Baird v Baird's Trustees
| Jurisdiction | England & Wales |
| Judge | Viscount Simonds,Lord Normand,Lord Tucker,Lord Cohen,Lord Keith of Avonholm |
| Judgment Date | 19 July 1956 |
| Judgment citation (vLex) | [1956] UKHL J0719-1 |
| Court | House of Lords |
| Date | 19 July 1956 |
| Docket Number | No. 6. |
[1956] UKHL J0719-1
House of Lords
Viscount Simonds
Lord Normand
Lord Tucker
Lord Cohen
Lord Keith of Avonholm
Upon Report from the Appellate Committee, to whom was referred the Cause Baird against Baird and others, That the Committee had heard Counsel, as well on Wednesday the 30th, as on Thursday the 31st, days of May last, upon the Petition and Appeal of William James Baird of Elie, residing at Langston House, Chadlington, Oxford, praying, That the matter of the Interlocutor set forth in the Schedule thereto, namely an Interlocutor of the Lords of Session in Scotland, of the First Division of the 12th of July 1955, so far as therein stated to be appealed against, might be reviewed before Her Majesty the Queen, in Her Court of Parliament, and that the said Interlocutor, so far as aforesaid, might be reversed, varied or altered, or that the Petitioner might have such other relief in the premises as to Her Majesty the Queen, in Her Court of Parliament, might seem meet; as also upon the printed Case of Brigadier General Edward William David Baird, Captain Robert Ian Baird and William Stanley Baird, lodged in answer to the said Appeal; and due consideration had this day of what was offered on either side in this Cause:
It is Ordered and Adjudged, by the Lords Spiritual and Temporal in the Court of Parliament of Her Majesty the Queen assembled, That the said Interlocutor of the 12th day of July 1955, in part complained of in the said Appeal, be, and the same is hereby, Recalled: And it is further Ordered, That the Questions in the Special Case be answered together by declaring, That the parties of the second part are not bound to continue to hold the capital of the Trust Estate and apply the income thereof as provided in the Ante-Nuptial Contract of Marriage, on the undertaking given by the first party being fulfilled to their satisfaction: And it is further Ordered, That the said Cause be, and the same is hereby, remitted back to the Court of Session in Scotland to proceed as accords: And it is further Ordered, That the Expenses of all parties incurred by them in the Court of Session and also the Costs incurred by them in respect of the said Appeal to this House, be taxed as between Solicitor and Client, and be paid out of the capital of the Trust Estate, the amount of the Costs incurred in respect of the Appeal to this House to be certified by the Clerk of the Parliaments: And it is also further Ordered, That unless the Costs, certified as aforesaid, shall be paid to the parties entitled to the same within one calendar month from the date of the certificate thereof, the Court of Session in Scotland, or the Judge acting as Vacation Judge, shall issue such summary process or diligence for the recovery of such Costs as shall be lawful and necessary.
My Lords,
This appeal is concerned with the meaning and effect of a few words in an ante-nuptial marriage contract made in May, 1918, in contemplation of the marriage, which was shortly thereafter solemnised, of the Appellant, William James Baird, and his wife, then Miss Audley Porter Porter. To this contract the Appellant's father, William Baird, was also a party.
I need not refer at length to the terms of the contract. By it the Appellant bound himself to pay to his wife in the event of her surviving him a free life rent annuity of £2,000. In security of that annuity the Appellant's father bound himself to transfer to the marriage contract trustees securities of the value of £40,000 (hereinafter called "the trust estate") to be held by them in trust ( inter alia) for the following purposes:
…"(Second) The Trustees shall pay over to the said William Baird the free yearly income after payment of the expenses of the Trust, during the lifetime of himself and the husband: (Third) In the event of the husband surviving the said William Baird the Trustees shall pay to him during his lifetime the free yearly income: …. (Fifth) On the death of the survivor of the spouses the Trustees shall make over to the husband's Testamentary Trustees or executors the Trust Estate which shall thereafter form part of his estate and be administered by such Trustees and executors in accordance with any Will or other Deed which may be executed by the husband".
