Hudson v Gray [1927] HCA 31

Hudson v Gray [1927] HCA 31 - HCA 1927 case summary — Zoe

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Loughborough said (1) of Lord Camden : - "I do not dispute his principles. They are very just, where they apply." He had then to consider the facts of the case before him. In that case he found, as Asthury J. found in Oldham's Case (2), that the only circumstances adduced - which did not include affirmative evidence such as exists here - were insufficient to lead him to conclude that the parties had entered into anything more than an arrangement resting on honourable adherence, which other circumstances, such as marriage, might make it proper to depart from. But the Lord "Chancellor made it perfectly plain that, if he had found a binding obligation to have been intended to make the testamentary

dispositions, he would have enforced the claim (3). And where "there is such an intended obligation, which is indeed essential to every contract, the nature of the transaction, in the absence of expression to the contrary, may lead to the implication that the
will, or codicil will, will not be, in fact, revoked. As to this, two
passages deserve quotation. One is from Hargrave, as quoted in Inve Heys (4). It is: - " Suppose he makes his will, and covenants not to revoke it. These cases are common; and there is no difference between promising to make a will in such a form and making his will with a promise not to revoke it." The other passage is from Sir John Mitford's argument in Lord Walpole v. Lord Orford (5). He
first says : - "' It may be objected, that this is a contract in its nature revocable. It is not revocable at all times, but only during the joint lives with notice; and after the death of either it becomes irrevocable." Then says learned counsel: " Lord Camden observes upon that, that when an instrument of this nature is executed, and there is any engagement not to revoke it, a covenant for instance, there can be no doubt, the assets would be responsible ; and where it is an engagement of a different description, if from the nature of the transaction an agreement not to revoke must of necessity be implied, it is precisely the same thing." Opposed to Sir John | Mitford in that case was the Attorney-General, Sir John Scott (as

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the value of the property, and, of course, the other party could the property at the judicial sale for the amount of the judgn e or less, if there were no other bid. O'Grady v. Wilmot (1) m the position permanently clear, and dispels what Lord Buckmaster L.C. termed "the darkness which surrounds the questio Property appointed under a general testamentary power is n any sense the property of the appointor, and does not pass to executor as such. It is not legal assets in his estate. It is equi assets for a limited purpose, namely, the unpreferential satisfacti of debts if the estate of the appointor is insufficient to pay and then it is "considered " as part of his estate for that limited purpose. The history of the subject, as traced by Lord Buckm and Lord Swmner, and less minutely by the other Lords of Ap) indicates the intricacy and the deviations of the doctrine as si up to 1916. The observations of Lord Atkinson (2) and of Parmoor (3) show that even Beyfus v. Lawley (4) left the quest very debatable. But, in view of the law as determined by 0'G v. Wilmot, it is self-evident that Mrs. Hargrave, though bound herself personally, yet, never having exercised her power appointment by deed (or by agreement for a deed, if that have sufficed), did not bind the property at all in her lifetime, further, she did not, by the testamentary appointment make th property assets of hers so as to bring them within the power of a Court of equity to bind them by a decree or order for s ¢ performance, or otherwise than to treat them as if they were th testator's assets in a certain course of administration. In view O'Grady vy. Wilmot I would substitute for the words " not" in In re Parkin; Hill v. Schwarz (5), the word "cannot." is, in my opinion, as much beyond judicial discretion to grant specifi performance in such a case as if the property had been that of some utter stranger. So far, therefore, as concerns the pres equitable ownership of the appointed property, it is not in respondent daughters, but wholly in the appellant.

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company, who says in his affidavit: "* Mrs. Hargrave expr the wish that the children should only be given life interests in t property so that the Perpetual Trustee Co. Ltd. should h management of the property during their lives and thay then | children could be provided for. After considerable diseussi this question, Mr. Hargrave agreed to Mrs. Hargrave's view, so far as I can remember something was said between them to the that if he made a will leaving everything to her for life with ren to the children for life and then to their children would she do th same, and she said that she would." This conversation is said by Mr. Bennett to have taken place in th presence of his superior officer, Mr. Douglass ; but Mr. Dougla his cross-examination, says that he cannot say whether Mr. Benne is correct : "he speaks of things which I cannot remember." M Douglass confines the alleged agreement to the spouses "ini estates." There is not even in the conversation, stated so hesitat by Mr. Bennett, any reference to the exercise of any power to appo and yet it is only the settled property, the property as to which were the two powers to appoint, that is the subject of the dec indispute. The conversation may, on its face, have referred only the separate property of husband and of wife. There has argument put before us as to the effect of the Statute of Fra the enforcement of the alleged agreement ; although the se comprised real estate as well as personal, and although the originat summons contains two questions on the subject. But, even statute be ignored, the alleged agreement has not that cer which is required in equity for the purpose of ordering performance ; it is " too vague too uncertain too obscure to et the Court te act with safety or propriety " (in the words of K Bruce 1..J.), and especially as both parties are dead, and the may involve breach of faith on the part of the deceased lady. apart from the weakness of this evidence, even if it be accep full in the absence of evidence to the contrary, it does not a to an agreement not to revoke. In my opinion, wills being in nature ambulatory, revocable until death, if parties agree 1 to make wills with the same limitations, the agreement mus

