Scottish Court of Session Decisions

Thomas Ballantyne, pawnbroker and jeweller in Glasgow, died on 21st May 1887, leaving a trust-disposition and settlement dated 14th June 1886, and a codicil dated 27th April 1887, whereby he conveyed his whole estate heritable and moveable to trustees for the purposes therein mentioned, and appointed his trustees tutors and curators to his pupil and minor children.

The first purpose of the said trust-disposition and settlement was for payment of debts and expenses. The second purpose provided for the widow getting the liferent use and enjoyment of the deceased's dwelling-house and furniture so long as she remained his widow; and the third purpose provided for payment to the widow, during her lifetime, of the whole annual income of his estate, under burden upon her of the maintenance and education of his sons till they attained majority, and of his daughters till they became married; and it was declared that the liferent to her should terminate on her entering into a second marriage. The fourth purpose was as follows:—“( Fourth) Upon the subsequent marriage or upon the death of my said wife, or upon my death should I survive her, I direct my trustees, after providing for the annuity and legacies after mentioned, to hold the remainder of my whole means and estate in trust for behoof of my children, till the youngest of them shall reach majority, when my said trustees shall, with the least possible delay, convert the whole of my estate, heritable and moveable, into money (if they should not have already done so in virtue of the powers given to them under these presents), and shall divide and pay over the same equally among them;

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Declaring that if any of my said children shall predecease the time of division leaving issue, such issue shall succeed to their parent's share equally among them.” The fifth purpose was for payment to such of his children as might be in pupilarity or minority at the time of his decease of a legacy of £100 each, payable to sons on their attaining majority, and to daughters on their attaining that age or being married, whichever event should first happen. The sixth purpose was for payment of an annuity to his sister, the seventh was for payment of various legacies, and the eighth made provision for an old assistant acquiring his business. The trust-disposition also contained a declaration that the foregoing provisions in favour of the truster's wife and children were and should be in full of all that she or they could claim by or through his decease in respect of terce, jus relictæ, and legitim, or any other legal claims competent to them respectively. The first clause of the codicil dealt with the acquisition of his business. The second and third clauses were as follows:—“( Second) I hereby authorise and empower my said trustees, if they shall think proper, to advance and pay to such of my children as may require it, in the case of sons upon their attaining majority, and in the case of daughters upon their attaining majority or being married, whichever event shall first happen, a sum not exceeding one-sixth of the share of my estate, which will probably fall to each child, said sum or sums to be paid out of the capital of my estate, and to be debited to the children who may receive such payment, and deducted from their share when it falls to be paid; Declaring that this provision is in addition to the fifth provision of my foregoing trust-disposition and settlement, and that my said trustees shall be the sole judges as to whether such advance should be made to my said children or any of them: and ( Third) In the event of any of my children, after attaining majority and being unmarried, not desiring to reside in family with my widow (although it is my wish that they continue to do so), they shall respectively be entitled to receive the proportion of the income which may be derived from their respective approximate shares in the residue of my estate—that is, they shall receive the whole income from the approximate amount of their shares in proportion to the income which may be derived from my estate; Declaring that the liferent interest of my widow shall be decreased accordingly.”

A holograph letter was found in the deceased's repositories after his death, in the following terms, viz.—“ March 1887. My dear Children—In all probability you will be one of these days without an earthly father. Jeannie with her dear husband and family, dear Maggie, Nancy, and Josephine (who seems so far away just now), Bessie, Horatio, Tom, Nelly, Arthur, Jackie, and darling Willie. To each and all of you I leave a father's blessing and means, which last I sincerely trust may never prove a snare to you, but which may, if wisely administered, afford you inward satisfaction and a great deal of pleasure in doing little acts of kindness to others. I hope you will all continue to live together in unity and harmony, standing loyally by Mamma, and thereby gaining the approval of your own consciences and the respect and esteem of others. God bless you. Your affectionate father, Thomas Ballantyne.”

Mr Ballantyne left heritable property valued at £1400, a bond and disposition in security moveable quoad succession but heritable quoad the widow's rights, which realised £156, 15s. 2d., and other moveable property amounting before deduction of debts and expenses to £13,228, 18s. 6d.

Mr Ballantyne was survived by his widow and by eleven children, five sons and six daughters, one of whom died on 23rd April 1892 survived by one pupil child, and leaving a will by which she appointed her husband her sole executor and universal legatory.

The truster's widow claimed her terce and jus relictæ, and so forfeited the provisions in her favour in the trust-disposition and settlement. She received one-third of the net moveable estate, and was regularly paid her terce.

The annuity provided for by the fifth purpose was paid till the death of the annuitant, and all the legacies were also paid except those payable to the two minor children upon their respectively attaining majority.

From the date of the truster's death till the term of Martinmas 1896 the trustees paid to each of his major children one-eleventh of the income of the residue, and they expended for the benefit of each of the minor children one-eleventh of the income during the same period.

