Administration of Assets
Succession Act
PART V
Administration of Assets
Estate of deceased to be assets for payment of debts and legal right.
[1285 (c. 19); 1357 (st. 1.c.11); 1695 (c. 12) ss. 7, 8; 1833 (c. 104); 1869 (c. 46)]
45.—(1) The estate, whether legal or equitable, of a deceased person, to the extent of his beneficial interest therein, and the estate of which a deceased person in pursuance of any general power disposes by his will, are assets for payment of the funeral, testamentary and administration expenses, debts (whether by specialty or simple contract) and liabilities, and any legal right, and any disposition by will inconsistent with this section is void as against the creditors and any person entitled to a legal right, and the court shall, if necessary, administer the property for the purpose of the payment of the expenses, debts and liabilities and any legal right.
(2) This section takes effect without prejudice to the rights of incumbrancers.
Administration of assets.
[New]
46.—(1) Where the estate of a deceased person is insolvent, it shall be administered in accordance with the rules set out in Part I of the First Schedule.
(2) (a) The right of retainer of a personal representative and his right to prefer creditors may be exercised in respect of all assets of the deceased, but the right of retainer shall only apply to debts owing to the personal representative in his own right whether solely or jointly with another person, and shall not be exercisable where the estate is insolvent.
(b) Subject to paragraph (a), nothing in this Act affects the right of retainer of a personal representative, or his right to prefer creditors.
(3) Where the estate of a deceased person is solvent, it shall, subject to rules of court and the provisions hereinafter contained as to charges on property of the deceased, and to the provisions, if any, contained in his will, be applicable towards the discharge of the funeral, testamentary and administration expenses, debts and liabilities and any legal right in the order mentioned in Part II of the First Schedule.
(4) Nothing in subsection (3) affects the rights of any creditor of the deceased or the legal right of a spouse.
(5) Where a creditor, a person entitled to a legal right or a personal representative applies an asset out of the order mentioned in Part II of the First Schedule, the persons entitled under the will or on intestacy shall have the right to have the assets marshalled so that a beneficiary whose estate or interest has been applied out of its order shall stand in the place of that creditor or person pro tanto as against any property that, in the said order, is liable before his own estate or interest.
(6) A claim to a share as a legal right or on intestacy in the estate of a deceased person is a claim against the assets of the estate to a sum equal to the value of that share.
Charges on property of deceased to be paid primarily out of the property charged.
[1854 (c. 113), 1867 (c. 69) and 1877 (c. 34) extended to personalty]
47.—(1) Where a person dies possessed of, or entitled to, or, under a general power of appointment, by his will disposes of, an interest in property, which at the time of his death is charged with the payment of money, whether by way of legal or equitable mortgage or charge or otherwise (including a lien for unpaid purchase money), and the deceased person has not by will, deed or other document signified a contrary or other intention, the interest so charged shall, as between the different persons claiming through the deceased person, be primarily liable for the payment of the charge; and every part of the said interest, according to its value, shall bear a proportionate part of the charge on the whole thereof.
(2) Such contrary or other intention shall not be deemed to be signified—
(a) by a general direction for the payment of debts or of all the debts of the testator out of his estate, or any part thereof, or
(b) by a charge of debts upon any such estate,
unless such intention is further signified by words expressly or by necessary implication referring to all or some part of the charge.
(3) Nothing in this section affects the right of a person entitled to the charge to obtain payment or satisfaction thereof either out of the other assets of the deceased or otherwise.
Causes of action surviving on death.
48.—The personal representatives of a deceased person may sue and be sued in respect of all causes of action which, by virtue of Part II of the Civil Liability Act, 1961, survive for the benefit of, or against, the estate of the deceased, subject to the provisions of that Act and the rules of limitation under the Statute of Limitations, 1957, or otherwise.
Distribution of assets after notice to creditors.
[1859 (c. 35) s. 29]
49.—(1) Where the personal representatives have given such notices to creditors and others to send in their claims against the estate of the deceased as, in the opinion of the court in which the personal representatives are sought to be charged, would have been given by the court in an administration suit, the personal representatives shall, at the expiration of the time named in the said notices, or the last of them, for sending in such claims, be at liberty to distribute the assets of the deceased, or any part thereof, amongst the parties entitled thereto, having regard to the claims of which the personal representatives have then notice.
(2) The personal representatives shall not be liable to any person for the assets or any part thereof so distributed unless at the time of such distribution they had notice of that person’s claim.
(3) Nothing in this section shall prejudice the right of any creditor or claimant to follow any such assets into the hands of any person who may have received them.
(4) This section applies whether the deceased died before or after the commencement of this Act.
Powers of personal representatives to sell and to act as trustees.
[1959 (No. 8) s. 18]
50.—(1) The personal representatives may sell the whole or any part of the estate of a deceased person for the purpose not only of paying debts, but also (whether there are or are not debts) of distributing the estate among the persons entitled thereto, and before selling for the purposes of distribution the personal representatives shall, so far as practicable, give effect to the wishes of the persons of full age entitled to the property proposed to be sold or, in the case of dispute, of the majority (according to the value of their combined interests) of such persons so, however, that—
(a) a purchaser shall not be concerned to see that the personal representatives have complied with such wishes; and
(b) it shall not be necessary for any person so entitled to concur in any such sale.
(2) Subject to section 20, it shall not be lawful for some or one only of several personal representatives, without leave of the High Court, to exercise any power conferred by this section or section 60 to dispose of any land.
(3) F19[…]
Annotations:
Amendments:
F19
Repealed (1.12.2009) by Land and Conveyancing Law Reform Act 2009 (27/2009), s. 8(3) and sch. 2 pt. 5, S.I. No. 356 of 2009.
Protection of purchasers.
[1959 (No. 8) s. 19]
51.—(1) A purchaser from the personal representatives of a deceased person of any property, being the whole or any part of the estate of the deceased, shall be entitled to hold that property freed and discharged from any debts or liabilities of the deceased, except such as are charged otherwise than by the will of the deceased, and from all claims of the persons entitled to any share in the estate, and shall not be concerned to see to the application of the purchase money.
(2) (a) This subsection applies to all property other than property the ownership of which is registered under the Registration of Title Act, 1964.
(b) A purchaser of any property to which this subsection applies, being the whole or any part of the estate of a deceased person, which has been conveyed by the personal representatives to any person shall be entitled to hold that property freed and discharged from the claims of creditors of the deceased and from any claims of the persons entitled to any share in the estate.
(3) This section applies whether the deceased died before or after the commencement of this Act.
General provisions as to assent or transfer by personal representatives.
[1959 (No. 8) s. 20]
52.—(1) In this section and in section 53—
(a) references to the land of a deceased person are references to land to which he was entitled or over which he exercised a general power of appointment by will;
(b) “person entitled” includes, in relation to any estate or interest in land—
(i) the person or persons (including the personal representatives of the deceased or any of them) who (whether by devise, bequest, devolution or otherwise) may be beneficially entitled to that estate or interest, and
(ii) the trustee or trustees or the personal representative or representatives of any such person or persons.
(2) Without prejudice to any other power conferred by this Act on personal representatives with respect to any land of a deceased person, the personal representatives may at any time after the death of the deceased execute an assent vesting any estate or interest in any such land in the person entitled thereto or may transfer any such estate or interest to the person entitled thereto, and may make the assent or transfer either subject to or free from a charge for the payment of any money which the personal representatives are liable to pay.
(3) Where an assent or transfer under subsection (2) is made subject to a charge for all moneys, if any, which the personal representatives are liable to pay, all liabilities of the personal representatives in respect of the land shall cease, except as to any acts done or contracts entered into by them before the assent or transfer.
(4) At any time after the expiration of one year from the death of an owner of land, if the personal representatives have failed on the request of the person entitled to transfer, by assent or otherwise, the land to the person entitled, the court may, if it thinks fit, on the application of the person entitled and after notice to the personal representatives, order that the transfer be made, and, in default of compliance with that order within the time specified therein by the court, may make an order vesting the land in the person entitled as fully and effectually as might have been done by a transfer thereof by the personal representatives.
(5) An assent not in writing shall not be effectual to pass any estate or interest in land.
(6) The statutory covenants implied where a person is expressed in a deed to convey as personal representative shall also be implied in any assent signed by a personal representative unless the assent otherwise provides.
(7) Subject to section 20, it shall not be lawful for some or one only of several personal representatives, without leave of the court, to make an assent or transfer under this section.
(8) This section shall not operate to impose any stamp duty in respect of an assent.
Annotations:
Modifications (not altering text):
C16
Application of section not restricted (1.12.2009) by Land and Conveyancing Law Reform Act 2009 (27/2009), s. 80(4), S.I. No. 356 of 2009.
Covenants for title.
80.— …
(4) Without prejudice to section 52(6) of the Act of 1965, where in a conveyance a person conveying is not expressed to convey “as beneficial owner”, “as trustee”, “as mortgagee”, “as personal representative”, under an order of the court or by a direction of a person “as beneficial owner”, no covenant on the part of the person conveying is implied in the conveyance.
…
Special provisions as to unregistered land.
[1959 (No. 8) s. 21]
53.—(1) An assent to the vesting of any estate or interest in unregistered land of a deceased person in favour of the person entitled thereto shall—
(a) be in writing,
(b) be signed by the personal representatives,
(c) be deemed, for the purposes of the Registration of Deeds Act, 1707, to be a conveyance of that estate or interest from the personal representatives to the person entitled,
(d) operate, subject to the provisions of the Registration of Deeds Act, 1707, with respect to priorities, to vest that estate or interest in the person entitled subject to such charges and incumbrances, if any, as may be specified in the assent and as may otherwise affect that estate or interest,
(e) subject to the provisions of the Registration of Deeds Act, 1707, be deemed (unless a contrary intention appears therein) for all purposes necessary to establish the title of the person entitled to intervening rents and profits to relate back to the death of the deceased, but nothing in this paragraph shall operate to enable any person to establish a title inconsistent with the will of the deceased.
(2) Any person in whose favour an assent or conveyance of any unregistered land is made by personal representatives may at his own expense require the personal representatives to register that assent or conveyance in the Registry of Deeds pursuant to the Registration of Deeds Act, 1707.
[New]
(3) An assent or conveyance of unregistered land by a personal representative shall, in favour of a purchaser, be conclusive evidence that the person in whose favour the assent or conveyance is given or made is the person who was entitled to have the estate or interest vested in him, but shall not otherwise prejudicially affect the claim of any person originally entitled to that estate or interest or to any mortgage or incumbrance thereon.
(4) This section applies to assents and conveyances made after the commencement of this Act whether the deceased died before or after such commencement.
Special provisions as to registered land.
54.—(1) An assent or transfer made by a personal representative in respect of registered land shall be in the form required under section 61 of the Registration of Title Act, 1964, and shall be subject to the provisions of that Act.
(2) The Registration of Title Act, 1964, is hereby amended by the substitution of the following subsection for subsection (3) of section 61:
“(3) (a) An application for registration made by a person who claims to be by law entitled to the land of a deceased registered full owner, accompanied by an assent or transfer by the personal representative in the prescribed form, shall authorise the Registrar to register such person as full or limited owner of the land, as the case may be.
(b) On the determination of the estate or interest of an owner who is registered as limited owner of land pursuant to such an assent or transfer, the assent or transfer shall, on application being made in the prescribed manner, authorise the Registrar to register, as full or limited owner, as the case may be, the person in whose favour the assent or transfer was made, or the successor in title of that person, as may be appropriate.
(c) It shall not be the duty of the Registrar, nor shall he be entitled, to call for any information as to why any assent or transfer is or was made and he shall be bound to assume that the personal representative is or was acting in relation to the application, assent or transfer correctly and within his powers.”
Powers of personal representatives as to appropriation.
[New]
55.—(1) The personal representatives may, subject to the provisions of this section, appropriate any part of the estate of a deceased person in its actual condition or state of investment at the time of appropriation in or towards satisfaction of any share in the estate, whether settled or not, according to the respective rights of the persons interested in the estate.
(2) Except in a case to which section 56 applies, an appropriation shall not be made under this section so as to affect prejudicially any specific devise or bequest.
(3) Except in a case to which section 56 applies, an appropriation shall not be made under this section unless notice of the intended appropriation has been served on all parties entitled to a share in the estate (other than persons who may come into existence after the time of the appropriation or who cannot after reasonable enquiry be found or ascertained at that time) any one of which parties may within six weeks from the service of such notice on him apply to the court to prohibit the appropriation.
(4) An appropriation of property, whether or not being an investment authorised by law or by the will, if any, of the deceased, shall not (save as in this section mentioned) be made under this section except with the following consents:
(a) when made for the benefit of a person absolutely and beneficially entitled in possession, the consent of that person;
(b) when made in respect of any settled share, the consent of either the trustee thereof, if any (not being also the personal representative), or the person who may for the time being be entitled to the income.
(5) If the person whose consent is so required is an infant or a person of unsound mind, the consent shall be given on his behalf by his parents or parent, guardian, committee or receiver, or if, in the case of an infant there is no such parent or guardian, by the court on the application of his next friend.
(6) No consent (save of such trustee as aforesaid) shall be required on behalf of a person who may come into existence after the time of appropriation, or who cannot after reasonable enquiry be found or ascertained at that time.
(7) If no committee or receiver of a person of unsound mind has been appointed, then, if the appropriation is of an investment authorised by law or by the will, if any, of the deceased, no consent shall be required on behalf of the person of unsound mind.
(8) If, independently of the personal representatives there is no trustee of a settled share, and no person of full age and capacity entitled to the income thereof, no consent shall be required to an appropriation in respect of such share provided that the appropriation is of an investment authorised as aforesaid.
(9) Any property duly appropriated under the powers conferred by this section shall thereafter be treated as an authorised investment, and may be retained or dealt with accordingly.
(10) For the purposes of such appropriation, the personal representatives may ascertain and fix the values of the respective parts of the estate and the liabilities of the deceased person as they may think fit, and may for that purpose employ a duly qualified valuer in any case where such employment may be necessary; and may make any conveyance which may be requisite for giving effect to the appropriation.
(11) Unless the court on an application made to it under subsection (3) otherwise directs, an appropriation made pursuant to this section shall bind all persons interested in the property of the deceased whose consent is not hereby made requisite.
(12) The personal representatives shall, in making the appropriation, have regard to the rights of any person who may thereafter come into existence, or who cannot after reasonable enquiry be found or ascertained at the time of appropriation, and of any other person whose consent is not required by this section.
(13) This section does not prejudice any other power of appropriation conferred by law or by the will, if any, of the deceased, and takes effect with any extended powers conferred by the will, if any, of the deceased, and, where an appropriation is made under this section, in respect of a settled share, the property appropriated shall remain subject to all trusts for sale and powers of leasing, disposition and management or varying investments which would have been applicable thereto or to the share in respect of which the appropriation is made, if no such appropriation had been made.
(14) If, after any property has been appropriated in purported exercise of the powers conferred by this section, the person to whom it was conveyed disposes of it or any interest therein, then, in favour of a purchaser, the appropriation shall be deemed to have been made in accordance with the requirements of this section and after all requisite notices and consents, if any, had been given.
(15) In this section, a settled share includes any share to which a person is not absolutely entitled in possession at the date of the appropriation and also an annuity.
(16) This section applies whether the deceased died intestate or not, and whether before or after the commencement of this Act, and extends to property over which a testator exercises a general power of appointment, and authorises the setting apart of a fund to answer an annuity by means of the income of that fund or otherwise.
(17) Where any property is appropriated under the provisions of this section, a conveyance thereof by the personal representatives to the person to whom it is appropriated shall not, by reason only that the property so conveyed is accepted by the person to whom it is conveyed in or towards the satisfaction of a legacy or a share in residuary estate, be liable to any higher stamp duty than that payable on a transfer of personal property for the like purpose.
(18) The powers conferred by this section may be exercised by the personal representatives in their own favour.
Right of surviving spouse to require dwelling and household chattels to be appropriated.
[New]
56.—(1) Where the estate of a deceased person includes a dwelling in which, at the time of the deceased’s death, the surviving spouse F20[or civil partner] was ordinarily resident, the surviving spouse F20[or civil partner] may, subject to subsection (5), require the personal representatives in writing to appropriate the dwelling under section 55 in or towards satisfaction of any share of the surviving spouse F20[or civil partner].
(2) The surviving spouse F20[or civil partner] may also require the personal representatives in writing to appropriate any household chattels in or towards satisfaction of any share of the surviving spouse F20[or civil partner].
(3) If the share of a surviving spouse F20[or civil partner] is insufficient to enable an appropriation to be made under subsection (1) or (2), as the case may be, the right conferred by the relevant subsection may also be exercised in relation to the share of any infant for whom the surviving spouse F20[or civil partner] is a trustee under section 57 or otherwise.
(4) It shall be the duty of the personal representatives to notify the surviving spouse F20[or civil partner] in writing of the rights conferred by this section.
(5) A right conferred by this section shall not be exercisable—
(a) after the expiration of six months from the receipt by the surviving spouse F20[or civil partner] of such notification or one year from the first taking out of representation of the deceased’s estate, whichever is the later, or
(b) in relation to a dwelling, in any of the cases mentioned in subsection (6), unless the court, on application made by the personal representatives or the surviving spouse F20[or civil partner], is satisfied that the exercise of that right is unlikely to diminish the value of the assets of the deceased, other than the dwelling, or to make it more difficult to dispose of them in due course of administration and authorises its exercise.
(6) Paragraph (b) of subsection (5) and paragraph (d) of subsection (10) apply to the following cases:
(a) where the dwelling forms part of a building, and an estate or interest in the whole building forms part of the estate;
(b) where the dwelling is held with agricultural land an estate or interest in which forms part of the estate;
(c) where the whole or a part of the dwelling was, at the time of the death, used as a hotel, guest house or boarding house;
(d) where a part of the dwelling was, at the time of the death, used for purposes other than domestic purposes.
(7) Nothing in subsection (12) of section 55 shall prevent the personal representatives from giving effect to the rights conferred by this section.
(8) (a) So long as a right conferred by this section continues to be exercisable, the personal representatives shall not, without the written consent of the surviving spouse F20[or civil partner] or the leave of the court given on the refusal of an application under paragraph (b) of subsection (5), sell or otherwise dispose of the dwelling or household chattels except in the course of administration owing to want of other assets.
(b) This subsection shall not apply where the surviving spouse F20[or civil partner] is a personal representative.
(c) Nothing in this subsection shall confer any right on the surviving spouse F20[or civil partner] against a purchaser from the personal representatives.
(9) The rights conferred by this section on a surviving spouse F20[or civil partner] include a right to require appropriation partly in satisfaction of a share in the deceased’s estate and partly in return for a payment of money by the surviving spouse F20[or civil partner] on F21[his or her] own behalf and also on behalf of any infant for whom the spouse F20[or civil partner] is a trustee under section 57 or otherwise.
(10) (a) In addition to the rights to require appropriation conferred by this section, the surviving spouse F20[or civil partner] may, so long as a right conferred by this section continues to be exercisable, apply to the court for appropriation on F21[his or her] own behalf and also on behalf of any infant for whom the spouse F20[or civil partner] is a trustee under section 57 or otherwise.
(b) On any such application, the court may, if of opinion that, in the special circumstances of the case, hardship would otherwise be caused to the surviving spouse F20[or civil partner] or to the surviving spouse F20[or civil partner] and any such infant, order that appropriation to the spouse F20[or civil partner] shall be made without the payment of money provided for in subsection (9) or subject to the payment of such amount as the court considers reasonable.
(c) The court may make such further order in relation to the administration of the deceased’s estate as may appear to the court to be just and equitable having regard to the provisions of this Act and to all the circumstances.
(d) The court shall not make an order under this subsection in relation to a dwelling in any of the cases mentioned in subsection (6), unless it is satisfied that the order would be unlikely to diminish the value of the assets of the deceased, other than the dwelling, or to make it more difficult to dispose of them in due course of administration.
(11) All proceedings in relation to this section shall be heard in chambers.
(12) Where the surviving spouse F20[or civil partner] is a person of unsound mind, a requirement or consent under this section may, if there is a committee of F21[his or her] estate, be made or given on behalf of the spouse F20[or civil partner] by the committee by leave of the court which has appointed the committee or, if there is no committee, be given or made by the High Court or, in a case within the jurisdiction of the Circuit Court, by that Court.
(13) An appropriation to which this section applies shall for the purposes of succession duty be deemed to be a succession derived from the deceased.
[Cf. “dwelling” in 1960 (No. 42) s. 2 (1)]
(14) In this section—
“dwelling” means an estate or interest in a building occupied as a separate dwelling or a part, so occupied, of any building and includes any garden or portion of ground attached to and usually occupied with the dwelling or otherwise required for the amenity or convenience of the dwelling;
“household chattels” means furniture, linen, china, glass, books and other chattels of ordinary household use or ornament and also consumable stores, garden effects and domestic animals, but does not include any chattels used at the death of the deceased for business or professional purposes or money or security for money.
Annotations:
Amendments:
F20
Inserted (1.01.2011) by Civil Partnership and Certain Rights and Obligations of Cohabitants Act 2010 (24/2010), s. 70(a), S.I. No. 648 of 2010.
F21
Substituted (1.01.2011) by Civil Partnership and Certain Rights and Obligations of Cohabitants Act 2010 (24/2010), s. 70(b), S.I. No. 648 of 2010.
Modifications (not altering text):
C17
Application of section affected (3.04.2010) by Capital Acquisitions Tax Consolidation Act 2003 (1/2003), s. 45AA, as inserted by Finance Act 2010 (5/2010), s. 147, commenced on enactment.
[
Liability of certain persons in respect of non-resident beneficiaries
45AA.— (1) Where—
(a) property passing under a deceased person’s will or intestacy or under Part IX or section 56 of the Succession Act 1965 , or otherwise as a result of the death of that person, is taken by a person or persons who is or are not resident in the State,
…
then, the personal representative or one or more of the personal representatives, as the case may be, and the solicitor referred to in section 48(10), shall be assessable and chargeable for the tax payable by the person or persons referred to in paragraph (a) to the same extent that those persons are chargeable to tax under section 11. ]
Editorial Notes:
E8
Certification of payment of inheritance tax in respect of property passing under section provided for (23.02.2003) by Capital Acquisitions Tax Consolidation Act 2003 (1/2003), s. 108(2), commenced on enactment.
Appointment by personal representatives of trustees of infant’s property.
[New]
57.—(1) Where an infant is entitled to any share in the estate of a deceased person and there are no trustees of such share able and willing to act, the personal representatives of the deceased may appoint a trust corporation or any two or more persons (who may include the personal representatives or any of them or a trust corporation) to be trustees of such share for the infant and may execute such assurance or take such other action as may be necessary for vesting the share in the trustee so appointed. In default of appointment the personal representatives shall be trustees for the purposes of this section.
(2) On such appointment the personal representatives, as such, shall be discharged from all further liability in respect of the property vested in the trustees so appointed.
Annotations:
Modifications (not altering text):
C18
Meaning of “infant” subjected to transitional provision (1.03.1985) by Age of Majority Act 1985 (2/1985), s. 7(1) and sch. para. 4.
Powers of Personal Representatives During Minority of Beneficiary
4. In the case of a beneficiary whose interest arises under a will or codicil made before the commencement of this Act or on the death before that date of an intestate, section 2 shall not affect the meaning of “infant” in sections 57 and 58 of the Succession Act, 1965.
Powers of trustees of infant’s property.
[New]
58.—(1) Property vested under section 57 may be retained in its existing condition or state of investment or may be converted into money and invested in any security in which a trustee is authorised by law to invest, with power, at the discretion of the trustees, to change such investments for others so authorised.
(2) F22[…]
(3) A person who is sole trustee under section 57 shall be entitled to receive capital trust money.
(4) Persons who are trustees under section 57 shall be deemed to be trustees for the purposes of sections 42 and 43 of the Conveyancing Act, 1881.
(5) Without prejudice to any powers under the said sections 42 and 43, persons who are trustees under section 57 may at any time or times pay or apply the capital of any share in the estate to which the infant is entitled for the advancement or benefit of the infant in such manner as they may, in their absolute discretion, think fit and may, in particular, carry on any business in which the infant is entitled to a share.
(6) The powers conferred by subsection (5) may also be exercised by the surviving spouse F23[or civil partner] as trustee of any property of an infant appropriated in accordance with section 56.
Annotations:
Amendments:
F22
Repealed (1.12.2009) by Land and Conveyancing Law Reform Act 2009 (27/2009), S.I. No. 356 of 2009.
F23
Inserted (1.01.2011) by Civil Partnership and Certain Rights and Obligations of Cohabitants Act 2010 (24/2010), s. 71, S.I. No. 648 of 2010.
Modifications (not altering text):
C19
Meaning of “infant” subjected to transitional provision (1.03.1985) by Age of Majority Act 1985 (2/1985), s. 7(1) and sch. para. 4.
Powers of Personal Representatives During Minority of Beneficiary
4. In the case of a beneficiary whose interest arises under a will or codicil made before the commencement of this Act or on the death before that date of an intestate, section 2 shall not affect the meaning of “infant” in sections 57 and 58 of the Succession Act, 1965.
Right to follow property.
[Restates existing law relating to right to follow property; as to real estate, see 1830 (c. 47) 1839 (c. 60) and 1848 (c. 87)]
59.—(1) Property which has been conveyed by personal representatives to any person (other than a purchaser) shall, so long as it remains vested in that person, or in any person claiming under him (not being a purchaser), continue to be liable to answer the debts of the deceased and any share in the estate to the extent to which it was liable when vested in the personal representatives.
(2) In the event of a sale or mortgage of the property by a person (not being a purchaser) to whom it was conveyed by the personal representatives, or by any person claiming under him (not being a purchaser), the seller or mortgagor shall continue to be personally liable for such debts and for any share in the estate to the extent to which the property was liable when vested in the personal representatives.
(3) This section applies whether the deceased died before or after the commencement of this Act.
Powers to deal with estate, etc.
[Restates, clarifies and extends to real estate existing law relating to personal estate; as to real estate, see 1859 (c. 35) ss. 14 to 18]
60.—(1) The personal representatives of a deceased owner of land may, in addition to any other powers conferred on them by this Act—
(a) make such leases of the land as may be reasonably necessary for the due administration of the estate of the deceased owner; or
(b) with the consent of the beneficiaries, or with the approval of the court, make leases of the land for such term and on such conditions as the personal representatives may think proper; or
(c) make, on such terms and conditions as the personal representatives may think proper, F24[a sub-lease of the land] with a nominal reversion, where such F25[…] sub-lease amounts in substance to a sale and the personal representatives have satisfied themselves that it is the most appropriate method of disposing of the land in the course of the administration of the estate;
and, where personal representatives F25[…] lease any land pursuant to any power conferred on them by this subsection, they may sell F25[…] any reversion expectant upon the determination of any such lease.
(2) The right of the personal representatives to obtain possession of any premises demised by them pursuant to the power conferred by paragraph (a) of subsection (1) shall be exercisable notwithstanding anything to the contrary contained in the Rent Restrictions Act, 1960.
(3) The personal representatives of a deceased person may from time to time raise money by way of mortgage or charge for the payment of expenses, debts and liabilities, and any legal right and, with the approval of all the beneficiaries being sui juris or the court (but not otherwise), for the erection, repair, improvement or completion of buildings, or the improvement of lands forming part of the estate of the deceased.
(4) This section shall not prejudice or affect any power or duty of personal representatives to execute any document or do any other act or thing for the purpose of completing any transaction entered into by a deceased person before his death.
[1840 (c. 105) s. 61]
(5) The personal representatives of a deceased person may distrain upon land for arrears of rent due or accruing to the deceased in like manner as the deceased might have done had he been living.
[1840 (c. 105) s. 62]
(6) Such arrears may be distrained for after the termination of the lease or tenancy as if the term or interest had not determined, if the distress is made—
(a) within six months after the termination of the lease or tenancy;
(b) during the continuance of the possession of the lessee or tenant from whom the arrears were due.
The enactments relating to distress for rent apply to any distress made pursuant to this subsection.
[New]
(7) The personal representatives may distrain for arrears of a rentcharge due or accruing to the deceased in his lifetime on the land affected or charged therewith, so long as the land remains in the possession of the person liable to pay the rentcharge or of the persons deriving title under him, and in like manner as the deceased might have done had he been living.
[Enlarges powers conferred by 1893 (c. 53) s. 21]
(8) The personal representatives of a deceased person may—
(a) accept any property before the time at which it is transferable or payable;
(b) pay or allow any debt or claim on any evidence they may reasonably deem sufficient;
(c) accept any composition or security for any debt or property claimed;
(d) allow time for payment of any debt;
(e) compromise, compound, abandon, submit to arbitration, or otherwise settle, any debt, account, dispute, claim or other matter relating to the estate of the deceased;
(f) settle and fix reasonable terms of remuneration for any trust corporation appointed by them under section 57 to act as trustee of any property and authorise such trust corporation to charge and retain such remuneration out of that property,
and for any of those purposes may enter into such agreements or arrangements and execute such documents as seem to them expedient, without being personally responsible for any loss occasioned by any act or thing so done by them in good faith.
