Peter v Shipway [1908] HCA 52;

Peter v Shipway [1908] HCA 52; - HCA 1908 case summary — Zoe

[7]

It is clear that the testatrix meant that the trustees should take the property mentioned and keep it during the life of her son Reginald, and apply it for his benefit. Whether in point of law that is a disposition to which effect could be given is quite immaterial in ascertaining the intention. The will then, after reciting that she was entitled to certain real property in her own right, which includes the property now in question called "The Firs," recited a marriage settlement made upon her second marriage under which the trustees of the settlement stood possessed of certain moneys upon trust for the children of that marriage as she and her husband, or the survivor, should appoint. She then devised "The Firs" as follows: "unto my said trustees ... to be held by them in trust for my son Reginald Bligh Read for the term of his natural life and to receive the rents issues and profits thereof for the sole use and benefit of the said Reginald ... and after the death of the said Reginald ... I devise the same to my daughter Margaret Charlotte Baylis absolutely for her sole and separate use free from the control and debts of any husband with whom she may intermarry." If there were no more in the will I do not suppose anyone would dispute that under that disposition Margaret took an equitable estate in fee expectant on the death of Reginald. That is the plain meaning of the words, and unless there is something later on in the will to qualify them, that is the effect that must be given to them. Having thus dealt with her real property, the testatrix proceeded to deal with the personal property subject to the marriage settlement, which she appointed in these words: "I hereby appoint all moneys stocks funds and securities upon which the same shall be invested and devise and bequeath the same in equal shares one moiety or half share ... to the said William Peter and J. W. Flood (the trustees) in trust for my said son Reginald ... for his support and advancement in life and the other moiety or half share to the said Margaret Charlotte Baylis absolutely free from the control of her present or any future husband with whom she may intermarry"; using the same words, practically, as in the devise of the realty. If there were no more in the will it is impossible to doubt that Margaret would have taken an absolute interest in half that property. It appears that Reginald was a person of weak intellect, and was directed, or at any rate expected, to be kept under the control of the trustees, for the will contained a direction that under no circumstances was he to be put into an asylum, and also an appointment of William Peter (who was Mrs. Read's son by the former marriage) as his guardian. What effect, if any, could be given to this direction is not material. So far the will seems quite clear. Then the testatrix went on: - "As to the rest and residue of my estate I devise and bequeath the same in equal shares to" the trustees "in trust for my said son Reginald ... and the remaining share to the said Margaret ... for her sole and separate use; I direct that the lawful issue of any child of mine shall take the respective shares which their parent takes under this my will." It is suggested - and I think there is a good deal in the suggestion - that these last words were intended to prevent lapse in the event of the death of either of the children in the lifetime of the testatrix. But in the view I take it is not material whether that is what she intended or not. Then followed the direction not to put the son Reginald in an asylum and then: - "in the event of the death of either of the said Reginald ... or Margaret ... without issue I direct that the interests or interest taken by either of them shall vest in the survivor." It is to my mind absolutely clear that that direction did not apply to "The Firs," which had been devised to the trustees in trust for Reginald for life and after his death for Margaret absolutely. It is, to my mind, impossible to suppose that the testatrix intended by such general words as these to provide that only in the event of the death of Reginald without issue in Margaret's lifetime should "The Firs" pass to Margaret. It was perfectly immaterial whether he died without issue or not: all that he took was a life estate. It is equally impossible to suppose that the intention of the testatrix was that, if Margaret died without issue, her interest in "The Firs" should go over to Reginald. At this point, it appears to me, the testatrix was not contemplating "The Firs" at all.

[10]

As I have already said, the paramount rule of construction is to ascertain the intention of the testator. There are, however, some subsidiary rules, one of which has been appealed to in this case, which I venture to call a rule of common sense, and which has been laid down in various ways. It has been put thus: That where there is a clear gift of property in a will, it cannot be cut down by anything subsequent unless it is equally clear. That statement of the rule has been said to be inaccurate. In Randfield v. Randfield[1], which is, I suppose, the leading case now upon the subject, Kindersley V.C. had stated the rule in the words I have just used, but Lord Campbell L.C. said[2]: - "If there be a clear gift, it is not to be cut down by any thing subsequent which does not with reasonable certainty indicate the intention of the testator to cut it down; but the maxim cannot mean that you are to institute a comparison between the two clauses as to lucidity." Lord Wensleydale stated the rule in slightly different language[3]: - "The gift being in terms absolute cannot be cut down, unless there is a sufficiently clear indication of an interest" (intention) "to defeat it by the subsequent clause. I quite agree with the Lord Chancellor in the construction of those words to which he referred, that you need not have a clause equally clear, but it must be reasonably clear, and the clause to which that effect is attributed by the respondents is capable of a construction confining its effect to the real estates only." The question was whether the words in question applied to both the real and personal estate. Lord Kingsdown said[4]: - "The language used in strictness applies only to the realty, and the improbability I think is great, having regard to the enumeration of the articles of which the personal estate consisted, that the testator should intend to make it the subject of a gift over, and that during the whole period of his life his son should be left in doubt whether he was an absolute owner of it or not. The original gift is clear, and I think there is not sufficient certainty in the subsequent words to restrict it." That is a rule of common sense, as well as a rule of construction by which the Court is bound.