At the term of Whitsunday 1897 the trustees, in respect they had doubts as to their power to make any payments whatever, declined to continue to pay or expend the income of the residue of the estate to or for behoof of Mr Ballantyne's children, as they had been in the habit of doing. A question having consequently arisen as to the interest of the children and issue of children in the residue of the estate and in the annual income derived therefrom, the present special case was presented for the opinion and judgment of the Court.

In addition to the facts above set forth, it was stated in the case that at the date when the case was presented the truster's widow was still alive and unmarried, that all the eleven children who survived the truster were still alive except one, a daughter, who had died leaving one pupil child, as stated above, that two of the daughters who were still alive were married, that all the children who were still alive were now major except two of the sons, that two of the sons (being major) and one of the daughters were not residing in family with the widow, and that the widow was willing if the estate could be divided to discharge her terce for the value of an annuity of the average amount thereof.

The parties to the special case were (1) the trustees; (2) the children major and

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minor of the truster who were still alive and the husband of the daughter who had survived the truster but was now dead, as sole executor and universal legatory of his wife; (3) the children of the truster who were not living in family with the widow; and (4) the pupil child of the daughter who had died.

The first parties contended that the residue of the estate had not vested and would not vest in the persons entitled thereto till the period of division provided for in the trust-disposition and settlement, viz., the attaining of majority of the youngest child after the second marriage or death of the widow, or at all events that vesting would not take place until the time when the trustees were directed to hold the residue for behoof of the children, viz., the second marriage or death of the widow, and the first parties also maintained that at whatever period vesting had taken or would take place they were not entitled or bound to pay either capital or income to the second parties until the period of division had arrived. The second parties maintained that vesting took place a morte testatoris, that the period of division was postponed simply for the purpose of protecting the widow's liferent which had now been forfeited, that the widow having elected to claim her legal rights must be presumed to be legally dead, and that as there were no interests to protect, the major children were entitled to instant payment of their shares of residue (under deduction of £200 to be retained by the first parties to meet the contingent legacies to the minor children), and in any event that the children, whether major or minor, were entitled to have the income of their shares expended for their behoof as formerly till the period of division. The third parties maintained that, in any event, as they had elected not to reside in family with the widow, they were entitled to receive the proportion of the income which might be derived from their approximate shares of the residue of their father's estate. The fourth party adopted the contention of the first parties, and he maintained that the share of the estate destined to the pupil's mother would, when the succession opened, fall to be paid to the pupil or his father as his tutor-at-law.

The questions of law for the opinion and judgment of the Court were as follows:— “(1) Did the residue of the trust means and estate of Mr Ballantyne vest in his children a morte testatoris? or is the vesting thereof postponed (1) till the second marriage or death of the truster's widow, or (2) till the youngest child of the truster attains majority if the widow enters into a second marriage or dies before that event? (2) If there was vesting a morte testatoris, are the major children entitled to instant payment of their shares? or Is payment postponed (1) till the youngest child of the truster attains majority though the truster's widow be then alive, or (2) till the second marriage or death of the truster's widow? (3) If there was vesting a morte testatoris, but if payment of the capital is postponed, are the major children entitled to payment of the income of their shares till the period of payment, and are the trustees entitled to expend the income of the shares of the minor children respectively for their behoof until they attain majority? (4) If payment is postponed, and should the third question be answered in the negative, are the third parties entitled to payment of the income of their approximate shares of the residue? ”

Argued for the second and third parties— (1) Vesting took place a morte testatoris. This was so upon the fourth purpose of the trust-disposition and settlement even apart from the codicil. The trustees were directed to hold for behoof of the children, and to pay at a postponed period, the issue of children predeceasing the time of division taking their parent's share. There was no survivorship clause, and the provision in favour of the issue of children predeceasing the period of payment did not amount in law to a destination-over. The postponement of payment was not adjected as a condition of the gift, but merely for the protection of the widow's liferent, and therefore did not import postponement of vesting.— Boss's Trustees, December 18, 1884, 12 R. 378; Jackson v. M'Millan, March 18, 1876, 3 R. 627; Hay's Trustees v. Hay, June 19, 1890, 17 R. 961; Boss's Trustees v. Boss, November 16, 1897, 25 R. 65. The last-mentioned case was directly in point, and indeed the present case was stronger, because here the beneficiaries were the testator's children, and in Boss's Trustees they were not. But when the codicil was taken into consideration the case for vesting a morte testatoris was still clearer. The codicil assumed that the children's shares vested a morte, as appeared from the terms of its second and third clauses. The word “probably” in the second clause only referred to the amount of the share, as was shown by the use of the word “approximate” in the third clause. These clauses showed that the testator intended the children to have severally a vested right each in his or her respective share. As to the effect upon vesting of such powers to give or rights to get anticipatory payments see Boss's Trustees, 12 R. 378, cit. and Wilson's Trustees v. Quick, February 28, 1878, 5 R. 697. The case of Adam's Trustees v. Carrick, June 18, 1896, 23 R. 828, relied upon by the other parties, was distinguished from the present. There the trustees had power to advance not only to the children but also to the widow. There was no reference to the individual shares of the children as there was here, and the beneficiaries were not ascertained until the period of payment. The Court there proceeded upon the view that there was no gift except by way of a direction to pay at a postponed period with a survivorship clause implied. See per Lord Adam at page 832. Such an interpretation of the residue clause in the present deed was not admissible, for the beneficiaries were ascertained before the period of payment, and the trustees were directed to hold for behoof of the children on the cessation of the widow's liferent, and not on the