By the contract the Appellant further bound himself to make certain provisions for the children of the marriage, the payment of such provisions to be within six months of his death, and the issue of such children as might predecease the time of payment to take the share which would have fallen to their parent or parents on surviving. This was a personal obligation of the Appellant and was not expressed to be secured on the trust estate.
The Appellant's father duly transferred the trust securities to the trustees. He died and was survived by the Appellant, who has thereafter received the income of the trust estate. In 1936 he was divorced by his wife, and from that date paid her the stipulated annuity of £2,000 until her death in 1952.
There is one child of the marriage who or whose issue will be entitled to be paid the sum of £2,000 under the provisions of the marriage contract within six months of the Appellant's death. The Respondents to the present appeal are the present trustees of the marriage contract.
In these circumstances the Appellant claimed to be entitled to immediate payment of the capital of the trust estate, but the Respondents were advised that they could not safely admit his claim without the authority of the Court. A Special Case was accordingly presented for the determination of questions which were thus stated:
"Upon a sound construction of the said Ante-Nuptial Contract of Marriage, and in the events which have happened—
1. Is the First Party entitled to immediate payment of the capital of the Trust Estate; or
2. Are the Second Parties bound to continue to hold the said capital and apply the income thereof as provided in the said Ante-Nuptial Contract of Marriage?"
These questions have been answered by the First Division of the Court of Session, the first in the negative, the second in the affirmative. Hence this appeal.
My Lords, upon the question which mainly engaged the attention of the learned Judges of the Court of Session I do not think that your Lordships entertain any doubt. If, upon its true construction, the marriage contract gave to the Appellant nothing more than a liferent in the trust estate and a testamentary power of appointment over the capital, then, even though there is no destination over in the event of that power not being exercised, I think that the law of Scotland is that he has not such a jus disponendi as to elevate him into the position of a fiar. That is the effect of a decision given nearly a hundred years ago by so great a Judge as Lord Justice Clerk Inglis (see Alves v. Alves, 23 D. 712 at p. 717), which has been consistently followed ever since and, apart from some criticism by Lord Dunedin in Mackenzie's Trustees v. Kilmarnock's Trustees, 1909 S.C. 472, has not been questioned. I do not myself see any valid ground for challenging the correctness of this view, but, even if I did, I should be unwilling to take a course which might well affect titles resting on a long-established doctrine of law. So far, then, I think that the judgments of Lord Carmont and Lord Russell must be upheld. Nor would I be prepared to take a different view from them upon the question what was the nature of the power expressly given to the Appellant. I am here referring to the narrow point whether the words in the fifth purpose, "in accordance with any Will or other Deed which may be executed by the husband", refer only to writings of a testamentary character. It is not very clear to me what they mean, but I am content to assume that they do not include an inter vivos deed.
But the main ground of appeal to this House was one which cannot, I think, have been fully developed in argument in the Court below, though it formed the basis of Lord Sorn's opinion. In a sentence it was that (to use Lord Sorn's words) "the clause does not confer a power of appointment at all but something different from that; and something more than that." In my opinion this is clearly right. The fifth purpose provides for something far different from the creation of a power of appointment. It requires that the trust estate shall be handed over to the husband's testamentary trustees or executors and shall thereafter form part of his estate. I pause there to observe that I see no reason for limiting in any way the meaning of "executors" and to ask whether more inept words could be used if it was intended to create a power of appointment and nothing more. The clause then goes on to provide that the trust estate, thus forming part of the husband's estate, shall be "administered by such Trustees and executors in accordance with any Will or other Deed", etc. From this it was argued as I understand it, that it was to form part of the husband's estate for a limited purpose only, that is, so far as the husband had by any will or other deed directed, and no further. If this were so, it would, I suppose, ensue that, so far as such direction did not extend, the trust estate would be undisposed of under the marriage contract. But I think that this would be a narrow and unnatural meaning to give to the clause: for, as I have already pointed out, the transfer of the trust estate to the husband's trustees or executors so that it forms part of his estate is thus rendered an entirely superfluous operation. The better view...
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