[11]

Now, I find here, first of all, a clear gift of the estate to Margaret absolutely. These words seem to leave no room for doubt. They are repeated in a gift of property which the testatrix had no power to give to anyone except to her children. Having made these two gifts, and having other property to dispose of, she proceeds to make the disposition in question, which is said to apply to the first, although it cannot by any possibility apply to the second. It is said that it applies to the first because it appears with reasonable certainty or sufficient clearness of language that she intended to cut down the original gift to a life estate - an estate in property devised absolutely to a conditional estate. The words relied upon are: "I direct (should both my children die without lawful issue) my trustees to convert into money all my estate as shall not already be converted into money and to divide the same," &c. Now, these words, if they stood alone in the will, might and probably would be large enough to include the whole estate of the testatrix, but, primâ facie, they suggest a limitation. What the trustees are directed to convert is what has not already been converted, which certainly assumes - to my mind, at any rate - that the testatrix was dealing with some property over which she had given the trustees a power of conversion, property which they might or might not have converted. Such a power of conversion was certainly assumed to exist with respect to what she was dealing with. That seems to be the plain primâ facie meaning of the terms. Reference to the earlier part of the will shows that it contained a disposition of property to which such a description would be quite apt. Property was given and appointed to the trustees of the will to be applied by them for Reginald's benefit during his life, and the testatrix rightly or wrongly thought that the trustees would or might keep it in their hands in specie during his life, so that, if he survived Mrs. Baylis, it would be in their hands unconverted at the death of the survivor without issue. Whether she thought (erroneously) that this direction to convert and divide unconverted property would be effectual also as to the share in the settlement funds appointed to Reginald is not material. In my opinion, the words "as shall not be already converted into money" aptly describe this property, and do not on their face purport to include "The Firs," and I think they should be so interpreted. It is, therefore, unnecessary to call in aid the rule to which I have referred, because the words said to be contradictory of the clear gift in fee apparently do not refer to the same subject matter at all. But supposing they are capable of that construction, is it reasonably clear that that is their real meaning? For my part I think that the language is reasonably clear, that it is not ambiguous. If, however, it is not reasonably clear, then it is ambiguous and cannot cut down the clear gift. I confess that, but for the difference of opinion which I know exists on the bench, I should have thought - which was the view taken by the learned Chief Judge in Equity - that the words were absolutely clear, and did not on their face refer to the same subject matter. But in deference to the opinion of members of this bench, I will assume that they might apply to the same thing. We find, then, first of all, a clear gift, and later on another set of words which to one set of Judges appear to clearly mean one thing and to another set of Judges not necessarily to bear that meaning; that is, in effect, that the view taken by one set is not the necessary or only meaning of the words. I am bound, therefore, to accept the position that there is some ambiguity - though it does not seem to me that there is any - as to whether the testatrix intended to cut down the clear gift, and, that being so, the rule in Randfield v. Randfield[5] applies and the original gift stands.

[17]

Another question was raised, whether under these circumstances the Court ought to decide the question of construction in this appeal. The appeal is from a judgment that the appellant is not entitled to any interest in the property. In my opinion that judgment is right. But, it is said, whether that is so or not, the appellant is not entitled to appeal, and is not entitled to argue the question whether the respondents are entitled to the property. The appellant, in order to succeed, has to establish, first, that under the will Peter took an interest in "The Firs," and, secondly, that that interest did not pass by the assignment for the benefit of creditors. I suppose that the Court may decide against him on either or both grounds, and need not decide both unless it likes. If the first question is decided against her it is not necessary to decide the second. On the other hand, if Peter took an interest under the will, the Court must determine the question as to the effect of the assignment for the benefit of creditors. I think it is right to express an opinion on both points. Again, supposing we confine our attention to the effect of the deed, another interesting question suggests itself for consideration, whether, the appellant having been allowed in the Court below to argue the point of construction, this Court should refuse to hear her. The Court is bound to hear her to the extent necessary to determine whether the deed operated upon Peter's interest, if any, and, if it did operate on that interest, the appellant has still a possible, though shadowy and remote, interest in the surplus. Under these circumstances the question what the Court ought to do, whether it should dismiss the appeal on the ground that, having heard the appellant upon both points, it is of opinion that Peter and, therefore, the appellant, never had any interest in "The Firs," or upon the ground that the interest of Peter, whatever it was, passed by the deed of assignment, or upon the ground that the appellant has no substantial interest in any view of the case, is a question not worth deciding.

