Davidson's Trustees v Ogilvie
| Jurisdiction | Scotland |
| Judgment Date | 21 January 1910 |
| Docket Number | No. 46. |
| Date | 21 January 1910 |
| Court | Court of Session |
Lord Justice-Clerk, Lord Ardwall, Lord Dundas.
SuccessionFee and LiferentProceeds of literary works.
In a question between liferenter and fiar royalties and profits derived from sales subsequent to a testator's death of literary works published by him during his lifetime held to form part of the income of his estate, those from sales of works published by the trustees after his death held to be capital.
The late Rev. Andrew Bruce Davidson, D.D., LL.D, Professor of Old Testament Language, Literature and Theology, New College, Edinburgh, died on the 26th day of January 1902, leaving a trust-disposition and settlement, whereby he directed his trustees to hold the residue and remainder of his means and estate, and to give to his niece, Mrs Helen Bruce Davidson or Ogilvie, the liferent use and enjoyment thereof, and to pay to her the free annual income of the estate, and upon her death to divide the residue equally among her children or the survivors of them.
The late Professor Davidson was the author of a number of published works on the Hebrew Language and Theology, and in his repositories on his death were found the manuscripts of certain further theological works. Some of the books and articles that had been published by Professor Davidson were paid for by a single payment. For others Professor Davidson received a royalty only, the publishers taking the whole risk, and for others again Professor Davidson received a large proportion of the profits, he taking the risk of publication. After Professor Davidson's death the trustees arranged for the publication of five manuscripts found in his repositories. In one case the trustees received a sum down in respect of a fixed number of sales with a royalty on additional sales. In two cases they received a royalty only. In a fourth case the publication was a joint undertaking with the publishers, the trustees receiving two-thirds of profits and bearing two-thirds of loss, while in the fifth case 200 was received for an absolute sale of an unfinished manuscript.
Questions having arisen as to whether the various sums received by the trustees in respect of sales subsequent to Professor Davidson's death fell to be treated as capital, or to be paid to the liferentrix as part of the free annual income of the estate, a special case was submitted for the decision of the Court.
The first parties to the case were the trustees and the beneficiaries who were, at the time when the case was stated, entitled to the fee; the second party was the testator's niece, who was entitled to the liferent.
The parties stated their contentions in the following terms:
The first parties maintain that all royalties and returns from Professor Davidson's works fall to be treated as capital, and to be held and invested from time to time, and the income thereon paid to the liferentrix. The first parties contend that although Professor Davidson agreed to take deferred payment for his work in the form of royalties upon the sales or a share of profits, the price was not by such agreement converted from capital to income. Similarly in cases where the first parties, following the deceased's practice, published his works receiving a royalty or share of profits, the first parties contend that the returns whether by way of royalty or share of profits are capital. In one case the first parties accepted a sum of 60 to cover the first 1500 copies and 1s. per copy thereafter. The sum of 60 being the price of an asset of the deceased falls into the capital of the estate, and the first parties contend that the postponed payment of 1s. per copy should also fall into capital. In another case a sum of 75 paid to the first parties on publication is stated to be in advance and on account of royalties. The first parties maintain that even if the royalties and shares of profit should be held to fall to revenue, this sum and all other sums paid on publication fall to be regarded as capital.
The second party maintains that all sums derived from the publication of the testator's works and falling due after his death, whether...
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M'Leod's Trustees v M'Leod
...to. 2 Campbell v. Wardlaw, (1883) 10 R. (H. L.) 65, Lord Watson, at p. 68, Lord Fitzgerald, at p. 73; Davidson's Trustees v. Ogilvie, 1910 S. C. 294; Strain's Trustees v. StrainSC, 20 R. 1025, Lord M'Laren, at p. 1030; Mein's Trustees v. MeinSC, (1901) 3 F. 994; Hay's Trustees v. HayUNK, (1......