Scottish Court of Session Decisions

This was an action of multiplepoinding and exoneration raised by the trustees of the late John Binnie of Hangingshaw.

The following narrative is taken from the judgment of the Lord Ordinary (Johnston):—“John Binnie, who died in 1847, left a trust-settlement dated 1826, and a supplementary trust-settlement dated 1832, and various subsequent codicils. By the original settlement, division of the residue of his estate was provided among his children, who were then a son and five daughters, in terms which I do not need to narrate, as they did not become operative. But for any bearing it may have upon the question now at issue I may add that the key-note of this provision was a stirpital distribution, with vesting at the date of the testator's death.

In 1832 he executed a supplementary settlement. Vesting was postponed for ten years after the testator's death, and two thirteenth shares having been provided by the original settlement, as modified by this deed, to his daughter Agnes, in regard to the destination of these shares he now declared and appointed 'that the same shall not be payable to her or her children; but I do hereby direct and appoint that the interest or produce of the same shall be paid and apportioned to her in liferent, for her liferent use allenarly; and failing her, to be paid and apportioned to her children equally, share and share alike, in liferent, for their liferent uses allenarly, and to the issue of her said children in fee; but failing the issue of her said children, I direct and appoint that the fee of said shares falling and allotted to her shall revert and belong to my other children before named, and to the issue of those who have deceased, equally, share and share alike. …”

By a codicil, dated in 1842, the testator … directed his trustees, as soon after his decease as they might think proper, to divide amongst and pay over his estate to his surviving children, that is to say, his daughters, for his son had predeceased the date of the codicil, and the issue of such of them as might have deceased, ‘ with the exception of my daughter Agnes, now Mrs Craig, whose share shall be held and retained by my said trustees, and the interest and produce thereof paid to her half-yearly, and failing her to her children, and the fee thereof shall be paid to the issue of her said children, all as before and after provided.’ The before provided referred to the above-recited provision of the supplementary settlement of 1832. The after provision was as follows—‘ In the third place, I hereby confirm the destination of the share of my means and estate of my said daughter Agnes, as contained in the foresaid codicil or supplementary trust-disposition and deed of settlement of date 17th December 1832, and I hereby again direct and appoint that the said share so falling to my said daughter Agnes shall not be payable to her, and upon her death the same shall not be payable to her children; but I do hereby direct and appoint my said trustees to hold in their own hands the amount of her said share, and to lend out the same upon good heritable security, taking the bonds and dispositions for the same in their own names … and I direct and appoint my said trustees to pay the interest or produce of the same to her in liferent, for her liferent use allenarly, and that half-yearly, at the terms of Martinmas and Whitsunday, by equal portions, declaring the same purely alimentary and unaffectable by the debts or deeds of her present or any future husband; and upon her decease I appoint the interest or produce of her said share to be paid and apportioned to her children, equally, share and share alike, in liferent, for their liferent use allenarly, and that half-yearly, at Martinmas and Whitsunday, by equal portions, as aforesaid; declaring the said interest or produce purely alimentary and unaffectable by the creditors of said children; and failing the children of my said daughter Agnes leaving lawful issue of their bodies, then I direct and appoint the fee of her said share of my means and estate to be paid to the lawful issue of her said children, and that equally, share and share alike; but failing lawful issue of the children of my said daughter Agnes, I direct and appoint that the fee of said share of my succession to fall and be allotted to her shall revert and belong, and be paid to my other children who may then be alive, equally, share and share alike, and to the issue of such of them as may have deceased, and that equally, share and share alike, the issue of any of my said children who may have deceased being in that case, as in the original destination of the shares of my succession, entitled to their parent's share of my succession with my children alive at the time, and that equally, share and share alike.’

In the fifth head of this codicil an anxious and elaborate provision was made for the case of any of his daughters having no issue, which has an indirect but important bearing on the present question.

In the event of any of his daughters ‘ being without lawful issue at the time’ of his death, a special direction was given for dealing with one-half of their respective shares, ‘whilst my said daughters are without lawful issue,’ and a relative special direction for dealing with such one-half ‘upon their having lawful issue.’