(9) This section shall not prejudice or affect any powers conferred by will on personal representatives, and the powers conferred by this section on the personal representatives of a deceased person who has died testate shall be exercised subject to any provisions contained in his will with respect to the disposal of his estate.
(10) This section applies whether the deceased died before or after the commencement of this Act.
Annotations:
Amendments:
F24
Substituted (1.12.2009) by Land and Conveyancing Law Reform Act 2009 (27/2009), s. 8(1) and sch. 1, S.I. No. 356 of 2009.
F25
Deleted (1.12.2009) by Land and Conveyancing Law Reform Act 2009 (27/2009), s. 8(1) and sch. 1, S.I. No. 356 of 2009.
Purchasers from personal representatives.
[Restates existing law: as to real estate, see 1859 (c. 35) s. 17]
61.—A purchaser from personal representatives shall be entitled to assume that the personal representatives are acting correctly and within their powers.
Time allowed for distribution.
[1695 (c. 6) s. 4]
62.—(1) The personal representatives of a deceased person shall distribute his estate as soon after his death as is reasonably practicable having regard to the nature of the estate, the manner in which it is required to be distributed and all other relevant circumstances, but proceedings against the personal representatives in respect of their failure to distribute shall not, without leave of the court, be brought before the expiration of one year from the date of the death of the deceased.
(2) Nothing in this section shall prejudice or affect the rights of creditors of a deceased person to bring proceedings against his personal representatives before the expiration of one year from his death.
Advancements to children to be brought into account.
[New]
63.—(1) Any advancement made to the child of a deceased person during his lifetime shall, subject to any contrary intention expressed or appearing from the circumstances of the case, be taken as being so made in or towards satisfaction of the share of such child in the estate of the deceased or the share which such child would have taken if living at the death of the deceased, and as between the children shall be brought into account in distributing the estate.
(2) The advancement shall, for the purposes of this section only, be reckoned as part of the estate of the deceased and its value shall be reckoned as at the date of the advancement.
(3) If the advancement is equal to or greater than the share which the child is entitled to receive under the will or on intestacy, the child or the issue of the child shall be excluded from any such share in the estate.
(4) If the advancement is less than such share, the child or the issue of the child shall be entitled to receive in satisfaction of such share so much only of the estate as, when added to the advancement, is sufficient, as nearly as can be estimated, to make up the full amount of that share.
(5) The onus of proving that a child has been made an advancement shall be upon the person so asserting, unless the advancement has been expressed in writing by the deceased.
(6) For the purposes of this section, “advancement” means a gift intended to make permanent provision for a child and includes advancement by way of portion or settlement, including any life or lesser interest and including property covenanted to be paid or settled. It also includes an advance or portion for the purpose of establishing a child in a profession, vocation, trade or business, a marriage portion and payments made for the education of a child to a standard higher than that provided by the deceased for any other or others of his children.
(7) For the purposes of this section, personal representatives may employ a duly qualified valuer.
(8) Nothing in this section shall prevent a child retaining the advancement and abandoning his right to a share under the will or on intestacy.
(9) Nothing in this section shall affect any rule of law as to the satisfaction of portion debts by legacies.
(10) In this section “child” includes a person to whom the deceased was in loco parentis.
Duty of personal representatives as to inventory.
[1357 (st. 1.c.11); 1537 (c. 18); 1695 (c. 6) s. 1]
64.—The personal representatives of a deceased person shall, when lawfully required to do so, exhibit on oath in the court a true and perfect inventory and account of the estate of the deceased, and the court shall have power to require personal representatives to bring in inventories.
Administration on behalf of the State.
[1884 (c. 71) ss. 2, 3]
65.—(1) Where administration of an estate is granted for the use or benefit of the State (whether to the Chief State Solicitor, the Solicitor for the Attorney General or any other person), any legal proceedings by or against the administrator for the recovery of the estate or any share thereof shall be of the same character and be instituted and carried on in the same manner, and be subject to the same rules of law and equity in all respects, as if the grant had been made to the administrator as a person beneficially entitled to a share of the estate.
(2) Proceedings on behalf of or against the State in respect of the estate of a deceased person or any share thereof or any claim thereon shall not be instituted except subject to the same rules of law and equity in and subject to which proceedings for the like purposes might be instituted by or against a private individual.
[New]
(3) Where the Chief State Solicitor for the time being is administrator of an estate for the use or benefit of the State, he shall cease to be administrator on ceasing to hold office and his successor in office shall become administrator in his place without further grant
Cases
In the Goods of Langley
Asse
Court of Probate.
24 January 1876
[1876] 10 I.L.T.R 11
Warren J.
Warren, J.
The facts in this case are as follow— The testator died, having duly executed his will, by which he devised certain rents and profits to his four sons as tenants in common, with a proviso that the shares of the sons dying unmarried should go to the survivors, and the shares of the sons dying married, but without issue, should go, after the death of such sons and their wives, to the survivors. The testator appointed his wife residuary legatee; she pre-deceased the sons, one of whom went to sea before his father’s death, and has not been heard of. The other three sons died, leaving no issue. The only surviving next of kin of testator and of Robert Langley, the last survivor of the four sons. are three children of testator’s brother, one of whom is the present applicant. Now, assent was given by the executors to the legacies of life interests contained in the will of testator; but, assent to the legacies of life interests in point of law is assent, also, to the gifts in reversion, and, therefore, the whole subject-matter of the legacies ceased to be assets to be administered. It follows that there are now no unadministered assets of the testator, and this motion must, therefore, be refused. Applicant can enforce all her rights in her character of personal representative of Robert Langley.
Mohan v Roche
Assent
[1991] IR 560
In the Matter of the Vendor and Purchaser Act, 1874, Colm Mohan, Plaintiff v. Thomas Roche (as personal representative of Mary B. Roche Deceased) Defendant
[1990 No. 785Sp.]
High Court 11th February 1991
Keane J.
11th February 1991
The facts in this matter can be shortly stated. The plaintiff bought a house, No. 5, Appian Way, Ranelagh, Dublin, on the 3rd October, 1990, for £146,000. The house was held under a fee farm grant dated the 1st June, 1877. The special conditions as to title provided that the title was to commence with this fee farm grant and then pass to a conveyance dated the 22nd January, 1959, between Daniel McMenamin of the one part and Michael Roche of the other part. The vendor was selling as the personal representative of Mary B. Roche who was the widow of Michael Roche to whom the property was conveyed by the deed of the 22nd January, 1959. He died intestate on the 14th October, 1967, and letters of administration to his estate were granted to his widow on the 3rd June, 1968. By deed of family arrangement dated the 29th December, 1969, and made between the nine children of Michael Roche and his widow, the nine children “granted released and conveyed” to the widow for natural love and affection their interest in the house. The widow died on the 5th October, 1989, having by her last will appointed the defendant and Patrick Roche her executors. Probate of the will was granted to the defendant on the 31st July, 1990, the rights of the other executor being reserved.
The objections and requisitions raised by the purchaser’s solicitors included one in a standard form (no. 18.1.):
“Furnish a written assent registered in the Registry of Deeds by the personal representative of any person on the title who died after the 31st May, 1959.”
The reply to this requisition was “vendor is selling as personal representative.”The purchaser’s solicitor assumed that an assent in writing by Mary B. Roche to the vesting of the property to those beneficially entitled (including herself) would be furnished at or prior to completion. It transpired, however, that no such assent had ever been executed and, accordingly, the purchaser’s solicitor declined to close the sale unless and until what was claimed to be the resultant defect in the title was cured by the extraction of a grant de bonis non to the estate of Michael Roche, the execution of an assent and its registration in the Registry of Deeds. The vendor’s solicitors claimed that these steps were unnecessary on three principal grounds:
(1) No such assent was required since the entire beneficial interest in the property was vested in Mary B. Roche by the execution of the deed of family arrangement of the 29th December, 1969;
(2) In so far as any such assent was required, the deed in question constituted an implied assent in writing signed by Mary B. Roche which met the relevant statutory requirements as to such assents;
(3) Mary B. Roche had in any event been in undisturbed possession or receipt of the rents of the house from the 29th December, 1969, onwards and hence had acquired a possessory title to the house at the date of her death.
Both parties being unwilling to withdraw from their respective positions, this vendor and purchaser summons was issued on behalf of the purchaser requesting the court to resolve the dispute.
The vendor’s solicitor was first asked for a copy of the assent in a letter of the 30th October, 1990. At that stage, the time for raising rejoinders had expired and under condition 17 of the general conditions of sale any reply to the requisition which had not been answered by the vendor was to be considered as satisfactory. However, Mr. Brady for the vendor, properly in my view, did not press any argument on this aspect of the case: the purchaser’s solicitor was equally entitled to insist on a strict reading of the reply actually furnished to the requisition and to assume that a copy of the assent would be furnished before or at completion.
Mr. Farrell on behalf of the purchaser submitted that, since the relevant sections of the Succession Act, 1965, provided that an assent in writing signed by the personal representative was a necessary pre-condition under the relevant sections of the Succession Act, 1965, to the vesting of any estate or interest in unregistered land which was the property of the deceased, it followed that the purchaser was entitled, in the absence of such an assent, to insist on this defect in the title being cured. He said that this could be done relatively simply either by extracting a grant de bonis non or by the court making an order under s. 27, sub-s. 4 of the Act of 1965 appointing a person to be administrator. In either case, the necessary assent could then be signed by the administrator and registered in the Registry of Deeds as required by the relevant sections. He submitted that, since the only purpose of the deed of family arrangement was to transfer the beneficial interest of the children to the widow, the fact that it was signed by her could not possibly make it an assent for the purpose of the Act of 1965. As to the vendor’s claim that he was in a position to convey a possessory title, Mr. Farrell submitted that a purchaser, in the absence of an express stipulation to that effect in the contract, could not be required to accept such a title and he referred to Ashe v. Hogan [1920] 1 I.R. 159. He also drew attention to certain covenants in the fee farm grant, the breach of which entitle the fee farm grantor to re-enter. Pointing out that the Supreme Court in Perry v. Woodfarm Homes Ltd. [1975] I.R. 104 had rejected the view that there was a “parliamentary conveyance” of the lessee’s interest to a squatter at the end of the limitation period, he said that it followed that the purchaser would be unable to acquire the estate of the fee farm grantor compulsorily under the Landlord and Tenant (Ground Rents) (No. 2) Act, 1978, and that hence the covenants would remain in force. In the result, the fee farm grant might be forfeited because of the breach by the grantee of the covenants to keep the house in repair and to use it solely as a private dwellinghouse. Mr. Farrell acknowledged that the latter was a somewhat remote contingency, but might well be raised by lending institutions, creating unnecessary difficulties for the purchaser. He also urged that such institutions were, in any event, more ready to make advances on the security of properties where a documentary title rather than a possessory title was offered.
Mr. Brady on behalf of the vendor submitted, first, that the execution of an assent by a personal representative was not necessary in circumstances such as the present where she would merely be assenting to the vesting of the interest in herself. He pointed to the words of the relevant section, i.e. that an assent not in writing should not be effectual “to pass any estate or interest in land”and submitted that they had no relevance where no estate or interest was passing, since the relevant interest was already vested in the personal representative. He properly drew attention to an English decision, In re King’s Will Trusts [1964] Ch. 542, which appeared to suggest the contrary but also referred to criticism of that decision and argued that it should not be followed. Secondly, he submitted that, if an assent in writing were required to complete the title of the vendor, the deed of family arrangement could be regarded as such an assent, since it contained a recital that it had been agreed by the parties including, of course, the widow that the house should “become the property of the widow”. He also submitted that the reference in the will of the widow to “my dwellinghouse 5 Appian Way” could also be construed, if necessary, as an implied assent to the vesting of the beneficial interest in herself. Finally, he submitted that, in the circumstances of this case, it was quite clear that the widow had acquired a possessory title and that the decision in Perry v. Woodfarm Homes Ltd. [1975] I.R. 104 did not have the effect on that title for which Mr. Farrell contended.
The question that arises can, accordingly, be reduced to this: does the fact that no assent was executed by the widow mean that the vendor cannot now convey the interest under the fee farm grant to the purchaser subject only to the fee farm rent and the relevant covenants? In answering that question, it is, I think, important to enquire in whom that interest is vested, if not in the vendor. (I refrain at the outset from using the terminology of “legal” and “equitable” estates for reasons which I will explain later.) The answer to that question depends in turn on whether that interest was vested in the widow at the date of her death. If it was, then unarguably it is now vested in the vendor.
It is clear that when letters of administration to the estate of Michael Roche deceased were granted to his widow on the 3rd June, 1968, that interest vested in her. It is unnecessary to enquire whether so much of the interest to which the children were entitled on intestacy ever vested fully in them, because it is accepted that by the deed of family arrangement of the 29th December, 1969, they effectually conveyed that interest to the widow so that it thereafter remained vested in her. From that time on, the interest in question, i.e. the interest of the grantee under the fee farm grant which the vendor has agreed to convey, was vested in the widow and no one else. It was not vested in the children and there was no one else in whom it could be vested.
Why then should the failure of the widow to execute an assent in writing to the vesting of the interest in herself now prevent the vendor from conveying that interest, if in truth it was vested in its entirety in the widow from the time of the deed of family arrangement onwards? (I am, of course, assuming for the moment that, contrary to what Mr. Brady argued, neither the deed itself nor the will of the widow could have constituted such an assent in writing.) The reason, it is said, is the wording of the relevant sections of the Succession Act, 1965. It accordingly becomes necessary to examine the relevant sections in order to ascertain whether Parliament intended that a personal representative who was already entitled to a particular interest in land should be incapable of transferring that interest to another unless he had first executed an assent to its vesting in himself.
Section 52, sub-s. 2 of the Succession Act provides that:
“. . . the personal representatives may at any time after the death of the deceased execute an assent vesting any estate or interest in any such land in the person entitled thereto . . .”
Section 52, sub-s. 5 provides:
“An assent not in writing shall not be effectual to pass any estate or interest in land.” (emphasis added)
Section 53, sub-s. 1 provides:
“An assent to the vesting of any estate or interest in unregistered land of a deceased person in favour of the person entitled thereto shall
(a) be in writing,
(b) be signed by the personal representatives,
(c) be deemed, for the purposes of the Registration of Deeds Act, 1707, to be a conveyance of that estate or interest from the personal representatives to the person entitled, [emphasis added]
(d) operate, subject to the provisions of the Registration of Deeds Act, 1707, with respect to priorities, to vest that estate or interest in the person entitled subject to such charges and incumbrances, if any, as may be specified in the assent and as may otherwise affect that estate or interest.”
The language used in both these sections indicates clearly, in my view, that the draughtsman was concerned with the transfer by the personal representative of the relevant estate or interest in the land to other persons who become entitled to that estate or interest by reason of the provisions of the will or the distribution of the estate of the deceased on intestacy. There is nothing, in my view, in the language used to suggest that the draughtsman considered it essential that the personal representative should also execute such an assent where he himself was the person entitled to the property, either by reason of a bequest or devise in the will or because of the distribution of the estate on intestacy.
Nevertheless, as I have already said, there is at least some authority in England for the proposition that the somewhat similar (but by no means identical) language of s. 36 of the Administration of Estates Act, 1925, necessitates, as part of the chain of title, the execution of an assent in writing by the personal representative to the vesting of the interest in the property in himself. This was the view taken by Pennycuick J. in In re King’s Will Trusts [1964] Ch. 542 to which I have already referred. In the course of his judgment at pp. 547 – 548 he observed:
“Subsection (4) [of s. 36 of the Administration of Estates Act, 1925] presents no difficulty where the person entitled to the estate or interest is someone other than the personal representative himself. It has been suggested that where the personal representative is also entitled in some other capacity, for example as trustee of the will, as beneficiary or otherwise to the estate or interest, he may come to hold the estate or interest in that other capacity without any written assent.
[Counsel for the plaintiff] has mentioned but not stressed this contention, and, in my judgment, the contention is not well founded.”
The authority of the decision is thus somewhat eroded by this rather surprising concession by counsel. Pennycuick J. went on at p. 548 to express his view as follows:
“The first sentence of subsection (4), accordingly, contemplates that for this purpose a person may by assent vest in himself in another capacity, and such vesting, or course, necessarily implies he is divesting himself of the estate in his original capacity. It seems to me impossible to regard the same operation as lying outside the negative provision contained in the second sentence of the subsection. To do so involves making a distinction between the operation of divesting and vesting the legal estate and that of passing the legal estate. I do not think that this highly artificial distinction is legitimate. On the contrary, the second sentence appears to me to be intended as an exact counterpart to the first.”
He went on to reject the primary submission of counsel in that case, i.e. that a deed of appointment of new trustees constituted a sufficient assent.
It will be observed that Pennycuick J. appears to assume (perhaps because of the concession made) that the relevant subsection not merely contemplates that a person may by assent vest an estate in himself in another capacity but also that he must take that step in order to enjoy it in another capacity, whether as trustee or beneficiary. If that were indeed the position, then it might well be that the language of the section (and I do not attach any particular significance to the addition of the adjective “legal” before estate in the English sub-section) could prevent the vesting of the interest in the personal representative in that different capacity. The fallacy in the reasoning, with respect, is that it assumes that an assent is in fact necessary to vest the interest in the personal representative so that he may enjoy it in another capacity. If one employs the terminology of the”legal” estate and the “beneficial” estate, the position in law, in my view, is that both estates are vested in the personal representative from the date of the grant. Manifestly, if he is not the person to whom the land has been bequeathed or devised by the will or he is not entitled to it on a distribution on intestacy, he must execute an assent in writing in order to vest the legal estate in the persons so entitled. If he is the person so entitled, then he need never execute an assent, since both the legal and beneficial estates remain vested in him at all times. On this analysis, s. 53, sub-s. 5 of the Succession Act, 1965, never becomes relevant, because it is never necessary to “pass any estate or interest in land” to the person beneficially entitled thereto: the estate or interest is already vested in him.
It appears to me that confusion sometimes arises in this area because of an erroneous assumption that the law requires the existance at all times of separate legal and equitable interests in property. In the present case, once the deed of family arrangement had been executed, there was no one other than the widow who could have been entitled to this house. Consequently, there was no need to posit the existence of two different estates, legal and equitable, the first of which could only be vested in the widow by the execution of an assent in writing to satisfy the requirements of sub-section 5. As Viscount Radcliffe pointed out, when giving the advice of the Judicial Committee of the Privy Council in Commissioner of Stamp Duties (Queensland) v. Livingston [1965] A.C. 694, 712, it is a mistake to assume that:
“[F]or all purposes and at every moment of time the law requires the separate existence of two different kinds of estate or interest in property, the legal and the equitable. There is no need to make this assumption. When the whole right of property is in a person, as it is in an executor, there is no need to distinguish between the legal and equitable interest in that property, any more than there is for the property of a full beneficial owner. What matters is that the court will control the executor in the use of his rights over assets that come to him in that capacity; but it will do it by the enforcement of remedies which do not involve the admission of recognition of equitable rights of property in those assets. Equity in fact calls into existence and protects equitable rights and interests in property only where their recognition has been found to be required in order to give effect to its doctrines.”
It may well be desirable that a personal representative should sign an assent in writing in circumstances such as the present but that is far from saying that it is a necessary link in the title. I am fortified in reaching this conclusion by the criticism of the decision of In re King’s Will Trusts [1964] Ch. 542 by learned commentators in England to which I was referred by Mr. Brady: “Dissent on Assents” by Professor J.T. Farrand, The Solicitor , volume 108, p. 698 and “Assents To-Day” by Mr. J.F. Garner, The Conveyancer , volume 28, p. 298).
It follows that the purchaser plaintiff is not entitled to the declaration sought in para. 1 of the summons. I should, however, say that I would have considerable doubt, if an assent were required, as to whether either of the documents relied on could be said to constitute such an assent. Although an assent does not in legal theory operate in the same way as a deed in the sense that it does not actually grant an estate to the beneficiary, it can only take effect as an assent if the personal representative, either expressly or by implication, thereby assents to the vesting of the estate in the beneficiary. There is nothing in the language used in the deed of family arrangement to suggest that it was intended to do any more than vest whatever interest the children were entitled to in the widow. Neither expressly nor by implication could it be read as an assent by the widow to the vesting in herself of the estate to which she was entitled on intestacy, assuming that such an assent was appropriate. Similarly, the intention of the widow in executing the will was exclusively to vest the interest in the property in the persons whom she wished to benefit. Again, in no sense could it be read as an express or implied assent to the vesting of any interest in the property in herself.
It is also unnecessary to express any concluded view on whether the vendor in circumstances such as the present is entitled to require the purchaser to accept a possessory title. In Ashe v. Hogan [1920] 1 I.R. 159, O’Connor M.R. at p. 169 said:
“I may add that in the case of the sale of a leasehold estate, I do not see how a vendor who has contracted to sell it can carry out his contract by offering a title under the Statute of Limitations on the doctrine of Tichborne v. Weir 67 L.T. 735; the leasehold estate is not vested in him. He cannot then convey it. The most he can convey is the right to hold possession of the lands during the residue of the term. From one point of view that may be a more beneficial estate, because it does not carry with it the personal obligations which the assignee of a leasehold estate assumes; but, on the other hand, not being in privity with the lessor, he does not get the benefits which pass to an assignee of a leasehold estate.”
The same observations would seem to apply to a grantee under a fee farm grant such as the present. Since, as Mr. Farrell pointed out, the Supreme Court in Perry v. Woodfarm Homes Ltd. [1975] I.R. 104 had confirmed the long accepted rule, referred to by the Master of the Rolls, that there is no “parliamentary conveyance”of the grantee’s interest in such circumstances, there are clearly serious difficulties in holding that a vendor is entitled to insist upon a purchaser accepting such a title where he has contracted for a documentary title.
However, as I have already said, in the present case the purchaser is not entitled to the declaration sought at para. 1 of the endorsement of claim in the vendor and purchaser summons.
In re Maher, Deceased
Scope of Benefit
Kenny J. [1961] IR 409
KENNY J. , having stated the facts, continued:
Counsel for the residuary legatees has argued that the bequest to Michael Cody is a bequest of “a business” and that he is therefore liable to pay the debts which were due in connection with that business at the date of the death of the testatrix. The decisions of Simonds J. (as he then was) in In re Rhagg(2) and of Wynn-Parry J. in In re White deceasedwere cited as authorities for the proposition that a bequest of a business involves the legatee in liability for the debts due in connection with that business at the date of the death of the testator. In re Harland Peck(4), in which Farwell J. seems to have taken a different view to that taken by Simonds J. and Wynn-Parry J., was also cited.
Unless a contrary intention is shown by the will, the personalty which has not been specifically bequeathed is the primary fund out of which the debts of a testator are to be paid. The order in which the assets are to be resorted to for payment of the debts is conveniently set out in Maitland’s Equity (1st ed.) at p. 208. In my opinion, the bequest to Michael Cody is not a bequest of a business. The reference in the will to “licensed premises” is descriptive of the property bequeathed and does not amount to a bequest of a business. If the testatrix intended to make a bequest of a business, it is difficult to understand why she inserted the reference to the household furniture between the bequest of the stock in trade and of the other effects on the premises. As there is not a bequest of a business, the cases relied on by Mr. O’Hanrahan are not relevant and I am spared the necessity of deciding the question on which Simonds J., Wynn-Parry J. and Uthwatt J. (as he then was) have expressed one view and Farwell J. another.
I do not see anything in the will which displaces the general rule that the personalty which has not been specifically bequeathed is the primary fund out of which the debts are to be paid.
The bequest to Michael Cody includes all the stock in trade in the premises at Bagenalstown and all the book debts owing to the testatrix in connection with the businesses carried on by her.
It has been argued for the residuary legatees that the intoxicating liquor licence attached to the premises forms part of the residuary estate. The ownership of such a licence has become of considerable importance since the passing of the Intoxicating Liquor Act, 1960. I do not agree with this argument. I think that the bequest to Michael Cody included the licence
In re Lopdell; Talbot v. Fetherstonhaugh
Legacy not paid
[1943] IR 50
Gavan Duffy J.
GAVAN DUFFY J. :
July 30.
The testator died on 10th November, 1911, having by his last will appointed his widow to be his sole executrix, and she proved the will.
The testator directed his debts and funeral and executorship expences to be paid out of his railway stock and shares, and gave to his widow, to be paid thereout, a sum of £1,000, to be disposed of as she thought proper, and certain other moneys; the remainder of his railway stock and shares he left to his widow for life, with a power to retain or vary the investments, and after her death he bequeathed the same to certain relatives; he made his wife residuary legatee.
On the evidence before me all the assets were comprised in the gift of which (subject to the debts and expenses and the legacy of £1,000) the widow was tenant for life, and she received the income of the whole estate until her death on 4th May, 1941.
She never withdrew nor segregated her £1,000, and the investments representing the testator’s assets have depreciated by some 40 per cent., even if one treats the present pound as having the value (which, of course, it has not) of the pound of 1911.
The question is whether the plaintiffs, as executors of the widow, are entitled to £1,000 out of the depreciated assets, or whether that legacy must abate with the legacy of the remainder of the railway stock and shares. The persons entitled to share in that remainder are numerous; most of them are out of the jurisdiction, and several of them reside in New Zealand; I have accordingly appointed the defendant, entitled by assignment to a portion of that remainder, to represent the whole group, to whom I shall refer hereafter as the ultimate beneficiaries.
It is admitted that the widow took an absolute gift of the £1,000 and it is admitted that her claim is not statute-barred.
Mr. Micks, for the defendant, urges that she must be deemed to have appropriated securities worth £1,000 to her legacy nearly thirty years ago, so that she must now bear her just proportion of the loss; the personal estate was sworn shortly after testator’s death at more than £9,000 and there is no reason to suppose that the debts were not speedily discharged; Mr. Micks says it was her duty to administer the estate promptly.
Mr. Newett, for the plaintiffs, says that she had no positive duty to pay her own legacy, if she was willing to wait, since there was nothing to distribute so long as she lived, and that the onus is on the defendant seeking to reduce her benefit under the will.
The executrix, who has been enjoying all the income, must be presumed to have assented to the legacy of £1,000 and also to the gift of income to herself; and it is not suggested that she failed to assent, as it was her duty to assent, to the legacy given to the ultimate beneficiaries. It is not suggested that she made any improper investment, and she cannot be charged with a devastavit: see Job v. Job (1),and compare, as to the position of a trustee, In re Chapman (2).The widow-executrix, after paying the debts, did not by mere process of time become, in the proper sense of the word, a trustee and cannot be treated as such: In re Mackay (3); it would, therefore, be difficult to justify a decision here based on the principle that a trustee may not assert any title of his own against his beneficiary, as if this were a case of following trust property after conversion. But the defendant must rely upon an equity against the widow, and the question is what equity, if any, he can sustain.
Had there been a deficiency at the testator’s death, the widow would clearly have been entitled to the payment in full of her £1,000 legacy before there could be a shilling for the ultimate beneficiaries; and I apprehend that the position would have been the same in a case of subsequent depreciation, if the executrix and the widow had been different individuals: Baker v. Farmer (4). But the fact that she was both legatee and executrix makes it necessary to consider precisely what her duty was. Apart from the payment of her own legacy, she probably completed the duties of her executorship proper in the year 1912 or the year 1913, and, if she then decided to leave her £1,000 where they were until her death, she presumably did so in order to save herself trouble, and the question is now whether any such express or implicit decision was in conformity with her duty as executrix.
The executor’s oath is to administer according to law, and to exhibit a true and perfect inventory of the estate, and render a just and true account thereof, whenever required by law so to do. Swinburne (Wills, 7th edn., p. 417) is perhaps, a little, but only a little, more illuminating:”Chiefly it is requisite that he be prudent, diligent and faithful”; the lady was not diligent in paying her own legacy, but her duty to pay it was a duty of imperfect obligation (for which she should not now suffer), unless it was comprised in her oath to administer according to law.
In order to test her duty, I have very carefully considered whether the ultimate beneficiaries could have insisted upon segregation and appropriation, and I am satisfied that they could; I am satisfied that the Court, finding that the testator had appointed no trustees and had left the securities in the hands of a sole executrix, herself a tenant for life and an unpaid, and substantial, pecuniary legatee, must have acceded to their application and must have rejected any plea on behalf of the executrix objecting that there was no necessity for it.
The ultimate beneficiaries failed, so far as the evidence goes, to assert any such claim, either in Court or out of Court, but that was no laches on their part, since the omission cannot be said to have prejudiced the widow, who was left mistress of the situation, and Mr. Micks cites an appropriate passage from Lindsay Petroleum Co. v. Hurd (1).
