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OUTER HOUSE, COURT OF SESSION
[2007] CSOH 54
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A2312/01
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OPINION OF LORD EMSLIE
in the cause
DOLORES ALTHEA
MOBERG or DE LATHOUWER (A.P.)
Pursuer;
against
ALISTAIR ROBERT
ANDERSON AND OTHERS
Defenders:
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Pursuer:
Wallace; McKay & Norwell,
W.S.
Fifth Defender: MacColl;
Lindsays, W.S.
9 March 2007
Introduction
[1] The
pursuer is a lady who lives in Texas. Many years ago, she and her then husband
assisted a Mr and Mrs Ross to acquire a house in Scotland. Initially the pursuer and her husband
purchased the property in their own name, on the strength of an agreement
whereby the price would be reimbursed by Mr and Mrs Ross over an extended
period. In due course, however, when
only г8,000 of the price remained outstanding, the arrangements were
changed. On 1 April 1982 Mr and Mrs Ross executed a probative
writing in the pursuer's favour, committing themselves to pay the balance of
the price in ten annual instalments of г800, and undertaking that they and the
survivor of them would leave and bequeath the house to the pursuer. The latter undertaking was expressed in the
following terms:-
"... And we and
the survivor of us undertake to leave and bequeath the said house to the said
Dolores Althea Moberg; And we further
declare that such bequest shall be irrevocable:
..."
Shortly thereafter, the pursuer
disponed and conveyed the property into the name of Mr and Mrs Ross and
the survivor of them.
[2] Following
the death of Mr Ross in 1990 Mrs Ross continued to live in the house,
and it appears that the balance of the price was duly paid. Mrs Ross herself (hereinafter "the
deceased") died domiciled in Scotland
on 2 March 2000. However, although both she and her husband
left wills, neither of them left or bequeathed the house to the pursuer, and
the residue of their respective estates went elsewhere. The pursuer has now raised the present action
against the executor of the deceased, and against the beneficiaries under the
deceased's will, claiming entitlement either
to conveyance of the house in direct implement of the undertaking of 1982 as a
deed having testamentary effect or,
failing that, to the payment of a substantial sum of damages for breach of
contract. The action is defended by the
executor (the first defender) and by the residuary beneficiary (the fifth
defender), and under her preliminary plea to relevancy the latter now seeks
dismissal of the pursuer's claim in both of its branches. I have now heard a procedure roll debate on
these issues, and for convenience propose to consider each of them in turn.
The alleged testamentary effect of the undertaking
[3] The primary argument
advanced by counsel for the fifth defender was to the effect that the pursuer's
averments in condescendence 3 regarding the legal character of the
undertaking were fundamentally misconceived.
Properly construed, the undertaking was in the nature of an inter vivos contract to test. The language "... undertake to leave and
bequeath" was future-looking. The
declaration of irrevocability was also in the future tense, and related to
"such" bequest as if the latter was yet to be identified. Those features could not simply be
ignored. Whatever the undertaking might
amount to, it was on no view a will or bequest.
It disclosed no present testamentary intention nor did it contain any
appointment, transfer or direction relative to any executor or other
representative. Had a testamentary act
been intended at that time, the operative wording would have been "... do hereby
leave and bequeath ..." or something similar, in which event different
considerations would have arisen.
Accordingly, in averring that
"... The said
undertaking was given in consideration of an interest free loan by the pursuer
to Mr Ross and the deceased of the purchase price of the Subjects. The said undertaking was onerous. It was binding on both Mr Ross and the
deceased. Mr Ross died on or about
February 1990. At the date of her death
the deceased was heritable proprietor of the Subjects. The said undertaking is testamentary in
effect. It is therefore binding upon the
first defender. ...",
the pursuer was proceeding on the
basis of a serious misconception, and her primary claim was irrelevant. Furthermore, the terms of the pursuer's later
disposition of the subjects could not properly be used as an aid to
construction of the disputed undertaking.
