Talbot v Staniforth
| Jurisdiction | England & Wales |
| Judgment Date | 27 May 1861 |
| Date | 27 May 1861 |
| Court | High Court of Chancery |
English Reports Citation: 70 E.R. 837
HIGH COURT OF CHANCERY
S. C. 31 L. J. Ch. 197; 7 Jur. (N. S.) 961; 9 W. R. 827. Compromised, 8 Jur (N. S.) 757; 10 W. R. 829. See O'Rorke v. Bolingbroke, 1877, 2 App. Cas. 828; Fry v. Lane, 1888, 40 Ch. D. 320.
Sale of Expectancy. Purchase by Tenant for Life. Difficulty of Valuation. Costs.
[484] talbot v. stanifokth. May 23, 24, 27, 1861. [S. C. 31 L. J. Ch. 197; 7 Jur. (N. S.) 961; 9 W. E. 827. Compromised, 8 Jur. (N. S.) 757 ; 10 W. E. 829. See O'Eorke v. BolingbroJce, 1877, 2 App. Cas. 828; Fry v. Lane, 1888, 40 Ch. D. 320.] Sale of Expectancy. Purchase by Tenant for Life. Difficulty of Valuation. Costs. Where a tenant for life purchased the reversion of his nephew in the family estate: Held, that the transaction fell within the ordinary rule as to reversionary interests, and was not to be regarded as a family arrangement. The fact that a reversion is dependent on contingencies, which do not admit of estimation by actuaries, does not relieve the purchaser from the onus of shewing that fair value was given. A family estate stood settled on A. (a bachelor) for life, with remainder to his issue in tail male, with remainder to his nephew B. in tail male, with remainder to the brothers of B. successively in tail male. A. purchased B.'s interest, and required B. to concur in disentailing the estate and conveying the fee. The sale was bo'nA fide intended to be for a fair price; and the object of the purchaser appeared to be to prevent the estate being sold by B. out of the family. The devisees of A. having failed to prove that fair value was given, the sale was set aside, without costs on either side. Seriible, that the estate to be valued was the reversion in fee which the purchaser acquired, and not merely the base fee which the vendor alone could have sold to a stranger. _, , 838 TALBOT V. STANIFORTH 1J.&H.485. Under the will of Arthur Wellington Hervey Aston, who died in 1839, the estate and mansion-house of Aston were devised to testator's uncle, Sir Arthur Aston, for life, with remainder to his first and other sons in tail male, remainder to testator's sister, Harriet Talbot, for lice, remainder to her first and other sons in tail male, remainder to testator's right Jieirs. Harriet Talbot died in 1845, leaving her surviving the Plaintiff, her eldest son, and other sons. In the beginning of the year 1857 the Plaintiff, who was a lieutenant in the Rifle Brigade and then of the age of twenty-three, was indebted to the extent of about 2500, and was much pressed by his creditors, and compelled to live abroad to avoid arrest. The Plaintiffs father had a power of appointment under his marriage settlement, in favour of the children, over a fund of 25,000, of which he was tenant for life. On the 1st of January 1357 an arrangement was suggested by Mr. Davis, then the solicitor of the Plaintiff, to Mr. Loaden, who was the solicitor of Sir Arthur Aston, and who also represented the Plaintiff's father, for relieving the Plaintiff from his embarrassments. The proposal was, either that the father should make an appointment of 3000 in the Plaintiffs favour, and release his own [485] interest in that sum, or that Sir Arthur should advance the amount upon the Plaintiff securing it upon his expectancy, and j Dining in a resettlement of the family estate-reserving to himself only a life-estate, with remainder to his children. Further communications followed, in the course of which it was suggested, as another alternative, that Sir Arthur should buy the Plaintiff's expectancy, which he expressed himself willing to do, at the full market value. The Plaintiff subsequently changed his solicitor; and from March 1857 the negotiations were conducted, on his behalf, by Mr. Sewell. On the 17th of March Sewell wrote to the effect that his client would prefer effecting a sale to Sir Arthur to being forced into a sale to a stranger; and that he also relied on an appointment of 2000 by his father. On the following day Loaden replied that the father did not feel justified in appointing 2000 away from his other children without a certainty of return, which could only be contrived by a resettlement; that it was of no consequence to Sir Arthur whether the estate were sold to a stranger