The testator had a sister, a wife, and two illegitimate children. His appointed George Arkle (‘GA’), if GA should survive him, his executor and trustee, but if GA should die in his lifetime he appointed Benjamin Arkle (‘BA’). He then gave ‘the following legacies’: andpound;1000 each to GA and BA; andpound;2000 to a great nephew; andpound;100 to his wife, and andpound;100 apiece to his two children. After the gift of other legacies, he gave annuities to his wife and to his two children subject to restrictions as to anticipation, and an annuity to his sister Mary Williams. He then gave his freehold and leasehold property (specially described), ‘and all other my real estate and the residue of my personal estate’ (subject to two debts due to his sister) ‘unto the said GA for all my estate and interest therein respectively if he shall be alive at my decease, but if he shall die in my lifetime, then I give my said real estate and residuary personal estate unto BA for all my estate and interest therein respectively.’ He empowered his trustee to retain or change his investments, to be free from all responsibility on that account, to employ accountants and receivers, to be the guardian of his children during their minority, and he directed that the trustee should possess all powers granted to trustees by the 23 and 24 Vict. c. 145 (Lord Cranworth’s Act).
Held: (Lord Chelmsford dissenting) The gift of the real estate and of the residue of the personal estate (the former unaccompanied by any trust) was not affected by the other provisions of the will, and GA took them beneficially.
Lord Cairns LC restated the Appellant’s argument: ‘George Arkle, the Respondent, does not appear to be a relative of the testator. The residue is given, in case George Arkle dies in the lifetime of the testator, to Benjamin Arkle. The same George Arkle is made executor, and the same Benjamin Arkle appointed executor in case George shall die in the testator’s lifetime- George, and, in the event of his death, Benjamin is appointed not merely executor, but trustee of the will. George and Benjamin have, each, a legacy of andpound;1000. After the residuary clause there is a power authorizing the testator’s trustee to invest his personal estate on such securities as he shall think best, and to continue any investments subsisting at the testator’s death, and to employ such accountants and receivers as shall be necessary. The trustee is appointed guardian of the children, and it is declared that the trustee shall have, and may exercise, all or any powers and authorities given to trustees by the Act commonly called Lord Cranworth’s Act. These are the provisions in the will relied upon by the Appellant.’
He continued: ‘It is to be observed that none of these provisions refers to or touches the real estate, and, as I have already said, no trust has to be answered out of the devise of the real estate. As regards the personal estate, there are legacies given amounting to about andpound;5000, and annuities which would require the appropriation of something like andpound;10,000 more; and one of these annuities was for the separate use of a married woman. There were, therefore, trusts connected with the personal estate as to which the executors would be trustees, and as to which powers for investment would, and powers for employing clerks and accountants might, be necessary; but all these trusts and purposes connected with the personal estate would have to be satisfied before the residue could be ascertained, and it is the residue and not the universitas of the personal estate which is given to George Arkle.
But there are several other circumstances connected with the will which in my opinion strongly support the natural construction of the words as a beneficial gift to George Arkle. The testator had a wife and two illegitimate children, who at the date of the will were of the ages of twenty and sixteen, and for all of them he made specific provision by his will. His sister, the Appellant, was at the date of the will his heiress and sole next of kin, and the person to whom undisposed-of realty, and undisposed-of personalty, other than that which a widow would take, would result. It is true that, at her death, other persons might have become interested; but testators do not generally look beyond the state of their families at the time. It is difficult to reconcile the gifts to the sister and to the wife, both of them apparently intended for maintenance, with a right, reserved to them, to a large undisposed-of residue. Again, if the wife was to marry, or mortgage her annuity, it was to fall into the residue; but of the residue, according to the Appellant’s hypothesis, she would take one-half. Again, the real estate is apparently subject to a charge in favour of the testator’s sister. But if she were to take the estate as heiress-at-law under a resulting trust, a charge in her favour would be unmeaning. Lastly, there is a devise, to the trustee of the will, of trust and mortgage estates. But this also would be more consistent with a construction which gave the testator’s own real estate to George Arkle beneficially, than with one which would make the devise of all real estate to be a devise in trust.