[31]

It recites that the assignors had respectively carried on business, and had trade and also private liabilities, and being unable to pay their creditors in full, had agreed to assign all their joint and separate estate to trustees upon certain trusts and agreements. The deed which has been placed before the Court described the arrangement and the property assigned in terms that are very material. "And whereas the said William Peter and Sarah Patience Peter being unable to pay either their joint or their separate creditors the whole of their respective demands have agreed to convey and assign all their joint and separate estate unto the said trustees upon and for the trusts and purposes and with under and subject to the powers provisoes and agreements hereinafter expressed declared and contained Now this indenture witnesseth that in pursuance of the said agreement they the said William Peter and Sarah Patience Peter do and each of them doth hereby grant release convey enfeoff assign transfer and set over unto and to the said trustees their heirs executors administrators and assigns. All and singular the lands tenements and hereditaments shares in any joint stock company stock in trade plant furniture goods chattels moneys debts credits and effects both real and personal of or to which the said William Peter and Sarah Patience Peter or either of them are or is seized possessed or otherwise entitled for their or either of their own benefit in any manner howsoever. And all other the property and effects of them the said William Peter and Sarah Patience Peter or either of them of what nature and kind soever and wheresoever situate and being in whomsoever's hands custody or power the same or any of them or any part or parts thereof now are or at or at any time hereafter may be with their or any of their appurtenances. And all the estate right title interest claim and demand whatsoever of them the said William Peter and Sarah Patience Peter and each of them as well jointly as separately of to in or out of the same premises and any of them respectively (the wearing apparel of themselves and family excepted) To have and to hold all and singular the said premises hereby granted and assigned or expressed or intended so to be and every part thereof unto and to the use of the said trustees their executors administrators and assigns according to the nature and quality thereof respectively. Upon the trusts nevertheless and for the several intents and purposes hereinafter expressed and declared concerning the same that is to say Upon trust" &c.

[56]

The words "my estate" exclude the appointed property - for the excellent reason that it was not her property and her powers of appointment were limited to certain objects; and the word "all" before them includes everything else. "The same" means "all my estate"; and unless some canon of construction forbids me from interpreting this clause so as to ascertain the true meaning of the testatrix, I feel no doubt that it was intended to apply to every preceding disposition by the testatrix of her own property. Is there any such canon of construction? I know of none. Randfield v. Randfield[14] was relied on to establish a rule of construction that, where one portion of a will read by itself makes a clear and indefeasible gift, the Court, in the absence of other unambiguous words establishing beyond any possible doubt a limitation of that gift, is bound to deny defeasibility. I cannot find any such canon in the case. In fact it is an authority to the contrary. In the Court below[15] Kindersley V.C. had said: "I must apply the broad and well-known principle, that if you have a clear gift, it shall not be cut down by anything subsequent, unless it is equally clear; and it appears to me, that in this case there is so much doubt about the residuary clause, that the prior gift of the real and personal estate must prevail." Lord Cranworth L.C.[16] reversed the decree of the Vice-Chancellor. The House of Lords upheld the Lord Chancellor as to the realty and reversed him as to the personalty. But in doing this their Lordships interpreted the will for themselves; and neither they in differing from the Lord Chancellor as to the personalty, nor the latter in differing from the Vice-Chancellor as to both, thought the fact of a doubt existing in the mind of another Judge sufficient to relieve any member of the tribunal of his responsibility to interpret the document for himself. Lord Campbell L.C. referring to the Vice-Chancellor's words, said[17]: - "If there be a clear gift, it is not to be cut down by any thing subsequent which does not with reasonable certainty indicate the intention of the testator to cut it down; but the maxim cannot mean that you are to institute a comparison between the two clauses as to lucidity." The learned Lord Chancellor went on to apply his observations. Dealing with the will before him he said: - "There may be considerable doubt as to some of the conditions," (that is as to the limitation over) "but there is by no means such obscurity as to justify the holding that the latter part of the will is to be taken pro non scripto." That was as to the realty. With regard to the personalty his Lordship not only found from the nature of most of the property the improbability that it could be advantageously used by one not having the absolute property in it, but that in framing his will the testator had kept the devise of the realty separate from the bequest of the personalty, and had so expressed himself as to make the natural and consistent meaning of the words in the collocation in which they were found inapplicable to the personalty.