It is obvious that the widow must bear her just proportion of the loss by depreciation, if I am right in holding that the ultimate beneficiaries could have compelled her to appropriate the “remainder” of the securities in which they were interested; it is obvious, because the reason justifying the order would have been that it was the duty of the executrix to do what the Court was asked to order her to do. Equity looks upon an act as done which ought to have been done, provided that the complainant had a right to have the particular act done: see Burgess v. Wheate (2).
In my opinion, the executrix ought, for the strict fulfilment of her duties, to have paid her own legacy and thus appropriated the surplus to the gift in which the ultimate beneficiaries are interested; and the fact that her failure to do so may at the time have seemed to be quite innocuous is irrelevant.
It is interesting to note that, on the like principle, Lord Selborne in Carmichael v. Gee (3), holds that a testamentary authority to postpone conversion will not be allowed to defeat any rights, though only rights of residuary legatees, which ought to have accrued, if immediate conversion had taken place.
Perhaps the same result could be reached on other equitable principles, such as that in favour of all equal measure in the apportionment of losses, which I had to apply recently in Drake v. Tyndall (4), but that principle carries the matter no further, for I do not think it would apply here, if the executrix were held to have neglected no duty in allowing her preferential legacy to remain unpaid and in failing to appropriate.
Or perhaps she might be made to bear her share of the loss, because the depreciation in the securities which ought to have produced her £1,000 is a loss for which she can blame no other person, so that the case is the converse of Davies v.Wattier (1), with the opposite result.
Or one might assimilate the case to those in which relief is given from loss through accident to claimants having a superior equity. (Story’s Equity Jurisprudence, 4th edn., par. 109.) In my opinion, the ultimate beneficiaries here have a superior equity to the plaintiffs as personal representatives of the widow-executrix.
There is, of course, no evidence of any assent by any of the ultimate beneficiaries to the course adopted by the executrix; that might have altered the position. Nor is there any evidence of any admission by the executrix that particular securities represented her £1,000 legacy; in view of the many years that have elapsed, this last matter might have been of some importance, if my view had been in favour of the plaintiffs, and I should probably have felt compelled, before deciding the case for the plaintiffs, to give a specific opportunity to the several scattered ultimate beneficiaries to bring forward any evidence that may be extant of relevant admissions by the lady, who probably corresponded with some of those concerned.
I propose to declare that, in the events which have happened, Mrs. Lopdell’s legacy of £1,000 is liable to bear its just proportion of the loss by depreciation in the money-value of the securities at the date of my order representing the testator’s stocks and shares after payment of his debts and funeral and executorship expenses, and that that just proportion will be measured by the ratio which the sum of £1,000 bore at the end of one calendar year from the testator’s death to the money-value at that time of those stocks and shares after payment of the said debts and expenses.
There will be liberty to apply, so that, if (for instance) the debts and other expenses were not paid within a year of testator’s death, another date may be determined, in default of agreement, upon an application justifying the delay in payment.
P.D. & Anor v D.D.
Accounts & Estate Expenses
[2020] IEHC 88 (25 February 2020)
Page 1 ⇓THE HIGH COURT[2020] IEHC 88[2015 No. 4925 P.]BETWEENP. D.ANDH. R.PLAINTIFFSANDD. D.DEFENDANTJUDGMENT of Mr. Justice Allen delivered on the 25th day of February, 20201. J. D. died on 9th July, 2005. He was survived by his wife, H., and five children, son 1,daughter 1, son 2, daughter 2, and son 3. By his will made on 23rd May, 2005 J. D.appointed his step-brother D. B. as his executor. He devised his house on four acres andhousehold chattels to H., for her life, dum sola, with a right of maintenance and supportfrom the balance of the farm. H. was 80 years of age at the time J. made his will.2. J. devised part of the farm, comprising about 50 acres, to H. and son 2, jointly; anotherpart, comprising about 40 acres, to daughter 1, daughter 2 and son 1; and the balance of240 acres or so, the house and four acres after the death of H., all of his stock and farmmachinery, and all of his entitlements under the single payment scheme, to son 3. Heleft the remainder of his estate to H.3. No estate account was ever prepared.4. Very soon after J.’s death, D. B. renounced. While the evidence is rather vague, itappears that in the years following J.’s death son 2 kept horses on the 40 acres and son 3farmed the balance of the lands.5. By notice given on 16th August, 2015 H. elected to take her legal right share and soonafter purportedly appropriated the family home and 108 acres in three identified plots insatisfaction of that share. There is no issue as to the validity of the election. It does notappear to have been ever formally agreed, but it does not appear to be contested, thatthe appropriation was ineffective. Firstly, the purported appropriation went beyond thedwelling, and secondly, the dwelling was held with agricultural land which formed part ofJ.’s estate, and no court application was made pursuant to s. 56(5)(b) of the SuccessionAct, 1965.6. There is no distribution account or draft distribution account for J.’s estate to show theeffect of H.’s election on the entitlements of the beneficiaries of J.’s estate.7. H. died on 25th July, 2008. By her will, which was also made on 16th August, 2005 H.appointed son 2 her executor, and devised, or purported to devise, the house andcontents and the surrounding four acres to her five children in equal shares, and theresidue of her estate to son 2.Page 2 ⇓8. No estate account was ever prepared for H.’s estate, either. There is no draft distributionaccount showing the effect of the invalidity of the notice of appropriation on the purporteddevise of the house and surrounding four acres on the distribution of H.’s estate: but ifthe appropriation was invalid, the devise failed, and son 2, as the residuary legatee, tookthe entire estate.9. On 5th October, 2010 son 2 proved H.’s will. The grant of probate shows a gross estateof €891,471, and a net value of €885,971. There must have been an inland revenueaffidavit sworn but it was not produced on the application before me.10. On 5th May, 2011 a grant of letters of administration with will annexed of the estate of J.was granted to son 2. It was said that there was a court application at or about thattime but at the hearing before me no details were given, save that son 3 was said to havean order for costs which had not been paid.11. On 27th September, 2011 son 1 made an application to the High Court under s. 117 ofthe Succession Act, 1965 for a declaration that J. had failed in his moral duty to makeproper provision for him, and for such provision from J.’s estate as to the court shouldseem just.12. On his application, son 1 put a value of €3.1million on the farm. He exhibited a revenuecertificate dated 17th July, 2008, based on an affidavit sworn by H. on 29th February,2008, which put a gross value of €3,279,000 on J.’s estate, and a net value of€3,257,880. That affidavit suggested that J.’s estate comprised the farm, valued as ofthe date of death at €3,194,000, and farming assets of €85,000, and nothing else. Itshowed five debtors amounting in total to a little over €20,000. The largest creditor ofJ.’s estate was a co-operative society, which was shown to be owed €15,448.87. That,debt it appears, has never been paid.13. The s. 117 proceedings meandered through the High Court. There was an exchange ofaffidavits in 2012 and an exchange of discovery in 2014 and the matter was listed forhearing on 9th December, 2014.14. On the day before the case was to be heard, son 3’s solicitors served on son 2’s solicitorsand son 1’s solicitors a form of notice of motion dated 8th December, 2014 andpurportedly returnable for the following morning, seeking an order joining son 3 as anotice party. That motion was never issued, and son 3 was never joined as a noticeparty, but he instructed his solicitors and counsel to attend on 9th September, 2014 asthey had from time to time previously when the proceedings were listed for mention.With the agreement of son 3, daughter 2, and daughter 1, and son 2 in his representativeand personal capacities, son 1’s claim was settled for €150,000 in addition to his“distributive share of the net value of the lands conferred on him jointly with his sisters …plus a one fifth share of the net value of the dwelling house and four acres appropriatedby his mother towards satisfaction of her legal right share” and agreed costs of €82,500.Page 3 ⇓15. I pause here to observe that the difficulty with the appropriation by H. does not at thattime appear to have been identified. The settlement with son 1 created or confirmed atleast an expectation on his behalf that he would have – in addition to his money – his onethird share of the 40 acres devised by J., which would have to abate by reason of H.’selection, and one fifth of the value of the house and four acres, which by reason of theinvalidity of the purported appropriation was never part of H.’s estate. Son 3 and son 2on the application now before the court have identified eleven issues to be determined.That list of issues does not include any issue as to the effect on the administration ofeither estate of the agreement made with son 1.16. The settlement of the s. 117 proceedings provided that son 2 would have his costs fromthe estate, to be taxed in default of agreement “on the executor’s scale” and that:-“… it is a matter for the court to decide whether or not the legal representatives of[son 3], [daughter 1] and [daughter 2] ([daughter 2] to confirm whether or notintends (sic.) to take legal advice) are entitled to costs from the estate.”17. The settlement provided that son 1 should have his money and other entitlements by 8thDecember, 2015.18. As far as can be seen, the settlement of the s. 117 proceedings was not finalised on 9thDecember, 2014 and no order was ever made for the taxation of the administrator’scosts. Nor, until now, was any application ever made for the costs now claimed by son 3.The s. 117 proceedings were adjourned for mention until 22nd January, 2015 andthereafter from time to time throughout 2015.19. By plenary summons issued on 17th June, 2015 son 3 and daughter 2 issued proceedingsagainst son 2 claiming an order revoking the grant of letters of administration in theestate of J.; an order appointing an independent administrator; an order directing son 2to account for the assets of the estate; a declaration that the purported election andappropriation by H. were void – not because they were not permitted by the SuccessionAct but on the grounds of incapacity and/or had been procured by undue influence; adeclaration that H.’s will was void on the grounds of incapacity and undue influence; anorder for the administration of J.’s and H.’s estates by the court; damages, and costs.20. On 13th October, 2015 an appearance was entered on behalf of son 2 in the plenaryproceedings. The notice of entry of appearance called for delivery of a statement ofclaim, but that was never done. Instead, son 3 issued a motion on 24th September,2015 for the revocation of the grant in the estate of J.; an order appointing anindependent administrator; an order for an account; and an order directing son 2 tocomply with the settlement agreement of the s. 117 proceedings.21. It is not useful to dwell on the detail of all of son 3’s complaints but one of them was thatbetween 2011 and 2015 son 2’s solicitors had collected a total of €299,222.68 for a BordGais wayleave and single farm payments, and had paid out a total of €99,454.46 – ofwhich €91,233 of was in respect of their own fees. Most of these fees appears to havePage 4 ⇓been related to the defence of the s. 117 proceedings but there was no suggestion thatthese had been agreed.22. Son 3’s motion in the plenary proceedings was countered by a motion issued on behalf ofson 2 on 27th November, 2015 to strike out some of the reliefs claimed by the plenarysummons on the grounds that they were frivolous and vexatious and bound to fail.23. The two motions in the plenary proceedings and the s. 117 proceedings came into the listtogether before Binchy J. on 17th December, 2015 and, by consent were referred tomediation.24. On 26th January, 2016 after a long day in mediation, an agreement was signed by son 2,son 3 and daughter 2. The first paragraph of the settlement agreement provided that:-“It is agreed that these proceedings and all matters arising from the administrationof the estates of [J. D.] and [H. D.] shall be resolved on the following terms”.25. It was agreed that the land, stock and machinery would be sold and “the proceeds of saledistributed as set out in this agreement”.26. It was agreed that two estate agents, one nominated by each side, would be jointlyappointed auctioneers “with joint carriage of sale” and that they should decide the reserveprice, the time and mode of sale, the necessary state and condition of the land for thepurposes of achieving the best price, whether the land should be sold with vacantpossession, and whether the single farm payment should be included in the sale of thelands.27. It was agreed that the sale proceeds would be used to pay the costs of sale, the debts ofthe estates, the income tax of the estates, the inheritance tax of the beneficiaries, theadministration costs, and the s. 117 payment and agreed costs to son 1: and that thebalance of the money would be lodged in a joint deposit account in the joint names of thesolicitors.28. The settlement agreement went on to provide that:-“The parties hereto shall agree how the net balance is to be divided, which saidsettlement shall be ruled by the court and in default of agreement determined bythe court.”29. The settlement agreement of 26th January, 2016 provided that the parties’ accountantswould forthwith agree and submit income tax returns for the years 2004 to 2015 andinheritance tax returns for the beneficiaries; that son 3 would be paid €250,000 “inrecognition of his contribution in maintaining the farm (from the single farm payment) tobe paid after the sale of the property”; and that the legal right share of H. would becalculated on the basis of one third of J.’s net estate before deduction was made of the€150,000 to son 1. It did not specifically provide that in the calculation of H.’s legal rightPage 5 ⇓share, no deduction should be made in respect of the costs payable to son 1 – from J.’sestate – or the costs of defending those proceedings, which were also for J.’s estate.30. The settlement agreement provided that it would be made a rule of court; that therewould be liberty to apply; and that the parties would bear their own legal costs of themediation and of the proceedings to date.31. I pause here to observe that it was impossible for the accountants to have agreed ormade inheritance tax returns, or for the inheritance tax to have been paid, unless anduntil the benefits to which the beneficiaries were entitled had been ascertained.Moreover, it is difficult to see the benefit to son 3 of the payment of €250,000 from thesingle farm payment, which had been specifically devised to him by the will.32. I suppose that the agreement that the farm would be sold represented some progress butthe issue as to the entitlement of the various beneficiaries in each of the estates waskicked down the road.33. The two cases were listed for mention together before Gilligan J. on 26th April, 2016when the January, 2016 settlement agreement was received and filed and made a rule ofcourt. The order then made provides that each of the parties should bear their owncosts, and that there should be no order as to the costs to date, and that there wasliberty to apply. The order of Gilligan J. – which was made in the plenary proceedings -recites that the s. 117 proceedings were then before the court, but the settlement ofthose proceedings was not received or filed, nor was any application made in respect ofthe costs of those proceedings. The proceedings were adjourned, together, for mentionuntil 5th July, 2016.34. In the meantime, on or about 5th February, 2016 the two auctioneers visited the landstogether and in an e-mail of that date made a number of recommendations to ensure thatthe farm would be in the best possible condition for sale, including the removal of allmachinery and scrap and livestock and bloodstock, and the application of fertiliser toimprove the colour and appearance of the grassland. The most urgent matters were saidto be the removal of bloodstock and scrap metal and machinery.35. By e-mail of 15th February, 2016 the accountants working on both estates asked thesolicitors for various documents said to be necessary to deal with the capital acquisitiontax returns, which documents were promptly made available. In a further e-mail of 24thFebruary, 2016 the accountants – inevitably – wanted to know how the net balance wasto be divided because they could not otherwise deal with the inheritance tax returns.36. There was protracted correspondence between the solicitors by which son 3 soughtextensive financial information and complained that son 2 had not removed his horsesand scrap metal.37. On 30th June, 2016 son 3 filed a long affidavit exhibiting all the correspondence. Heexhibited the auctioneers’ recommendations, which in the narrative of his affidavit werePage 6 ⇓said to have been that the bloodstock, i.e. son 2’s horses, should be taken off the land toensure sufficient growth of grass. That is not what the advice was. Quite clearly, therecommendation was that all livestock, i.e. son 3’s cattle, as well as all bloodstock, i.e.son 2’s horses, should be removed. The removal of the horses, machinery and scrap wasidentified as the most urgent matter to be attended to but the recommendation that thelivestock be removed was unequivocal.38. After a number of listings for mention in July, 2016, at which son 3 was agitating for adate for hearing of an application for an order directing son 2 to do so, son 2 vacated thelands and the matter was adjourned for mention until 13th October, 2016. Whathappened to the motions thereafter is unclear.39. On 31st January, 2017 a further motion was issued on behalf of son 3 in the plenaryproceedings seeking liberty to re-enter the matter pursuant to the settlement agreementof 26th January, 2016 and seeking the same reliefs as had been sought by the motionissued on 24th September, 2015 – revoking the grant to son 2 in the estate of J.,appointing an independent administrator, and so on.40. On 2nd February, 2017 Gilligan J., noting an undertaking to do so, ordered that son 2furnish a draft estate account by 5.00 p.m. on Friday 10th February, 2017, and adjournedthe motion for mention.41. On 23rd February, 2017 son 3 filed a further long affidavit, called Supplemental AffidavitNo. 3, in which he complained bitterly at the lack of progress and information. Heexhibited what he described as a two page account which was furnished by son 2’ssolicitors in purported compliance with the order of Gilligan J. of 2nd February, 2017.The first page lists five heads of income to date, amounting in total to €342,216.10 –without any dates or breakdown; six items of “funds and assets to be realised”, three ofwhich are not quantified; and a figure of €2.2 million for “estimated net proceeds of saleof the farm”.42. The second page lists three items of expenditure to date and fourteen “outstandingliabilities and claims to date”. The expenditure to date includes €200,000 for thesettlement of the s. 117 proceedings, which is less than the total payable to son 1, and noprovision is made for the balance. It also includes €118,695 for the legal fees of son 2’ssolicitor, without any indication as to the work to which these payments related. The listof outstanding liabilities and claims to date does not indicate which are accepted andwhich are contested. Included is a sum of €111,782.46 for son 3’s solicitors’ fees and afurther global sum of €306,070,13 for son 2’s solicitors’ fees “estimated to date and intothe future”. By the way, son 3’s solicitors’ claim for fees is in fact for €64,178.55 andthere is no clue as to where the figure of €111,782.46 came from.43. There was no attempt to separate the estates.44. By February, 2017 farm accounts had been drafted for 2004 to 2015 and, I think, acalculation made of the tax liabilities on the premise that the farm was being farmed byPage 7 ⇓J.’s estate. The list of outstanding liabilities to which I have referred included a sum of€195,387.22 for income tax but there was no reference to the income on which that taxarose, or how much, if any, of that income should be appropriated to H.’s estate.Provision was made in the list of outstanding liabilities for €250,000 in respect of son 3’s“wages” – which was part of the January, 2016 settlement – but as far as I can see thishad already been included in the farm accounts, spread over a number of years.45. In his Supplemental Affidavit No. 3, son 3 complained – quite rightly – that the figures onthe two page account had not been broken down or vouched or separated between J.’sestate and H.’s estate. Son 3 called for a breakdown of the €118,695 paid to son 2’ssolicitor but did not specifically complain that the costs of son 1’s s. 117 proceedings hadneither been taxed nor agreed. While son 3 complained about the delay in progressingthe administrations, there was no real suggestion as to how they might have been orought to be progressed.46. On 24th October, 2017 senior counsel instructed on behalf of the estates wrote an opinionon the distribution of the estates. He offered his opinion on the legal effect of H.’selection to take her legal right share on the gifts to her in J.’s will; the legal effect of thatelection on the other gifts in J.’s will; the invalidity of the purported appropriation by H.;and the legal effect of the invalidity of the purported appropriation on the gifts in H.’s will.47. The farm had eventually been sold and the sale of completed on 4th August, 2017 at theprice – before costs of sale – of €2,380,000. On 20th October, 2017 the valuerinstructed on behalf of the estate had provided a breakdown of the total gross price, byreference to six parcels – the house, the four acres, the forty acres, the fifty acres, andthe balance. Interestingly, the house was valued separately from the four acres, giving acombined value of about €126,000, compared to the €400,000 ascribed to the house onfour acres by a valuation by the same valuer dated 14th July, 2006. While it is true thatthe date of death valuation of the entire farm (at about €3.2 million) was a good dealhigher than the price ultimately achieved, the value ascribed to the house and four acreswas proportionately a great deal less.48. Senior counsel, having said what he said about the two estates, then undertook what hesaid was a pro-rata assessment on a percentage basis of the beneficiaries’ interests in thetotal gross sale proceeds of the farm and came up with 76.12% for son 3, 11.34% for son2, and 4.18% for of each of daughter 2, daughter 1, and son 1.49. With respect, I am unconvinced that this was a useful exercise. It is certainly nottransparent. It leaves out of account, as counsel’s opinion spells out, the value of thestock and machinery, but it also leaves out of account the substantial receipts in respectof the Bord Gais wayleave and (apart from a figure of €58,379 included in the proceeds ofsale of the farm) single farm payments and the income derived from the farm in thetwelve years between the date of J.’s death and the sale of the farm. Critically, in myview, the exercise leaves out of account H.’s legal right share of one-third.Page 8 ⇓50. Son 3’s motion of 31st January, 2017 came on for hearing before McDonald J. on 25thApril, 2018. The order of Gilligan J. made on 2nd February, 2017 shows that there hadthen been no objection to the re-entry of the proceedings and that Gilligan J. ordered thatthe motion do stand listed for hearing. Thereafter further affidavits had been filed oneach side, but the parties apparently spent the whole day before McDonald J. arguingabout whether the proceedings (which had been re-entered by Gilligan J. fifteen monthsearlier) should or should not be re-entered.51. McDonald J. gave liberty to son 3 and daughter 2 to re-enter the proceedings anddirected the delivery of points of claim and points of defence. Both sides ignored theorder of the court and instead eventually agreed an issue paper which set out elevenissues for determination by the court, without any indication of the facts – agreed orcontested – said to give rise to those issues.52. On 15th May, 2019 Reynolds J. gave directions for the delivery of an issue paper andreply, and the exchange of written submissions. Those directions were also ignored. Atthe hearing before me counsel for son 3 produced a summary of general principles of lawcomprising in the main quotations from cases and text books, which made no meaningfulattempt to tie the principles to the administration of the two estates.53. After the issue paper had been agreed, son 2’s solicitor put the ball in for the hearing ofthe agreed issues by swearing a short affidavit exhibiting the January, 2016 settlementagreement and counsel’s opinion. Son 3’s solicitor countered with a fairly short affidavitsummarising the history of the litigation and exhibiting a 132-page bundle of e-mails,letters and documents, by reference to which, it was suggested, the court could considerin full the efforts of son 3 to force son 2 to advance the distribution of the estate.54. Not to be outdone, son 2’s solicitor swore another affidavit exhibiting a 130-page bundleof correspondence and e-mails with the declared object of rebutting some, but not all ofthe averments in son 3’s solicitor’s affidavit – which were not identified – which were saidto be substantially untrue and inaccurate. I listened as patiently as I could for two daysas counsel dipped in and out of the correspondence, reopening old wounds, in the hope ofconvincing the court that the other side was responsible for the extravagant legal bills.55. Each side submitted that the other has acted unreasonably and has impeded theadministration of the estates. I accept the submission of both sides.56. The joint recommendation of the auctioneers was that the best time to sell the farm wasin the spring. It may or may not have been ambitious at the time of the mediatedagreement on 26th January, 2016 to have hoped for a sale in the spring of 2016 but for anumber of reasons it did not happen.57. Following the recommendation of the auctioneers on 5th February, 2016 that the land becleared of livestock, bloodstock and scrap, neither son 3 nor son 2 complied. At the endof July, 2016 there were numerous court applications directed to getting son 2’s horsesand scrap off the land. As far as I can see, no allowance was then made for the fact thatPage 9 ⇓son 2 had had a health scare. Neither does it appear to have been recognised that thewindow for the sale of the farm had long since closed.58. The agreement in January, 2016 was that the stock and machinery, as well as the land,would be sold. The stock and machinery were not sold but rather were taken off the landby son 3. Until the afternoon of the second day of the hearing before me, son 2 and hislawyers were labouring under the impression that the cattle had been sold, and son 2 wasdemanding that son 3 should account for the proceeds of sale. It is not entirely clear tome that son 3 was responsible for creating this misunderstanding, but it is quite clear thathe knew that son 2’s solicitors were labouring under a misapprehension and did nothingto dispel it. The truth only came out in answer to a question asked by the court. Whathappened was that the cattle were valued and taken away by son 3 to a rented farm.What happened to them thereafter is not clear.59. On 23rd August, 2016 son 3 obtained a document called “quotation of cattle priced” froma cattle dealer, which valued the herd of 229 beasts at a total of €105,240. The date ofthe valuation shows that the cattle were removed from the farm a month after son 2’shorses and scrap had been removed.60. The valuation put a price or value of €750 on each of 100 cows, €350 on each of 25heifers, and so forth. There was a general complaint on son 2’s side that the animals hadnot been sold in the market but there was no evidence, or even suggestion, that the wayto sell a herd is at the market rather than off the farm, or that the prices or values put onthe animals by the valuation were low.61. What son 3 did with the stock was in clear breach of the agreement and it wasunderhand, but son 2’s focus was on the impropriety of son 3’s conduct, rather than theconsequences for the administration.62. What son 3 did with the herd, and what son 2 thought son 3 did with the herd, did giverise to a significant problem in finalising the 2016 farm accounts. The cattle were gone,but there was no money. Even if the valuation were accepted, the estate has since thattime been out of pocket.63. As to the farm accounts, son 2 complains that son 3 delayed unreasonably in providingthe accountants with information and documents which they required, and son 3complains that son 2 has delayed unreasonably in signing the accounts when they wereready. But there was no evidence as to what information or documents, precisely, son 3delayed in providing, or when he was first asked to provide them. Nor was there anyevidence as to when son 2 was first asked to sign the accounts.64. Each complains that the other, by his delay, had increased the liability of the estate (orestates?) to penalties and interest but neither has attempted even a rough calculation ofwhat those increased penalties and interest might have been. The only thing that wasclear was that after the accounts and tax returns had been finalised, son 2 refused to signPage 10 ⇓a revised account and return which would have reduced the amount of tax by €15,000.Son 2 was advised by his lawyers to sign the revised return but wilfully refused to do so.65. There is a good deal more contested detail, but I have identified the main issues.66. From all of this it can be seen that son 2 and son 3 have been trading blows – or perhapsmore accurately swinging at each other – for upwards of ten years. Son 3 is entitled tothe lion’s share of J.’s estate. If son 2 is right about the purported appropriation by H.,he is entitled to the entirety of H.’s estate, which is one third of J.’s estate. Son 2 andson 3 both seek to fix J.’s estate with the costs of their squabbling. As far as I can see,no consideration has been given to how this would impact on the interests of daughter 2,daughter 1 and son 1: beyond an assumption that their entitlements would abate rateablyto pay for their brothers’ protracted and extravagant battle. Daughter 2, in themeantime, has died without having seen a cent of her inheritance.67. By the way, there are a number of outstanding claims by creditors of J.’s estate whichalthough not contested, and probably included in the farm accounts, have still not beenpaid.68. I come eventually to the eleven issues identified in the issue paper.First issue69. The first issue which the court is asked to decide is whether, having regard to the saleprice achieved for the lands and the valuation of the intended gifts of portions of the landssold, and subject to any adjustment in regard to the value of stock, machinery and otherincome and realisations not yet accounted for, the beneficiaries shares in the estates(sic.) are to be measured in accordance with Formula A, which is son 3 76.12%, son 211.34%, and each of daughter 2, daughter 1 and son 1 4.18%, or Formula B, 78.40%,10.20%, and three times 3.8%.70. The first problem with the issue as formulated is that the estates are not beingadministered separately. The second, I think, is that the issue as formulated seeks toisolate one only of many issues that will arise in connection with the distribution and, onits face, contemplates that the exercise might need to be revisited. Counsel’s opinioncorrectly identifies that H.’s legal right share must be accounted for in priority to all of thegifts in J.’s will. To do that, it will be necessary to identify the valuation date. It is clearthat there was a significant reduction in the value of the farm between the date of J.’sdeath and the date of H.’s election, and the date on which it was sold. Unless thevaluation date for the legal right share is the date of distribution, there may be asignificant impact on the other gifts.71. Since J.’s will specifically devised and bequeathed all of his estate, all of the gifts in thewill will have to abate. Counsel observes that the effect of the election was to acceleratethe gift to son 3 of the house and four acres but does not appear to have addressed hismind to whether that will impact upon the abatement of the other devises. Counselobserves that the effect of the invalidity of the purported appropriation is that the devisePage 11 ⇓in H.’s will fails but does not appear to take account of the settlement with son 1 bywhich, rightly or wrongly, he appears to have been promised a one fifth share of thehouse and four acres.72. While the parties agreed that the alternative to Formula A was Formula B, neither couldexplain the basis of Formula B. It appears to have been floated at a meeting along theway, but no one was able to identify any valuation on which it was based.73. In his affidavit sworn on 17th July, 2019, son 2’s solicitor put into the mix a documentgenerated in the course of the mediation in January, 2016 which, by reference to differentvaluations of the parcels specifically devised by J., suggested a division of 76.9%, 11%,and three times 4.66%. There was no attempt to explain the difference in the valueascribed to each of the parcels in the 2016 exercise and the October, 2017 exercise.74. Even if one or other of the formulae proposed would give an indicative assessment of thebeneficiaries’ interests in two thirds of J.’s estate, the exercise would have to be revisitedto take account of the very significant sums received for Bord Gais wayleaves and singlefarm payments, the value of the stock and machinery taken away by son 3, and theincome generated by the farm in the sixteen years between the date of J.’s death and thedate on which the farm was sold.75. In the distribution of J.’s estate it will eventually be necessary to ascribe a value to eachof the parcels specifically devised by reference to the proceeds of sale of the lands, but Iam not satisfied that this should be done in isolation, or on some sort of provisional basis.76. In any event, there is simply no evidence by reference to which the court could resolvethe issue as to which – if either – of the two proposed formulae are correct.77. On 2nd February, 2017 Gilligan J. ordered son 2 to