Then in the event of any of his said

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daughters ‘ not having lawful issue at the time of their decease’ he directed his trustees ‘to pay and allot the said half of the shares or portions of my means and estate so retained on behalf of my daughter or daughters so deceasing without having lawful issue, to my other daughters having lawful issue, and that equally, share and share alike; and failing any of my daughters having lawful issue, then their share of said half of the share of my daughters dying without having lawful issue shall be divided amongst and paid to the lawful issue of my daughters who may have so deceased, with the exception always of that portion thereof falling to my daughter Agnes.’ With regard to this excepted portion, the testator made this special declaration, ‘ which portion or share, as in the case of her own share of my means and succession, shall not be paid to her or her children, but shall be retained by my said trustees, and the interest or produce thereof paid half-yearly to my said daughter Agnes, and failing her, said interest or produce shall be paid to her children equally, share and share alike, and failing her children leaving lawful issue, then the fee of said portion of the share of one-half of the share of my said daughters dying without lawful issue falling to my said daughter Agnes, shall, as in the case of her the said Agnes' own share of my means and succession, be allotted and paid equally amongst the issue of her children, and that equally, share and share alike.’”

The testator's daughter Agnes survived her father and died in 1851. She was twice married. By her first husband Lawrence Mackenzie she had three children—(1) Captain Lawrence Mackenzie, who died in 1887 without issue, (2) Captain John Binnie Mackenzie, who died in 1880 leaving a daughter Mrs Prendergast, and (3) Janet Mackenzie, Mrs Robert Anderson, who died in May 1908 survived by six children and predeceased by five others; and by her second marriage with Mr James Craig she left three other children, (4) Mary Guthrie Craig (Mrs Henry), who died in 1873 leaving seven children surviving and predeceased by two others, (5) Isabella Craig (Mrs Brook), who died in 1875 leaving two children, and (6) Binnie Craig, who died in 1891 leaving two children and predeceased by two others. The total number of Agnes Binnie's grandchildren was thus twenty-seven, of whom eighteen survived their parent and also the last surviving liferentrix Mrs Robert Anderson.

The present action was brought in 1888. The fund in medio was one-half of the share of the testator's estate destined to his daughter Agnes, being the three one-sixth parts which were liferented by Captain Lawrence Mackenzie, Mrs Henry, and Mrs Brook. On 11th January 1890 the Second Division determined that the right of liferent conferred on the children of Agnes Binnie was a joint-liferent, and that the shares of predeceasing liferenters accresced to the survivors. Accordingly the fee of the fund in medio did not become available for distribution until the death of Mrs Robert Anderson on 31st May 1908.

On 14th July 1908 the cause was wakened, and thereafter claims were lodged for the following claimants—(1) Mrs Prendergast, daughter of Captain John B. Mackenzie, who claimed one-fifth of the fund on the ground that it was divisible per stirpes; alternatively she claimed one-eighteenth of the fund on the footing that it was divisible per capita and did not vest until the expiry of the liferent. (2) Alexander C. Anderson and others, the six surviving children of Mrs Robert Anderson, who claimed eleven twenty-thirds of the fund on the ground that it was divisible per capita, and vested in the issue at birth; alternatively they claimed six-eighteenths of the fund on the footing that it was divisible per capita, and did not vest until the expiry of the liferent. (3) Mrs Agnes B. Henry or Blumenthal and others, the seven surviving children of Mrs Henry, who claimed seven-eighteenths of the fund on the ground that it was divisible per capita and did not vest until the expiry of the liferent; alternatively they claimed nine twenty-fifths of the fund on the footing that it was divisible per capita and vested in the issue at birth. (4) Robert A. Brook and another, the children of Mrs Brook, who claimed one-fifth of the fund on the ground that it was divisible per stirpes; alternatively they; claimed one-ninth of the fund on the footing that it was divisible per capita and did not vest until the expiry of the liferent. (5) Edward J. B. Craig and another, the surviving children of Binnie Craig, who claimed one-fifth of the fund on the ground that it was divisible per stirpes; alternatively they claimed four twenty-sevenths of the fund on the footing that it was divisible per capita and vested in the issue at birth.

On 1st June 1909 the Lord Ordinary ( Johnston) pronounced this interlocutor—“Finds that on a sound construction of the settlement of the late John Binnie, the share of his estate liferented by his daughter Agnes, and by her children and the survivors and survivor in succession, fell on the death of Mrs Anderson, the last survivor, on 31st May 1908, to be divided among the issue of the children of his said daughter Agnes equally per stirpes, and in the circumstances equally among the members of each stirps surviving the said last surviving liferentrix.”

