Re Greaves. Public Trustee v Ash
| Jurisdiction | England & Wales |
| Judge | THE MASTER OF THE ROLLS,F |
| Judgment Date | 05 March 1954 |
| Judgment citation (vLex) | [1954] EWCA Civ J0305-6 |
| Docket Number | 1955 No. 1013. |
| Court | Court of Appeal |
| Date | 05 March 1954 |
[1954] EWCA Civ J0305-6
In the Supreme Court of Judicature
Court of Appeal
The Master of the Rolls,
(Sir Raymond Evershed)
Lord Justice Denning, and
Lord Justice Jenkins.
Re Greaves Deceased.
Counsel for the Appellant: Mr L. M. Jopling appeared for Mrs. Margaret F. Ash instructed by Messrs. Vertue & Churcher.
Counsel for the Respondent: (For the Public Trustee) Mr. W. S. Wigglesworth, instructed by Messrs. Woodcock, Ryland & Co., Agents f o r Messrs. Tweedale Sons & Lees, Oldham.)
Counsel for other Respondent: Mr. W. F. Waite appeared for Jane Elizabeth Woods (Spinster and infant) instructed by Messrs. Kingsford, Dorman & Co.
The Judgment which I am about to read is the judgment of the Court.
By his Will dated November 19th, 1931, the Testator, Henry Greaves, who died on December 1st, 1934, gave to his daughter, the first Defendant and Appellant, Mrs. Margaret Prances Ash, a special power of appointment or the capital of his residuary trust fund subject (in the events which have happened) to the life interest of Mrs. Ash herself. The class of objects of the power consisted of the children and remoter issue of Mrs. Ash. The terms of the power, which were usual in form and are fully recited in the Report of the case before Vaisey J. in 1953 3 N.L.R.987, need not be here recited beyond stating that the power was expressed to be exerciseable "by deed revocable or irrevocable or by will or codicil". In default of and subject to any appointment by Mrs. Ash the Testator gave his residuary trust fund to the children or child of Mrs. Ash who should attain the age of 21 years or (being female) attain that age or marry under it; if more than one, in equal shares. Mrs. Ash has had five children, all daughters and all made Defendants to these proceedings, of whom one has been married and one is an infant. The married daughter of Mrs. Ash has had one child, also a daughter and' about 2-1/2- years old; and she too is a Defendant in the action and a Respondent in this Court.
On May 30th, 1938, Mrs. Ash executed a Deed of Appointment pursuant to the power above recited. The effect of the Deed, (the terms of which are also fully recited in N. L. R.) was that the Testator's residuary trust fund was settled so that each child of Mrs. Ash who attained 21 or being a daughter married under that age would be entitled to a life interest in the income of a proportionate share of the fund, the corpus of the share passing to the children of that child, with appropriate cross remainders in default of such children.' By a proviso at the end of theAppointment Mrs. Ash declared that she reserved to herself power at any time or times thereafter by any deed or will wholly or partially to revoke the appointment. Subject therefore to such power of revocation the infant granddaughter of Mrs. Ash became by virtue of the appointment entitled to an expectant share in the capital of the Testator's trust fund.
On February 15th, 1952, Mrs. Ash by Deed of that date wholly revoked and made void her appointment of 1938 to the intent that the trust funds thereby appointed should be held upon the trusts applicable thereto as if the appointment of 1958 had not been executed. On the following day, February 16th, 1952, by a further deed Mrs. Ash released and for ever discharged the trust funds in question from the power of appointment given to her by the Testator's will to the intent that such power should "not henceforth be exercise able by her and the said trust funds … devolve according to the provisions in the … ill contained in default of appointment.11 On February 18th, 1952 Mrs. Ash entered into four farther documents expressed to be conditional agreements for exchange with her four adult daughters. These last mentioned agreements need not be further recited for they and the preceding deeds of revocation and release were all executed as part of a scheme the nature and purpose of which is clearly set out in paragraph 9 of the affidavit made by Mr. Higson on behalf of the Plaintiff, the Public Trustee, in support of the Originating Summons. The paragraph is as follows: -
"In the year 1951 the Plaintiff was informed by? Mrs. Ash's Solicitors" "that a scheme had been suggested for a partial distribution of the capital of the Trust Fund between Mrs. Ash and her adult daughters; particulars of the scheme were as follows:-
(a)that Mrs. Ash should revoke the said Appointment;
(b)that she should release her said power of appointment among issue over the trust fund;(c)that the Plaintiff should divide the trust fund into five equal shares and appropriate one of such shares to each of Mrs. Ash's five children;
(d)that in the case of each of Mrs. Ash's adult children the share of the trust fund appropriated to the child in question should be divided between Mrs. Ash and the child actuarially according to the respective values of their interests therein Mrs. Ash releasing her life interest in the part to be taken by the child and the child by way of exchange assigning her reversionary interest to Mrs. Ash in the part to be taken by Mrs. Ash.
(e)that in the carrying out of the said scheme Mrs. Ach the one hand and her adult children on the other hand should be separately represented both by Solicitors and actuaries and that due regard should be had to any estate duty payable in respect of the trust fund on the death of Mrs. Ash for which the Plaintiff should be liable."
In these circumstances the question has arisen whether the transaction described in Mr. Higson's affidavit can be impeached as involving a "fraud on a power" - in particular a fraud on the power of revocation expressly conferred by the testator and expressly reserved by Mrs. Ash in the Deed of 1938. Two separate points are involved, namely, (1) whether the principles enshrined in the formula "a fraud, on a power" apply at all to the power of revocation conferred, reserved, and exercised, in the present case and (2), if so, whether on the facts of the present case there has been such a fraud.
Vaisey J. answered both enquiries affirmatively. As regards
the second, the learned Judge said:-
"The truth is that the scheme in the present case may well be regarded as a meritorious one, but the very fact that it is beneficial to all parties, non-objects as well as objectsand including Mrs. Ash herself, makes it impossible for me to say that it complies with the requirements laid down by Lord Westbury and Lord St. Leonards in Portland v. Topham, and the many other cases which illustrate the same principle. The scheme may be very good indeed, and there may be many ways in which to carry it out, but, in my judgment, it cannot be validly effected in any manner which gives to the appointor, Mrs. Ash, many thousands of pounds of capital through and by means of her execution of a fiduciary power." Assuming that the principles of a fraud on a power apply at all, we should entirely agree with Vaisey J. upon this second point and, in light of the terms of paragraph 9 of Mr. Higson's affidavit, we cannot usefully add anything to the language of the learned Judge save to observe the not insignificant point that Mrs. Ash has been the sole appellant before us and through Mr. Jooling has most strenuously argued in favour of a reversal of Vaisey J.'s judgment upon both the points formulated above.
Upon the first point Vaisey J. drew attention to one extreme paucity of authority upon it. The matter seems twice only to have been before the Court at first instance - in Shirley v. Fisher 47 L.T. 109 before Bacon V.G. and in In...
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