furnish a draft estate account. Whatwas produced was unquestionably not a draft estate account and this was acknowledgedby counsel. It is not even a cash account.78. Counsel for son 2 agreed with the court that much of the difficulty and confusion wouldhave been avoided if proper administration accounts had been prepared. When pressedby the court that draft distribution accounts for both estates should have been producedyears ago, counsel argued that distribution accounts are not usually made up until theestate has been fully realised and all liabilities paid. It was suggested that thepreparation of draft administration accounts was a counsel of perfection which mightexpect too much of a small firm of solicitors, as opposed to one of the big firms.79. I am bound to say that in a case where the estates’ solicitor is claiming hundreds ofthousands of euros for his own fees, plus tens of thousands of euros for accountants’ andvaluers’ fees, I do not consider it to be unreasonable to expect that the estates areadministered properly. The standard of work that is to be expected is an objectivestandard of care and skill and is not to be measured by the size of the firm, or theindividual competence of the solicitor dealing with the case.Page 12 ⇓80. In the hope that it might support the way in which the administrator’s solicitors haveapproached their work, counsel referred to an article by Mr. Richard Hammond, solicitor,in the March, 2014 issue of the Law Society Gazette. Mr. Hammond was then the vice-chairman of the probate, administration and trusts committee of the Law Society.81. The title of Mr. Hammond’s article is “Holding to account” and the headline is “Theexecutor/administrator as the primary client and the residuary legatees/intestatebeneficiaries are entitled to receive administration accounts”. The author explains veryclearly and concisely the need for and purpose of administration accounts and how theyallow the solicitor and the beneficiaries to understand the progress of the administration.He advises that it undoubtedly lessens the bookkeeping burden on the solicitor if theadministration accounts are commenced when the inland revenue affidavit is completedand updated regularly as the matter progresses. Mr. Hammond then provides clearexamples of an estate account, a cash account, and a distribution account.82. I do not find in Mr. Hammond’s valuable article any glimmer of support for the way inwhich these administrations have been approached. It may be that in a straightforwardadministration the distribution account can be left until the end, but in a protracted anddifficult administration a draft account will allow any issues that arise to be immediatelyidentified and addressed. It will also allow an assessment to be made of the practicalconsequences of the resolution of each issue, one way or the other.83. There is absolutely no good reason why the preparation of the draft distribution accountshould be deferred until the estate has been fully realised. The eventual outcome mayvery well depend on the extent to which estimates are realised but, in the meantime, thedraft accounts will provide a matrix by reference to which all those interested will be ableto see the progress of the administration and estimate the likely outcome. In this case,draft accounts would have ensured that everyone knew where they were going before son1’s s. 117 application was settled.84. The answer to the first issue is that the court is not satisfied that either of the suggestedformulae is appropriate.Second issue85. The second issue is whether J.’s estate is liable for any personal legal costs incurred byson 3 in connection with son 1’s s. 117 proceedings.86. The simple answer to this is no. Son 3, by himself and his solicitors, kept a very closeeye on the s. 117 proceedings and a full team of counsel was instructed to attend at thesettlement negotiations between son 2’s lawyers and son 1’s lawyers. I know of noauthority for the proposition that the court has jurisdiction to award costs to someonewho was not party to proceedings. At the very last minute son 3 contemplated that hemight apply to be made a party, but in the end did not.87. In any event, it seems to me any claim by son 3 for costs incurred in connection with thes. 117 application was a matter arising from the administration of the estate of J., whichPage 13 ⇓was compromised by the agreement of 26th January, 2016. The agreement carries therecord number of the plenary proceedings but the order of Binchy J. of 17th December,2015 which sent both cases to mediation and the order of Gilligan J. of 26th April, 2016 -when the settlement was received and filed – recites that the two cases, which had beensent away together, came back together.88. The estate has offered to make an ex gratia payment of €5,000 to each of thebeneficiaries in respect of advice taken by them in relation to the settlement of son 1’scase and son 3 must content himself with that.89. I noted earlier that son 2’s solicitors have paid themselves €118,695 – at least – for theircosts of son 1’s proceedings and that they did so without agreement or taxation. Thatought not to have been done. It may very well be that there was no objection to theamount of those costs but that is not the same as consent. The settlement with son 1, asI have said, provided that the defendant was to have his costs, but it is not apparent tome that an order was ever sought or made for the taxation of those costs in default ofagreement. It may very well be said that for so long as son 3’s solicitors were promotinga claim that they should be paid their costs, they were not entirely dispassionate inlooking at the estate’s solicitors’ claim. The refusal of son 3’s solicitors’ claim for costsout of J.’s estate may encourage them to scrutinise more closely the estate’s solicitors’claim.90. In the meantime, the money which was taken from the estate account must be put backuntil the costs have been taxed or agreed.Third issue91. The third issue is whether the interest and penalties arising on the settlement of therevenue liabilities of the estate are expenses of the estate.92. The answer to that is unquestionably yes. In fact it appears that in respect of the years2005 – 2015 there was a surcharge for late filing of accounts of €5,696 and interest of€37,896, and no penalties.Fourth issue93. The fourth issue is whether the estate is entitled to set off as against any sums due fromthe estate to son 3 such interest and penalties on the revenue settlement as wereincurred by reason of the alleged failure of son 3 to deliver papers and records of theestate to the estate accountants until September, 2013.94. As I have observed, the issue is inchoate without an indication of the date on which son 3was asked to deliver those papers and records and when they were in fact delivered. Inany event there is no evidence of the date of any request.95. What appears to have happened here – and elsewhere – is that a draft issue premised ona bald general assertion of delay was modified by the insertion of the word “alleged”,rather than reframed as a claim that there was a demand at a specified time for thePage 14 ⇓delivery of specified papers and records, a failure to comply with it, and a quantifiedalleged contribution of such delay to the interest and penalties.Fifth issue96. The fifth issue is whether the administrator is to be held personally liable for any interestor penalty charges incurred by the estate on the revenue liability as a result of his allegedunreasonable refusal to sign, in a timely manner, the farm accounts as prepared by theestate accountants.97. Again, there is no indication in the issue, or the evidence, of the time at which son 2 wasasked to sign the accounts, or what time he might reasonably have taken to do so.98. The point is also made by son 2 that any issues as to the delay and the preparation andsigning of the estate accounts prior to 26th January, 2016 were compromised by thesettlement signed by the parties. Rather than nailing his colours to the mast of thesettlement, however, son 2 got his retaliation in first by reviving or introducing anallegation of delay on the part of son 3 in facilitating the preparation of the accountswhich, he, son 2, delayed in signing.Sixth issue99. The sixth issue is whether son 2 should be held personally liable for the alleged costsincurred by son 3 in allegedly advancing the distribution of the estate of J., including butnot limited to all re-entry proceedings before the High Court. In practical terms, son 3wants son 2 to personally pay the costs of these proceedings: which he has not yetsecured.100. The agreement of 26th January, 2016 provided that the parties would bear their owncosts of the mediation and of the proceedings to that date, and that is reflected in theorder made by Gilligan J. on 26th April, 2016.101. The premise of this issue is that the later court applications were necessary and effectiveto advance the distribution: but the demonstrable fact of the matter is that thedistribution is no further on.102. The costs incurred by son 3 in 2016 in seeking to compel son 2 to get his horses andscrap off the land were incurred at a time when there was no immediate prospect of thelands being offered for sale and at a time when son 3 still had a substantial herd of cattleon the land. Taking into account the manner in which the cattle were taken off the landin August, 2016 in my view there should be no order as to the costs of those applications.103. If I were to look at the costs of the application and order of 2nd February, 2017 when theorder was made for the estate account, in isolation, I would have allowed those costs toson 3 but then would have had to consider the costs implications of the fact that son 3’sclaim for costs in connection with son 1’s application has failed. I am satisfied thatjustice can be done by making no order on either application.Page 15 ⇓104. The costs of the hearing before McDonald J. on 25th April, 2018 appear to me to havebeen entirely wasted. So much of son 3’s motion issued on 31st January, 2017 assought liberty to re-enter the proceedings had been dealt with by Gilligan J. on 2ndFebruary, 2017 and the order then made clearly showed that the proceedings had beenre-entered. As to the substance of the dispute, McDonald J. directed an exchange ofpleadings which, if they had been delivered, would have brought some focus to a verydiffuse dispute, but the parties ignored the order and formulated a list of issues withoutidentifying how they arose and without providing the court with the evidence that wouldhave been necessary to have decided many of them.105. Similarly, the costs of the hearing before Reynolds J. on 15th May, 2019 do not appear tome to have been usefully incurred. Rather than following the four directions given by thecourt, the parties agreed a list of mostly hopelessly vague issues and they did not, asdirected, exchange submissions before applying for a hearing date.Seventh issue106. The seventh issue is whether the estate has no liability to son 3 in respect of his legalcosts in any matter other than those agreed of 26th January, 2016.107. That issue, it seems to me, overlaps with the issue as to whether son 3 should have thecosts he incurred in supervising son 1’s claim and whether he should have the costs ofany or all of the court applications in the plenary proceedings.Eighth issue108. The eighth issue is whether son 2 should provide the information as requested by theestate accountants regarding the finalisation of the 2016/2017 accounts.109. The issue as formulated is extremely vague but it seems to be ultimately directed to theremoval by son 3 from the farm of the stock and machinery in August, 2016. In practicalterms, son 3 is complaining that son 2 has failed to provide the accountants withinformation which he, son 3, has failed to provide to son 2. Moreover, the informationrequested by the estate accountants – which was for an account of the proceeds of sale ofthe animals – is overtaken by son 3’s belated confession that the animals were not soldbut were taken away.110. The answer is that son 3 is accountable to the estate for the value of the stock andmachinery which he removed from the land. If son 3 cannot justify the valuation he nowrelies on, the value can be determined by applying the rule in Armory v. Delamirie (1722)1 Strange 505.Ninth issue111. The ninth issue is whether the administrator’s solicitor should provide full estate accountsto the plaintiffs in respect of the estates of J. D. and H. D.112. I cannot understand how this might conceivably be in issue. If it is not in issue, I cannotunderstand how it might have found its way onto the issue paper. The defendant, as theadministrator of both estates, is accountable to the beneficiaries of each estate. ThePage 16 ⇓plaintiffs, as beneficiaries under both wills, are entitled to accounts. Son 2’s solicitor hasdeposed that he is “ready, willing and able” to furnish the accounts – without sayingwhen.113. That, it seems to me, is the key to moving this administration on and there will be anorder directing the preparation, in each estate, of a draft estate account, a draft cashaccount, and a draft distribution account.Tenth issue114. The tenth issue is whether son 2 as administrator is responsible for any interest that mayhave accrued on any outstanding debts owed by the estate of J. D.115. The evidence is hopelessly vague. It is acknowledged that there are outstanding liabilitieswhich have not been paid. It is suggested that son 2’s solicitor is engaged in ongoingnegotiations with the creditors who – with abundant justification – have been agitatingclaims for interest with a view to getting their long overdue accounts paid. The positionappears to be that these creditors are not insisting on interest if only their accounts arepaid.116. Whether or not there are unresolved claims for interest, the admitted liabilities must bepaid, and the estate is not to be burdened with a claim for costs in respect of anyprotracted and futile and wholly unnecessary negotiations with creditors.Eleventh issue117. The eleventh issue is whether son 3 is obliged to properly and fully account to the estatein verifiable manner in respect of the sale of stock, farm machinery and fodder.118. The answer to this is that son 3 is accountable to the estate for the full value of the stockand machinery and the value of any fodder removed by him from the farm, but theevidence put before the court is hopeless inadequate to allow any assessment to be madeof the extent of that liability.Orders119. There will be an order directing son 2 to exhibit a true, full and perfect inventory andaccount of the estates of each of J. D. and H.D.120. There will be an order that son 3 is not entitled to be paid any costs incurred by him inconnection with the s. 117 application of son 1 against the estate of J. D.121. The costs of these proceedings up to and including 26th April, 2016 were dealt with bythe order of Gilligan J. of that date.122. There will be no order as to the costs reserved by the orders of Gilligan J. of 2ndFebruary, 2017, McDonald J. made on 25th April, 2018, or Reynolds J. made on 15thMay, 2019.Page 17 ⇓123. There will be an order that neither party to these proceedings is entitled to be paid by theother, or to retain from the estate of J. D., any sum whatsoever in respect of any costs ofor incidental to these proceedings.124. There will be liberty to apply.
Result: Directions in administration action.
Messitt v. Henry
Appropriate Dwelling
[2001] IEHC 104 (12th July, 2001)
JUDGMENT of Mr. Justice Finnegan delivered the 12th day of July, 2001 .
1. Laurence Farrell deceased died on the 7th January, 1999. Letters of administration intestate to his estate issued to the Defendant, his sister, on the 11th April, 2000. The deceased left him surviving and entitled to share in his estate the Defendant as to one half thereof and the Plaintiffs, the children of a deceased brother of the deceased, as to one half thereof between them. The sole asset of the deceased, for all practical purposes, is the lands comprised in Folio 436 of the Register County Dublin comprising 7.226 hectares or 17.8 acres. There is a cottage on the lands which if not derelict has outlived its useful life and also some farm buildings.
2. On the 19th October, 2000 pursuant to Section 55 of the Succession Act 1965 the Defendant duly gave notice of her intention to appropriate to herself in satisfaction of her entitlement in the estate part of the lands comprised in Folio 436 of the Register County Dublin containing in area 3.5 acres (the appropriated lands) upon which the cottage and farm buildings were sited. The remainder of the lands some 14.3 acres (the unappropriated lands) would then be available to satisfy the entitlement of the Plaintiffs subject however to the discharge of the liabilities of the estate. Correspondence was admitted and from this it appears that the assets other than lands amount to £1,376.96 and that the liabilities are estimated at £45,426.96. I gleaned this information from a letter dated 3rd May, 2000. In that letter the Defendant made a proposal that the lands be divided and that the Defendant and the Plaintiffs each discharge one half of the net liabilities. The division of the lands proposed corresponds with that in the notice under Section 55 of the Succession Act 1965: the notice is however silent as to the payment of the estate’s liabilities. I am concerned with the notice and must have regard only to the same. On the basis of the notice the estate will be distributed as follows:-
3. To the Defendant 3.5 acres
4. To the Plaintiffs the proceeds of sale of 14.3 acres less the net liabilities of the estate estimated at £44,050.00.
5. The liabilities do not take account of the costs of this action. I must leave them out of consideration as the action had not been instituted at the date of the notice. I note however, that some or all of those costs may fall to be paid out of the estate.
6. The Plaintiffs in this action claimed a number of reliefs but at the hearing all save one were abandoned: the relief pursued at the hearing was an order pursuant to the Succession Act 1965 Section 55(3) prohibiting the appropriation.
7. The Succession Act 1965 Section 55 insofar as it is relevant to these proceedings provides as follows:-
“55(1) The personal representatives may, subject to the provisions of this Section, appropriate any part of the estate of a deceased person in its actual condition or state of investment at the time of appropriation in or towards satisfaction of any share in the estate, whether settled or not, according to the respective rights of the persons interested in the estate.
(3) Except in a case to which Section 56 applies, an appropriation shall not be made under this Section unless notice of the intended appropriation has been served on all parties entitled to a share in the estate (other than persons who may come into existence after the time of the appropriation or who cannot, after reasonable inquiry, be found or ascertained at that time) any one of which parties may within six weeks from the service of such notice on him apply to the Court to prohibit the appropriation.
(10) For the purposes of such appropriation, the personal representatives may ascertain and fix the values of the respective parts of the estate and the liabilities of the deceased person as they may think fit, and may for that purpose employ a duly qualified valuer in any case where such employment may be necessary: and may make any conveyance which may be requisite for giving effect to the appropriation.
(18) The powers conferred by this Section may be exercised by the personal representatives in their own favour”.
8. The first issue to arise is whether the Plaintiffs have complied with Section 55(3) which requires a party within six weeks from the service of a notice on him to apply to the Court to prohibit the application. The special indorsement of claim to the special summons seeks to invoke subsection (3) in the following terms which the Defendant claims are inadequate:-
“The Plaintiff claims
D. An order requiring the Defendant to sell the lands all that and those Farrells Farm, Glencullen Road, Kilternan in the County of Dublin and comprised in Folio 436 of the Register of Freeholders County Dublin by public auction.
E. A declaration that the Defendant is not entitled to appropriate any of the said lands and premises all that and those Farrells Farm, Glencullen Road, Kilternan in the County of Dublin comprised in Folio 436 of the Register of Freeholders County Dublin as her share of the estate of Laurence (otherwise Larry) Farrell deceased without the approval or consent of the beneficiaries.
F. An order requiring the Defendant to sell the premises all that and those Farrells Farm, Glencullen Road, Kilternan in the County of Dublin comprised in Folio 436 of the Register of Freeholders County of Dublin and after payment of all lawful debts and expenses to divide the proceeds in accordance with law.”
9. The Special Summons was issued within six months of the service of the notice. While these reliefs do not follow the wording of Section 55(3) it must have been quite clear to the Defendant that relief under the subsection is what is in issue. All the more so is the case when regard is had to the Grounding Affidavit and to paragraph 8 thereof in particular which reads as follows:-
“The Plaintiffs object to said appropriation by the Defendant/Administratrix on the grounds that the net effect of this appropriation would be that the value of the property to be appropriated and nominated by the Defendant/Administratrix is far in excess of her half share and therefore disproportionate to her entitlement. I refer to a report and valuation of the lands prepared by Mr. Robert Ganly of Ganly Walters, Estate Agents and Valuers, copy of which is attached hereto and upon which marked with the letters BM6, I have signed my name prior to the swearing hereof.”
10. I am satisfied that the Defendant was at all times aware of the relief sought and the basis upon which it is being sought. I am satisfied that the Special Summons is a sufficient invocation of Section 56(3).
11. The second matter to arise is this, if the land should be sold the Defendant would incur a heavy liability to Capital Acquisitions Tax: if she should apportion part of the lands in specie to herself, she would be entitled to agricultural relief. Assuming the value of her inheritance to be in the amount of £300,000 and the lands are sold in the course of administration her capital Acquisition Tax liability would be £96,040.01 while on a distribution to her in specie the liability would be £711.75. I do not consider this to be a factor to which I should have regard: I must look at the pre-tax benefit to the parties for the purposes of Section 55: see Hickey & Company -v- Roches Stores Limited (1980) ILRM 107. If a distribution in specie would benefit all parties however, it may be that the instance of taxation would be relevant.
12. Finally it was urged upon me that the Defendant has an attachment to the appropriated lands which have been the family home for some 300 years. I accept that this is relevant to bona fides and I have regard to it.
13. Section 55 gives little explicit guidance to the Court as to the approach to be taken on an application pursuant to Section 55. The Supreme Court considered this in
H. -v- O. (1978) IR 194 at p. 207 where Henchy J. said:-
“The Court only acquires jurisdiction in the matter when a party, on being served with notice of an intended appropriation, applies within six weeks to the Court to prohibit the appropriation. The Section is silent as to how the Court is to exercise its jurisdiction, which is essentially supervisory and prohibitive. So it must be assumed, having regard to the tenor, the scope and the purpose of the Section, that the Court should prohibit an intended appropriation only
(a) when the conditions in the Section have not been complied with; or
(b) when, notwithstanding such compliance, it would not be just or equitable to allow the appropriation to take place having regard to the rights of all persons who are or will become entitled to an interest in the estate; or
(c) when, apart from the Section, the appropriation would not be legally permissible.
Since the personal representatives hold the estate under Section 10(3) as trustees for the persons by law entitled thereto the exercise of the statutory discretion to appropriate must be viewed as an incident of the trusteeship so that it is the Courts duty to prohibit the appropriation if it is calculated to operate unjustly or inequitably by unduly benefiting one beneficiary at the expense of the other. But otherwise where the conditions of the Section have been observed and the personal representatives have made a bona fide decision to appropriate the exercise of their discretion to appropriate should not be interfered with unless for some reason unrelated to the terms of the Section the appropriation would be legally unacceptable, e.g. if it would amount to a sub division prohibited by law . Such an approach to the scope of the section is also required by the fact that, when the Act of 1965 was passed, it was settled law that, without any statutory enablement, personal representatives could appropriate a specific part of the estate (such as a leasehold) as part of the share of a beneficiary with his consent on the ground that they could sell it to the beneficiary and set off the purchase money against his share: see In Re: Beverly , Watson -v- Watson .”
14. On this application I have had the evidence of two reputable and highly experienced valuers. They agree that the appropriated lands would be regarded as being likely to have planning permission granted in respect thereof for a substantial dwelling and so are highly saleable being in a much sought after location. Mr. Ganly for the Plaintiff valued the same at two thirds the value of the whole, the unappropriated lands having a value of one third thereof. In his opinion a sale in one lot would yield a greater return than a sale in two lots. The former would yield £750,000. However, his evidence is that agricultural land in this location would fetch between £20,000 and £25,000 per acre: this puts a value on the lands not appropriated as between £280,000 and £350,000. These lands have virtually no prospect of ever receiving planning permission being zoned GB (commonly called “ Green Belt ”). Taking his evidence as a whole I believe its effect to be as follows:-
1. A sale in one lot of the entire holding would realise £750,000.
2. Of this sum it would be reasonable to apportion £320,000 to the unappropriated lands.
3. Of this sum it would be reasonable to apportion £425,000 to the appropriated lands.
15. Mr. Lennox for the Defendants is of opinion that the entire holding sold as one lot would not produce a better return. It is too large for a single dwelling and a smaller area, ideally circa 3 acres, sold as a potential site as one lot and the remainder sold as agricultural land with a prospect of planning permission albeit slim as a second lot would produce the best result. Each lot would command £300,000 in his opinion.
16. Thus there is a difference in professional opinion as to whether the best return could be obtained by a sale in one or two lots and also as to the relative values of the appropriated and unappropriated lands.
17. As to the first matter Section 55 empowers a personal representative to employ a qualified valuer. The Defendant did this and she is entitled to take his advice and act upon it, not alone as to values but also as to the manner in which that value may be optimised. The standard of care expected of her is that of a trustee, namely that of a prudent man of business in the conduct of his own affairs. While the opinion of the Plaintiff’s valuer Mr. Ganly differs from the advice of Mr. Lennox, this alone would not justify the Court in interfering to prevent the Defendant acting bona fide on the advice which she has obtained.
18. Accordingly I move on to consider whether there is as the Defendant contends substantial equally and value between the appropriated and unappropriated lands. As I read Section 55 the onus is on the Plaintiff to satisfy me on the balance of probabilities that there is not. As to the respective values I prefer the evidence of Mr. Ganly. The unappropriated lands are unattractive for a number of reasons:-
1. Their irregular configuration.
2. The nature of their access.
3. The aspect from the same is blighted by a garage business carried on in an adjoining cottage.
4. As agricultural land they are largely of poor quality.
5. The prospect of obtaining planning permission is remote in the extreme.
6. Even if planning permission should be obtained the area of the same greatly exceeds that considered ideal for a single dwelling.
19. Valuation is not an exact science: this is clear from the conflicting firmly held views of the two valuers who have given evidence. On that evidence I find that the proportionate values of the appropriated land and the unappropriated land is in the ratio 55:45. Thus on Mr. Ganly’s evidence a sale in one lot at £750,000 would result in the Plaintiffs and the Defendant realising £337,500 and £412,500 respectively, an inequality of £75,000. On Mr. Lennox’s evidence allowing that a sale in two lots would achieve a total of £600,000, that not being less than a sale in one lot would achieve, the Plaintiffs would receive £270,000 and the Defendant £330,000 an inequality of £60,000.
20. The matter does not end there however. The parties agree and I accept that on this application I may only make or refuse to make an order prohibiting the proposed appropriation. I have no jurisdiction to modify the same. I must take the notice in the terms in which it is given. Upon this basis the inequality will be compounded as in its terms the notice requires the liabilities of the estate to be borne by the Plaintiffs. I may not have regard to the correspondence in which it was envisaged that the Defendant would bear one half the liabilities of the estate. Having regard to the foregoing regardless of whether the valuation of Mr. Ganly or Mr. Lennox is accepted a material discrepancy exists. I accept the bona fides of the Defendant. I accept that she acted on the advice of a highly qualified and reputable valuer and was fully justified in so doing. She is in the position of a trustee and notwithstanding that she was exercising her statutory entitlement in her own favour she conscientiously carried out her duties as befits a trustee. As I said valuation is not an exact science and the guide prices and option results published week after week are evidence of this. Certainty in such matters can only be achieved in the sales room. Accordingly my findings in no way reflect on the bona fides of the Defendant or on the expertise of her valuer.
21. I find that the appropriation proposed would be inequitable and would unduly benefit the Defendant and accordingly I propose to made an Order prohibiting the same.
Cases Benefits
Ashburner v Macguire
(1786) 2 Bro CC 108
Lord Thurlow LC:
… the claim of Mrs Ashbumer and her daughters depends on two questions: First whether the bond was given as a specific legacy: which depends on this, whether the manner in which the sum is menti ned,
turns it to be a pecuniary legacy, or, as civilians call it, a demonstrative legacy, that is a legacy in its nature
a general legacy, but where a particular nd is pointed out to satisfy it; or whether it can be what they call a legatum nominis or legatum tlebiti. I shall not stand long on that point .. . 1
.. .if the testator receives payment on the debt, the legacy is gone, unless it appears from the rlianner of his disposing of the money afterwards that he means to preserve it for the legatee Lord Camden in The Attorney-General v Parkin (1769) Amb 566 held there was no distinction between·voluntary payment and payment on a demand, and that in both cases the legacy was extinguished; he added, that where the sum is specified in the bequest, it is a general legacy, as ‘I shall mention on the other point. But the distinction between “I bequeath the £500 due·on ·a bond from AB” and “I bequeath the bond from A B’1, is very slender: and so admitted to be by;his Lordship. ‘ · ·
In the civil law there is distinction taken between a deemonstrative legacy, where the testator gives a general legacy, but points out the fund to satisfy it; and a specific legacy, where he-bequeaths a particular thing. •I
the first point, lam clear this is a specific legacy. If the fortune of the testator ruµl failed, so as not to satisfy all t_hepecunilll)’ legacies, ;md the questio had been, whether this legacy should have been contributive to the pecuniary legacies, I believe no man in the profession would have doubted.
When the testator made his will, £3,500 was due to him from William Ashbumer, by bond: he meant to relinquish that bond for the benefit of the family; not by way of release to the husband, but by way of settlement; and that this debt, whether it turned out ill or well, should go to the family: the interest to his sister for her life, the principle among her daughters. In this case, the bequest must be considered as specific, although the sum be mentioned: for I cannot agree to Lord Camden’s distinction.
As to the legacy of East India Stock to the plaintiff Beawes, there is no case to countenance his claim. The testator says, “I give my capital stock to,” etc: the pronoun my bas been relied on, in many cases, in deciding the legacy to be specific.
The testator, after making his will, sold his stock, which made it as if it had never existed; the legacy is
tukemed, according to all the cases.’
Bothamley v Sherson
(1875) LR 20 Eq 304
Jessel MR:
‘ … I think one may arrive at a tolerably clear idea of what a specific bequest is. In the first place it is a part of the testator’s property. A general bequest may or may not be a part of the testator’s property. A man who gives £100 in money or£ l 00 stock may not have either the money or the stock sufficient to discharge the legacy, in which case the executors would probably discharge it out of the actual money or stock. But, in the case of a general legacy it has no reference to the actual state of the testator’s property, it being only supposed that the testator bas sufficient property which on being realised will procure for the legatee that which is given to him, while in the case of a specific bequest it must be part of the testator’s property itself. That is the first thing.
In the next place, it must be a part emphatically, as distinguished from the whole. It must be what is sometimes called a severed or distinguished part. It must not be the whole, in the meaning of the totality of the testator’s property, or the totality of the general residue of his property after having given legacies out of iL But if it satisfies both conditions, that it is a part of the testator’s property itself, and is a part as distinguished, as I said before, from the whole, or from the whole of the residue, then it appears to me to satisfy everything that is required to treat it as a specific legacy. I hope the definition which I have attempted to give will be more successful than those which have been attempted before, but I can only express that hope with some degree of trepidation.