[4] In
any event, esto the undertaking was
testamentary in nature, it was revocable according to settled principles of law
and had in fact been revoked by the deceased's later will. Neither delivery of a will to third parties,
nor the insertion of any clause of irrevocability, could in law prevent a
testator from changing his or her mind at any time:- cf. Bell,
Principles, paras.1864, 1866; Stair Memorial Encyclopaedia, vol.25,
para.736; Dougall's Trs. v Dougall
1789 M. 15949; Clark's Exors. v Clark
1943 SC 216, esp. per Lord Jamieson at 241 and Lord Justice-Clerk Cooper at
224-5. Accordingly, the pursuer could
not succeed in her primary claim even if the undertaking qualified for
testamentary status in the first place.
No doubt an irrevocable obligation to bequeath property might be
undertaken, and there might be other circumstances in which revocation of a
will might be barred by inter vivos
contract, as illustrated by cases such as McLachlan
and Others v Seton's Trs. 1937
S.C. 206. But even in that case it was
truly the underlying obligation to bequeath which the court held irrevocable,
as opposed to the codicil of 1911 by which that obligation was initially
implemented.
[5] In
response, counsel for the pursuer began by asserting that he was "... absolutely
not ..." saying that the undertaking was a testamentary deed. In his submission the undertaking was
testamentary "in effect", as averred in condescendence 3, in the sense
that it obliged someone to make the property available to the pursuer after the
death of the deceased. In effect it was
a will, although legitimately embodied as part of a wider contractual
deed. No special form was in law
required. The undertaking was directly
enforceable against the first defender as executor because its concluded
testamentary intent was clear. There
would otherwise be no content for the words "leave and bequeath", or for the
destination to executors in the subsequent disposition of the subjects, and it
would be absurd if a further document was required - in virtually identical
terms - to render that testamentary intent effective. No doubt clearer or more elegant language
could have been used in the undertaking, and it was conceded that "at first
blush" it did not look like a will, but that was immaterial where the deed
evinced an intention that something should happen on the death of the surviving
grantor. The absence of any express
mention of future wills was a further point in the pursuer's favour, and it could
not matter that, at the time when the undertaking was granted, the identity of
the surviving grantor (and supposed testator) could not be ascertained. In a testamentary context, even informal
writings traditionally attracted a benign construction, and such a construction
was also appropriate here where the parties might otherwise be left to contest
a claim of damages for breach of contract.
[6] As
regards the fifth defender's argument on revocability, counsel maintained that
since this was not an ordinary testamentary writing the ordinary rules did not
apply. The case of McLachlan was authority for the irrevocability of a very similar
obligation with a strong contractual element, and could not be distinguished
for present purposes. The contractual
element here was averred in condescendence 3 at page 9A-C, and it
could not be said that these averments were irrelevant.
[7] In
my view these issues can be dealt with fairly shortly. In the first place, I have no hesitation in
holding that the undertaking of 1 April
1982 was not, in its nature or effect, a testamentary writing. Properly construed, I consider that it
embodied something quite different, namely an inter vivos obligation binding the surviving grantor, at some time
in the future, to leave and bequeath the house to the pursuer. As counsel for the fifth defender put it, the
deed comprised an obligation to test or make a bequest, as opposed to
constituting a bequest in its own right.
In my view there are several features which point strongly towards that
conclusion. First, the deed contains no words of present gift, bequest, conveyance
or transfer, being expressed in terms of an undertaking to leave and
bequeath. Second, the clause of irrevocability is in the future tense, and
refers to "such bequest" as if the latter had yet to come into existence. Third,
the deed contains no reference to an executor or other representative, whether
in the form of appointment, transfer or direction. Fourth,
as at 1 April 1982, the
title to the property was still held by the pursuer herself and formed no part
of the disposable assets of either Mr Ross or the deceased. And fifth,
as conceded by counsel for the pursuer, the undertaking would appear to bind
the surviving grantor only, in circumstances where his or her identity was at
that time unascertainable. Thus
Mr Ross as the predeceasing grantor incurred no ultimate obligation under
the deed, and even counsel for the pursuer did not contend that it was
"testamentary in effect" quoad
him. In such circumstances, I am unable
to accept that the deed evinces any concluded testamentary intention on the
part of either grantor, and hold that on a proper construction it was simply an
agreement to test at some future date.
