Re Welford’s Will Trusts, Davidson v Davidson and Others

 

Re Welford’s Will Trusts, Davidson v Davidson and Others

SUCCESSION; Gifts, Wills: TRUSTS

CHANCERY DIVISION

ROMER J

24 OCTOBER, 5 NOVEMBER 1945

Powers – Exercise – Special power to appoint by deed or will – Whether intention to exercise expressed in will – Gift, subject to payment of debts, of “all my

real and personal estate whatsoever and wheresoever and over which I shall have any disposing power at the time of my decease” – Gift to objects of the

special power – “And” – Failure to use “appoint.”

Under her father’s will, Mrs D had a special power of appointment among her children and grandchildren over a settled legacy. The power was exercisable by

deed or will, and, in default of appointment, on Mrs D’s death the legacy was, in the events which had happened, to be divided equally among her five

children. By her will, made on 18 October 1938, Mrs D provided (by cl 3): “Subject to the payment of my just debts funeral and testamentary expenses I give

devise and bequeath all my real and personal estate whatsoever and wheresoever and over which I shall have any disposing power at the time of my decease to

my children EINK, and ESD, in equal shares absolutely.” She did not exercise the special power during her lifetime and the question to be determined was

whether the words in her will “and over which I shall have any disposing power at the time of my decease” were a sufficient exercise of the power. She was

not the donee of any other general or special power of appointment either at the date of her will or at the date of her death. It was contended by the children

who were not beneficiaries under her will (i) that the words in question were used in an explanatory sense or to introduce an additional quality to the property

already mentioned; (ii) that the reference to payment of debts negatived any intention to exercise the power of appointment; (iii) that the failure to use the

word “appoint” also negatived such intention; and (iv) that, properly construed, the words referred to a power of appointment which might be acquired after

the date of the will and not to the special power which Mrs D already had:—

Held – (i) The use of the word “and” before the words “over which I shall have any disposing power at the time of my decease” was not intended merely to

introduce an additional quality to the property disposed of. The clause must be regarded as elliptical and its true meaning was “and all real and personal estate

over which I shall have any disposing power at the time of my decease.”

(ii) the reference at the beginning of the gift to the payment of debts was not an intention to charge with their payment each item of the property

subsequently referred to, but the rule of reddendo singula singulis must be applied, so that the debts were payable only out of property properly chargeable

therewith.

Re Teape’s Trusts applied.

(iii) failure to use the word “appoint” did not necessarily imply that a special power of appointment had not been exercised.

(iv) the words “over which I shall have any disposing power at the time of my decease” did not refer to property subject to a disposing power which Mrs

D might subsequently acquire, but to property over which she should have a disposing power at the time of her death. The language was, therefore, accurate

in relation to a power which was operative at the date of the will but which could subsequently be executed by deed.

(v) though the interests of those entitled in default of appointment were vested subject to divesting by the exercise of the power, it was not essential to

such divesting that the words used by the person exercising the power should contain no element of doubt.

(vi) upon the true construction of the will, and in view of the fact that this was the only power of appointment that Mrs D had ever had, Mrs D had

exercised by her will the special power of appointment over her settled legacy.

Notes

In Grey v Pearson ((1857) 6 HL Cas 61), Lord Wensleydale referred to the wisdom of the rule that in construing wills the “grammatical and ordinary sense of

the words is to be adhered to, unless that would lead to some absurdity, or 􀂭 23􀀉 some repugnance or inconsistency.” In this case “and” is accordingly given

its ordinary conjunctive meaning, although involving an ellipsis, since the more unusual sense of introducing an explanatory sentence would add nothing to the

preceding words.

The intention to execute the special power of appointment, notwithstanding the omission of the word “appoint” is decided by the application of the rule

laid down by Sargant J, in Re Ackerley, namely, that: “In order to exercise a special power there must be a sufficient expression or indication of intention in

the will or other instrument alleged to exercise it; and that either a reference to the power or a reference to the property subject to the power constitutes in

general sufficient indication for the purpose.” Here the reference is to the property subject to the power.

As to Intention to Exercise Power of Appointment, see Halsbury, Hailsham Edn, Vol 25, pp 549–554, paras 986–981; and for Cases, see Digest, Vol 37,

pp 446–460, Nos 491–617.

Cases referred to in judgment

Re Ackerley, Chapman v Andrew [1913] 1 Ch 510, 37 Digest 454, 562, 82 LJCh 260, 108 LT 712.

Re Teape’s Trusts (1873), LR 16 Eq 442, 37 Digest 451, 541, 43 LJCh 87, 28 LT 799.

Re Weston’s Settlement, Neeves v Weston [1906] 2 Ch 620, 37 Digest 451, 540, 79 LJCh 54, 95 LT 581.

Von Brockdorff v Malcolm (1885), 30 ChD 172, 37 Digest 480, 771, 55 LJCh 121, 53 LT 263.