Now there is no question, as I understand the authorities, that the part may be defined in any way which distinguished it. If a testator gives “the black horses which I now have”, or “the black horses of which I shall be possessed at the time of my death”, or at any other specified time. the gift satisfies the definition of a specific legacy. If authority were wanted there is plenty. I have been referred to a great many cases. and I will mention on that point one or two. There is the very singular case. to which I shall refer for another purpose, of Stewart v Denton (1785) 4 Doug 219, where a gift was of “any-stock-in-trade of wines and spiritous liquors which I shall be possessed at the time of my death”. That was held to be specific. Again, in the case of Fontaine v Tyler (1821) 9 Price 81 at 98, Chief Baron Richards says,
“A gift of all the horses which I may have in my stable at the time of my death, would-be specific. Therefore, the.mere fact of death being referred to as the period for ascertainment does not make the gift less specific; and those cases get rid of the observations made by Sir Thomas Plumer in the case of Parrot v Worsfold (1820) l Jae & W 594, that a specific legacy must necessarily be subject to adempiion. That cannot. of course, be so when the time of death is the time for ascertainment for a man does not live after his own death, and therefore there is no period at which ademption can take place. It is not necessary theJCfore that a specific bequest should be subject to ademption … ”
… in the case of Fielding v Preston (1857) l De G & J 438, there were two gifts: one was of “my , leaseholds”, and the other of “my funded property and other personal estate not hereinbefore bequeathed”. · Lord Cranworth was clearly of the opinion that both would have been·specific except for the circumstances that the gift “of my funded property” was followed by a gift of all the rest of the estate. His Lordship says:
“My mind has fluctuated on this point, but at last I have arrived at the conclusion that this is not a specific
$ift of the funded property; and I come to that conclusion because I think it would be very dangerous to hold that in a will where there is a gift of the residue, and the testator unnecessarily chooses to enumerate some particular things in that residuary gift, such a circumstance was sufficient to constitute the things so
enumerated specific gifts. It rarely happens that in the gift of residue something is not:mentioned specifically. For instance, a testator may give his horses and all his other personal estate, or his stock in trade and the rest of his personal estate. Such bequests could not, I think, be properly held to be specific.
Suppose the will to be worded thus: ‘I give to Henrietta. her executors, administrators, and assigns, all Qty other personal estate, including my funded property’. that would not have been specific.’.’ ·
Therefore. when you come within that line of cases such gifts are not specific not because the word “my” would not make the bequest specific, but because it is the mere enumeration of particulars making up the residue. and it is not intended by the testator to be a gift of part of the property itself to be taken by the legatee in that shape.
I think. then. that … gifts either “of my shares or stoc,:k in a railway company”, or “of the stock of shares in the railway company which I shall be possessed of at the time of my death”, or, as it was in Stewart v Denton, “of all my stock in trade which I shall be possessed of at the time of my death”. are specific legacies.
… one class of speci9c bequests is … the class of specific bequests described as generic, that js, a specific bequest which points to a class of objects given by the testator, and which from their nature would not naturally be referable to the date of the instrument. A good illustration of this class of bequests is gift “of my household furniture”. There are very few persons not in articulo mortis who would not expect that some articles of household furniture would wear out, or be broken, or otherwise be parted with, and be replaced with articles of a similar kind It would not be natural to assume that a man giving that kind
..of legacy intended to restrict it to the property of that description which he had at the date of the will. It has
been held in.Good/adv Bunj.ett (1855) 1 K & J 34 l, and in some other cases to which reference has been made that in cases that description the riew law (ie section·24 Wills Act) brings down the specific bequest to the date of death; in .other words, the new law makes a specific bequest of “my furniture”, to · mean not “the furniture which belongs to me at the time of making this my will,” but “the furniture which shall belong to me at the time of my death
Clifford, Re
[1912] 1 Ch 29 Chancery Division
Swinfen Eady J:
… the residuary legatees … contend that the bequest speaks from death and only passes twenty-three new
£20 shares. In the alternative they contend that if the bequest speaks from the date of the will and refers to the old £80 shares then existing it is adeemed, as those shares had disappeared before the testator’s death.
Now s24 of the Wills Act 1837 provides that:
“Every will shall be construed, with reference to the real and personal estate comprised in it, to speak and take effect as if ithad been executed immediately before the death of the testator, unless a conlrary intention shall appear by the will.”
Is there such a contrary intention on the face of the will?
… in the present case the bequest of “twenty-three of the shares belonging to me in the London and County Banking Company Limited” is a specific bequest of a thing incapable of increase or diminution, and there is in my opinion a sufficient contrary intention to show that the testator meant the bequest to be construed as at the date of the will.
1be residuary legatees contend that if so construed the bequest has been adeemed, as the £80 shares no longer exist … Here I find the twenty-three shares bequeathed by the will changed in name and form only, but substantially existing in their sub-divided form, and each original share traceable into its four sub divided shares.1be subject-matter of the bequest remains in substance, though changed in name and form. There is therefore no ademption, and ninety-two of the new shares, identical in all but name and form with the twenty-three original shares, pass by the bequest … ‘
Davies, Re
[1957] 1 WLR 922
Vaisey J:
‘One vie , which I will call the first view, is that the principle of acceleration now falls to be so applied as to give the fund to those three children to the total and final exclusion of all the other at present non existent members of the class, that is to say, Mrs Mackintosh’s grand-children and remoter issue. It seems rather suprising that the purely gratuitous act (that is, disclaimer) of one of the beneficiaries, Mrs Mackintosh, should operate to deprive and dispossess a number of other beneficiaries, namely Mrs Mackintosh’s grandchildren and remoter issue, of the interest which she, the testatrix, had given them by her will. It is clear, however, that acceleration may and does sometimes alter the constitution of a class of beneficiaries from what it would have been if the gift had not been accelerated: see In re Johnson (1893) 68 LT 20. Another view, which I will call the second view, is that, as the disclaimed life interest must be treated as struck out of the will and as not having been thereby effectively disposed of, the obvious consequence is a panial intestacy in which case the income of the fund during the residue of the life of Mrs Mackintosh is divisible equally between the two sons of the testatrix, leaving the capital of the fund (o be divided strictly in accordance with the plain terms of the will. I have mentioned two possible views, but a third one is that the three children of Mrs Mackintosh should be treated as possessing vested interests liable to be divested by the birth of further issue to Mrs Mackintosh during her life. een those three views, I am bound to say that the choice is to my mind difficult, as it is, in my view, not S1Jpponed by any clear authority.
On the whole, I decide this case in favour of the first view, which treats the class of Mrs Mackintosh’s first issue as now fmally closed, this view being, in my judgment, supponed by Jull v Jacobs (1876) 3 Ch D 703. In that case there was a gift to a testator’s daughter of real and personal estate during her life time, and after her decease the property was to be equally divided between her children on their coming of age. It was held that the gift to the daughter being void on account of her having witnessed the will, the gift to her children was accelerated and took effect immediately. The report seems to make it clear that it was possible for the daughter to have had further children. In the course of his judgment, Malins V-C said at (712]:
“I am clearly of opinion that the remainder is accelerated, and the children take just as if the mother had
died immediately after the lestator.”
To the same effect, I think, isln re Townsend’s Estate (1886) 34 ChD 357, of which the headnote reads:
“Gifts by will of real and personal estate upon trust to convert and pay the income of the proceeds to A, for life, and after A’s death to pay the capital or income thereof unto the child or children of A, in equal shares with gifts over in case A should die without leaving issue living at his death. The will had been llltesled by A’s wife so that the gift of a life interest to her was void under section 15 of the Wills AcL There were no children of A’s marriage. The personal estate was exhausted and the trust funds represented real estate only.
… until A had a child the gifts upon the determination of A’s life estate could not be accelerated, and that during the life of A and so long as he had no children, the income of the trust funds was undisposcd of, and belonged to the heir-at-law, and could not be accumulated for the benefit of persons contingently entitled to remainder.”
Juli v Jacobs was distinguished and other cases were explained. And see also In re Johnson.
What I have ,called the second view, which is that there is no acceleration, and an intestacy as regards the income during Mrs Mackintosh’s life, may have some support from In re Vernon (1906) 9S LT 48 but this is far from being conclusive. For the third view, which seems logical, though it may be awkward to work out in practice, I can find .., authority at all ..”.
Gibson, Re
(1866) LR 2 Eq 669
WoodV-C:
‘Suppose a man to have, at the date of his will, a picture of the Holy Family by some inferior artist, and to give by his will “my Holy Family”. He afterwards disposes of this picture, and subsequently acquires by purchase or gift a very much better one, on the same subject, painted by an eminent artisL Would it not be a monstrous construction to hold, that the picture existing in the testator’s possession at the time of death, would pass? When there is a clearly indicated intention upon the face of the will, to give the single specific thing and nothing else, it would be a very narrow construction of the words of section 24 of the Wills Act to hold that you must sweep in everything to which the words might be held to apply, without the slightest reference to the state of things existing at the date of the will. It is true that the testator had not at the date of his will 1,000 shares, but £1,000 guaranteed stock. But he had nothing else too which the words of the will could be applied, and no one could doubt that his stock was the thing pointed out by the will. After the date of his will he sold this £1,000 stock, and purchased not uno ictu, but bit by bit a number of other shares or stock. I adhere to my view, that where there is a distinct reference to a distinct and specific thing and noJ to a genus, there is a sufficient indication of “a contrary iniention” to exclude the operation of the rule established by the 24th section of the Wills Act, and the limit of the operation of the will and the state of things existing at the date of the will.’
Hickman v Peaeey
[1945] AC 304 House of Lords
Lord Macmillan:
‘My Lords, in this appeal your Lordships are called upon for the first time to consider the interpretation
and application of an enactment which has introduced an entire novelty into the law of England. It first appeared in sl07 subs3 of the Law of Property Act 1922, and is now in identical terms embodied in sl84 of the Law of Property Act 1925. It reads as follows:
“In all cases where, after the commencement of this Act, two or more persons have died in cin:umslances rendering it uncertain which of them survived the other or others, such deaths shall (subject to any order of the court), for all purposes affecting the title to property, be presumed to have occured in order of seniority, and accordingly the younger shall be deemed to have survived the elder.”
The problem with which the legislature has thus dealt has long been familiar to lawyers. Rights of succession, alike testate and intestate, depend on the survivance of one person to another. The living succeed to the dead. In the ordinary case there is no difficulty in ascertaining which of two persons died first. But in the vicissitudes of human life there occur instances in which, owing to the bsence of any positive evidence, it is not possible to arrive at a conclusion and the matter is left in uncertainty. The most familiar case is where two or more persons meet their death in a common calamity, the case of commorientes, as lawyers designate it. Two or more persons perish together and there is no evidence to show which survived the other or others. Yet rights of high importance may depeod thereon. The Roman Law provided a solution for the dilemma in certain cases by means of presumptions founded on what I may call biological considerations. Thus a grown up son is presumed to have survived his parent. Cum explorari non possit uter prior extinctus sit, humanis est credere filium diutius vixisse. Dig Lib XXXIV Tit V De Rebus Dublis. The presumption takes the place of proof. The topic has been discussed with much learning by continental jurists and is specificially dealt with in the Code Napoleon by means of detailed presumptions. For the continental law I may refer to Surge’s Commentaries on Foreign and Colonial Laws, 1st ed. vol IV, pp 11-29. But, says Chancellor Kent in his Commentaries on American Law,”The English law has hitherto waived the question, and perhaps prudently abandoned as delusive all those
ingenious and refined distinctions which have been raised on this vexed subject by the civilians.” (14th F.d. Vol n. p435).
In the absence of any presumptions the English courts had to find some way of extricating the difficulty. What they did was to fall back on the principle that the plaintiff must prove his case – acrori incumbit onus probandi. If a plaintiff’s claim depended on showing that A survived B then the plaintiff must establish the fact affirmatively by evidence; if sufficient evidence was not forthcoming the claim failed: In Re Phene’ s Trusts (1869) LR 5 Ch 139. This important conclusion was not a solution of the problem but rather an admission of its insolubility. Where the deceased persons had mutual claims to succeed the one to the other and there was no evidence that one survived the other, the fictioq was adopted of hoping that they died together at one and the same time; In the Goods of Beynon [1901) P 41. This expedient of assuming the deaths to have occurred simultaneously did not proceed on any proof of the fact or on any presumption, but was merely a method of solving an otherwise insoluable problem which had to be solved somehow. Such a state of law was far from satisfactory. The results which may follow from the absence of any aid from presumptions are well illustrated in a recent case in Scotland, where the common law remains as it was in England: Drummond’s Judicial Factor v Lord Advocate (1944) SC 298. In that case the whole savings of one of the victims of a calamity almost identical in the circumstances with that which this House has now under consideration were carried off by the Crown.
It was to remedy this imperfection of the law that the legislature came to the aid of the courts by enacting a statutory presumption in the terms which I have quoted. Unfortunately. the wording of the section is such as to have given rise to controversy. Two views have been advanced as to its meaning and effect. According to one view, which is the view of Lord Greene MR and Goddard U, the statutory presumption is strictly limited in its application to cases in which:
“the court is satisfied as to two things – one that the proper inference from the circumstances is that the deaths took place consecutively, the other, that the circumstances leave the court in unce’1_ainty as to which death took place first” [1944) Ch.138 at pl 46.
That is to say, all that the statute does is to fix artificially the order of sequence among consecutive deaths, where that order cannot in fact be ascertained. If the circumstances are such as to justify an inference that all the parties concerned died simultaneously then the circumstances are not such as to render it uncertain which of them survived the other or others, for it is certain that none survived the other or others. This, according to Goddard U [1944) Ch 138 at p152, is the literal construction of the plain words of the enactment. The other view is that when the circumstances are such that it cannot be ascertained that one of the deceased survived the other then the uncertainty which the section postulates exists and the statutory presumption applies. One reason why it cannot be ascertained that one survived the other may well be that the deaths occurred so closely in time that there is a high probability that they were practically simultaneous. I say “practically” for reasons which will appear later. Having carefully weighed the arguments in support of each of these rival constructions I pronounce unhesitatingly in favour o( the latter. It would be indeed unfortunate if the former were to prevail. For one thing it would mean that the legislature has signally failed to provide any remedy for an admitted defect in the law in a large and unahppily increasing number of cases in which evidence that the victims died consecutively is not
available. Having set out, as I think may be reasonably assumed, to remedy the law as to com.morientes, or persons dying together, the legislature is ironically found not to have made any provision for the case of commorientes who die together but to have dealt only with persons proved to have died consecutively. In the next place, I would observe that where two persons perish in a common calamity and there is no evidence as to which died first it is necessarily left uncertain whether they died consecutively or.
simultaneously, although the circumstances may point with high probability to their not having hoth died at the same moment. The operation of the statutory presumption is, in the view of the learned Master of the Rolls, made dependent on the ascertainment of the fact, namely, that the deaths were.consecutive, which is itself necessarily conjectural in the absence of any positive evidence. The only case in which can be demonstrated that the deaths were consecutive is where one of the persons concerned is proved to have been alive after the other is proved to have died; but in such a case there is no need for any presumption of survivorship. Nevertheless, it is said that unless the court is satisfied that one of two victims of a common calamity survived the other the circumstances are not such as to render it uncertain which victim survived the other. I prefer to read the enactment as meaning that where the circumstances are such that it is no possible to say with certainty that one of the victims survived the other there is then uncertainty as to which survived the other. Clearly you cannot say with certainty that one of the victims silrvived the other if your belief is that both died at the same time, if that be possible. The decision of the Court of Appeal, if it were affirmed, would almost inevitably lead to every case having to come into comt for determination of the obviously contentious and often really insoluble question whether the deaths were consecutive or simultaneous. 1be view of the learned Master of the Rolls involves two things, first, that it is possible by legal proof to demonstrate that two persons died at precisely the same moment of time, and second, that intentionally or inadvertently the legislature omitted to deal with this case. I gravely doubt whether the legislature envisaged as a practical consideration the existence of the possibility
of simultaneous deaths.1be draftsman in addressing himsel to the fonnulation of this remedial enactment may be assumed to have read at least the leading case of Uruhrwood v Wing (1860) 4 De GM & G 633, 661. There he would find at p661 this pronouncement by Lord Cranworth LC:
“It cannot be assumed to be proved, or probable, or possible, that two humans beings would cease to breathe at the same moment of time, for that is hardly within the range of imagination, and to adjudicate on such a principle would, I think, be proceeding on false data, but the real ground to proceed on is that it cannot be proved which died fusL”
It is easy to involve oneself in logic,al and metaphysical subleties, and perhaps fallacies, in handling such a topic as this. It is true that time ik infinitely divisible and also that it is theoretically possible that the deaths of two persons may be absolutely coincident in time. ”This is, of course, a profound and impressive truth”, as Lord President Robenson once said in another context, and then proceeded to add “but there &IC times and places for everything; and I should hardly have thought a Tramway Act exactly the occasion which Parliament would choose for teaching business men metaphysics unawares.” Edinburgh Street Tramways Co v Edinburgh Magistrates (1894) 21 R 688, 704. I prefer, therefore, to judge the language of the present enactment by a more commonplace standard. I think that it poses a practical question – Can you say for certain which of these two dead persons died first? If you cannot say for certain, then you must pre-sume the older to have died first It is immaterial that the reason for your inability to say for certain which died first is either because you think they both died simultaneously or because you think they died consecutively but you do not know in what sequence. I note with interest that the learned Master of the Rolls himself in the course pf the argument in the Court of Appeal [1944} Ch 138 at pl45 “suggested that the section on its true construction might cover the case of simultaneous deaths”. The
reasons which he gives for rejecting his suggestion do not. with all respect, convince me, despite their verbal logical cogency.I would add only a few words regarding the term “uncertain” which occurs in the enactment and which was so much canvassed in the course of the argument. The basis of belief may range from mere conjecture
throuh all degrees of probability to absolute demonstration- possibility, probability, certainty. In seeking to arrive at a conclusion in fact in ordinary human affairs the law rejects mere possibility as an insufficient basis of proof, but on the other hand it does not exact absolute or mathematical proof. It is content to proceed on probability, if it is sufficient, and the test of sufficient probability is that the direct evidence, with all legitimate inferences, is such as ought to satisfy the mind of a person of reasonable intelligence. But the result of a decision on a question of fact by a judge or a jury is not certainty. It is finality, not certainty. Your Lordships in considering a verdict of a jury on a question of fact have often declared that it is not to be disturbed because there was evidence on which a reasonable person could so find but that it is not to be taken that your Lordships would have reached the same conclusion. Can it be said that in such circumstances the fact found by the jury has been ascertained with certainty? lt·has been determined with finality in law, but but not with certainty in fact. In my opinion the legislature in employing the word ‘uncertain’ in the section which the House has to construe was not thinking of the kind of certainty with which the law has to be content but was using the word in its ordinary acceptation as denoting a reasonable element of doubt.
So, coming at last to the facts of the present case so far as known, I put the question thus: Can it be
said for certain if any of the five persons involved in this tragic occurrence that one did or did not survive the other? All that is certain is that a high explosive bomb fell on a small house, No 5 Upper Cheyne Row, Chelsea, on September 14, 1940 about 6.30, that it exploded within the house and reduced it to a heap of ruins, that five dead bodies, severely mutilated, were subsequently recovered from the debris and that there was a shelter in the basement of the house to which the deceased were in the habit of resorting when there was an aid-raid No technical evidence was led on the action of blast from high explosives or its effect on the human body. Now I do not for the purpose of my argument need to say that, if a judge or jury had to try the issue whether in these circumstances all the victims of the calamity perished at precisely the same instant. and were to fmd as a matter of fact that this was so, the fmding would on appeal be set aside on the ground that there was no evidence on which a reasonable man could reach that conclusion – pace Lord Cranworth LC who thought that the simultaneous death of two human beings was insusceptible of proof. Two most eminent and most reasonable judges have so found in this case. But, with all respect, that is not an issue which the statute requires to be determined in order to bring it into operation or exclude its operation. All that is necessary, in order to invoke the statututory presumption, is the presence in the circumstances of an element of uncertainty as to which of the deceased survived the other or others. I can imagine a juryman saying:
“I really cannot answer this question. It may be that they died one after the other or it may be that they all died at the same moment, but in any case I cannot say for certain which, if any, was the survivor.”
That is also my state of state of mind on the facts of the present case. Without resorting to fantastic or far-fetched conjectures it is perfectly possible that the blast of the explosion did not annihilate the whole of these five victims at the same instant. Thus, one of them may quite well have been out of the shelter in another part of the house at the moment of the impact of the shell and the blast, though by an infinitesimal interval, may have struck him sooner or later than the others. I simply do not know. Nobody can know. When everything depends, as Lord Cranwonh said in Wing v Angrave (1860) HLC 183 at p207, on “survivorship for a second” I cannot accept the view that in the circumstances of this case there was no element of uncenainty, legal or other, on the cardinal issue.
My opinion. accordingly is that the statutory presumption applies and that the appeal should be allowed.’
K (deceased)
Re [1986)]Ch180
Vinelott J:
‘ … section 2(2) requires that before making any order under that section modifying the effect of the forfeiture rule the court must be satisfied that, having regard to the conduct of the offender and of the deceased and to such other circumstances as appear to the court to be material, the justice of the case requires the effect of the rule to be so modified in that case … It is clear, I think, that the relative financial position of a person claiming relief under the 1982 Act and of others with claims under the te_stator’s will or intestacy are circumstances which the court is entitled to take into account in the exercise of its discretion … However, in a case where reasonable provision is made by the will, the first question is whether, having regard to the conduct of the deceased and of the claimant in particular in relation to the unlawful killing, justice requires that the claimant should be relieved against forfeiture in respect of all
or any interests accruing on the death. The 1982 Act was clearly passed with the decision of Pennycuick V-C and earlier decisions in mind. In Re Giles [1972] Ch 544 Pennycuick V-C declined to enter into any investigation of the degree of moral culpability attending the killing. The purpose of the 1982 Act as I see it is to entitle and indeed require the court to form a view on that very matter.
I have reached the conclusion after anxious consideration that in the very unusual circumstances of this case it would be unjust that the widow should be deprived of any of the benefits which the deceased chose to confer on hereby his will or which accrued to her by survivorship. As Lord Salmon observed in DPP v Newbury [1977) AC 500 at 507, it being unnecessary in cases of manslaughter to prove that the accused knew that the act causing death was unlawful or dangerous, cases of manslaughter necessarily vary infinitely in their gravity. Despite the revulsion which any person must feel at conduct which leads to the death of another human being it is impossible in the tragic circumstances of this case not to fc;el sympathy for the widow. If the cases vary infinitely in their gravity, for this, I think, one of the cases which weighs least heavily. The widow, as I have said, was a loyal wife who suffered grave violence at the hands of the deceased. When she took hold of the gun and released the safety catch she was in a state of great distress and feared further violence. She must accept the blame for what happened but she should not, in my judgment, suffer the further punishment of being deprived of the provision which her husband made for her which was, it seems to me, wholly appropriate having regard to the fact that the widow gave up a worthwhile and satisfying career when she married him, to her conduct towards him to the very end of his life and to the fact that there were no other persons for whom he was under any moral duty to provide.’
Kebty-Fletcher’s Will Trusts,
[1968] 2 WLR 34
StampJ:
‘ … my attention has also been called to a number of cases where a gift to A for life has been followed by a gift to his children and the gift to the children has, by reason of disclaimer or invalidity of the prior gift, been accelerated. I must refer to some of them.
In Re Davies, Davies v Mackintosh (1957) 3 All ER 52 there was, as here, a gift to A for life followed by a direction for division equally between his issue. A disclaimed the life interest. Vaisey J held that the disclaimer operated to acclerate the gift to issue. He also held that the acceleration operated to exclude after-born children and issue of A.1be judge treated the problem as simply one of acceleration and did not explain the process by which he came to the conclusion that aftcrbom children and issue were excluded,
relying primarily onJullv Jacobs (1876) 3 Ch D703 for that conclusion. I have read Juli v Jacobs more than once.1bere the gift was a gift to a lady who [attested the will] for life and after her death to be equally divided between her children on their becoming of age. Sir Richard Malins V-C held that the gift to the children was accelerated by reason of the fact that the lady could not take, and that the income was not tmdisposed of during their mother’s life. I can find no indication in the judgment, and the point does not appear to have been argued, that the effect of the acceleration was to exclude children born after the eldest,
for the time being in existence, had attained a vested interest.
That question would indeed hav.e been a future question which may never have arisen, and it does not seem to be that the fact of acceleration involves the corollary that the class intended to take is altered. If, as a matter of construction, the testator intended all the children of the lady born in her lifetime to take, it would, so I think, be after the acceleration just as if the gift had been an immediate gift to the chldren of the lady living at the testator’s death who attained twenty-one and those thereafter born who attained that age (see for example Scott v Earl of Scarborough (1838) 1 Bcav 154 and the terms of the declaration made in that case). Again, in Re Townsend’s Estate, Townsendv Townsend (1886) 34 Ch D 357, which Vaisey J treated as to the same effect as Jull v Jacobs, there was no suggestion that all the children of the life tenant, whenever born, would not take.1berefore having given the matter the best consideration that I can, I conclude that neither Juli v Jacobs nor Re Townsend’s Estate are authority for the view that acceleration has the effect indicated by Vaisey J and I am left with the decision in Re Davies itself. In Re Taylor (1957) 1 WLR 1403 Upjohn J expressed approval of the decision in Re Davies, but it was not necessary for him to do so and he was at pains to point out that the doctrine of acceleration docs not permit one to misconstrue a will. The latter remarlc was, I think, part of the ratio decidendi of the decision of Upjohn J. I am content to treat the decision of Vaiscy J as one applicable only to a case of acceleration. I am not prepared to extend it to such a case as the present where there has been no acceleration. The doctrine of acceleration is that all interests which fail or are undisposed of are captured by a residuary gift or go on an intestacy, but that a testator is presumed to have intended an acceleration of subsequent interests where a life interest fails in consequence of the donce being prevented by law from taking (sec Re Crowther’s Trusts (1916) IR 53). As a matter of construction a similar result may follow where the testator himself by a codicil revokes the prior life interest. And in that case, and again as a matter of construction, the testator may be presumed to have intended the period of distribution among the class to be his own death so as to bring a further role of construction known as Andrews v Partington (1791) 3 Bro CC 401 into operation. Re Johnson (1893) 68 LT 20- on which Vaisey Jin Re Davies relied as supporting
the proposition that acceleration may, and docs sometimes, alter the membership of the class – falls into the latter category. It docs not, however, in my judgment follow that because the revocation by the testator of a life interest may bring about both the results I have indicated, so will a disclaimer; and I confes to a doubt whether RE Davies was correctly decided.
It is, however, sufficient for me to say that although a disclaimer being sometimes within the contemplation of the testator, may, on the authority of Re Davies operate not only to accelerate the subsequent gift to the class but also, as a matter of construction of the will, alter the composition of that class, it docs not in my judgment follow that a disposition of a life interest, the terms of which cannot have been envisaged by the testator, and which may not have the former effect, nevertheless has the latter. The dispositions of the nephews’ life interests under the will of the testator could not operate over the capital of their shares or alter in any way the construction of the will. If one of those dispositions had extended to a nephew’s life interest in half his share instead of the whole of it, the question which has been discussed would have arisen with regard to that half, and no authority has been cited to me requiring this court to attribute to the testator such a prophetic vision as would enable me to hold that if the disposition by one of his nephews had operated over half instead of the whole of the income of his settled share, that half would be divisible to the exclusion of the nephew’s children, born after a child attained twenty-one but that the latter children would participate in the other half.’
Land v Devaynes
(1793) 4Bro Ch 537
Malins V-C:
… the authorities which were cited, and others which might have been referred to, show that in order to determine this question the court will look at the whole will for the purpose of ascertaining the intention of the testatrix in making this provision.
What was the intention of the testatrix? She begins with a specific legacy of certain parts of her estate to her trustees. It is certainly specific to some extent, though not so much so as Mr Glasse and Mr Renshaw contended. I think it would have passed any balances at her bankers. She then charges her debts upon this fund, then makes the gift in questioo …
Now, did she merely intend to give shares in Indian funds? If she had used the word “my” the gift must have been held specific and have failed, because she had no property answering that description at the time of her death. If she intended to give a legacy, at all events the words descriptive of the fund make it simply a demonstrative legacy.
In this case I am so clearly satisfied that it was the intention of the testatrix to give £3,000 irrespective of the kind of investment she might have at her death, that I would look carefully at everything in the will tending to show that it was not specific. If she had said: “I give £3,000 which is now invested in Indian securities”, the gift would be simply demonstrative. Now, looking al the whole will, I am so clearly of opinion that it was her meaning to give the £3,000 which was then invested in Indian Securities, that I think it ought not to fail, because at her death there was no fund invested in Indian securities, and I am perfectly satisfied that this decision will be in accordance with her real intention.’
O’Connor, Re
[l948] 1 Ch 628 Chancery Division
Roxburgh J:
‘The question which I have to determine is whether this legacy of ten thousand preference shares of £1 each is a general legacy or a specific legacy, and there are two points in that there is nothing in the language of cl 5 itself to indicate that the testator is describing specific property of his. For example, the testator does not use the word “my”or any possessive word. The second point in favour of a general legacy
– and, in my judgment, a very strong point – is that the testator never had ten thousand preference shares either at the date of his will or at the date of his death, but only nine thousand, and accordingly, if he did intend by this clause to make a specific disposition of existing property of his, he must have been misinformed as to its extent. Those are the two points in favour of a general legacy.