My Lords, I have thus gone through the more minute details of this will for the purpose of pointing out that they appear to me to support the case of the Respondent rather than that of the Appellant; and as I think it cannot be shewn that the testator has used the words in the general gift to George Arkle, which I commenced by reading, otherwise than in their natural sense, according to which, I repeat, they import a beneficial gift, the case of the Appellant appears to me to fail, and the appeal, as I submit, and move your Lordships, ought to be dismissed, with costs.’
Lord Hatherley said: ‘Is he or is he not, intending by what he has done to give his property, both the realty and the residuary personal estate, after payment of debts and legacies, beneficially to the same person whom he has appointed as his executor and trustee? Now when a testator has provided, as the testator has done, most remarkably in this will, for his wife, for his sister (his presumptive heir-at-law), for his illegitimate children, and for his great nephew in Ireland, to whom he has given a considerable legacy, namely andpound;2000; when he has provided for all of them, what is there to make it improbable, or anything out of the ordinary course of a testator’s will, that this bequest, which undoubtedly was an absolute devise for these persons successively, not qua executors or trustees but nominatim, should be with the intention of leaving (as he does) the whole of his real estate beneficially, and the residue of his personal estate beneficially, to them after the payment of his debts and legacies? . .
My Lords, I fail to see in this case that any trust whatever is attached to that portion which is given to George Arkle. As in the legacy of andpound;1000 he is simply called George Arkle, and not executor or trustee, so in the gift of the real estate he is simply called George Arkle. The real estate is devised to him, and no trust whatever is imposed upon him as to that; and as to the only remaining portion of the gift, it is not a gift of the whole personalty, but a gift of the residue of the personalty after the trusts of the will have been satisfied. It appears to me, therefore, that no part of the property comes to him as George Arkle by virtue of the gift until all the trusts of the will are exhausted, there being no trust at all as to the real estate, and as to the personal estate only the payment of debts, leaving the whole of the remainder to come to him in his personal capacity.
But, my Lords, the difficulty is extreme, as it seems to me, of holding (for it comes back to that point) that the testator, who has so carefully provided in his will for those who would be entitled to his personal estate, namely, his widow and his sole next of kin, a testator who has carefully provided against any imprudence on the part of that widow and his daughter with reference to the annuities which he has given to them, and which are to fall into the residue in case of their attempting to alienate them, should proceed afterwards, having provided an annuity only during that time for his presumptive heir-at-law, his sister Mary Williams, who was at that time of the age of sixty-nine, the testator himself being of the age of seventy-four, to give to George Arkle the whole of his real estate without saying one word about trust for her or for anybody else, without any apparent object in creating a trust, inasmuch as (as I have said) he has not mistrusted her. Is it likely that, having a perfect confidence in her, he should give the property to George Arkle (referring expressly to a debt of andpound;2500 owing to his presumptive heir-at-law, and to another debt of andpound;500 to her, which he states to be in his hands) subject to this trust, whereas she being heir-at-law and presumptive heiress of the whole estate, there was no need whatever of mentioning any charge that she had upon it, because she would be mistress of the whole property?’
Lord Chelmsford dissented, saying of the will that ‘an air of trust pervades it throughout’.
Lord Cairns LC, Lord Hatherley, Lord Chelmsford
(1875) LR 7 HL 606
England and Wales
Cited by:
Cited – Rawstron and Another (Executrices of The Estate of Lucian Freud) v Freud ChD 30-Jul-2014
The court considered the construction of a point in the deceased’s will. The clause said: ‘I GIVE all the residue of my estate (out of which shall be paid my funeral and testamentary expenses and my debts) and any property over which I have a . .
These lists may be incomplete.
Updated: 20 June 2021; Ref: scu.535825