Re Holford’s Settlement, Lloyds Bank Ltd v Holford [1944] 2 All ER 462, [1945] Ch 21, 114 LJCh 71, 171 LT 379.

Re Hayes, Turnbull v Hayes [1901] 2 Ch 529, 37 Digest 425, 335, 70 LJCh 770, 85 LT 85.

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Re Bower, Bower v Mercer [1930] 2 Ch 82, Digest Supp, 99 LJCh 17, 141 LT 639.

Adjourned Summons

Adjourned Summons to determine whether Mrs Elizabeth Scott Davidson had exercised by her will the special power of appointment over her settled legacy

which was conferred upon her by her father’s will. The facts and the relevant clauses of the wills are fully set out in the judgment.

R R Formoy for the plaintiff.

Wilfrid Hunt for the first defendant.

G D Johnston for the second defendant, a beneficiary under the will.

John Pennycuick for the third defendant, a beneficiary under the will.

The fourth defendant did not appear.

Cur adv vult

5 November 1945. The following judgment was delivered.

ROMER J. By his will dated 9 May 1865, William Henry Welford, after appointing executors and trustees and making certain pecuniary and specific

bequests, directed as follows:

‘I direct my trustees to raise out of my residuary estate the legacy or sum of £1,500 for or in respect of each and every daughter of mine together

with interest for the same after the rate of £5 per cent. per annum computed from my decease And I direct that the legacy of each such daughter shall be

held upon the trusts following that is to say upon trust during the life of the same daughter to permit her whilst unmarried to receive the annual income

thereof or to pay such income into her proper hands being covert to be enjoyed by her during every coverture for her separate use free from marital

control and engagements but without any power for her to anticipate the growing payments thereof and from and after the decease of the same daughter

the same legacy together with the annual income thereof shall be held upon such trusts for such interests and with under and subject to such powers

restrictions and limitations and in such manner in all respects as the same daughter by any deed or deeds or by her will shall at any time or times

whether covert or sole appoint. So only that every such appointment be made in favour of a child or children of the same daughter who shall have

attained or who shall attain the age of 21 years or who shall marry under that age or of a grandchild or grandchildren of the same daughter and in default

of such appointment Upon trust for the child if only one or all the children equally if more than one of the same daughter who shall be living at my

decease or born afterwards and who being a son or sons shall live to attain the age of 21 years or dying under that age shall leave issue surviving or

being a daughter or daughters shall live to attain that age or be previously married but no child of the same daughter in favour of whom or of whose

issue an appointment shall be made under the power aforesaid shall participate in the unappointed fund without the appointed share being brought into

distribution unless the same daughter shall declare a contrary intention in writing.’

􀂭 24􀀉

The testator died on 25 April 1876. He left, among other children, a daughter, Elizabeth Scott Davidson, whom I will hereinafter refer to as Mrs

Davidson. The question which I have to determine is whether or not Mrs Davidson exercised by her will the special power of appointment over her settled

legacy which was conferred upon her by her father’s will.

Mrs Davidson died on 7 January 1945. By her will, which was dated 18 October 1938, after appointing two executors (naming as one of them her son

Edward Selby Davidson) and giving some pecuniary legacies, Mrs Davidson, by cl 3 thereof, expressed herself in the following terms:

‘Subject to the payment of my just debts funeral and testamentary expenses I give devise and bequeath all my real and personal estate whatsoever

and wheresoever and over which I shall have any disposing power at the time of my decease to my children Ellen Isabel Naysmith Kydd and the said

Edward Selby Davidson who shall be living at my death and if more than one in equal shares absolutely.’

The first thing to be observed about this language of Mrs Davidson is that, whatever may have been the property with which she was intending to deal,

she has not expressed herself with perfect grammatical accuracy, and a question arises as to the meaning and effect of the word “and” which appears between

the words “wheresoever” and “over.” The word was not, in my judgment, intended to be used in an exegetical or explanatory sense. Such a sense is not in

accordance with the normal use of the word “and,” which has primarily a conjunctive meaning. I think this primary meaning should be attributed to the word

rather than a secondary and unusual meaning, in the absence of some compelling context to the contrary. Reading, then, the word “and” in a conjunctive

sense, two alternatives seem possible: (i) that she was introducing an additional quality to the property of which she was disposing, viz, that it should not only

be her own property, but that at the time of her death she should have a disposing power over it; or (ii) that she was bringing into the scope of the gift property

different from, and additional to, her own real and personal estate which she had already mentioned. It seems to me that the first of these alternatives would

result in no effect being given to the words which follow the conjunctive. It is plain that she could dispose of what belonged to her and nothing effectual

therefore is added to the words “all my real and personal estate “if this alternative is adopted. In my judgment, the second alternative is to be preferred,

notwithstanding that, if adopted, it involves an ellipsis. I think the true meaning of the testatrix would be expressed by the words “I give devise and bequeath

all my real and personal estate whatsoever and wheresoever and all real and personal estate over which I shall have any disposing power at the time of my

decease,” etc So read, the word “and” which follows upon the word “wheresoever” receives its primary conjunctive signification and effect is given to the

language which it introduces.