Opinion.—“..… It is not, I think, without significance that the testator commenced in 1826 with the idea of stirpital division, though it does not much advance the question, for he was then thinking of his immediate children, while the present question relates to the special provision for the issue of the children of one particular daughter Agnes. That provision is first met in the supplementary settlement of 1832, which, though repeated, amplified, and explained, still remains the substantive provision regarding this special share. Agnes' share is not to be payable to her or her children. But the interest or produce

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of the same is to be paid and apportioned termly to her, and failing her to her children in liferent allenarly, ‘and to the issue of her said children in fee.’ This is not grammatical, and it is elliptical, but it clearly means that the fee of Agnes' share is to be paid and apportioned to the issue of her children. It is, however, added that failing the issue of her children it shall revert and belong to his other children and the issue of those who have deceased, equally, share and share alike— i.e., I think per stirpes.

Now if I had nothing to guide me but this provision, I should have said that the issue of Agnes' children took no indefeasible right until the lapse of all the successive liferents, that it was only then that the issue then in existence took, and that they took per capita among the immediate issue, issue of issue deceased coming in per stirpes. But though this is, I think, the natural conclusion from a consideration of the phraseology of the particular provision, it is not consistent with the general current of the settlement up to this point, and the words used are not incapable of another construction, if there is anything in what follows to show that the conclusion, at which I should have arrived from a consideration of this passage alone was not really the intention of the testator.

Turning then to the codicil of 1842, there is a confirmatory provision in head three, which considerably amplifies the original provision. The destination of the fee then becomes, ‘failing the children of my said daughter Agnes leaving lawful issue of their bodies’ the fee of Agnes' share is to be paid ‘to the lawful issue of her said children, and that equally, share and share alike.’ But again it is added ‘failing lawful issue of the children of my said daughter Agnes' that the fee is to revert to ‘my other children who may then be alive,’ equally, share and share alike, and to the issue of predeceasers equally, share and share alike. Had I to rest on this amplification or explanation of what had gone before I should still have said that no indefeasible right vested in the issue of Agnes' children until the lapse of the liferent right, and that the division, at least among the immediate issue, was then per capita, issue of predeceasing issue coming in per stirpes. Where the testator says ‘failing the children of my said daughter Agnes leaving lawful issue of their bodies’ the fee of her share is ‘to be paid to the lawful issue of her said children,’ I think he intends to favour these issue only, and not those who have predeceased their parents. And further, that by the destination-over he limits even their issue to those who then, that is, when the beneficial fee opens, survive. And it must be remembered that issue is a comprehensive word not confined to immediate children, and farther that this is a case where in any event the condition si sine would apply. But the construction of the passage is most difficult, and in view of the authority to be immediately referred to, I must admit it to be extremely doubtful whether, notwithstanding the terms of the destination-over, the fee is so limited, to the immediate issue surviving or represented at the opening of the fee, and whether the whole issue born are not intended to be included. I was much pressed to this effect with the case of Hickling's Trustees, 1 Fr. (H.L.) 7, not indeed a very satisfactory one to have to rest a judgment upon having regard to the great diversity of judicial opinion manifested.

But I think I am relieved from the difficulty I should have felt in either applying that authority or in interpreting the passage last referred to without it, by a consideration of the testator's last declaration on the subject. In the fifth head of this codicil of 1842 he deals with possible accretion to Agnes' share, and he emphatically declares his intention that such accretion is to be dealt with ‘as in the case of her own share,’ and so dealt with to ‘be allotted and paid equally amongst the issue of her children, and that equally share and share alike.’ The italics are mine. He thus himself supplies an interpretation for the previous involved and doubtful expressions. There can, in my opinion, be no doubt that this explanation of his meaning can only be properly satisfied by an equal division per stirpes, and within the stirps by an equal division per capita— Inglis v. M'Neils, 19 R. 924. This is in accordance, as I have pointed out, with the general idea which pervades the whole settlement, and it is not inconsistent with the primary and substantive direction of the supplementary settlement of 1832, which is still the foundation of the provision.

If this be the true construction it is in the circumstances immaterial, as the result will be the same whether predeceasing issue are to take a share or only surviving, though personally, notwithstanding the authority of Hickling's case, I think, only surviving.”

Thereafter the cause came to depend before Lord Cullen, who on 4th December 1909 pronounced an interlocutor whereby he ranked and preferred the claimants in accordance with the findings contained in the interlocutor of 1st June 1909, and granted leave to reclaim.