The two points in favour of a specific legacy are these: First, there is the circumstance that the bequest is one of shares of a private company of which the testator was the manager and governing director, a company in which the shares were subject to the restrictions on transfer usual in such a case. Secondly – and this is a very important point – the testator did not include the bequest of the preference shares among the bequests which his executors and trustees were to satisfy out of the residue …
… There is no doubt that the court leans strongly in favour of a general legacy. How strongly is apparent from the decision in Re Willocks [l 92 l] 2 Ch 327, yet if the testator, instead of referring to the ten thousand preference shares had referred to nine thousand or less prefereoce shares, I should have held that there was sufficient context here to carry me to the other side of the line … I decide … that this is a general legacy … ‘
Paget v Huish
(1863) I H & M 663 Court of Chancery
Page Wood V-C:
” … the first class is where you have a simple gift of a legacy of annuity, with a mere charge upon real estate; and there the personal estate is not only not exonerated, but remains primarily liable; just as the case of a charge of debts.
Another class is where the legacy or annuity is a specific gift out of real estate, which is assumed to be sufficient to cover the amount There the personal estate is in no way liable, and if the specific fund fails the gift must fail with it
The third class is intermediate to these where a legacy or annuity is, as it is termed, demonstrative, there being a clear general gift, but a particular fund pointed out as that which is to be primarily liable, on failure of which the general personal estate remains liable.
The point in all these cases is to ascertain whether the testator has merely pointed out a particular fund which he desires to have applied in paying the legacy, or whether the legacy itself is given only as a portion of the specified fund.
These are, therefore, the three classes of gifts: First, a general gift, in which no special fund is pointed at for payment; secondly, a specific gift out of a particular fund alone; and, thirdly, a gift where a particular fund is pointed out as primarily applicable, but where the gift is not to fail by the failure of the particular fund. In this case I think there is a clear intention that the gift should take effect in any event … ‘
Ross v Caunters
[1980] Ch 297 C
Mcgarry V-C:
‘That, I think, disposes of the issues before me. It may be of assistance if I summarise my main conclusions:
1) Despite the dicta in Robertson v Fleming (1861) 4 Macq 167 and what was said in Groom v Crocker and other cases in that line, there is no longer any rule that a solicitor who is negligent in his professional work can be liable only to his client in contract; he may be liable both to his client and to others for the tort of negligence.
2) The basis of the solicitor’s liability to others is either an extension of the Hedley Byrne principle, or,
more probably, a direct application of the principle of Donoglule v Stevenson
3) A solicitor who is instructed by his client to carry out a transaction that will confer a benefit on an identified third party owes a duty of care towards that third party in carrying out that transaction, in that the third party is a person within his direct contemplation as someone who is likely to be so closely and directly affected by his acts or omissions that he can reasonably foresee that the third party is likely to be injured by those acts or omissions.
4) The mere fact that the loss to such a third party caused by the negligence is purely financial, and is in no way a physical injury to person or property, is no bar to the claim against the solicitor.
5) In such circumstances there are no considerations which suffice to negative or limit the scope of the solicitor’s duty to the beneficiary. ‘
From what I have said, it follows that the plaintiffs claims succeeds, and she is entitled to damages against the defendants for the loss of benefits that the 1974 will would have carried to her but for the negligence of the defendants.’ ·
Rowland, Re
[1963] Ch 1 Court of Appeal
Harman LJ
‘ … the testator and his wife were thus involved in a common disaster, and the question is whether his death and hers can be said to have coincided. 1be testator has by his will given all his estate to his wife,and this is, of course effective if and only if, she survives him. He has, on the other hand, provided that in the event of her death preceding his, the estate is to go to the second and third defendants. All events in time are thus provided for except one, that of neither surviving the other. There is nothing in the will about the cause or the occasion of death; it is simply a question of time.
… so here it is attractively argued that this testator setting out on the adventure offered by this post in the Southern Pacific contemplated, as did his wife, the very event which happened, namely, that both of them should be involved in the same calamity. The learned judge did not feel able to reach this conclusion. It is for those claiming under the gift over to prove their case that the deaths of the testator and his wife were coincident. This word in the context in which it appears can in my judgment only be a reference to the time and not the occasion of death. In other words, “coincident” is equivalent to “simultaneous”. That was the only event which the testator on the language he used could have contemplated. He had already made gift to his wife if she survived him and to the defendants if she did not. Can these deaths on the evidence be held to have been simultaneous, using the word not in the philosopher’s sense but as it was used by the testatrix in Pringle’s case [1946] Ch 124? I am satisfied that it cannot. Not enough is known. It is not even known at what date, within a week, the ship went down, nor is the whereabouts of
either the testator or his wife at that time certain. One or other of them may easily have.survived the ….. going down of the ship and the event is too uncertain to infer a simultaneous death, as was possible for Cohen J in tbe case of two persons killed in close proximity to each other by the same bomb.
If this meaning of the word be out of the question, it is argued that “coincident” is a little,looser and can mean in this will, “at about the same time and as a result of the same catastrophe”. This in my opinion is an impossible view. The will has provided for both possibilities of survivorship and there is no warrant for introducing a reference to something other than time, namely, the same catastrophe. I am, therefore, of the same opinion as the learned judge and would dismiss this appeal.”
Scott, Re
[1975] 1 WLR 1260
Walton J:
‘ … on the facts of this case, the result of acceleration might be startling. The charities might get the income which they were never intended to have at all until the birth of a child (who subsequently ,attained 21, or,, . being a female, married) to Colonel Scott. And it is quite clear that it was never the testatrix’s intention that if there was such child the charity should touch a penny of her money. Of <;ourse, one may equally-say that it was never the intention of the testatrix that the income should go anywhere else than to her sister, Ruth, her brother, Colonel Scott, and Colonel Scott’s children, and so on, but of course, if as a result of something completely unforeseen, in the event that the estate is not disposed of, well, that is carried by law in certain directions, and whether the testatrix wanted it or not, that is something which is imposed on her by law. But never has the doctrine of acceleration been used, nor in my judgment, can it ever be used, to carry an interest to somebody to whom the testatrix never intended it to go, if something else happened, and that something else is still capable of happening.’
Sinclair, Re
[1985] Ch 446
Slade LJ
‘ … onnopossible footing can one rc;ad the opening words of the new s ISA( I)(b) as meaning simply “any devise or bequest to -the former spouse shall fail by reason of the death of the legatee during the testator’s lifetime”. For, in the cases dealt with by slSA(a)(b), the former spouse is ex hypothesi still alive at the date of the testator’s death.
In the more developed stages of his argument, Mr Rawson had to contend and did context that, in the
context of slSA(l)(b), the word “lapse” means something more than this. He contended that (unlike the word as used in other provisions in the 1837 Act) the single word “lapse” in this context is in truth a deeming provision. He submitted that the opening words of s l SA(l)(b) should be read as meaning “any devise or bequest to the former spouse shall fail with the same consequences as if the former spouse had died in the testator’s lifetime”. It is thus an essential part of the fund’s case on this appeal that the single word “lapse” in slSA(l)(b) should be read as not only importing a failure of the relevant gift in favour of the former spouse, but as designating also the consequences of such failure in relation to the other provisions contained in the will …
… for my part, I find it impossible to read the opening words of slSA(l)(b) in this manner. First, as I have said, it must be and is accepted that the word “lapse” is, in an appropriate context, perfectly apt to cover the happening of. any event in a testator’s lifetime which prevents the intended legatee from being entitled to the legacy, and thus to mean nothing more than fail. In my opinion the word “lapse” in the context of s l 8A(l )(b) is to refer to the happening of an event, namely divorce, in the testator’s lifetime which is to prevent the intended legatee, the former spouse, from becoming entitled to the legacy. The natural meaning of the word “lapse” in this particular context is that, in the relevant contingency, the devise or bequest to the former spouse shall fail, no more and no less.
Second, if the legislature had intended that s1SA(l)(b) should have the effect, not only of preventing the former spouse from receiving the gift in cases such as this, but also of designating the consequences which would ensue in relation to the other provisions of the will, it would in my opinion inevitably have said so. To spell out a deeming provision from this one word “lapse” would in my opinion be impermissible according to any proper principles of statutory construction.
Third, the conclusion that the legislature did not regard s18A( I )(b) as designating the consequences that would ensue from the failure of the gift to the former spouse, in relation to the other provisions of the will, is in my opinion clearly supported by the presence of subsection (3). For this subsection does designate such consequences in those cases where the will has given the former spouse a life interest. The provisions of subsection (3) would have been wholly unnecessary if slSA(l)(b) had itself been intended to provide that the effect of the failure of the gift on all theother provisions of the will was to be the same as if the former spouse had died in the testator’s lifetime … ‘
Slater, Re
[1907] 1 Ch 665 Court of Appeal
Cozens-Hardy MR:
‘But, supposing I am wrong in that, and that the appellant is right on this point, and that by construction I am to read this bequest as meaning “I bequeath the interest during her life arising from the money invested in the following particulars which I now hold”, then you are face to face with the question, “Has not this gift, so far as the Lambeth Waterworks Company’s stock is concerned, been adeemed by the subsequent transaction?” Speaking for myself, altough it may not be absolutely necessary for the decision of this case, I think it has been. There was a time when the Courts held that ademption was dependent on the testator’s intention, on a preswned intention on his part: and it was therefore held in old days that when a change was effected by public authority, or without the will of the testator, ademption did not follow. But for many years that has ceased to be law, and think it is now the Jaw that where a change has occurred in the nature of the property, even though effected by virtue of an Act of Parliament, ademption will follow unless the case can be brought within what I may call the principle of Oalres v Oakes (1852) 9 Hare 666 .in which Tw:ner V-C held that a bequest of shares in a railway company was not revoked by the subsequent change of those shares into stock by reason of a vote of the company under the powers of their special Act. At the end of his judgment the Vice-Chancellor says this (at p672):
“The testator bad this property at the time he made bis will, and it bas since been changed in name or form only. 1be question is, whether a testator bas at the lime of his death the same thing existing, it may be in a different shape – yet substantially the same thing”.
Remembering the extraordinary accuracy of the language used by Turner V-C, I think there is a great force in those words which he used “changed in name or form only … yet substantially the same thing”. Applying that to the present case, in the first place the Lambeth Waterworks undertaking was sold, and sold for cash – sold, that is, for cash in the sense, that the price was ascertained in cash and could only be paid otherwise than in cash if both the vendors and purchasers agreed to a scheme providing for satisfying the purchase money otherwise. That agreement was obtained in the present case. A scheme was prepared, and the Water Board B stock was allotted to the testator in respect of his shares in the old company. But can it possibly be said that is the same thing? Instead of having shares in a company dependent for its profits upon water rates which they, and they alone, were able to demand from the limited area within the ambit of their Act of Parliament, the Water Board B stock is a stock which is payable out of water rates levied not merely upon the Lambeth Waterworks area, but upon the whole of the metropolitan area, and I think, also on some districts even outside the metropolitan area. But, more than that, in the event of the water rates being insufficient to provide for the interest the present stock has a claim upon the rateable property in London, and any deficiency has to be made good out of the general rates. I cannot bring myself to say that is the same thing. I feel bound myself to adopt the view taken not in one case only, but in many, that you have to ask yourself, whe isthe thing which is given? If you cannot find it at the testator’s death,
it is no use trying to trace it unless you an trace it in this sense, that you find something which has been changed in name and form only, but which is substantially the same thing. One authority has been adduced to us which is certainly very near the present case: it is the case of In Re Grey (1887) 36 Ch D 205 decided by Kay J. It is quite true that the observations made by that learned judge were not necessary for the decision of the case, for he first held that the legacy in that case was general not specific, but he went on to discuss the question of what would happen assuming that the gift was specific. In that case the testator bequeathed certain shares in an old unlimited bank. It is in the interval between the date of his will and of his death the company was registered under the same name with the addition of the word “Limited” and the shares were sub-divided up, each £100 being converted into two shares of the nominal value of £60, and the learned judge held that, even assuming the legacy had been specific, the shares in the limited
company were not so completely identified with the old shares as to prevent the application of the doctrine of ademplion.’
Stanley v Potter
(1789) 2 Cox 180
Lord Thurlow LC:
” … when the case of Ashburner v Macguire (1786) 2 Bro CC 108 was before me, I took all the pains I could to sift the several cases upon the subject, and I could find no certain rule to be drawn from them,except this, to inquire whether the legacy was a specific legacy (which is generally the difficult question in these cases} and if specific, whether the thing remained at the testator’s death; and one must consider it in the same manner as if a testator had given a particular horse to AN. If that horse died in the testator’s lifetime or was disposed ofby him, then there is nothing on which the bequest can operate. And I do not think that the question in these cases turns on the intention of the testator. The idea of proceeding on the animi,s adimendi has introduced a degree of confusion in the cases which is inexplicable, and I can make out no precise rule from them upon that ground. As to the case of Attorney-General v Parlcyns, I collect from the note I read of that case that Lord Camden would have had great difficulty in making those legacies contributory in the event of a deficiency of assets: and if so, I cannot conceive how they are to be taken as general legacies for any other purpose; they must have had all the consequences of general legacies, or none; they could not be specific to one purpose, and general to another. This I cannot understand. And I believe it will be a safer and clearer way to adhere to the plain rule which I before mentioned, which is to inquire whether the specific thing given remains or not. For where a testator gives by his will a particular sum of money, and he afterwards receives and spends it, I see no end to the confusion arising from the following any other line.’
Trotter, Re
(1899) 1 Ch 764
BymeJ:
” … in Gurney v Gurney (1855) 3 Drew 208 the testator had given benefits by his will to two persons who did not attest the will, but who did afterwards attest two codicils. Kindersley V-C decided that the word “thereby” in sl5 of the Wills Act must be construed to mean “by the same testamentary instrument which is attested” and that it does not apply to the case where a legatee has not attested the same instrument under which he talces. This points to the will and codicil being treated as separate instruments for the purpose of ascertaining whether or not an attesting witness to either of such instruments can take
… I think that these points in respect of wills made since the Wills Act have been thus established. (1) that a will invalid in itself may operate as a valid instrument when referred to and incorporated in or with a subsequent and validly-executed codicil. (2) That a valid gift by a will to a legatee is not rendered invalid by reason of his subsequently attesting a codicil, although the codicil has the effect of republishing and incorporating the will. (3) That although a gift by a valid will to an attesting witness is utterly null and
void, such gift may be rendered effectual if the will is republished by a codicil referring to the will but not attested by the legatee. (4) That iie legatee must be able to point to an instnnnent giving him his legacy not attested by himself before he can establish his right to his legacy. Bearing in mind these principles, the
question appears to be whether or not John Trotter can point to an instrument not attested by himself and giving him the benefit he claims. It cannot be to the will alone, for though a valid instrument it is utterly null and void so far as the disposition in his favour is concerned. But just as had the original will been altogether void be would have been able to point to a codicil republishing and incorporating the whole of it, and as validating the whole of,the dispositions intended to be made by the will so in like mannerI think he can point to the first codicil republishing and incorporating an instrument valid as to some of its
dispositions, but invalid as to the dispositions in his favour, as being the instrument under which he claims. I think that the true view is that, where the original gift is by the operation of sl5 of the Wills Act utterly
null and void, the will is pro tanto null and void, as it would have been, if unattested, null and void altogether; and that, just as in the latter case the whole will would, if referred to in a duly-executed and duly-attested codicil, operate in its entirety as from the date of the codicil, so where void in part as to its dispositions by reason of improper attestation, it will, so far as void, operate for the first tme by the incorporation and republication effected by the due execution of the codicil. I think that John Trotter is entitled here to point to the first codicil as the instrument conferring upon him the benefit in question, inasmuch as that codicil incotporates the whole will, including the originally void disposition, and that this being so, upon the authority of Gurney v Gurney and Re Marcus (1887) 57 LT 399 he has not lost this benefit by reason of bis having subsequently attested the second codicil.’
Wilson, Re
[1967] Ch 53 C
Pennycuick J:
‘ … apart from authority, the natural view, so it seems to me, is that where a testator makes a general or
universal gift of his real estate, that is “all my property”, the subject-matter of that gift falls under the second head (para 2 of Sched 1), that is, as being property not specifically devised but included “in a residuary gift …”. A gift in this form does not indicate any particular items of property but covers all items of real property which the testator may be entitled to at his death. In ordinary language today lawyers would, I think, not inaptly descnbe such a gift as a residuary devise. They would certainly not describe it as a specific devise.
[Counsel) for Mrs Lambert advanced certain arguments to the contrary. His first argument was that all devises are from their nature specific. It seems that this was indeed so, at any rate until 1925: see in particular Hensman v Fryer (1867) LR 3 Ch App 420 and Lance.field v lggulden (1874) LR 10 Ch App 136. On the other hand, as I have said, it is clear that Part II of the Schedule contemplates that real property may be capable of being comprised in a residuary gift. I do not think that in the context of the First Schedule to that Act one should put a construction on the words “specifically devised” and “residuary gift”
as would in effect deprive the class of residuary gifts of realty of any possible content at all.
… [Counsel’s) second point was thata devise is residuary only if there has been a previous devise, so that the residuary devise operates on what remains after the previous devise has taken effect. That is grammatically a good point. On the other hand, the expression “residuary gift” is habitually used to denote a general or universal gift and, as I have said, it seems to me natural so to treat the words “residuary gift” here.
The only alternative in the context of para 2 is to treat the general or universal gift as a specific gift, and that I should have thought certainly it was not. This construction would produce a wholly illogical result as regards payment of debts. On the one hand a residuary gift devise following a specific devise would be a residuary gift for the purpose of para 2. On the other hand, a general or universal devise would be a specific devise and would fall not within para 2 but para 6. I cannot think that that is right. I conclude, therefore, that the devise of “all my real estate” to Mrs Lambert in this will is a residuary gift for the purpose of para 2 of Pt 2 of Sch l to the Administration of Estates Act I925.’
Zouche, Baroness, Re
[1919] 2 Ch 178
PO Lawrence J:
” … if any part of this plate had been sent to a shop for repair at the time of the death, and was only temporarily absent for that purpose, or had been deposited at the bank by the testatrix for a temporary purpose, eg, while she was absent from town on a visit, there could not be any reasonable doubt that it would have passed by the gift. But, to my mind the facts in this case are wholly different. The testatrix herself did not deposit this plate at the bank. The temporary purpose for which it was originally deposited by her predecessor in title had expired many years before her death. Neither her predecessor nor the testatrix ever fetched the plate away from the bank, and it is a matter of pure speculation what her intention with regard to the destination of the plate would have been if she had ever thought of taking it away from the bank. In my judgment, the testatrix, knowing it was not at Parnham House at the time she made her will, did not intend that it should pass by the specific gift in her will … That leaves only the rare books and MSS at the British Museum, and I think the judgment I have just given with regard to the plate covers the articles which were lent to the British Museum for exhibition purposes … ‘
Commissioner of Stamp Duties v Livingston
Privy Council (1965] A.C. 694; [1964] 3 W.L.R. 963; [1964] 3 All E.R. 692; [1964] T.R. 351;
VISCOUNT RADCLIFFE:
One way or the other then, if there is to be a taxable succession, it must be because she died owning a beneficial interest in real property in Queensland or had beneficial personal property interests locally situate in Queensland. This is the way in which the issue has been posed in the judgments of the High Court of Australia, and in their Lordships’ view it is the correct formulation of the problem.
When Mrs. Coulson died she had the interest of a residuary legatee in the testator’s unadministered estate. The nature of that interest has been conclu sively defined by decisions of long-established authority, and its definition no doubt depends upon the peculiar status which the law accorded to an executor for the purposes of carrying out his duties of administration. There were special rules which long prevailed about the devolution of freehold land and its liability for the debts of a deceased, but subject to the working of these rules whatever property came to the executor virtute officii came to him in full ownership, without distinction between legal and equitable interests. The whole property was his. He held it for the purpose of carrying out the functions and duties of administration, not for his own benefit; and these duties would be enforced upon him by the Court of Chancery, if application had to be made for that purpose by a creditor or beneficiary interested in the estate. Certainly, therefore, he was in a fiduciary position with regard to the assets that came to him in the right of his office, and for certain purposes and in some aspects he was treated by the court as a trustee. “An executor,” said Kay J. in In re Marsden ( (1884) 26 Ch.D. 783, 789), “is personally liable in equity for all breaches of the ordinary trusts which in Courts of Equity are considered to arise from his office.” He is a trustee ” in this sense.”
It may not be possible to state exhaustively what those trusts are at any one moment. Essentially, they are trusts to preserve the assets, to deal properly with them, and to apply them in a due course of administration for the benefit of those interested according to that course, creditors, the death duty authorities, legatees of various sorts, and the residuary beneficiaries. They might just as well have been termed ” duties in respect of the assets ” as trusts. What equity did not do was to recognise or create for residuary legatees a beneficial interest in the assets in the executor’s hands during the course of administration. Con ceivably, this could have been done, in the sense that the assets, whatever they might be from time to time, could have been treated as a present, though fluctuating, trust fund held for the benefit of all those interested in the estate according to the measure of their respective interests. But it never was done. It would have been a clumsy and unsatisfactory device from a practical point of view; and, indeed, it would have been in plain conflict with the basic conception of equity that to impose the fetters of a trust upon property, with the resulting creation of equitable interests in that property, there had to be specific subjects identifiable as the trust fund. An unadministered estate was incapable of satisfy ing this requirement. The assets as a whole were in the hands of the executor, his property; and until administration was complete no one was in a position to say what items of froperty would need to be realised for the purposes of that administration or o what the residue, when ascertained, would consist or what its value would be. Even in modern economies, when the ready marketability of many forms of property can almost be assumed, valuation and realisation are very far from being interchangeable terms.
At the date of Mrs. Coulson’s death, therefore, there was no trust fund consisting of Mr. Livingston’s residuary estate in which she could be said to have any beneficial interest, because no trust had as yet come into existence to affect the assets of his estate. The relation of her estate to his was exactly the same as that of Mrs. Tollemache’s estate to that of her deceased husband’s, as analysed in the well-known decision of Sudeley v. Attorney-General ([1897] A.C. 11). Just as Mr. Tollemache’s rights in the mortgages of New Zealand land were the property of his executors for the purposes of the administration of his estate, and no one else had any property interest in them, so Mr. Livingston’s property in Queensland, real or personal, was vested in his executors in full right, and no beneficial property interest in any item of it belonged to Mrs. Coulson at the date of her death. In their Lordships’ opinion the decision of the Sudeley case is conclusive on this issue. It is sufficient to quote the words of Lord Herschell, which do no more than reflect the reasoning and views of all the members of the House who took part in the decision. “I do not think,” he said (at p. 18), speaking of Mrs. Tollemache’s executors, “that they have any estate, right, or interest, legal or equitable, in these New Zealand mortgages so as to make them an asset of her estate.”
It is evident that there would not have been the divisions of opinion in the Australian courts that have arisen in this case, if the proposition iaid down by the Sudeley decision had always been regarded as being as final and compre hensive as, in their Lordships’ opinion, it was intended to be. There has been a reluctance to accept Lord Herschell’s words at their face value and, it would seem, a feeling that they ought to be treated as subject to some limitation that does justice to the “interest” that a residuary legatee possesses in his testator’s estate. The judgment of Jordan C.J. in McCaughey v. Commissioner of Stamp Duties ( (1945) 46 S.R.(N.S.W.) 192) contains a reasoned statement of some of these misgivings, which were again referred to in the High Court of Australia in Smith v. Layh ( (1953) 90 C.L.R. 102, 108-109); and cases in England such as Cunliffe-Owen v. Inland Revenue Comm1·s. ([1953] Ch. 545) indicate a certain unease at relating Sudeley to other English decisions. Basically, these criticisms appear to arise from an incomplete assessment of the legal position of assets which belong to an executor for the purposes of his administration and from a use of the word “interest” that is not sufficiently precise to meet the require ments of a taxing Act to which questions of locality and valuation are all important. But since these criticisms have been made, it is desirable that this opinion should notice and comment upon them.
First, it is said that Sudeley’ s case cannot properly be treated as laying down a general proposition about unadministered estates, because, if it were, such a proposition would be inconsistent with the earlier decision of the House of Lords in Cooper v. Cooper ( (1874) L.R. 7 H.L. 53, 64–05). Cooper v. Cooper was a case about election as between beneficiaries and had nothing to do with death duty or succession duty Acts. There had been an intestacy and a devolution of property on intestacy, and the only question to be decided was whether persons interested in the intestate’s estate could be put to their election between different interests at a date when the administration of his estate was still proceeding. The question was said to be whether they had by then an interest “sufficiently specific to raise a case of election.” …
In the course of his speech in Cooper v. Cooper Lord Cairns L.C. expressed himself as follows . . . “For the benefit of creditors, and the facility of division among the next of kin, the estate is to be turned into money, but as regards substantial proprietorshif the right of the next of kin remains clear to every item of e pe;1;sonal estate o the intestate, subject only to those paramount claims of creditors. . ..
It is said that Lord Cairns’ description of the next-of-kin as having a ” sub stantial proprietorship” in every item of an intestate’s personal estate and of residuary legatees of what, presumably, he was regarding as an unadministered estate as possessing ” a clear tangible interest in specie ” in a particular item of the estate contradicts the statement of the position which was made by Lord Herschell and others in the Sudeley case. So indeed it does, in the sense that Lord Cairns’ words cannot be treated as an accurate statement of the law in the light of the later decision. But what is to follow from this? Cooper v. Cooper, certainly, was not cited during the argument of Sudeley v. Attorney-General, and it has apparently been suggested that, if it had been, the law as laid down in that case would somehow have been stated in a different or qualified form. Their Lordships can give no encouragement at all to this speculation. The members of the House who decided Sudeley were dealing with a branch of the law that was familiar and well established, and they were dealing with it with the precision that they regarded as being required by the particular issue that was before them. The law as they there stated it was reaffirmed by the House in the same terms in Dr. Barnardo’s Homes v. Special Income Tax Commissioners ([1921] 2 A.C. 1, 8 and 10). It is sufficient to quote two short passages from speeches in that case. Viscount Finlay said : ” … the legatee of a share in the residue has no interest in any of the property of the testator until the residue has been ascertained. His right is to have the estate properly administered and applied for his benefit when the administration is complete”; while Viscount Cave says: “When the personal estate of a testator has been fully administered by his executors and the net residue ascertained, the residuary legatee is entitled to have the residue, as so ascertained, with any accrued income, transferred and paid to him; but until that time he has no property in any specific investment forming part of the estate or in the income from any such investment, and both corpus and income are the property of the executors and are applicable by them as a mixed fund for the purposes of administration.” Similar explicit statements of the true pos1t10n will be found in the judgments of Lord Sterndale M.R., when the Barnardo case was in the Court of Appeal ([1920] 1 K.B. 468, 479) and of Sir Wilfrid Greene M.R. in Corbett v. Commissioners of Inland Revenue ([1938] 1 K.B. 567, 575-577).
In their Lordships’ opinion the truth of the matter is that Lord Cairns’ speech in Cooper v. Cooper cannot possibly be recognised today as containing an authoritative statement of the rights of next-of-kin or residuary legatees in an unadministered estate. His language is picturesque, but inexact; and while it was no doubt sufficient to enforce the point with which he was concerned to deal, a beneficiary’s right or duty of election, and the decision of the case remains an authority on that point, it would be idle to try to set it up as an exposition of the general law in opposition to what was said and laid down in the Sudeley and Barnardo cases.
A second line of criticism has occasionally been expressed to the effect that it is incredible that Lord Herschell should have intended by his proposition to deny to a residuary legatee all beneficial interc:-st in the assets of an unadministered estate. Where, it is asked, is the beneficial interest in those assets during the period of administration? It is not, ex hypothesi, in the executor: where else can it be but in the residuary legatee? This dilemma is founded on a fallacy, for it assumes mistakenly that for all purposes and at every moment of time the law requires the separate existence of two different kinds of estate or interest in property, the legal and the equitable. There is no need to make this assump tion. When the whole right of property is in a person, as it is in an executor, there is no need to distinguish between the legal and equitable interest in that property, any more than there is for the property of a full beneficial owner. What matters is that the court will control the executor in the use of his rights over assets that come to him in that capacity; but it will do it by the enforce ment of remedies which do not involve the admission or recognition of equitable rights of property in those assets. Equity in fact calls into existence and protects equitable rights and interests in property only where their recognition has been found to be required in order to give effect to its doctrines.