Before considering whether the disposition, as so construed, operated as an exercise of the power now in question, it is necessary to note one or two facts

which were established by the evidence filed in support of the originating summons. This evidence consisted of an affidavit of the plaintiff Alfred Newall

Davidson. He says that Mrs Davidson had issue five children only, namely, himself and the four defendants, all of whom have long since attained the age of

21 years. To the best of the plaintiff’s information and belief, his mother did not at the date of her will or of her death have any power of appointment other

than the special power of appointment over the said settled legacy under the testator’s will; and he states that she did not in her lifetime exercise that power by

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deed. The investments representing the said settled legacy (including accruers thereto) are of the value of about £2,100 subject to estate duty. The net estate

of Mrs Davidson at her death (ie, her own estate) was sworn for probate at the value of £2,178. She had no real estate at the date of her will or of her death.

The general principle to be borne in mind in considering whether or not a special power has been executed in any given case is not in doubt and was

stated in Re Ackerley by Sargant J in the following words ([1913] 1 Ch 510, at p 515):

‘… in order to exercise a special power there must be a sufficient expression or indication of intention in the will or other instrument alleged to

exercise it; and that either a reference to the power or a reference to the property subject to the power 􀂭 25􀀉 constitutes in general a sufficient indication

for the purpose.’

Sargant J then explained what he meant by the words “in general.” This statement of the general rule has frequently been referred to, and approved, in

subsequent cases.

Having regard to the conclusion which I have formed and expressed upon the question whether Mrs Davidson was intending by her will to deal with one

class or with two classes of property, and to the fact that the special power now under consideration was the only power of appointment that she ever had, it

would seem reasonable, at first sight, to suppose that her intention was to exercise the power; for the second class of property consisted of real and personal

estate which was not her own but which was property over which she had a power of disposal and there was in fact one such item of property, and only one,

viz, the settled legacy. In other words, there would appear, prima facie, to be a sufficient reference to the property subject to the power. The donees,

moreover, were objects of the power and, apart from one consideration, the disposition contained no directions which were in conflict with the legitimate

treatment, or destination, of the settled legacy.

On behalf, however, of the children of Mrs Davidson who are not beneficiaries under her will, certain considerations were advanced as showing that no

sufficient expression or indication is to be found of an intention by her to exercise the special power, and that the will, taken as a whole, is only consistent with

the view that the testatrix was directing her mind exclusively to property over which she should at her death have an unqualified power of disposition. In the

first place, it is said that she has subjected the whole of the property of which she was affecting to dispose to the payment of her debts and funeral and

testamentary expenses, and that accordingly each and every item of property within the scope of the disposition is stamped with a charge which the testatrix

was at perfect liberty to impose upon her own property, or property over which she had a general power of appointment, but which she had no authority to

impose upon the settled legacy. Secondly, it is observed that there is a significant omission of the word “appoint.” Thirdly, it is contended that the words

“over which I shall have any disposing power at the time of my decease” are irreconcilable with the view that there was present to her mind the intention of

exercising the special power which she already had; and, fourthly, it is pointed out that the onus is on the persons claiming to be appointees to satisfy the court

that the power was exercised and that, if there is a doubt about the matter, it should be resolved in favour of those who take in default of appointment,

inasmuch as they take vested interests liable to be divested only by a clear appointment to other objects.

As to the first of these considerations, it is true that the words of gift are preceded by the qualification “subject to the payment of my just debts funeral

and testamentary expenses.” I read these words, however, as a warning to the executors that these outgoings have got to be met, in priority to the beneficial

interests, rather than as an intention to charge with their payment each and every item of the property subsequently described. The rule of reddendo singula

singulis may I think be fairly and legitimately applied: compare, for example, Re Teape’s Trusts; and the case does not in this respect fall within the class of

which Re Weston’s Settlement is an example.

Then, secondly, as to the omission of the word “appoint,” this omission is undoubtedly an element which has to be taken into account when weighing up

the considerations as a whole, but I do not think it is of any considerable importance in itself. It is not as though the words “I give” or “I bequeath” are

altogether inapt or unsuitable when used in relation to property which is subject to a special power. All that can be said is that the words “I appoint” are more

apt and more suitable and that the use of them would in some cases be decisive of an intention to exercise a power.