The claimants Alexander C. Anderson and others (the Anderson family) and Mrs Blumenthal and others (the Henry family) reclaimed, and argued—The issue took a vested interest at birth. The destination-over failing issue was not suspensive of vesting. “Failing issue” might mean either “in the event of issue not being born” or “in the event of issue predeceasing”; prima facie it meant “in the event of issue not being born”— Carleton v. Thomson, July 30, 1867, 5 Macph. (H.L.) 151, 4 S.L.R. 226; Cunningham v. Cunningham, November 29, 1889, 17 R. 218, 27 S.L.R. 106. That was its meaning here, and if so, the bequest was not contingent, but vested at birth. Even if the destination-over were held to refer to the event of issue predeceasing, vesting was not suspended. The representatives of predeceasing issue

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were entitled to share provided one member of the class survived— Hickling's Trustees v. Garland's Trustees, August 1, 1898, 1 F. (H.L.) 7, 35 S.L.R. 975. (2) The fund was divisible per capita and not per stirpes. The gift was a gift to a class, and there was no indication of any intention to favour one individual member more than another. In these circumstances the ordinary rule was that the fund was divisible per capita— Mackenzie v. Holte's Legatees, February 2, 1781, M. 6602; Bogie's Trustees v. Christie, January 26, 1882, 9 R. 453, 19 S.L.R. 363; Allen v. Flint, June 15, 1886, 13 R. 975, 23 S.L.R. 703, per Lord M'Laren; Hay Cunningham's Trustees v. Blackwell, 1909 S.C. 219, 46 S.L.R. 175, per L. P. Dunedin. There was nothing to take the present case out of the ordinary rule. Searcy's Trustees v. Allbuary ( 1907 S.C. 823, 44 S.L.R. 536), and Inglis v. M'Neils (June 23, 1892, 19 R. 924, 29 S.L.R. 795), were distinguishable. In Searcy's Trustees ( cit.) the gift was divisible among families. In Inglis v. M'Neils ( cit.) the gift was to A and the children of B; there was to be equal division between A and B's children, and thereafter equal division among the children of B. In the present case the repetition of the word equally was a mere redundancy. It was immaterial that a liferent was given to the children. It might have been important if separate shares of the fund had been destined to a parent in liferent and his issue in fee. But here the liferent was a joint liferent.

Argued for the claimant and respondent Mrs Prendergast—The fund was divisible per stirpes and not per capita. The gift was in favour of the children in liferent and their issue in fee, and in such circumstances it was presumed that the fund was divisible per stirves— Richardson v. Macdougall, March 26, 1868, 6 Macph. (H.L.) 18, 5 S.L.R. 454; Home's Trustees v. Ramsay, December 11, 1884, 12 R. 314, 22 S.L.R. 221; Allen v. Flint ( cit.); Lorn's Trustees v. Whitworth, February 4, 1892, 19 R. 431, 29 S.L.R. 389. Further, the repetition of the word “equally” showed that the testator contemplated in the first place an equal division among the different families, and thereafter an equal distribution of each family's share among the members of that family— Inglis v. M'Neils ( cit.); Searcy's Trustees v. Allbuary ( cit.) (2) Vesting was suspended until the termination of the liferent. Carleton v. Thomson ( cit.) and Cunningham v. Cunningham ( cit.) were distinguishable, because here the issue of children took only in the event of children leaving issue. If that were so, the bequest was plainly contingent and the reclaimers could not succeed unless the doctrine of Hickling's Trustees v. Garland's Trustees ( cit.) was applicable. Hickling's Trustees ( cit.) had always been regarded as the high-water mark of the doctrine of vesting subject to defeasance. It was distinguishable, because in the present case there was a destination-over. Hickling's Trustees ( cit.) therefore did not apply, and it was necessary to fall hack on the ordinary rule that a destination-over was suspensive of vesting— Young v. Robertson, February 14, 1862, 4 Macq. 314; Bryson's Trustees v. Grant, November 26, 1880, 8 R. 142, 18 S.L.R. 103; Bowman v. Bowman, July 25, 1899, 1 F. (H.L.) 69, 36 S.L.R. 959.

The claimants Robert A. Brook and another (the Brook family) adopted the argument for the respondent Mrs Prendergast. The claimants Edward J. B. Craig and another (the Binnie Craig family) adopted the argument for the reclaimers on the question of vesting and the argument for Mrs Prendergast as to the division being per stirpes.

At advising—