[59]

In Morrall v. Sutton[20] Parke B. lays down in succinct terms the established rules of construction for ascertaining the intention of a testator. Although there was a difference of opinion between himself and Lord Langdale M.R. on the one hand and Coleridge J. on the other regarding the conclusion to be arrived at in the particular case, there was none, as I understand, as to the accuracy of the observations quoted. Parke B. said: - "These rules, so far as they are applicable to the present question, are admitted to be, that technical words are, primâ facie, to be understood in their strict technical sense; that the clause is, if possible, to receive a construction which will give to every expression in it some effect, so that none may be rejected; that all the parts of the will are to be construed so as to form a consistent whole; that of two modes of construction, that is to be preferred which would prevent an intestacy; and that where two provisions of a will are totally irreconcilable, so that they cannot possibly stand together, and there is nothing in the context or general scope of the will which leads to a different conclusion, the last shall be considered as indicating a subsequent intention, and prevail." Now, there are here no technical words, and therefore proceeding upon the lines stated by Parke B., and with all the care enjoined by Randfield v. Randfield[21], and seeking for "reasonable certainty" or "a reasonably clear intention" to limit the apparent absolute gift contained in the earlier words, it appears to me that condition is fulfilled. A. H. Simpson C.J. in Equity, as learned counsel for the appellant informed us, gave no reasons when pronouncing judgment, but from his previous observations appeared to regard the limitations over as applicable to the residue only. His Honor therefore could not have proceeded upon any supposed rule in Randfield v. Randfield[22], because the absolute gift of residue is as clear as that of "The Firs." But if he did, these limitations are as applicable to Mrs. Burrows' interest in "The Firs" as to her interest in the residue notwithstanding the word "absolutely" occurs in the former case and not in the latter. The word "absolutely" has not always the same signification. It may mean the quantity of estate given, or that its nature is beneficial and not in trust, or even as adverbially emphasizing the words following it. But assuming the first meaning, the words of Lord Davey in Comiskey v. Bowring-Hanbury[23] are most pertinent. His Lordship said: - "I do not myself attach any great importance to the use of the word absolutely. Reading it as qualifying or expressing the estate which the wife had to take, it does not seem to me to do more than to give her a fee simple. It is now admitted that she has a fee simple, and the question is whether there is a good executory limitation capable of taking effect upon her death. The use of the word absolutely, as defining the amount of the estate which is given to the wife, must of course be subject to any executory limitation or any other valid limitation or exception which you find engrafted on that estate in fee simple; therefore I attach no importance, or very little importance, to the use of the word absolutely."

[66]

Personally, I should have been in favour of dismissing the appeal without expressing any opinion on the question of construction. Any opinion that we express is an unofficial dictum, and a dictum that may embarrass the respondent, may even lead to further litigation. In fact, having ascertained that the appellant has no interest in the subject matter, we are functi officio, and have, strictly speaking, no right to express an opinion. But as my learned colleagues have thought it well to express their opinions, I am compelled to say, in order to prevent any misapprehension, that, in my opinion, Mr. Harriott's contention as to the construction of the will is clearly right. The grounds on which I rely are substantially those set forth elaborately by my brother Isaacs; and I do not think it necessary to recapitulate the reasoning merely in order to state it in my own way. The words (dealing with the event of one child dying without issue) "I direct that the interests or interest taken by either of them under my will shall vest in the survivor," are applicable, without any straining of language, to the fee simple in remainder given to Mrs. Baylis after her brother's life interest. Then the words following (dealing with the event of both children dying without issue) "I direct my trustees to convert into money all my estate as shall not already be converted into money and to divide the same," &c., are also applicable, without any straining of language whatever, to the interest taken in "The Firs" by Mrs. Baylis, and afterwards by her brother. I cannot see why the meaning of these plain words should be cut down. These are unambiguous words to which effect must be given. They do not produce any inconsistency or anomaly, or any contradiction of the previous words. The prior gift to Mrs. Baylis was "absolute," in the sense that there was no trustee interposed, and that she was to have the highest estate that the law recognizes - the fee simple (cf. sec. 24 of Wills, Probate and Administration Act 1898 N.S.W.. The word "absolutely," as lawyers well know, is often used with regard to real estate in wills, as meaning that a fee simple title is given (and see Comiskey v. Bowring-Hanbury[27]). But a fee simple is not inconsistent with a gift over on certain events. The gift over does not contradict, is not repugnant to, a fee simple. A fee simple may be defeasible. Here, it was defeated by the death of Mrs. Baylis before her brother. All the beneficial interests then combined in her brother; but his fee simple was defeated when he also died without issue. This natural interpretation of the words gives a consistent scheme to the whole will without doing violence to any of the words. The children of the second marriage are, primarily, the sole beneficiaries; but if their stock should fail, the mother wishes all her estate to go to her children by her first marriage rather than to strangers. There are no outside beneficiaries. Except by this interpretation, I cannot see how effect can be given to all the words of the will.

At a glance

Court

Decision date

Before

Source

Judgment (88 paragraphs)

Peter v Shipway [1908] HCA 52; (1908) 7 CLR 232 (28 August 1908)

Parties

Legislation Cited (1)

Cases Cited (1)