I come now to the third contention, viz, that the language used is not fairly referable to the special power of appointment which the testatrix had at the

time of making her will, but is applicable only—or, at all events, if far more applicable—to a future possibility, viz, that at the date of her death the testatrix

should possess a power of appointment of which she had no knowledge at the date of her will, and that, as the language used is, at the very least, equally

applicable to this conception, it is insufficient to operate as an exercise of the 􀂭 26􀀉 special power now in question. This view of the matter would appear to

be inconsistent with the decision of Pearson J, in Von Brockdorff v Malcolm. In that case a testator had at the date of his will a power of appointment, under a

settlement, over certain property in favour of his children and remoter issue. By his will, without making any express reference to the power, he gave:

‘… all the real and personal estate and effects whatsoever and wheresoever, whether in possession, reversion, remainder, or expectancy, over which

at the time of my decease, I shall have any beneficial disposing power by this my will” to trustees, upon trusts partly for persons who were objects of the

power, and partly [for persons who were not]’

It was held by Pearson J that this language sufficiently indicated an intention on the part of the testator to exercise the power. Counsel, who argued before me

on behalf of those entitled in default of appointment, says that the point I am now considering was not argued in that case. The argument and judgment in the

case certainly appear to have been mainly concerned with the effect of the word “beneficial” and I do not know whether the point I am now considering was

raised or not. If it was raised, it certainly was not dealt with specifically, nor apparently was any express reference to the point made (as it might have been) in

Re Holford’s Settlement.

Having regard to the interpretation which I have placed on the language which Mrs Davidson used, it follows that she had in mind two kinds of property,

viz, that which was her own and that which, though not her own, she could dispose of in some direction which, at all events, included her children Ellen and

Edward. For the purposes of the argument it must be assumed that Mrs Davidson was contemplating the possible subsequent acquisition either of a general

power or of a special power. The suggestion that she had in view some general power of appointment, which she might subsequently acquire, results in no

real effect being given at all to the words “and over which I shall have any disposing power at the time of my decease.” The reason for this is that, by virtue of

the Wills Act, 1837, s 27, any property over which she had a general power of appointment at her death would pass under the general words of gift, devise and

bequest which she had already used. To adopt this view of the matter accordingly involves a departure from the ordinary principle of construction that, if

possible, some effect should be given to every part of a will. The second alternative is that the testatrix had in mind some special power of appointment which

she might subsequently acquire. It seems to me inherently improbable that any testator should have it in his mind to exercise a special power of appointment

at a time when he is necessarily unaware of the conditions or limitations which might be attached to the power, when created. This improbability formed the

foundation of the Court of Appeal’s decision in Re Hayes. As to whether a donee of such a power can in fact exercise it by anticipation, even if so minded, see

Re Bower. I am, accordingly, not prepared to accept this alternative as reasonably possible.

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The only remaining view would appear to be that Mrs Davidson was in fact intending to pass to her two named children the property subject to the power

which she had at the date of her will, provided that at her death such property, or some of it, still remained subject to the power. I am unable to see why the

language which she used is, so far as the present point is concerned, unsuited to the purpose. In the first place, the testatrix does not refer to property subject

to a disposing power which she might subsequently acquire, but to property over which she should have any disposing power at the time of her decease, which

seems to me to be a very different thing. Secondly, the language used is, as I think, perfectly accurate and apt in relation to power which was fully operative at

the date of the will, but which could subsequently be executed by deed or released. Upon these contingencies would depend the question whether, at Mrs

Davidson’s death, she still had a disposing power over the settled legacy or not. Apart altogether, then, from the decision in Von Brockdorff v Malcolm I am of

opinion that the language used in Mrs Davidson’s will is more applicable to an intention to pass the settled legacy than to an intention to exercise some

subsequently acquired general or special power.

Taking, as I have tried to do, all the relevant circumstances into consideration, and attributing to each of them such weight as I think it deserves, I have

arrived at the conclusion that Mrs Davidson did exercise the special power over her 􀂭 27􀀉 settled legacy. With regard to the fourth contention of counsel for

those entitled in default of appointment (ie, the contention dealing with onus of proof), it is, of course, impossible to say that no uncertainty arises as to the

intentions of a testatrix who expresses herself in such language as Mrs Davidson employed. I cannot, however, accept the view that the vested interests of

persons who are entitled in default of appointment can only be divested in cases in which, practically speaking, there is no element of doubt; and, having come

to a reasonably clear conclusion on the present case, I propose to give effect to it by declaring, in answer to question 1 of the summons, that Mrs Davidson did

exercise the special power of appointment over her settled legacy.

Declaration accordingly. Costs of all parties, as between solicitor and client, out of the capital of the settled legacy.

Solicitors: Clifford-Turner & Co agents for Ingledew, Mather & Dickinson, Newcastle-on-Tyne (for the plaintiff and the first defendant); Hyde, Mahon &

Pascall agents for Keenlyside & Forster, Newcastle-on-Tyne (for the second and third defendants).

B Ashkenazi Esq Barrister.

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