Nicol v Chant [1909] HCA 4

Nicol v Chant [1909] HCA 4 - HCA 1909 case summary — Zoe

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the purchase money. This decision is not consistent with general rule that the question whether property which may be converted from realty to personalty by the exercise of a power vested in another person passes as real or personal estate must be determined by its condition at the time of transmission, as, for instance, in the case of mortgaged property (Wright v. Rose (1) ). In my opinion the ease can only be regarded as a decision that, when a testator gives his real estate to one and his personal estate to another simpliciter, and there is no context, it must be taken that he means to give as personal estate whatever may in the event turn out to be personal estate, so that in such a case if land of his is liable to be converted under an option of purchase which may be exercised after his death, he must be taken to mean that the land is to retain its quality of real estate until the option is exercised, or the time for exercising it has passed, and thereafter is to be real or personal property according to the event. The case was followed (but not approved) by Lord Eldon LC. in 1808 in the case of Townley v. Bedwell (2) which was really a case of in- testacy, the devise of the land in question having been held void(3). Here, again, the question was between real and personal estate simpliciter, with no context of a will to show the intention of the ancestor. But the rule cannot, of course, be extended to cases in which to give effect to it would be to frustrate the declared intention of the testator. Thus in Drant v. Vause (4) Knight- Bruce V.C. held that the decision in Lawes v. Bennett (5) was not applicable toa will by which the testator specitically devised land which was subject to an option to purchase, together with other real estate, to trustees for successive beneticiaries. The learned Vice-Chancellor did not advert to the successive limitations, but said that, as the testator had made specifie mention in his will of the estate which was the subject of the option, the general rule did not apply. In the later case, muss vy. Smith (6), the same learned Judge applied the same test, but under somewhat different circumstances. The testator had by a will made in 1830 specifically devised land called Nash's Own Farm, and

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that very difference would be sufficient to alter the interpretation of that instrument. You have, in fact, no guide whatever ; and the result, especially in some cases of wills, has been remarkable. There is, first, document A., and a Judge formed an opinion as to its construction. Then came document B., and some other Judge has said that it differs very little from document A. - not suffi- ciently to alter the construction - therefore he construes it in the same way. Then comes document C., and the Judge then compares it with document B., and says it differs very little, and therefore he shall construe it in the same way. And so the construction has gone on until we find a document which is in totally different terms from the first, and which no human being would think of construing in the same manner, but which has, by this process, come to be construed in the same manner:" <Aspden y. Seddon (1). Firmly convinced of the truth of these words and of their value as a guide, I shall first try to ascertain the testator's meaning without reference to other people's wills. What he meant can only appear from what he has said. It is true that the Court is entitled to know what subject matter it is that he was dealing with. A will cannot be put in operation without reference to that, as Lord Blackburn made very clear in the ease of The River Wear Commissioners y. Adamson (2) when he said : - * In the cases of wills the testator is speaking of and concerning all his affairs ; and therefore evi- dence is admissible to show all that he knew, and then the Court has to say what is the intention indicated by the words when used with reference to these extrinsic facts, for the same words used in two wills may express one intention when used with reference to the state of one testator's affairs and family, and quite a different one when used with reference to the state of the other testator's affairs and family. In the case of a contract, the two parties are speaking of certain things only, and therefore the admissible evidence is limited to those circumstances of and concerning which they used those words: see Graves v. Legg (3). In neither case does the Court make a will or a contract such as

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land or not. He apparently knows the difference between realty and personalty. And I consider it important that the disposition which includes the Empire Hotel gives the widow no more than a life interest, while that disposition which in terms refers to personalty, and so excludes what was realty at the date of the will - and therefore excludes the hotel - is made to the wife absolutely and not merely for life. He is to be taken to know of the existence of the option, as indeed the appellant insists. Recollecting that, did he mean the devise on the one hand and the bequest on the other to be so construed as to take away from his nieces and his adopted son the: interest in remainder which his words, if words mean anything, were meant to secure to them, such a proposition would contra- dict itself. His wife, e concessis, was to have all that was then personalty, and a life estate in the hotel. Did he then intend to leave to a mere tenant, a stranger, beyond any control, the power to give her an absolute and not merely a life estate in that pro- perty, and so to destroy outright his careful plan of disposition as to the others whom he wished to benefit ? That, again, would be entirely opposed to his apparent intention, for he provides that after his widow's death the "real estate," which be it remembered included the hotel, shall be sold by the trustee, and the proceeds, as well as the net income until sale, divided between the nieces and the adopted child. What was Mr. Chant's duty if it happened that the widow died, the option remaining unexercised ? The will directed him in that case to sell the property, at the time he should judge advantageous, and to divide the proceeds among the young beneficiaries ; and sub- ject to the option, he would have to doso. And these dispositions may well stand without in any way impeding the exercise of the option. Then would the trustee have been doing his duty if he retained those proceeds until the lease expired without an exercise of the option? The dispositions of the will raise many questions of this sort as indications that it was not intended that the rule relied on should obtain to alter the testator's scheme. The hotel was under mortgage, and he must be taken to have borne in

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ceeding Judges have followed it where they have seen no way of escape ; but it has always been regarded as somewhat anomalous. Neither in Lawes v. Bennett (1), nor in Townley v. Bedwell (2), so far as I can discover, was there any indication of intention in the will to prevent the rule, if I am to call it so, from apply- ing. There were no limitations or provisions, such as I think there are in the present will, to show on the testator's part a dealing with the real property demised evincing his intention that on its subsequent conversion the beneficiaries should take the same interest in the proceeds as they did or would failing conversion, that is the same interest as was conferred on the face of the will. That is the intention which in some of the subsequent cases has been held to be shown, to the exclusion of the contention founded on Lawes v. Bennett (1). There are examples both ways, and it is argued that the criterion is whether the real estate has been so specifically devised before conversion (and as it is sometimes added, only where the giving of the option precedes the testamentary expression of inten- tion) that no doubt can be entertained that that specific property was intended to pass and remain as if unconverted - that is, so far as the donees and their respective interests have been concerned. I do not intend to analyse the mass of cases. In this instance it is a profitless quest, for reasons which I quoted early in this opinion. But having examined them with care I am prepared to repudiate the argument that Laawes v. Bennett (1) must be applied in all cases except those of specific devise. Those who so assert mistake instance for principle. I do not think there is a case which says a word to narrow down the dominant rule of testa- mentary construction in this fashion. The whole principle is that the distinct intention of the testator must prevail. That the cases cited are with few exceptions, if any, instances of inten- tion evinced in one particular way does not confine the operation of the principle to such instances, and I am of opinion that if such an intention is clearly evinced in the will, then, however it be evinced, it can operate to exclude the rule in Lawes v. Bennett (1). In the present case it seems to me that the attempt is even

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Court

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Before

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Judgment (156 paragraphs)

Cited By (3)