Criticisms of this kind arise from the fact that the terminology of our legal system has not produced a sufficient variety of words to represent the various meanings which can be conveyed by the words “interest” and “property.” Thus propositions are advanced or rebutted by the employment of terms that have not in themselves a common basis of definition. For instance, there are two passages quoted by the Chief Justice in his dissenting judgment in this case which illustrate the confusion. There is the remark of Jordan C.J. in McCaughey’ s case, “The idea that beneficiaries in an unadministered or partially administered estate have no beneficial interest in the items which go to make up the estate is repugnant to elementary and fundamental principles of equity.” If ” by beneficial interest in the items ” it is intended to suggest that such beneficiaries have any property right at all in any of those items, the proposition cannot be accepted as either elementary or fundamental. It is, as has been shown, contrary to the principles of equity. But, on the other hand, if the meaning is only that such beneficiaries are not without legal remedy during the course of administration to secure that the assets are properly dealt with and rights that they hope will accrue to them in the future are safeguarded, the proposition is no doubt correct. They can be said, therefore, to have an interest in respect of the assets, or even a beneficial interest in the assets, so long as it is understood in what sense the word ” interest ” is used in such a context…. While it may well be said in a general way that a residuary legatee has an interest in the totality of the assets (though that proposition in itself raises the question what is the local situation of the “totality”), it is in their Lordships’ opinion inadmissible to proceed from that to the statement that such a person has an equitable interest in any particular one of those assets, for such a state ment is in conflict with the authority of both Sudeley and Barnardo and is excluded by the very premise on which those decisions were based.
Nor can the solution of the difficulty be advanced by referring to those cases in Equity Courts in which a creditor or a pecuniary or residuary legatee has been allowed to follow and recover assets which have been improperly abstracted from an estate. The basis of such proceedings is that they are taken on behalf of the estate and, if they are successful, they can only result in the lost property being restored to the estate for use in the due course of administration. Thus, while they assert the beneficiary’s right of remedy, they assert the estate’s right of property, not the property right of creditor or legatee; indeed, the usual situation in which such an action has to be launched is that in which the executor himself, the proper guardian of the estate, is in default, and thus his rights have to be put in motion by some other person on behalf of the estate. [Viscount Radcliffe then referred to Skinner v. Att.-Gen. [1940] A.C. 350.] Their Lordships, therefore, must reject the idea that the Sudeley decision, which relates to a residuary share of an unadministered estate, has been in any way qualified by Skinner’s case. Where, as here, the question is whether a succession arose on a death in respect of a ” devolution by law of any beneficial interest in property,” and the necessary limitations of the Queensland Succession Duty Act reduce that question to one whether there was a beneficial interest in Queensland property belonging to her at her death, it is necessary, to use Lord Greene’s words, to “discover the locality to be attributed to a right,” and this requirement involves a precise analysis of the nature of the right. It is not enough for this purpose to speak of an ” interest ” in a general or popular sense. It is apt to recall what Lord Halsbury L.C. said on this point in his speech in the Sudeley case: ” With reference to a great many things, it would be quite true to say that she had an interest in these New Zealand mortgages-that she had a claim on them: in a loose and general way of speaking, nobody would deny that that was a fair statement. But the moment you come to give a definite effect to the particular thing to which she becomes entitled under his will, you must use strict language, and see what it is that the person is entitled to; because upon that in this case depends the solution of the question. It is idle to use such phrases as … that she had an ‘interest’ in this estate.” If the present appeal is tried by this test, which they accept as the correct one, their Lordships regard it as clearly established that Mrs. Coulson was not entitled to any beneficial interest in any property in Queensland at the date of her death.
What she was entitled to in respect of her rights under her deceased husband’s will was a chose in action, capable of being invoked for any purpose connected with the proper administration of his estate; and the local situation of this asset, as much under Queensland law as any other law, was in New South Wales, where the testator had been domiciled and his executors resided and which constituted the proper forum of administration of his estate.
Bothamley v Sherson
Chancery Division (1875) L.R. 20 Eq. 304; 33 L.T. 150; 23 W.R. 848
The bequest was of “all my shares or stock in the Midland Railway Company.”
JESSEL M.R.: . . . The first point to consider is, what a specific bequest means; and certainly great discouragement is thrown upon succeeding Judges by Lord Cranworth’s observations in the case of Fielding v. Preston ( (1857) 1 De
- & J. 438), in which he said: ” There have been attempts in various cases to determine the meaning of a specific legacy, and what is the test whereby such legacies may be distinguished from general bequests. There are objections to most of the definitions, but I think we are quite safe in treating that as a specific bequest which the testator directs to be enjoyed in specie.” That is no definition at all; it is simply saying (putting the words “in specie” in English), “that is a specific bequest which the testator directs to be enjoyed specifically.” However, notwithstanding that discouragement, I think one may arrive at a tolerably clear idea of what a specific bequest is. In the first place it is a part of the testator’s property. A general bequest may or may not be a part of the testator’s property. A man who gives £100 money or £100 stock may not have either the money or the stock, in which case the testator’s executors must raise the money or buy the stock; or he may have money or stock sufficient to dis charge the legacy, in which case the executors would probably discharge it out of the actual money or stock. But in the case of a general legacy it has no reference to the actual state of the testator’s property, it being only supposed that the testator has sufficient property which on being realized will procure for the legatee that which is given to him, while in the case of a specific bequest it must be of a part of the testator’s property itself. That is the first thing.
In the next place, it must be a part emphatically, as distinguished from the whole. It must be what has been sometimes called a severed or distinguished part. It must not be the whole, in the meaning of being the totality of the testator’s property, or the totality of the general residue of his property after having given legacies out of it. But if it satisfy both conditions, that it is a part of the testator’s property itself, and is a part as distinguished, as I said before, from the whole, or from the whole of the residue, then it appears to me to satisfy everything that is required to treat it as a specific legacy. I hope the definition which I have attempted to give will be more successful than those which have been attempted before, but I can only express that hope with some degree of trepidation.
Now there can be no question, as I understand the authorities, that the part may be defined in any way which distinguishes it. If a testator gives ” the black horses which I now have,” or “the black horses of which I shall be possessed at the time of my death,” or at any other specified time, the gift satisfies the definition of a specific legacy. If authority were wanted there is plenty. I have been referred to a great many cases, and I will mention on that point one or two. There is the very singular case, to which I shall refer for another purpose, of Stewa1·t v. Denton ( (1785) 4 Doug. 219), where the gift was of “any stock-in trade of wines and spirituous liquors which I shall be possessed of at the time of my death.” That was held to be specific. Again, in the case of Fontaine v. Tyler ( (1821) 9 Price 98), Chief Baron Richards says, “A gift of all the horses which I may have in my stable at the time of my death, would be specific.” Therefore the mere fact of death being referred to as the period for ascertain ment does not make the gift less specific; and those cases get rid of the observa tions made by Sir Thomas Plumer in the case of Parrott v. Worsfold ( (1820) 1 Jae. & W. 594), that a specific legacy must necessarily be subject to ademption. That cannot, of course, be so when the time of the death is the time for the ascertainment: for a man does not live after his own death, and therefore there is no period at which ademption can take place. It is not necessary therefore that a specific bequest should be subject to ademption….
In the case of Fielding v. Preston there were two gifts: one was of “my leaseholds,” the other of “my funded property and other personal estate not hereinbefore bequeathed.” Lord Cranworth was clearly of opinion that both would have been specific except for the circumstance that the gift “of my funded property ” was followed by a gift of all the rest of the estate. His Lordship says: “My mind has fluctuated on this point, but at last I have arrived at the conclusion that this is not a specific gift of the funded property; and I come to that conclusion because I think it would be very dangerous to hold that in a will where there is a gift of the residue, and the testator unnecessarily chooses to enumerate some particular things in that residuary gift, such a circumstance was sufficient to constitute the things so enumerated specific gifts. It rarely happens that in the gift of residue something is not mentioned specifically. For instance, a testator may give his horses and all his other personal estate, or his stock in trade and the rest of his personal estate. Such bequests could not, I think, be properly held to be specific. Suppose the will to be worded thus: ‘I give to Henrietta, her executors, administrators, and assigns, all my other personal estate, including my funded property,’ that would not have been specific.”
Therefore when you come within that line of cases such gifts are not specific; not because the word ” my ” would not make the bequest specific, but because it is mere enumeration of particulars making up the residue, and is not intended by the testator to be a gift of part of the property itself to be taken by the legatee in that shape.
I think, then, that it is clearly settled … that gifts either “of my shares or stock in a railway company,” or “of the stock or shares in the railway company which I shall be possessed of at the time of my death” or, as it was in Stewart v. Denton, “of all my stock in trade which I shall be possessed of at the time of my death,” are specific legacies.
. . . the class of specific bequests described as generic, that is, a specific bequest which points to a class of objects given by the testator, and which from their nature would not naturally be referable to the date of the instrument. A good illustration of this class of bequests is a gift “of my household furniture.” There are very few persons not in articulo mortis who would not expect that some articles of household furniture would wear out, or be broken, or otherwise be parted with, and be replaced by other articles of a similar kind. It would not be natural to assume that a man giving that kind of legacy intended to restrict it to the property of that description which he had at the date of the will. It has been held in Goodlad v. Burnett ( (1855) 1 K. &
- 341), and in some other cases to which reference has been made, that in cases of that description the new law brings down the specific bequest to the date of the death; in other words, the new law makes a specific bequest of “my furniture” to mean not ” the furniture which belongs to me at the time of making this my will.” but “the furniture which shall belong to me at the time of my death.” Legacies expressed in both ways were specific before the Wills Act, and they equally remain specific now.
Mytton v Mytton
Chancery Division (1874) L.R. 19 Eq. 30; 44 L.J.Ch. 18; 31 L.T. 328; 23 W.R. 477
The bequest was “the sum of £3,000 invested in Indian security.” She had £3,000 East India Debenture Bonds.
MAI.INS V.-C.: The construction of this will is by no means free from difficulty. But I certainly see very plainly that, if this gift were held to be specific, the intention of the testatrix, which was that the nephew, at all events, should have the legacy, would be entirely disappointed. It is, however, clear that if the will is expressed in such form as leads me to hold that the gift is specific, I must so determine. But the authorities which were cited, and others which might have been referred to, shew that in order to determine this question the Court will look to the whole of the will for the purpose of ascertaining the intention of the testatrix in making this provision.
What was the intention of this testatrix? She begins with a specific legacy of certain parts of her estate to her trustees. It is certainly specific to some extent, though not so much so as Mr. Glasse and Mr. Renshaw contended. I think it would have passed any balances at her bankers. She then charges her debts upon this fund, then makes the gift in question. …
Now, did she intend merely to give shares in Indian funds? If she had used the word ” my ” the gift must have been held specific, and have failed, because she had no property answering that description at the time of her df’ath. If she intended to give a legacy, at all events, the words descriptive of the fund make it simply a demonstrative legacy.
In this case I am so clearly satisfied that it was the intention of the testatrix to give £3000, irrespective of the kind of investment she might have at her death, that I would look carefully at everything in the will tending to shew that it was not specific. If she had said, ” I give £3000 which is now invested in Indian securities,” the gift would be simply demonstrative. Now, looking at the whole will, I am so clearly of opinion that it was her meaning to give the
£3000 which was then invested in Indian securities, that I think it ought not to fail, because at her death there was no fund invested in Indian securities, and I am perfectly satisfied that this decision will be in accordance with her real intention.
Re Wilson
[1966] 2 All E.R. 867
PENNYCUICK J. : . . .
“Property of the deceased not specifically devised or bequeathed but included (either by a specific or general description) in a residuary gift, subject to the retention out of such property of a fund sufficient to meet any pecuniary legacies, so far as not provided for as aforesaid.”
It will be observed that in this paragraph, as in the other paragraphs of Pt. II, all property passing under a will is treated as falling under one or other of two mutually exclusive heads, namely, (1) property specifically devised or bequeathed and (2) property not specifically devised or bequeathed but included in a residuary gift. There is no intermediate head into which any property could be thrust.
It will further be observed that para. 2 unequivocally contemplates that there may be real property which is not specifically given but which is included in a residuary gift. This is apparent from the use of the expression ” devised or bequeathed “.
Apart from authority, the natural view, so it seems to me, is that where a testator makes a general or universal gift of his real estate, that is “all my property “, the subject-matter of that gift falls under the second head (para. 2 of Sched. I), that is, as being property not specifically devised but included “in a residuary gift….” A gift in this form does not indicate any particular item of property but covers all items of real property to which the testator may be entitled at his death. In ordinary language today lawyers would, I think, not inaptly describe such a gift as a residuary devise. They would certainly not describe it as a specific devise.
…advanced certain arguments to the contrary. His first argument was that all devises are from their nature specific. It seems that this was indeed so, at any rate until 1925: see in particular Hensman v. Fryer ( (1867) L.R. 3 Ch.App. 420) and Lancefield v. lggulden ( (1874) L.R. 10 Ch.App. 136).
On the other hand, as I have said, it is clear that Part II of the Schedule contemplates that real property may be capable of being comprised in a residuary gift. I do not think that in the context of the First Schedule to that Act one should put such a construction on the words “specifically devised” and ” residuary gift” as would in effect deprive the class of residuary gifts of realty of any possible content at all.
… referred me to dicta in two post-1925 cases in
support of his argument on this point. In Re Rowe, Bennetts v. Eddy ([1941] Ch. 343) the relevant words of the will were: “I devise all my real estate and bequeath all the residue of my personal estate …”to certain persons. Farwell J.,
after deciding the question on a different ground, added (at p. 348):
” … for according to the construction which I place upon this particular will the real estate is devised, not as part of the residue, but as a specific devise to the named persons, the residue which is given being the residue of the personal estate.”
In Re Ridley (deed.), Nicholson v. Nicholson ([ 1950] Ch. 415) the relevant words in cl. 6 of the will were :
” I give free of all death duties all my real estate which includes Man mead, Covert and Maperton and my advowsons to the said [ G.] absolutely,” and in cl. 8 of the will the testatrix gave
” the residue of my property including property over which I have a general power of appointment to the said [G.].”
Harman, J., pointed out that although by cl. 6 the testatrix gives all her real
estate, by cl. 8 she gives the residue of her property, and that he describes as a ” true residuary clause “.
After referring to Hensman v. Fryet· and Lancefield v. Iggulden, he said:
“In my judgment, cl. 6 of this will, although it contains a general devise of realty, is not a residuary gift. I cannot think that a clause placed as this one is, even though it might have a certain sweeping-up effect by virtue of
- s. 24 of the Wills Act, 1837, is a residuary gift within the meaning of the Act of I am supported in that view by a dictum of Farwell, J., in Re Rowe.”
He then refers to that case. He concludes:
” If that be right, it is clear that the present case is a stronger one, and although I am not bound by that decision because it was not necessary for the conclusion at which he arrived, it is none the less a decision of that learned judge, and I should be very sorry to differ from .it. I agree with the reasoning: I cannot think that cl. 6 was what is meant in this Schedule as being a residuary gift, and if necessary I should be prepared so to hold; ”
I must, of course, pay great respect to those two dicta, but it is important to observe that Harman, J., considered that it was cl. 8 and not cl. 6 which was the true residuary gift. On the best consideration that I can give it I do not
think that it would be right for me to hold that for the purpose of para. 2 in Pt. 2 of Sch. 1 there is no such thing as a residuary gift of realty and that all realty must be treated as specifically devised.
… second point was that a devise is residuary only if there has been a previous devise, so that the residuary devise operates on what remains after the previous devise has taken effect. That is grammatically a good point. On the other hand, the expression ” residuary gift” is habitually used to denote a general or universal gift and, as I have said, it seems to me natural so to treat the words ” residuary gift ” here.
The only alternative in the context of para. 2 is to treat a general or universal gift as a specific gift, and that I should have thought certainly it was not. This construction would produce a wholly illogical result as regards payment of debts. On the one hand a residuary devise following a specific devise would be a residuary gift for the purpose of para. 2. On the other hand, a general or universal devise would be a specific devise and would fall not within para. 2 but para. 6. I cannot think that that is right.
I conclude, therefore, that the devise of ” all my real estate ” to Mrs. Lambert in this will is a residuary gift for the purpose of para. 2 of Pt. 2 of Sch. 1 to the Administration of Estates Act, 1925.
UK Cases
Cadbury v Smith
Court of Chancery (1869) L.R. 9 Eq. 37; 24 L.T. 52; 18 W.R. 105
LORD ROMILLY M.R. : . . . The defence that is set up is, that the legacy is barred by time; in answer to which the plaintiffs contend that there has been admission of assets sufficient to pay the legacy; and further, that this was a trust.
The first question I have to decide is, whether there has been an admission of assets. In support of this the Plaintiffs rely on the fact that a sum of £1,000 was paid to the Infirmary at Leeds, at the instance of the Defendant Smith, in the year 1856. I am of opinion that this was no admission of assets for the pay ment of the other charitable legacies. The cases of Postlethwaite v. Mounsey ( (1842) 6 Hare 33n.), and others that were cited, all determined that a payment by an executor to have that effect, must be made with that intention in the ordinary way, for, as Vice-Chancellor Wigram puts it, the payment by an executor of legacies to servants on his own responsibility, without reference to the state of the assets, cannot bind him to pay all the legacies given by a will.
The circumstances of this case were very peculiar:-[HiLsordship then reviewed the evidence as to the payment to the Infirmary at Leeds and said that in his opinion it was a gratuity to the Infirmary by Smith and Robinson.] If the payment was intended as a gratuity, then it was no admission of assets. Sup posing a person who is entitled as executor to the residue of property should say to a legatee that the estate is insufficient to pay him his legacy, but that out of personal regard he would pay it out of his own pocket, could it be said that that was an admission of assets to pay the other legatees and creditors? If an executor were to pay a debt in that way, there can be no doubt (although I do not much approve of the law in that respect) that it would only be an admis sion of assets to pay debts of a superior order, but not those of an equal order, as to which he could not, by reason of having selected some, be compelled to pay the others.
I am, therefore, of opinion, that this payment, according to the statements in the bill and the evidence, does not amount to an admission of assets for the payment of the other charitable legacies.
Another matter which is relied upon as an admission of assets appears to me to amount to nothing of the sort. It is this,-after the death of Robinson, Smith, who was residuary legatee with Robinson, stated that Robinson had never accounted to him or let him know what was payable in respect of his share, which he insisted ought to be done, and a correspondence ensued between Robinson’s executors and Smith, the result of which was, that by way of com promise they gave him £700 as his share of the residue; thereupon he gave them a release in full. Can it be said that is an admission of assets to pay all the legacies? I am of opinion that it is only an admission that there was then £700 applicable to the due administration of the estate.
If the matter were now new, the proper decree would, unquestionably, be for an account of the real and personal estate of the testatrix, with a direction to ascertain how much was pure personalty and how much savoured of realty, and, that being ascertained, the legacies would have to be paid in the proportion of the realty to the pure personalty, and the balance paid to the legatees. But this bill is filed, as I have stated, nearly thirty years after the death of the testatrix, and that being so, it cannot be supported unless it is a case of trust.
Job v Job
(1877) 6 Ch.D. 562
JESSEL M.R.: What is the rule in equity? I agree that in Crosse v. Smith ( (1806) 7 East 246) it was laid down that an executor is liable at law for the loss of his testator’s assets when they have once come into his hands; but if that is in conflict with the law of a Court of Equity, equity must now prevail. The real question then is, what is the rule in equity? Tow I refer to /ones v. Lewis ( (1750) 2 Ves. Sen. 240), where a common decree was made against an adminis tratrix for an account. Part of the assets had been delivered by her to her solicitor, who was robbed, and it was held that she was not to be charged. Lord Hardwicke said, ” If a trustee is robbed, that robbery properly proved shall be a discharge, provided he keeps them (the goods) so as he would keep his own. So it is as to an executor or administrator, who is not to be chargeable further than goods come to his hands; and for these not to be charged, unless guilty of a devastavit; and if robbed, and he could not avoid it, he is not to be charged, at least in this Court.” That is an old case. and, as far as I know, it has been always followed.
I will now take a modern authority. In Williams on Executors the law is thus stated: “Again, upon the supposition that goods come fully into the possession and hands of an executor or administrator, but are afterwards wrong fully taken from him, a question arises whether such goods shall be considered assets in his hands. There are some authorities for asserting that things taken out of the possession of the executor are assets in his hands, unless they were taken by the Queen’s enemies. But it should seem, at least in a Court of Equity, that an executor or administrator stands in the condition of a gratuitous bailee; with respect to whom the law is that he is not to be charged, without some default in him. Therefore, if any goods of the testator are stolen from the possession of the executor, or from the possession of a third person, to whose custody they have been delivered by the executor, the latter shall not, in equity, be charged with these as assets.” Then, at p. 1807, the learned author refers to the passage I have read, and quotes a passage from Lord Ellenborough’s judg ment in C,·osse v. Smith, shewing the rule at law to be that an executor was liable for the loss of assets once come into his hands. The rule there laid down is, however, as I have already intimated, not the rule now, even at law, for the Judicature Act, 1873, provides by sect. 25, sub-sect. 11, that where “there is any conflict or variance between the rules of equity and the rules of the common law with reference to the same matter, the rules of equity shall prevail.” The rule, then, at law as well as in equity, now is that an executor or administrator is in the position of a gratuitous bailee, who cannot be charged with the loss of his testator’s assets without wilful default; and a further rule is that though he is liable in equity in case of wilful default, he cannot be charged with it unless an account is ordered against him on that footing: you cannot charge him with wilful default without making out a case; and therefore, under the old practice, unless wilful default was charged in the bill, you could not so charge him in the accounts. I think, however, that under the new practice an order charging him with wilful default may be made at any time on a proper case being made.
The present case stands simply thus: On the death of the testator, who was a watchmaker, his executor delivered part of his stock-in-trade, to the value of £160, to his son James Job, who was also a watchmaker and jeweller, for the purpose of being sold in the ordinary course of trade. James Job became bank rupt, and his trustee then took possession of all his stock-in-trade, including the goods of the testator, and sold the whole, as being within the order and dis position of the bankrupt.
Now, if that was right on the part of the trustee, it could only be so through James Job having mixed up the testator’s goods with his own stock-in-trade; and I must take it that he did mix them up with his own stock-in-trade, and there fore that the trustee was entitled to sell. On that presumption the executor was not liable for allowing the trustee to sell; and if, on the other hand, the trustee was wrong, you cannot charge the executor for not suing the trustee. Taking it either way, the executor is not, in my opinion, liable for wilful default.
Angullia v Estate and Trust Agencies
AHMED ANGULLIA BIN HADJEE MOHAMED SALLER ANGULLIA v.
ESTATE AND TRUST AGENCIES (1927) LTD.
Privy Council [1938] A.C. 624
LORD ROMER read the judgment of the court: . . . In support of his claim to be allowed the whole of the two sums in question, the appellant relied upon the decision of Lord Romilly M.R. in Cooper v. farman ( (1866) L.R. 3 Eq. 98). That case, in some respects, bears so close a resemblance to the present one that it must be examined in some detail. The facts were these. An intestate had entered into a contract with some builders for the erection of a house on some
freehold land belonging to him. At the time of his death the house was in course of erection, but had not been finished. Letters of administration were i_n due course granted to two of his children, one of whom happened to be his
heir-at-law. The house having been completed by the builder after the intestate’s death the heir-at-law, as one of the intestate’s legal personal representatives, paid to th builder out of the intestate’s personal estate the cost of such completion. According to the headnote of_ the report, it was held that the heir-at-law was entitled to have the house fimshed at the expense of the personal estate of the intestate. In point of fact Lord Romilly held nothing of the sort.. It had, indeed, been laid down in Holt v. Holt ( (1694) 2 Vern. 322) that the heir-at-law had such a right in the like circumstances, though on what grounds the decision in that case was founded is not at all apparent. It is true, too, that Holt v. Holt was cited in the arguments on behalf of the heir-at-law in Cooper v. Jarman. But the question in the last-mentioned case was whether the heir-at-law in his capacity of legal representative of the intestate ought to be allowed, in taking the account of the personal estate come to his hands, the cost of completing the house. The decision was in favour of the heir-at-law, but it was not in any way based upon any rights he possessed as heir-at-law. The case of Holt v. Holt is not even mentioned in Lord Romilly’s judgment. His judgment was based solely upon the rights and duties of a legal personal representative in such circumstances, and would have been precisely the same if the heir-at-law had not himself been one of the administrators of the intestate. It had been argued that the duty of the administrator was to commit a breach of the contract entered into by the intestate, inasmuch as it was one of which equity would not have decreed specific per formance, and to pay the builder the damages occasioned by that breach. Lord,, Romilly would have none of this: “it cannot be good law,” he said, “that a administrator is bound to do an injury and inflict damages upon a person with whom the intestate had entered into a contract, and to prevent that person from completing his contract because, by so doing, he would increase the personal estate of the intestate.”
He then rejected the contention that the duty of a legal personal representa tive in this connection depends in any way upon the question whether the con tract is, or is not, one of which specific performance can be enforced, and proceeded as follows: ” it cannot, in my opinion, be law, that the next of kin should be entitled to call upon the heir-at-law to resist Messrs. Lawrence,” [ the builders in question] ” and hinder them from coming on the land, and prevent them from completing the contract because, in the opinion of the next of kin, the damage sustained by the contractor would possibly be less than the amount to be paid for the fulfilment of the contract.”
He then pointed out that in any case the administrator, if he paid the con tractor damages without suit, might be charged by the next of kin with having paid more than a jury would have awarded, and that if he went to law the amount of damages found by the jury, together with the costs of the suit, might exceed the cost of completing the contract, and he concluded as follows : ” The administrator has, in my opinion, a clear duty to perform. The moral duty is distinct. It is to perform the contract entered into by his intestate. The legal duty, in this instance, as I believe it is in all cases where it is fully understood and examined, is identical with the moral duty.”
All of which appears to their Lordships to be both good law and good sense. Prima facie it is the duty of a legal personal representative to perform all con tracts of his testator or intestate, as the case may be, that can be enforced against him, whether by way of specific performance or otherwise. If the contract be one that cannot be enforced against him for any reason, such as the Statute of Frauds, and is one that it would be disadvantageous to the estate to perform, it is a different matter (see In re Rownson. Field v. White ( (1885) 29 Ch.D. 358); though it seems to be settled that he is not bound to plead the Statute of Limitations, and may pay a statute barred debt unless it has been judicially declared to be so (see Midgley v. Midgley [1893] 3 Ch. 282). Nor, in the case of an enforceable onerous contract, ought he to neglect any opportunity that may present itself of coming to terms with the other contracting party that may
benefit the estate. But the breaking of an enforceable contract is an unlawful act, and, in their Lordships’ judgment, it can never be the duty of an executor or an administrator to commit such an act. It is this principle that lies at the root of the decision in Cooper v. Jarman. Burton A.C.J., however, thought that Cooper v. farman was distinguishable from the present case, in that Kader Ebrahim was not the heir-at-law of the intestate. He was, said the learned Chief Justice, a stranger to the intestate’s estate, and unlike the heir-at-law in Cooper v. farman had no claim to have the contract carried out. In saying this he seems to have been misled by the head note in that case, and failed to notice that the decision in no way turned upon any righ_ts. the heir-at-law might possess, but solely upon the_ rights and duties of the adm1mstrator. He also thought that he was warranted m refusing to follow Cooper v. farman by the decision of North J. in In re Day. Sprake v. Day ([1898] 2 Ch. 510). It cannot be denied that this latter decision fully justified the statement of the Acting Chief Justice that Kader Ebrahim had no claim to have the intestate’s contract with the builder carried out. But it is no authority for the proposition that the cost of completing it was not proper to be allowed to the appellant in taking his account. The facts of that case were substantially as follows. A testator by his will had devised certain land to his wife for life. Shortly before his death he had entered into a contract with some builders for the erection of some cottages on the land. He had also entered into a contract with the same builders for the erection of a house on some land that belonged not to him, but to his wife in her own right. At the time of his death neither of these contracts had been completed, and after his death his executors prevented the builders from finishing the work. The wife thereupon claimed to be entitled to have the two contracts completed at the cost of the testator’s personal estate. North J. acceded to the wife’s claim in respect of the first contract, but rejected it in respect of the second. He thought that Cooper v. farman was an authority in her favour so far as the land devised to her was concerned, treating a devisee as being in the same position as an heir-at-law. If no distinction is to be drawn between a devisee and an heir-at-law for this purpose Holt v. Holt was no doubt an authority in favour of the learned judge’s decision. But, with all respect to him, and for the reasons already given, Cooper v. farman was not. As to the second contract, he held that the wife, being a stranger to the testator’s estate, had no right to have it carried out at the expense of his personal estate. Whether Sprake v. Day was rightly decided or not is a question upon which it is unneces sary for their Lordships to express any opinion. It is sufficient to say that it has no bearing upon the present case….In their Lordships’ judgment, it was the duty of the appellant as the apparent
legal personal representative of the intestate to honour the intestate’s obligations under the contract in question unless an opportunity presented itself of coming to·some arrangement with the builder that would be of advantage to the estate that he was administering. There is no evidence that any such opportunity did in fact present itself, and the onus of proving the existence of such an oppor tunity lay, in their Lordships’ opinion, upon the respondents….
