 S. 586; Campbell v. Campbell, June 19, 1878, 5 R. 961.

Argued for the parties of the third part—A lapsed appointment was in a different position from a lapsed legacy, for it was a failure to exercise a power on the part of the maker of the deed, whereas the lapse of a legacy arose from circumstances not in the power of the testator. It was a question of intention, and as there was nothing to show an intention on the part of the appointer here that the sum invalidly appointed was to go to the residuary legatees, the only resource was to leave it to be dealt with by the provisions of the marriage-contract. The question had been determined in England in that way— Gage v. Leapingwell, 1812, 18 Vesey, 463; Easum v. Appleford, 1839, 5 Mylne & Craig, 56; Jeaffreson's Trustees, 1856, L.R., 2 Eq. 276; Lakin v. Lakin, 1865, 34 Beav. 443.