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As for the case of Dufour v. Pereira (1), the judgment has been alled by Lord Loughborough L.C. " ingenious and eloquent " (Lord Walpole v. Lord Orford (2)); by Astbury J. "alluring" (In re Oldham (3) ): but the abbreviated report in Dickens hardly enables to appreciate these epithets. It has never been overruled ; ut no instance has been produced to us of a trust being actually established on its authority. We get to know more about the case by the words of Lord Loughborough, who was engaged as counsel in it, and by Hargrave's book. It appears, from Lord Loughborough, t the will prayed specific performance - that is, specific perform- mee of a contract. The word "contract" is actually applied to the transaction by Lord Camden himself, according to the report in Dickens : " It is a contract between the parties, which cannot be 'inded, but by the consent of both." In the case of Lord Walpole vy. Lord Orford, where Lord Loughborough was asked to follow Dufour v. Pereira, he said he must find that the parties meant to impose on one another "a legal and binding obligation " - not a 'mere honourable engagement. With all respect to Harvey J., I do not think that anything short of a contract is enough. At first, I could not understand how there was a contract in Dufour v. Pereira. Under the law of England at the time a husband and wife could not usually contract with each other. The wife became titled under an aunt's will to a legacy (or residue ?) which had 'hot been reduced into possession by the husband. But the 'explanation is to be found in Lord Camden's words : " as the husband by the mutual will assents to his wife's right, and makes it separate "

that is to say, her separate property. Astbury J. also takes this "View of Dufour y. Pereira - that it was " personal property pow to her separate use " (4); and as to this separate property _ there was an agreement. It is "' all based on Lord Camden's finding y fact that a certain and unequivocal trust was agreed to and created by the two parties who executed this mutual will. It is true he came

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chattels'real and chattels personal and declared trusts as follows: first, such trusts as the wife might, during his lifetime with her husband's consent and afterwards in her uncontrolled discretion, appoint by deed or will; second, subject to this power, for the wife for life for her separate use ; third, after her death, subject again to her power of appointment and in default of its exercise, such trusts as the husband should by deed or will appoint; fourth, subject to his power and in default of its exercise, for him for life and after his death for children of the marriage and in default of children to him for an absolute interest. In October 1914 husband and wife vere minded together to arrange their affairs and accordingly 'sought the assistance of the officers of the plaintiff trustee company. 'The children of the marriage were four daughters and there were ome grandchildren. The husband was 'possessed of substantial property outside the settlement but the wife does not appear to ave had any unsettled property. _ The husband, in their joint consultation with the trustee company's fficer, expressed the desire that after the death of himself and his wife their property should be divided equally among their children absolutely. The wife stated her opinion that, if the property were to the children absolutely after their deaths, it would only lead disputes as to the division, because the property was held in various forms of investment, and insisted that the children should only have life interests in the property which should be managed by the trustee company during the children's lives and that erwards the grandchildren should be provided for. They were atsome stage told that if the wife exercised her power of appointment the settled property would be chargeable with probate duty in her ite, whilst in any event upon the husband's death it would be dutiable under secs. 49 and 58 of the New South Wales Stamp a D ies Act 1898. At length they agreed that each would make a vill the effect of which should be that the survivor would take all e settled and unsettled property for life and after the survivor's death the income thereof should be divided among the children or their respective lives. Upon the death of each child its children

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an obligation so to deal with it is placed upon the donee a be enforced in these Courts if the donee becomes entitled. of the cases where the principle has been applied are cases the gift has been made by a will; but the principle operates wh the gift is made by settlement inter vivos, or by will, or where owner of property refrains from making a will and so allows th property to pass to the donee as on an intestacy." Many of the authorities will be found collected in the same case (1). But her the wife took only a life estate in the unsettled property : and wh the real and substantial thing upon which the husband relied w; the continued non-exercise of her superior power of appointm Yet it must not be forgotten that the long established prin formulated by Romer J. rests upon conduct which Courts of equity considered fraud and illustrates the application of the equitabl doctrine of constructive trust as a means of working out the ri resulting from that conduct. The power of appointment which the wife ought not, butiss to have exercised, is an equitable power. It did not enable her appoint or assure any legal interest in the property. The title « the appointees depends upon the exclusive jurisdiction of cha The power, by its very character, is alternative with that of #l husband. During their joint lives she is given a choice of exe her own with his consent or allowing him to exercise his, alth if she survives she has an independent and superior power. extinguishment of her power would necessarily operate to his absolute and no longer defeasible. There can be little doubt therefore, that but for her status as a married woman her equita power would have ceased (see per Sir William James V.C. in Isaa v. Hughes (2); the judgment of Neville J. in In re Sugden's Trusts; Sugden v. Walker (3), and Lord Cozens-Hardy MLR. (4), and Warrington L.J. (5); and see Hodkinson v. Quinn (6), the first ground given by Page Wood V.C.). In discussing the last-mentioned case in his book on Powers (3rd ed., pp. 15, 16) Farwell L.J. said : - * The impli (1) (1920) 1 Ch, 501; (1920) 2 Ch. (3) (1917) 1 Ch, 511, at pp. 516, 518 523. (4) (1917) 2 Ch. 92, at p. 96. .

At a glance

Court

Decision date

Before

Source

Judgment (232 paragraphs)

Cited By (1)