Cochrane's Executrix v Cochrane
| Jurisdiction | Scotland |
| Judgment Date | 06 December 1946 |
| Date | 06 December 1946 |
| Docket Number | No. 15. |
| Court | Court of Session (Inner House - First Division) |
1ST DIVISION
SuccessionConstruction of testamentary writingsSubject of giftFull fee or liferent or intermediate rightInitial gift of fee followed by power of disposal and gift-overFee and Liferent.
A testator, whose estate consisted entirely of moveables, by his will bequeathed all he possessed to his sister. He further provided:"Anything she may desire to dispose of or realise after my decease such as library and stamp collection, may be done. On her decease everything of mine to be sold and the proceeds divided" among certain named charities. By holograph note appended to a codicil he gave directions for the selling of his stamp collection and library of books.
Questions having arisen as to the quality of the right given to the testator's sister in the estate,
Held by a Court of Seven Judges that, on a sound construction of the will, the testator's sister took the fee of the estate as institute, and that the charities would take, as substitutes, in succession to her whatever might remain of the testator's estate at her death.
Dictum of Lord President Clyde in Ironside's Executor v. Ironside's Executor, 1933 S. C. 116, at p. 119, that a right of fee once conferred by a will upon a beneficiary is not withdrawn by a subsequent provision as to the disposal of the subject after the death of the fiar, disapproved (diss. Lord Mackay), as being stated too broadly and without necessary qualifications.
Denholm's Trustrees v. Denholm's Trustees, 1907 S. C.61, 1908 S. C. 255, and Heavyside v. Smith, 1929 S. C. 68, which recognised a right intermediate between a liferent and a fee, described as a fee restricted to a right of sale, administration and consumption, overruled (Lord Mackay dissenting as regarded Denholm's Trustees).
William Gilchrist Cochrane died domiciled in Scotland on 11th December 1942, leaving a holograph will dated 15th April 1933 and a holograph codicil thereto dated 4th February 1938, to which was appended a signed holograph note.
By his will the testator provided as follows:"I, William Gilchrist Cochrane hereby bequeath all I possess to my sister Mary Jane Slight Cochrane.
"Anything she may desire to dispose of or realize after my decease such as Library and Stamp Collection, may be done. On her decease everything of mine to be sold and the proceeds divided as follows." There then followed a number of bequests of sums of money to certain charities, and a direction to divide the residue among other charities.
By his codicil the testator bequeathed a further legacy to another charity. A note appended thereto was in the following terms: "NOTE.Stamp Collection to be sent to Harmer, Rooke & Co., Ltd., to be disposed of by them for the benefit of my Estate." There was a similar direction referring to the testator's library of books.
Questions arose as to the nature of the right in the testator's estate to be taken by his sister, and a special case was presented for the opinion and judgment of the Court of Session. The testator's sister, as executrix-dative, was the first party, and, as an individual, she was the second party. The charities to which legacies were given under the will were the third parties; the charities to which the residue was given were the fourth parties; and the charity to which a legacy was given in the codicil was the fifth party.
The contentions of the parties, so far as material to the subject of this report, were as follows:
The first party submitted no contention.
The second party contended that the testator had bequeathed to her the fee of his whole estate, under deduction of the legacy payable under the codicil; alternatively he had bequeathed to her a liferent with a power of sale and consumption of the capital of his whole estate under deduction of that legacy; alternatively, he had bequeathed to her a liferent of his whole estate under deduction of that legacy.
The third and fourth parties contended that, upon a sound construction of the testator's testamentary writings, the second party was entitled only to a liferent of the estate, and alternatively to a liferent with a power of sale and consumption of the capital.
The fifth party offered no contention with regard to the subject of this report.
The questions of law, so far as this report is concerned, were:"(2) Is the second party entitled to the fee of (b) the testator's whole estate under deduction of the legacy of 100 to the fifth party? (3) In the event of question (2) being answered in the negative, is the second party entitled to a liferent, with a power of sale and consumption, of (b) the testator's whole estate under deduction of the legacy of 100 to the fifth party? (4) In the event of questions (2) and (3) being answered in the negative, is the second party entitled to a liferent of (b) the testator's whole estate under deduction of the legacy of 100 to the fifth party?"