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youngest child attaining majority for behoof the survivors. Here, in the view that vesting was postponed, partial intestacy would result if a child predeceased the period of payment without leaving issue. Even apart from the codicil the cases were distinguished, but in view of the codicil the distinction was quite clear. Moreover, Adam's Trustees was an isolated case and ought not to be followed if it conflicted with the authorities referred to above. It was not supported by the subsequent decision of Mackinnon's Trustees v. MacNeill, June 29, 1897, 24 R. 981, which on the contrary was an authority in these parties' favour. (2) If vesting took place a morte testatoris, then the children who had attained majority were entitled to immediate payment of their shares, the further postponement of payment till the youngest child attained majority being ineffectual as void for repugnancy, and there being now no necessity for postponing payment to secure the widow's liferent— Miller's Trustees v. Miller, December 19, 1890, 18 R. 301; Wilkie's Trustees v. Wight's Trustees, November 30, 1893, 21 R. 199; Greenlees' Trustees v. Greenlees, December 4, 1894, 22 R. 136; Stewart's Trustees v. Stewart, December 17, 1897, 35 S.L.R. 298. In the case of Russell v. Bell's Trustees, March 5, 1897, 24 R. 666, it was held that vesting was suspended, the restriction being effectual as a qualification of the gift. (3) In any event, the 3rd and 4th questions should be answered in the affirmative. There was no direction to accumulate income.

Argued for the first and fourth parties—There was no vesting (1) till the death or second marriage of the widow, or (2) till the youngest child attained majority, whichever of these events occurred last. The terms of the deeds here were practically the same as in the case of Adam's Trustees v. Carrick, cit. That case was not isolated. It was one of a series of which Sloan v. Finlayson, May 20, 1876, 3 R. 678, was an example. It had, moreover, been approved, although it was distinguished in Mackinnon's Trustees v. MacNeill, cit. The fact that the trustees in Adam's case had power to advance to the widow was not sufficient to account for the decision, because such a power did not affect the vesting of provisions in favour of children but only their amount— Reddie's Trustees v. Lindsay, March 7, 1890, 17 R. 558. The postponement of payment here was not merely to secure the widow's interest, for the trustees were directed after her interest had ceased to hold till the youngest child had attained majority. On the residue clause apart from the codicil no several rights were conferred upon the children, and the beneficiaries could not be determined till the period of payment. In these circumstances the absence of a survivorship claim was not of importance as regards vesting, for it was not required. The codicil did not make any difference in this respect. The “shares” of children were no doubt mentioned, but it was only “the share” “which will probably fall to each child,” and the word “probably” plainly referred to the contingency of the right, and not merely to the amount. This interpretation was supported by the fact that subsequently where the amount only was referred to the word “approximate” was used and not “probable.” At least this was a fair meaning to attach to the word “probable,” and it had this advantage, that it did not conflict with the testator's intention, which was clear (whether allowable or not in law), whereas in the opposite view the whole provision as to making advances was meaningless and nugatory. The interpretation suggested also harmonised with the interpretation suggested for the residue clause. Such a reference to “a child's share” did not import a several right in each child, especially when it occurred in a codicil to a deed by which no several rights were given. There was therefore here nothing but a direction to the trustees to pay at a postponed period, and the beneficiaries had no several interests, their several interests not being capable of determination till the occurrence of the event upon which the trustees were to pay. Such a postponement of payment imported postponement of vesting— Adam's Trustees, cit.; Reeves' Executor v. Reeves' Judicial Factor, July 14, 1892, 19 R. 1013. The trustees were not even directed to hold for behoof of the children till after the widow's death or second marriage, and vesting at any rate could not take place till that event occurred. As regards vesting, this provision was not affected by the fact that the widow had renounced her liferent and taken her legal provisions— Muirhead v. Muirhead, May 12, 1890, 17 R. (H.L.) 45. In Ross's Trustees, 12 R. 378, cit., and Ross's Trustees v. Ross, 25 R. 65, cit., several rights were given to the beneficiaries, and these cases were consequently distinguished from the present. Wilson's Trustees v. Quick, cit., must be held as overruled by Adam's Trustees, cit. (2) If vesting took place a morte testatoris, then probably the major children were entitled to immediate payment.

At advising—