A marriage settlement settled property on the husband, wife, and prospective children. The wife also promised to settle after-acquired property on the same trusts. She later received andpound;285 which she invested in part in bearer bonds which remained at the bank in the husband’s name until his death. The trustees sought to obtain the bonds from the husband’s executors on behalf of the settlements.
Held: Equity treats as done that which ought to have been done.
Swinfen Eady J said: ‘It was contended that the bonds never in fact became trust property, as both the wife and husband were only liable in damages for breach of covenant, and that the case was different from cases where property which has once admittedly become subject to the trusts of an instrument has been improperly dealt with, and is sought to be recovered. In my opinion as soon as the 285l. was paid to the wife it became in equity bound by and subject to the trusts of the settlement. The trustees could have claimed that particular sum, could have obtained at once the appointment of a receiver of it, if they could have followed the money and claimed the investment.’
Swinfen Eady J
[1913] 1 Ch 9
England and Wales
Citing:
Cited – Smith v Lucas CA 1881
Jessel MR said: ‘What is the effect of such a covenant in equity? It has been said that the effect in equity of the covenant of the wife, as far as she is concerned, is that it does not affect her personally, but that it binds the property: that is . .
Lists of cited by and citing cases may be incomplete.
Trusts, Equity
Leading Case
Updated: 01 November 2021; Ref: scu.471501