The case was heard before the First Division on 9th July 1946, when the Court answered a question with which this report is not concerned and appointed the case to be further heard by a larger Court. It was accordingly heard before the Judges of the First Division along with the Lord Justice-Clerk, Lord Mackay and Lord Jamieson on 7th and 8th November 1946.
At advising on 6th December 1946,
LORD JUSTICE-CLERK (Cooper) and LORD JAMIESON.The questions still outstanding in this case relate to the nature of the interest taken by the second party under the holograph will of her brother. The testator's estate was wholly moveable. His will, which was evidently
prepared without skilled advice, contains no appointment of an executor and no disposition to trustees. Its provisions, so far as relevant, are these"I hereby bequeath all I possess to my sister Mary Jane Slight Cochrane.
"Anything she may desire to dispose of or realise after my decease such as library and stamp collection, may be done. On her decease everything of mine to be sold and the proceeds divided " amongst stated charities.
In a codicil the testator gave administrative instructions regarding the disposal of the library and stamp collection "for the benefit of my estate."
The rival contentions maintained before us were that the second party took either (a) a full fee, or (b) a fee restricted to the rights of sale, administration and consumption, or (c) a liferent with a power of sale and consumption, or (d) a bare liferent. These alternative submissions emerged during a discussion of the doctrine of repugnancy and of the implications to be derived from an initial gift of fee; and in the course of debate the correctness of certain decisions and dicta was challenged. It is convenient before considering the interpretation of the will to clear the ground by disposing of two overriding issues thus raised.
(1) The argument in favour of a full fee was in part supported by thedictum of Lord President Clyde in Ironside's ExecutorSC1 that "it is an elementary principle in the construction of wills that a right of fee once conferred upon a beneficiary is not withdrawn by a subsequent provision as to the disposal of the subject after the death of the fiar." This statement of the law was reluctantly accepted by Lord Sands after being subjected by him to severe criticism; for he understood it (as the late Professor Dykes evidently understood itSupplement to M'Laren on Wills, p. 99)as virtually requiring any Court of construction, upon encountering an initial gift of fee, to shut its eyes to all subsequent repugnant provisions.
We are of opinion with all respect that this formulation of the so called rule of the initial gift of fee is stated too broadly and without necessary qualifications, and that it is impossible thus to combine in a single "elementary principle" several different rules of more limited ambit. What are these rules?
The most important is derived from Miller's TrusteesUNKSC,2 the principle of which, as authoritatively declared by the majority of the Whole Court in Yuill's TrusteesUNKSC,3 is that "when a vested, unqualified and indefeasible right of fee is given to a beneficiary of full age, he is entitled to payment of the provision notwithstanding any direction to the trustees to retain the capital of the provision, and to pay over the income periodically, or to apply the capital or income in some way for his
benefit." It is plain that the subsequent provision which is figured in this formulation as insufficient to affect an initial gift of a fee is a provision concerned not with modifying or abridging the gift but only with adjecting conditions to its enjoyment. Even within this limited sphere, the Court in Yuill's TrusteesUNKSC1 was at pains to stress several "necessary qualifications," (a) that the initial gift of fee should be absolute and unqualified and not burdened with annuities or other charges, (b) that the fee should have vested indefeasibly; and (c) that there must be no trust purposes to be served which could only be secured by the retention in the hands of trustees of the interest of the beneficiaryAn important corollary of Miller's TrusteesUNKSC2is the well recognised rule that, when an initial gift of fee is followed in the same deed by prima facie repugnant provisions, these subsequent provisions will in dubio be construed as intended only to fetter the enjoyment of the gift and not to enlarge or abridge it.
Another of these rules originated as part of the then developing doctrine of vesting subject to defeasance, and is associated withTweeddale's Trustees.3 In its original form it was that, if a bequest is made to A with a further direction that trustees shall hold for A in liferent and for his issue in fee, the fee remains with A if he has no issue. This rule has recently been expanded to cover the case where the destination-over is to others than the legatee's issueLivingston's TrusteesSC4and it must now be stated in the language of Lord Davey in Hancock v. WatsonELR5 to this effect that...
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