or not; that his offer to purchase was instigated by the desire to preserve the estate in the family; and that a sale might be completed as quickly as an appointment by the Plaintiff's father. The alternative of a sale was then accepted; and on the 21st of March Loaden wrote to Sewell a letter, as follows :- "Dear Sir,-When Sir Arthur proposed to purchase the expectancy of Mr. Talbot, I impressed upon him the necessity of a very clear, perfect and explanatory statement of rental and outgoings. Th s has been furnished, and you may rely upon it. I now send you a copy of the statement, by which you will see that 3045, 18s. 2d. is [486] the net income, subject to augmentation, in twenty years, by the cessation of the drainage rent-charge. "Sir Arthur will be fifty-line next birthday, and your client will be twenty-three. I furnish you with all these :iacts that you may calculate the sum that should fairly be given for the purchase of your client's expectancy.-Yours truly, " william loaden." Accompanying this letter was a statement containing details of income and outgoings, and concluding wish a summary, as follows:- Total rental ...... 10,416 17 11 Drainage rent-charge . . . 536 8 10 Annual payments . . . 88 14 5 Interest on mortgages . . 4293 12 0 Eepairs and expenses of management 1100 0 0 Taxes, &c. . . . . 1352 4 6 Total yearly outgoings, . . 7370 19 9 Net income . . . . . . 3045 18 2 1J.&H.487. TALBOT V. STANIFOBTH 839 The times when the drainage rent-charges would expire were stated. Among the details of outgoings were included : income tax, 447, 2s. 8d.; insurance of the hall and other buildings, 111 ; entertainment to tenants, 50; cost of keeping up game, 230; garden and pleasure-grounds, 450; repairs, 600; and expenses of management, 500. A copy of the will of A. W. Hervey Aston was also sent. [487] The statement and the will were then submitted, on the Plaintiff's behalf, to Mr. Ansell, an actuary, who gave the following opinion (C. B. signifying the Plaintiff, and A. B. the tenant for life :)- "From the accompanying statement, it appears that C. B., who is stated to be twenty-three years of age, will be entitled for the remainder of his life-contingent upon his surviving A. B., age fifty-nine-to the net yearly proceeds of the estates therein referred to, at present amounting to 3046 pe:- annum, but which will hereafter be increased to 3582, when the annual payments now charged upon the estates for money advanced on account of drainage improvement, and which cease at various periods, expire. " I think, under the above circumstances, that the present fair value of the interest of C. B. is about 18,703-say 18,703. " charles ansell, Jun., "Actuary, National Life Assurance Society." On this valuation being forwarded to Loaden, "he objected that the contingencies had not been correctly stated ; and a new case was prepared by Loaden and Sewell, in concert, which was as follows :- "CASE. " C. B., who is now twenty-three years of age, is entitled in remainder expectant upon the decease of A. B., a bachelor, now aged fifty-nine years, to freehold estates hereinafter referred to, subject to the following contingencies, viz.:- [488] " First. That A. B., who is the present tenant for life of the estates in question, shall not have any son who shall attain twenty-one years. " Second. That C. B. shall not die in the lifetime of A. B.; and " Third. That C. B. shall not die in the lifetime of any son of A. B., who either shall or shall not attain twenty-one years." The case also stated circumstances tending to shew the probability of Sir Arthur marrying, and added that the Plaintiff "lived very fast," Upon this case Mr. Ansell gave the following opinion:- "8th of May 1857.-Of the three contingencies involved in the before-mentioned case the first and third-viz., that A. B. (who is the present tenant for life) shall not have any son who shall not attain twenty-one years, and that C. B. shall not die in the lifetime of any son of A. B., who either shall or shall not attain twenty-one years -contain elements of a nature that preclude any value in figures being assigned to them, based upon satisfactory data. The only course, therefore, will be to value the interest of C. B. as subject solely to the second contingency mentioned, viz., that he shall not die in the lifetime of A. B. It...
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