On that basis, it cannot relevantly support the pursuer's primary claim
directed against the first defender as the executor of the deceased, and in my
judgment that claim must now be dismissed.
[8] The
fallacy of the pursuer's approach here is in my view threefold. In the first place, I think that it ignores
the plain terms of the undertaking itself together with certain important
features of its factual matrix. Secondly, it seems to me to confuse the
concept of a testamentary writing, on the one hand, with, on the other, a deed
which merely envisages that something will happen on the death of the
grantor. Such a deed may or may not be
testamentary in nature, with the answer in any given case depending on a
careful construction of its terms. And
thirdly, the pursuer has to my mind sought to rely on irrelevant
considerations, such as the mention of executors in her own later disposition
of the subjects to Mr and Mrs Ross.
In any event, even if that reference could legitimately be taken into
account, I would not regard it as being of any assistance, one way or the
other, in construing the earlier undertaking since it is equally consistent
with both of the competing submissions.
[9] Even
if I were wrong in reaching these conclusions, and the deed truly fell to be
regarded as testamentary in nature, I would have been inclined to hold that it
was subsequently revoked by the general clause of revocation in the deceased's
later will. On the authorities cited by counsel for the
fifth defender, neither delivery of a testamentary writing, nor any integral
clause of irrevocability, can effectively bar a testator from changing his or
her mind. No doubt an underlying
agreement to test might have that effect, as illustrated by the case of McLachlan, but since I do not think that
the present deed could constitute both a completed bequest and an agreement to
test at the same time I would not have been prepared to hold that the necessary
contractual element was present in this case.
The pursuer's alternative claim
[10] As previously indicated, the
pursuer's fallback position was that, esto
the undertaking of 1 April 1982 fell to be construed as a contract to
test, she was entitled to proceed with her claim of damages for the deceased's
breach of that contract as averred in condescendence 4. For the fifth defender, counsel contended
that this alternative branch of the pursuer's claim should also be dismissed. According to him, the opening sentence of
condescendence 4 was unintelligible, even when read against the background of
the averments in condescendence 3, and overall the pursuer had failed to
give his client any fair notice of this ground of claim. In particular, the pursuer nowhere expressly
stated that she was founding on the undertaking as an agreement to test, and
his client should not be left to guess what the pursuer meant by the hypothesis
on which condescendence 4 proceeded, namely that the deed was "not binding
on the first defender" as the deceased's executor.
[11] In response, counsel for the pursuer maintained that the basis
of his alternative claim was sufficiently identified in
condescendence 4. All he was saying
was that if the undertaking was not testamentary it was contractual, and thus
rendered the deceased's estate liable in damages for any breach. Even if the first sentence of
condescendence 4 was unclear, the remainder was not, and the same applied
to the pursuer's fourth plea-in-law. At
the very least, therefore, the pursuer was entitled to a proof before answer on
her alternative claim, and standing the defenders' pleadings it was
acknowledged that this would have to be a proof before answer on both merits
and quantum.
[12] In my opinion the defenders have adequate notice of the
pursuer's alternative claim, as expressed in condescendence 4 and in her
fourth plea-in-law. During the debate,
counsel for the fifth defender very fairly conceded that breach of a valid inter vivos agreement to test might in
due course sound in damages against the grantor's estate, and in the
circumstances there can in my view be no real doubt that this is what the
pursuer has in mind. Putting it another
way, and applying the ordinary test for relevancy, I am unable to hold that
even if the pursuer were to prove all of her averments on this matter she would
nevertheless be bound to fail. No doubt
the averments in condescendence 4 might have been more clearly expressed,
and the averments of loss are certainly sparse, but in the whole circumstances
I conclude that a proof before answer on the pursuer's alternative claim must
now be allowed.
Disposal
[13] For the foregoing reasons I
shall sustain the fifth defender's first plea-in-law to the extent of repelling
the pursuer's third plea and dismissing the pursuer's primary claim as
reflected in her first and second conclusions.
Quoad ultra I shall allow a
proof before answer on the pursuer's alternative claim as focused in her third
conclusion, fourth article of condescendence and fourth plea-in-law.