Re Owers
[1941] Ch. 389
SIMONDS J.: . . . The material fact was that, at the date of his death, the testator was possessed of a large number of leasehold properties. There is no question but that his executors entered into possession of them and became, by virtue of the privity of estate thereby created, personally liable on the covenants contained in the leases. It is true that there are some limitations upon this personal liability of an executor, notably he may not be liable for the full rent reserved by the lease, but only for the letting value of the premises therein com prised, but he is under a personal liability and to protect him from that personal liability the court will decree that a sufficient sum be retainec for his protection. Where he is under no personal liability, but is only under a liability as executor, the court will not decree that a fund is to be set aside for his protection. That is clear from the cases which have been cited, the last of which, I think, was In re Nixon. Gray v. Bell ([1904] 1 Ch. 638), which I had occasion to review myself in the recent case of In re Lewis. fennings v. Hemsley ([1939] Ch. 232). But this is a case where, apart from s. 26 of the Trustee Act, 1925, it would be proper to order that a fund should be set aside for the protection of the executors.
It is said, however, that the section is a sufficient safeguard and that no fund need be set aside. I cannot take that view. The section is as follows. [His Lordship read the section and continued: ] It is clear to me that the section deals only with the liability of the executor as such and it is not intended to cover the cases where the executor has entered into possession of the testator’s leaseholds and thereby incurred, in addition to his liability as executor, the personal liability of an assignee of the term. The section which I am now considering adopts, with certain modifications, the provisions of ss. 27 and 28 of the Law of Property (Amendment) Act, 1859 (Lord St. Leonard’s Act), in regard to which it had never been suggested that it covered the personal liability of the executor who had entered into possession of his testator’s leaseholds. That view is taken and, in my opinion, correctly taken by the text books, Wolstenholme and Cherry’s Conveyancing Statutes, 12th ed., p. 1307, and Carson’s Real Property Statutes, 3rd ed., p. 1046. Accordingly, since the section does not protect the executors, it is necessary to follow the old practice of the court and to decree that a sufficient indemnity be set aside for their protection.
I have not got the materials to determine what the amount of that protection should be, and it must be referred back to chambers to ascertain what is a sufficient sum to set aside.
Cherry v Boultbee
Court of Chancery (1839) 4 My. & Cr. 442
LORD COTTENHAM: … It must be observed that the term ” set-off” is very inaccurately used in cases of this kind. In its proper use, it is applicable only
to mutual demands, debts and credits. The right of an executor of a creditor to retain a sufficient part of a legacy given by the creditor to the debtor, to pay a debt due from him to the creditor’s estate, is rather a right to pay out of the fund in hand, than a right of set-off. Such right of payment, therefore, can only arise where there is a right to receive the debt and to be paid; and the legacy or fund, so to be applied in payment of the debt, must be payable by the person entitled to receive the debt.
In the present case, however, the bankruptcy of the debtor having taken place in the lifetime of the testatrix, her executors never were entitled to receive from the assignee more than the dividends upon the debt; and although the bankrupt had not gained his certificate, and the liability incident to that state remained upon him, yet he, for the same reason, was never entitled to receive the legacy; and, consequently, there never was a time at which the same person was entitled to receive the legacy and liable to pay the entire debt; the right, therefore, of retaining a sufficient sum out of the legacy to pay the debt can never have been vested in anyone. The assignees who claim the legacy would, indeed, have been liable to the payment of any dividend upon the debt, had it been proved; and the Master of the Rolls proposed to the executors to make provision for deducting the amount of such dividend from the amount of the legacy….
Re Akerman
[1891] 3 Ch. 212
KEKEWICH J.: … Henry, William, and James, all take as specific devisees or legatees under the will, and it has been suggested rather than argued, that they cannot take the properties specifically given to them without first making good what they owe (if they owe anything) to the testator’s estate. A specific devise or bequest is a thing taken apart, and given directly to the devisee or legatee. It is extracted from the testator’s estate before the residue is ascertained, and under no circumstances, so long as the specific gift takes effect, can the property so given form part of the residue.
On the other hand, a debt due to the estate of a testator is part of the residue. It has to be paid in whole or in part, in whole, if it can be recovered, in order that the residue may be constituted, and there is therefore a clear distinction between a specific legacy and a residuary legacy so far as concerns a debt due from the legatee to the estate. No case has been cited to shew, and it seems to me to be contrary to principle to hold, that there can be a right of retainer in respect of a debt owing from a specific legatee to the estate of the testator.
As regards the residuary personal estate, apart from the argument that there is no debt at all owing to the estate, there has not been any substantial contention that the debtors must not make good their debts before they can take any part of that residue. If the case falls within the ordinary rule that a debtor cannot claim a distributive share of the residue without making good what he owes to that residue, then it is not argued that this case can for any reason be treated otherwise than as that rule indicates. But the difficulty is this. The residuary gift is not confined to residuary personal estate, but comprises real estate also. There is a general residuary gift-a devise and bequest of the real and personal estate of the testator to trustees, who happen in this case to be also executors, upon trust to sell and out of the proceeds of sale, after paying debts and funeral and testamentary expenses and pecuniary legacies, to divide the residue among the testator’s children in the shares and manner indicated. In other words it is a strictly proper residue. It is what remains of the testator’s property after satisfying the specific gifts, and that strictly proper residue is to be dealt with as the residue should be dealt with, that is, in paying debts and funeral and testamentary expenses and legacies, and then what remains as the ultimate residue, the subject of the testator’s bounty, is divided in that character.
The argument is, that though as regards the executors and as regards the personal estate, what is due from the sons must be brought into account so as to constitute a complete residue, yet as regards the proceeds of sale of the real estate that principle does not apply, and there is this foundation at least for the argument that no case has been produced in which the general rule has been held applicable to such a state of things. The reason why that is so, may perhaps be that which is hinted at rather than mentioned by Vice-Chancellor Bacon in the case of In re Cordwell’s Estate ( (1875) L.R. 20 Eq. 644), in which he said that he was not surprised at there being no case cited on the point. There an attempt was made to distinguish between the right of an administrator and that of an executor, and the Vice-Chancellor decided the case on the general principle. I think I must decide this case on the general principle. The Lord Chancellor, Lord Cottenham, in the case of Cherry v. Boultbee ( (1839) 4 My. & Cr. 442; supra, p. 340), took occasion to remark that the expression ” set-off” is very inaccurately used in cases of this kind, and he might have added, no doubt, that inaccuracy implies confusion. I will venture to add to that remark that the term “retainer” also is inaccurately used in cases of this kind. I have heard more of ” retainer ” in this case than I have heard of “set-off,” but neither the one term nor the other can really be used with propriety, and either, I think, equally introduces confusion.
The principle is to be found laid down in Cherry v. Boultbee in the passage to which I have just referred, and also in Courtenay v. Williams ( (1844) 3 Hare 539; (1846) 15 L.J.Ch. 208), and no doubt, if search were made, it would be found to have been laid down in many other cases. It is this. A person who owes an estate money, that is to say, who is bound to increase the general mass of the estate by a contribution of his own, cannot claim an aliquot share given to him out of that mass without first making the contribution which completes it. Nothing is in truth retained by the representative of the estate; nothing is in strict language set off; but the contributor is paid by holding in his own hand a part of the mass, which, if the mass were completed, he would receive back. That is expanding what the Lord Chancellor calls in Cherry v. Boultbee ” a right to pay out of the fund in hand,” rather than a set-off, and is in conformity with what the Lord Chancellor, Lord Lyndhurst, in Courtenay
v. Williams, says, “The defendant’s, the legatee’s demand (the Court says) is in respect of the testator’s assets, without which the executor is not liable; and it is very just and equitable for the executor to say, that the defendant, the legatee, has so much of the assets already in his own hands, and consequently is satisfied pro tanto.” Why should not that be applied to a case like this where the property is put together, and the whole is given to the same persons upon the same trusts, both for payment of_ d:bts nd other deductions a d for division among the same persons? The pnnc1ple 1s the same. The contributor to the mass is in precisely the same position whether the mass is held by trustees or by an executor, and it would, to my mind, be introducing mere technicality into the principle, and preventing its proper and reasonable applica tion to say that because there is no legal personal representative of the testator, because the representative is a trustee and not an executor, therefore the contributor is to get off, and have his aliquot share of the mass minus his contribution to it, instead of having his aliquot share of the mass including his contribution.
Mr. Warmington says that he takes only real estate, and that he does not claim any personal estate, and therefore the rule in Courtenay v. Williams does not apply. I am not deciding a case where there is a mere gift of real estate, whether it be a gift directly to the legatee or devisee, or through the intervention of a trustee, or by way of trust for sale. But here I am dealing with a case
such as I have mentioned-with a general fund made up of proceeds of sale of real estate, and proceeds of conversion of personal estate, and there seems to me to be a principle of general application, and no reason occurs to me, none has been suggested, why I should not apply that principle. Therefore, I think that if there is a debt payable by a residuary legatee under such circumstances as exist here, that debt must, for the purposes of computation, be included in the residue, and-again for the purposes of computation-treated as part of the share going to the legatee debtor.
Then I am asked to hold that here these three sons do not owe money to the estate…. Ithink ;n the whole it will be better for me not to comment on the evidence put in on behalf of the beneficiaries. All I hold is, that on the present evidence there are not sufficient materials before me to justify me in arriving at a con clusion. I think the matter must be inquired into, and all I decide at present is that on the evidence before me William, James, and Henry Akerman have not satisfied me that they did not, at the testator’s death, owe him the sums mentioned in these respective documents signed by them; and I should further hold that if they do owe those sums, those sums with interest from the testator’s death and not before, must be deducted from their aliquot shares. There will be a declaration that the Plaintiff and the two other sons ought to bring into account as against their respective shares of the testator’s residuary real and personal estate any sums due by them respectively to the testator at the date of his death with interest at 4 per cent. from that date.
Jervis v Wlolferstan
JERVIS v. WOLFERSTAN
Court of Chancery (1874) L.R. 18
JESSEL M.R.: This case is one which is by no means common, and which, I hope, will not become common. It is a case where the executors of a will now claim as creditors against the estate which they have themselves distributed; and it is so peculiar that it is necessary to state it shortly.
By a deed of settlement of the 21st of August, 1866, Mr. Swynfen Jervis, who was the owner of 625 fully paid-up shares in the Albert Insurance Company (then a going concern, and supposed to be not only solvent but wealthy), made a settlement of the shares, which were then supposed to be of great value, on his wife …
The executors of Mr. Swynfen Jervis, of whom the Plaintiff is one, advertised for creditors in the usual way. They found that they had paid all their debts, that they had got rid of all their liabilities except this, that there was a possible liability on the Albert shares, because, though it was a going concern and believed to be solvent, it might fail; this failure might take place before the remaindermen had become entitled in possession; they would thus have an opportunity of disclaiming and this would throw back the shares, as regards beneficial interest or liability, on the testator’s estate; and in that way there was a possible liability of the testator’s estate to the trustees of that settlement-a remote, contingent, unexpected liability; and it is not contended that the Plaintiff was not aware that there was such a possibility. There being no debt unpaid, and no present liability, the executors divided the residue, which then amounted to £2649 12s. 6d., in shares; they paid one share of £883 4s. 2d. to the trustees of Mrs. Broughton’s settlement, and another share of equal amount to the trustees of Mrs. Brackenbury’s settlement. Unfortunately, the payments having been made, the Insurance Company failed and was wound up, and eventually the costs of the liquidation turned out to be exceedingly heavy, and very large calls, amounting to £6875, were made upon these trustees and executors. Of course, as trustees of the settlement and holders of the shares, they were legally liable to pay this large sum of money.
The cestuis que trust under the settlement, with the exception of the widow (who had received some dividends, and was unable to disclaim), naturally disclaimed, and the result, therefore, was, that under our law there was a resulting trust for the testator’s estate. Mrs. Jervis has paid, or is willing to pay, a sufficient contribution; but the result is that the testator’s estate is liable for several thousands of pounds, and liable to indemnify these trustees. I take it to be a general rule that where persons accept a trust at the request of another, and that other is a cestui que trust, he is personally liable to indemnify the trustees for any loss accruing in the due execution of the trust; and under that doctrine I shall hold that the estate of the testator became liable to indemnify the trustees against the payment of this large sum of money….
Thneext question is, Are they liable to refund at all? I take it that no proposition is better settled than that residuary legatees are liable to refund at the suit of an unpaid creditor, and I have already held that the Plaintiff and his co-trustee are unpaid creditors.
The only proposition that remains to be examined is this: It is said that, in addition to being creditors, the Plaintiff and his co-trustee were also the executors of the debtor, and that, though creditors can obtain an order to refund against residuary legatees, executors cannot, if the executors have paid over the assets with notice of the debt. Now that is undoubtedly good law, but it does not by any means follow that the creditor, as such, has lost his right to recover, because he could not recover in another character, assuming always that he could not recover in that character. It may be quite true that if the suit was brought in the character of executor only, it would be barred; for that reason I will examine in a moment whether it is so barred; but still I do not think that it is at all conclusive, on the question as to the creditor’s right to recover, to say that he has done something which would debar him in another character from recovering, he not suing in that other character.
But, is it true that the executor would be barred in a case like this? I
cannot find any authority. I have looked through many cases, and I have asked for the assistance of the Bar, and I cannot find the rule stated in wider terms than these, that he cannot recover from a legatee a payment made with notice of a debt. Now he certainly had not notice of a debt, for the debt did not exist. The utmost notice that he had was notice of a possible liability-a remote, unlikely liability, but a possible one; and the question therefore remains, whether the notice of a possible remote contingent liability of this kind prevents the executor recovering back the assets, if he had paid them away, when that which was formerly this possible remote liability becomes a debt? I am not willing to stretch the rule beyond what its terms require, because it appears to me that great inconvenience would arise from so straining or stretching the rule. If it were true that an executor was disabled from recovering merely because he had notice of such a possible liability, the result would be to throw the great bulk of the estates of testators who had any property into this Court-a result certainly not desirable, because it would then be sufficient for an executor to allege as an excuse for not paying any of the legatees, that at some remote period his testator had been a lessee of property, though the property might be of the greatest possible value, though it had been assigned many years before, and there was a good covenant of indemnity by a solvent purchaser. That is a very common case, indeed. But not only would it be a sufficient ground for refusing to pay a legatee, it would be a sufficient ground for refusing to pay anybody anything. The mere fact that the executor had heard (for that is notice) that the testator had formerly been a lessee, would give him any delay he might wish, because he might say that he was prosecuting inquiries as to whether the testator had ever been a lessee of any leasehold property whatever of which he was formerly possessed.
This shews the extreme inconvenience of notice of such a kind of remote contingent liability being held sufficient to make the executor guilty of negligence (for that is what it must come to) in distributing the assets-guilty of wilful negligence, such as to deprive him of any remedy if he were after wards made personally liable at the suit of the person entitled to enforce that liability. I think the mere statement of such a result shews how dangerous it would be to extend the doctrine to that length, and I am not prepared so to extend it; on the contrary, I would rather encourage executors to distribute the assets as soon as possible, instead of making them liable to such a responsibility if they did not take such superfluous and unusual precautions. I think, therefore, that it would not have been sufficient to prevent the Plaintiff, even as executor, from recovering this amount if he had been compelled by a third person to pay it. That being so, I am of opinion that the Plaintiff is entitled to recover.
There now remains the question, What is he entitled to recover? I take it that he is entitled to recover what he has paid. It was put to me that that would involve some hardship; but, on the other hand, everybody taking a residue must know that he takes it subject to the testator’s liabilities, and takes the risk of its afterwards turning out that there are undiscovered liabilities. That has always been the law, and I think there is no unusual hardship in that. On the other hand, it has been thought to be a hardship that a man may not spend the income of what he has been paid, and the doctrine is now established, that if an executor recovers back assets he cannot recover any of the income, but he must take only the capital. Following that doctrine, I shall direct the trustees of Mrs. Brackenbury’s settlement to pay £883 4s. 2d. into Court, and the trustees of Mrs. Broughton’s settlement to pay the like sum into Court by a day to be fixed for that purpose. . . .
Re Diplock
[1948] Ch. 465; [1948] 2 All E.R. 318; [1948] L.J.R. 1670; 92 S.J. 484;
the Court of Appeal reversed the decision of Wynn-Parry J.
. . Now upon the question whether the mistake here made was one of fact or of law we think the learned judge was clearly right in deciding that it was the latter and we cannot usefully add anything to what fell from him upon that point. Equally we agree with him that as regards common law claims for money had and received the action will not lie where the mey has been paid under a mistake of law. It may, we think, be taken to be clearly established that the common law _clai;111 is founded upon an implied promise to pay and that-whether by an apphcat1on of the principle “ignorantia juris non excusat” or on other grounds no such promise will be implied where the payment was made under mistake of the general law. It is no doubt true that for certain purposes (for example the purposes of the application of the Statutes of Limitation) the direct eq1!-it_able claim by the unpaid beneficiary against the wrongly or overpaid rec1p1ent of part of the testator’s estate-for it is conceded that in certain circumstances such direct claims will lie-has hitherto been regarded as analogous to the common law claim for money had and received. Both are, after all, money claims. But the common law claim, as may now be taken to be established, is in no sense derived from equity, but has a lineage altogether independent of it. And as the appellants forcibly pressed upon us in argument, in other respects there are marked and important differences between the claim here put forward on the part of the appellants and a claim at common law for money had and received. In the latter the proper claimant is normally the person who originally made the payment or is that person’s principal or representative: and the claim is made against him who received the money or his representative. It is indeed difficult to see how, save between the parties to the original transaction or between parties linked by a relationship such as that of principal and agent, any implied promise to repay could be imported. In the present case the payments were originally made by the executors and it is in our judgment impossible to say that in making the payments the executors were acting as agents or in any way on behalf of the next-of-kin, of whose rights and existence the executors were entirely ignorant. Plainly, nothing that the next of kin have done can be said to have involved any ratification or acceptance on their part of the executors’ acts. Further whatever may have been the nature of the mistakes made by the executors, the next-of-kin have never made any mistake at all whether of law or of fact.
For these reasons it seems to us that in approaching the question of the existence and characteristics of the direct equitable cause of action there is not, unless the authorities otherwise establish, any necessity in logic for regarding the claim as being clothed, as it were, with all the attributes or limitations appropriate to the common law action for money had and received. Nor, on similar grounds, does it appear that there is any conflict involved between law and equity. Equity here, as in other places, comes in, as Maitland has observed, “not to destroy the common law but to fulfil it.” Since (for so runs the appellants’ argument) the common law can only recognize the two parties to the transaction, payer and payee, or at most third parties asserting the rights of one or other of them, the common law does not, to borrow again from the language of Maitland “comprehend the whole truth.” For the payers in the present case (namely the executors) were handling not their own money but the_money of others who had a proprietary interest unknown to and unrecognized by the executors and who, from the moment when they became aware of their own rights and the transactions of the executors, immediately challenged and repudiated what the executors had done.
Nevertheless, if the claim in equity exists it must be shown to have an ancestry founded in history and in the practice and precedents of the courts administering equity jurisdiction. It is not sufficient that because we may think that the “justice” of the present case requires it, we should invent such a jurisdiction for the first time….
Th earliest cases cited to us in which there is found any reference to the right of an unpaid creditor or legatee to go direct against a legatee already paid were three cases all reported in the first volume of Cases in Chancery; they are Nelthrop v. Hill ( (1669) 1 Ch.Cas. 135) before Lord Keeper Bridgman,
Windham J. and Turner B., Grove v. Banson ( (1669) 1 Ch.Cas. 148) in the same year before Lord Keeper Bridgman and Wyld J., and Chamberlain v.
Chamberlain ( (1675) 1 Ch.Cas. 256) before Lord Keeper Finch. It is not necessary to refer further to these three cases. All were cited to Nottingham L.C.
in the case of Noel v. Robinson ( (1682) 1 Vern. 90). This case may be regarded as having laid the foundation for the later exercise of the equity jurisdiction for which the historical justification was the rivalry in regard to the administration of the estate of deceased persons between the courts of Chancery and the spiritual courts. According to Sir William Holdsworth (vol. VI. of the History of English Law at p. 652), the Chancery court ” had practically taken over the jurisdiction of the ecclesiastical courts over suits for fegacies and suits for the distribution of residue. In theory it is true the jurisdiction of the ecclesiastical courts over these matters lasted till 1857; but it was generally ignored by the court of Chancery, on the grounds … that the ecclesiastical courts could not do complete justice in these cases-they could not give any indemnity to an executor paying a legacy under an order of the court, they could not order the legatees to refund if other debts subsequently appeared … “:and he cites Noel v. Robinson in support. In the ecclesiastical court it was t e practice that ” . . . to guard himself against latent debts the executor 1s entitled to demand security of the legatee before paying his legacy to refund in case the amount is required in discharge of ” debts. (See Coote: Ecclesiastical Court Practice (1847), p. 641.) But at least from the time of Noel v. Robinson it appears that the court of Chancery resorted to no such practice: and the reason, we think, was that, in the case supposed, the creditor would be treated as entitled to claim a refund direct from the legatee.
Having regard to its importance as a starting point and as showing the reason and justification for the jurisdiction, it is desirable to refer somewhat fully to the case of Noel v. Robinson. The plaintiffs in the case were specific legatees of a moiety of the testator’s American ·plantation. The defendant Robinson was the testator’s executor who after granting a lease of the plantation had later sold it to the second defendant Faulconer. The plaintiffs alleged that Robinson by granting the lease must be taken to have assented to the specific bequest: and their claim against both defendants was for the property and for an account. Robinson by his answer denied that he had assented to the bequest and said that the sale to Faulconer was required to pay the testator’s debts, the deficiency of the estate having arisen since the date of the lease as a result of adverse trading conditions. He further said that even if the lease must be taken as an assent, nevertheless he (Robinson) having in fact paid the testator’s debts could stand in the shoes of the creditors and claim in effect a refund from the legatees.
The Lord Chancellor after referring to the practice of the spiritual court
in regard to the giving of security proceeded ” … but in this court though there be no provision made for refunding, yet the common justice of this court will compel a legatee to refund. It is certain that a creditor shall compel the legatee to refund ‘lnd so shall one legatee compel the other where the assets become deficient. But whether the exerntor himself, after he has once voluntarily assented unto a legacy, shall compel the legatee to refund is causa prim;e impressionis: and it must be allowed that there is a great difference between a voluntary assent and where the executor was compelled to assent … ” According to the report in Vernon the plaintiffs’ bill was dismissed: but as pointed out in the notes in the English Reports the decree was in fact in the plaintiffs’ favour….
– We now come to the impurtant case of David v. Frowd ( (1833) 1 My. & K.
200). It is true, as stated by the learned judge, that there had in that case been an administration by the court of the estate of the deceased, one David Williams, and that the estate had been distributed pursuant to an order of the court amongst the persons who had been found by certificate of the master to be entitled as the next-of-kin. But there is nothing in the judgment of Sir John Leach ,vhich gives any support to the view that these were material circumstances to the plaintiff’s right of action. Nor is there anything in the judgment to indicate that the learned Master of the Rolls regarded jt as relevant that the assumed error made-though made not by the personal representatives making the payment but by the master in his certificate-was one of fact, namely, as regards the identity of the next-of-kin.
But the main significance of the case for present purposes lies in this: that the claim of the plaintiff was that she was the sole next-of-kin and in that capacity entitled to recover back from those who had received the estate the whole of what they had been paid-and, on the basis of the validity of the plaintiff’s claim, wrongly paid. It should be stated that the intestate’s personal representatives were included among the defendants in the action but it is plain on an examination of the pleadings (which we obtained from the Public Record Office) that they were joined as recipients of part of the estate in their capacity as supposed members of the class of next-of-kin. Indeed, having regard to the administration decree and the orders made thereunder the personal representatives as such were obviously immune from attack.
For the purposes of the hearing before Sir John Leach it was agreed at the Bar that the title of the plaintiff as sole next-of-kin should be admitted. On that footing the question for the court was whether she was precluded by the administration decree from making her claim. That question the Master of the Rolls answered in the negative. By his order he referred it to the master to inquire whether the plaintiff was sole next-of-kin or one of the next-of-kin: and he added a declaration ” that if the plaintiff be established as the sole next-of-kin of the intestate, the defendants are bound to refund to the plaintiff the several sums which they have received under the order of the court” in the administration action.
Having regard to the importance of the case we caused the records to be searched with a view to discovering what was the exact order made and what was the outcome of the order. No trace of the formal order could be discovered and (whether the matter was afterwards settled or for other reasons) no record was found of any later order or proceeding.
However that may be, David v. Frowd was, on the proved or assumed facts of the case and having regard to the declaration made, a case in which the defendants were held liable to refund not merely so as to let in some person found to be entitled to participate with them in the distribution, but to the full extent of what they had received and on the basis, accordingly, that they had in truth from the start been total strangers to the estate, without any title to what had been paid to them….
What then is the conclusion to be drawn on this part of the appellants’ claim from what we fear has been a long citation of the authorities? It is not, we think, necessary or desirable that we should attempt any exhaustive formulation of the nature of the equity invoked which will be applicable to every class of case. But it seems to us, first, to be established and that the equity may be available equally to an unpaid or underpaid creditor, legatee, or next-of-kin. Second, it seems to us that a claim by a next-of-kin will not be liable to be defeated merely (a) in the absence of administration by the court: or (b) because the mistake under which the original payment was made was one of law rather than fact; or (c) because the original recipient, as things tum out, had no title at all and was a stranger to the estate; though the effect altogether rather than to produce equality between him and the claimant of the refund in the last case will be to dispossess the original recipient and other persons having a like title to that of the recipient. In our judgment there is no authority either in logic or in the decided cases for such limitations to the equitable right of action. In our judgment also there_ 1s no justification for such limitations to be found in the circumstances which gave rise to the equity. And as regards the conscience of the defendant upon which in this as in other jurisdictions equity is said to act, it is prima facie at least a sufficient circumstance that the defendant, as events have proved, has received some share of the estate to which he was not entitled. “A party” said Sir John Leach in David v. Frowd “claiming under such circumstances has no great reason to complain that he is called upon to replace what he has received against his right.”
On the other hand, to such a claim by an unpaid beneficiary, t ere is, in our judgment, at least in circumstances such as the present, one important qualification. Since the original wrong payment was attributable to the blunder of the personal representatives, the right of the unpaid beneficiary is in the first instance against the wrongdoing executor or administrator: and the beneficiary’s direct claim in equity against those overpaid or wrongly paid should be limited to the amount which he cannot recover from the party responsible. In some cases the amount will be the whole amount of the payment wrongly made, e.g., where the executor or administrator is shown to be wholly without assets or is protected from attack by having acted under an order of the court….
We have not been informed of the exact sum recovered under the compromise. But it follows in our judgment that the sum recovered ought to be credited rateably to all the one hundred and thirty-nine charities so that the maximum amount which in equity can be recovered by the next-of-kin from any respondent is thus limited to the same proportion of the sum paid to that respondent as the balance of the total sum paid away by the executors to the one hundred and thirty-nine charities less the total amount recovered from the executors and their estates bears to the total sum paid away. For example, if the amount so recovered is one-fourth of the total sum paid away, then the maximum liability of any respondent to refund direct to the next-of-kin would be three-fourths of that which such respondent received.
It is to be noted that the writ in the main action (against St. George’s Hospital and others) was issued in January, 1940—more than four years before the date of the compromise order. It does not, however, follow, jn our judgment, that at the date of the issue of the writ the plaintiffs had no cause of action in equity for recoupment. The point has an important bearing on the further question of the application of the relevant Statutes of Limitation. If our view is right, the beneficiary’s cause of action does not or does not necessarily arise for the first time after exhaustion of any remedy he may have against the personal representative. If it did only so arise for the first time the overpaid recipient might have the possibility of such proceedings hanging over him for a very great length of time and the commencement of the running of the Statutes of Limitation might be similarly postponed. In our judgment the cause of action is for recoupment of such amounts as are in fact irrecoverable from the party primarily responsible-viz., the personal representative-and it will be sufficient in any case at the trial to show that at the date of the writ the whole of the sums wrongly paid away were not recoverable from the personal representative. In the present case the extent of the executors’ contribution has been determined : and there is therefore no difficulty in fixing the amounts which, if they are othen ise liable, the respondents must refund. In cases where the total recoverable from the personal representative has not been finally determined at the date of the trial of the action against the recipient, any order would have to make appropriate provision for the plaintiff duly prosecuting his claim against the personal representative and bringing into account all sums then or thereafter recovered from him….
Wsheould add that, as already indicated, in our judgment the respondents are liable under this head of their claim for the principal claimed only and not for any interest. This last result appears to follow from the case of Gittins v. Steele ( (1818) 1 Swanst. 200) cited in Roper (loc. cit.) at p. 461, where the language of Lord Eldon in the case is cited: ” If a legacy has been erroneously paid to a legatee, who has no farther property in the estate, in recalling that payment, I apprehend that the rule of the court is, not to charge interest; but if the legatee is entitled to another fund making interest in the hands of the court, justice must be done out of his share.” …