Re Hayes' Will Trusts
| Jurisdiction | England & Wales |
| Year | 1971 |
| Date | 1971 |
| Court | Chancery Division |
Will - Construction - Intention of testator - Named persons “(hereinafter called ‘my trustees’)” appointed executors and trustees of will - Power of sale of land given to “my trustees” - Whether power given without limitation to their capacity as trustees - Estate Duty - Valuation - Land - Duty of executors -
By his will a testator appointed four named persons including his son “(hereinafter called ‘my trustees’) to be the executors and trustees of this my will.” He demised real property “to my trustees to be held upon trust as follows” and by clause 5 (iii) “… with full power to sell the same … at any time after my death to any person or persons including my son despite his being a trustee and in his case at the value placed upon the same for purposes of estate duty ….” The demise was followed by a residuary gift upon trust equally between “such of my children as shall be living at my death.” In February 1967 the testator died, leaving the son and six daughters surviving. In December 1967 the executors contracted with the son to sell the property to him. The daughters objected to a sale at what they considered too low a price.
On a summons to determine, inter alia, whether on the true construction of the will or otherwise the contract was a valid exercise of the power of sale conferred by the will: —
Held, (1) that on the true construction of clause 5 (iii) and of the will as a whole the power was intended to be given and was given to “my trustees” without limitation to their capacity as trustees.
(2) That in agreeing the estate duty valuation the executors were not under a duty to hold the balance evenly between the beneficiaries but to consider the interest of the estate as a whole.
(3) That in agreeing the estate duty valuation the executors were not under a duty to agree it at the highest price which might be obtained in the open market, but that it was proper to agree it at the price “which the property would fetch if sold in the open market” and that the price which they agreed was that price.
The following cases are referred to in the judgment:
Charteris, In re [
Commissioner of Stamp Duties (Queensland) v. Livingston [
Ellesmere (Earl) v. Inland Revenue Commissioners [
Rudd's Will Trusts, In re [
The following additional cases were cited in argument:
Bold, In re (
Boston's Will Trusts, In re [
De Lisle, decd., In re [
Dowse, In re (Note) [
Eumorfopoulos, In re [
Hampden v. Buckingham (Earl) [
Hill v. Hill (
King's Will Trusts, In re [
Lepine, In re [
O'Mahoney v. Burdett (
Raby v. Ridehalgh (
Robinson v. Briggs (
Shenton, In re [
Thomson, In re [
Verrell's Contract, In re [
Wilkes' (Beloved) Charity, In re (
ORIGINATING SUMMONS
By his will dated February 23, 1962, the testator, Thomas Wilfred Hayes, appointed the first defendant, Ruth Hayes (the widow), the second defendant, Wilfred Thomas Hayes (the son), the first plaintiff, William Pratt Pattinson and Colin Roger Walter (who by a codicil dated February 18, 1965, was replaced as executor and trustee by the second plaintiff, Geoffrey Mawer Cooper), “(hereinafter called ‘my trustees’) to be the executors and trustees of this my will.”
By clause 5 of the testator devised “my farm properties known as The Slated House Farm, Stonepit Farm and any adjoining fields thereto” at Spridlington in the county of Lincoln to his trustees upon trust, with by clause 5 (iii):
“full power to sell the same and any part thereof at any time after my death to any person or persons including my said son Wilfred Thomas Hayes despite his being a trustee and in his case at the value placed upon the same for the purposes of estate duty …”
Clause 6 contained a gift of residue to “my trustee” upon trust “to divide the same equally between such of my said children as shall be living at my death.”
The testator had seven children all of whom survived his death, namely the second defendant, the third defendant, Ruth Hayes, the fourth defendant, Jean Muriel Sergeant, the fifth defendant, Clarice Storr, the sixth defendant, Joyce Marjorie Barton, the seventh defendant, Doreen Margaret Dickinson and the eighth defendant, Enid Marion Hall. The ninth defendant, William Richard Sergeant, who was born on April 18, 1948, was one of the children of the fourth defendant.
On February 16, 1967, the testator died and on June 30, 1967, the will and codicil were proved by all the executors. By an agreement dated December 15, 1967, the executors agreed to sell the real property to the son at the agreed estate duty valuation. The third to eighth defendants objected to a sale at what they considered too low a price.
The plaintiffs took out this summons on February 19, 1969, and by question 1 (a) thereof sought the determination upon the true construction of the trusts of the will or otherwise whether the contract dated December 15, 1967, constituted a valid exercise of the power of sale conferred by clause 5 (iii) of the will.
On February 22, 1971, the first defendant died.
The facts are stated in the judgment.
F. M. Ferris for the plaintiff trustees.
Martin Buckley for the first defendant.
N. Browne-Wilkinson for the second defendant.
C. A. Brodie for the third to eighth defendants.
Dennis Levy for the ninth defendant.
March 2. UNGOED-THOMAS J. read the following judgment. This case turns on the validity of the exercise of a power of sale of land.
The plaintiffs are executors and trustees of the will of Thomas Wilfred Hayes and the defendants are his widow, son, daughters and grandson. The widow has died since the hearing but that does not materially affect the question in this case. The testator by will and codicil appointed four persons, including his wife and son, (whom he thereafter referred to as “my trustees”) to be executors and trustees of his will. He devised his farms to “my trustees” upon trust to pay rents to his wife for life with a power to sell to the son at estate duty valuation and after his wife's death to sell the farms and divide the proceeds between his children then living. He gave his residue to “my trustees” after payment of administration liabilities on trust to divide it equally between his children living at his death.
The will was made on February 23, 1962, and on February 18, 1965, there was a codicil material only in that it replaced one auctioneer and valuer by another as trustee, viz., Mr. Walter by Mr. Cooper. They both gave evidence before me. On February 16, 1967, the testator died and on June 30, 1967, the will was proved by the four named executors. All the testator's children except one daughter married and had issue. The testator at his death owned the freehold of certain farms subject to a tenancy agreement of April 6, 1965, with a company T. W. Hayes Ltd., which was a family company in which the testator owned 801 shares and his wife and son owned the balance of the 2,000 issued shares. The executors agreed with the district valuer the valuation of the farms for estate duty purposes at £48,000 subject to a mortgage of £15,000, making the net valuation £33,000. On December 15, 1967, the executors in order to discharge estate duty and other estate liabilities contracted with the son to sell the farms to him at the agreed estate duty valuation of £48,000. The daughters objected to a sale at what they considered too low a price.
The will so far as material provides by clause 2:
“I appoint my wife Ruth Hayes … my son Wilfred Thomas Hayes … my solicitor William Pratt Pattinson … and Colin Roger Walter … (hereinafter called ‘my trustees’) to be the executors and trustees of this my will.”
Mr. Walter, as I have said, was replaced by the codicil by Mr. Cooper. Clause 3 contained a bequest of personal effects and clause 4 of pecuniary legacies.
Clause 5 is a very material clause which I shall read in full:
“I give and devise my farm properties known as The Slated House Farm, Stonepit Farm and any adjoining fields thereto all situate at Spridlington in the County of Lincoln to my trustees to be held upon trust as follows: (i) To pay the net rents arising therefrom to my said wife during her life. (ii) After the death of my said wife the properties shall be held upon the trusts hereinafter mentioned. (iii) My trustees shall have power to continue the present tenancy of T. W. Hayes Ltd. of these properties and with full...
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