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Scottish Court of Session Decisions |
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You are here: BAILII >> Databases >> Scottish Court of Session Decisions >> Russell v Russells [1835] CA 13_551 (25 February 1835) URL: http://www.bailii.org/scot/cases/ScotCS/1835/013SS0551.html Cite as: [1835] CA 13_551 |
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Page: 551↓
Subject_Provisions to Children.—
A father, by his contract of marriage, destined his estate to his eldest son, subject to provisions to the extent of £8000 to his younger children, and with a power to augment these. By a subsequent trust-deed he augmented the provisions to the younger children, directing the residue to be paid to his eldest son, and that the provisions of such children as might die before attaining majority should fall into the residue so to be conveyed to the eldest son. He afterwards contracted large debts, so that after his death the whole free estate was found not to exceed £6000. Held, 1st, That the heir had no claim in competition with the younger children; and, 2d, That the shares of children dying in minority, though having survived their father, lapsed into the general fund, and did not fall to the heir.
The late Colonel Russell of Woodside, by antenuptial contract of; marriage entered into of date 25th April, 1808, disponed his estate of Woodside, “with and under the burdens and reservations after written, to himself, whom failing, to the son or sons to be procreated of the marriage hereby contracted between him and the said Miss Mary Stirling, the elder always succeeding before the younger.”
This contract inter alia contained the following clause:—“Whereas no provisions are made upon the younger children of this marriage, in the event of the foresaid lands and estate devolving upon the issue of this marriage, and whereas parents frequently omit to settle provisions on their younger children, therefore, and in order to remedy such omissions, the said James Russell does hereby, in case there shall be issue, male or female, procreated of this marriage, besides the heir appointed to succeed to the said lands and estate, and in case the said James Russell shall dio without providing for such issue, binds and obliges himself and his foresaids, with and under the provision and declaration after-written, to make payment to the younger child or children, male or female, of this present marriage, other than and besides the heir of the marriage who shall succeed to the said lands and estate upon the death of the said. James Russell, of the provisions after specified, viz. if there shall be only one younger child, whether male or female, of the sum of £5000 sterling; and if there shall be two or more such younger children, of the sum of £8000 sterling, and to be divided the said sum of £8000 sterling, in case of two or more younger children, equally between or among them, and to be paid the said provisions at the first term of Whitsunday or Martinmas next after the decease of the said James Russell their father,” &c. “Provided and declared, that notwithstanding of the provisions before written, conceived in favour of the said child or children, other than the heir of this marriage succeeding, as said is, to the said lands and estate, yet they shall only take effect in the event of the said James Russell
In 1813, Colonel Russell executed a trust-deed of settlement, whereby he conveyed his whole estate to trustees inter alia for the payment of the provisions to his younger children, which were at the same time augmented by him beyond the obligation in the contract of marriage. The purposes of the trust, so far as regarded the younger children, were thus expressed:—“For payment to John Russell, my second son, and to each other lawful son to be procreated of my marriage, the sum of £4000, and that at the first term of Whitsunday or Martinmas after their attaining the age of twenty-one years complete, with the due and ordinary annual-rent thereafter, during the not-payment thereof”…“My said sons being suitably alimented, clothed, and educated in the mean time.” “For payment to each of my daughters, Mary and Elizabeth Russell, of the sum of £3000 sterling, and to each other daughter that may yet be procreated of my present marriage, of the like sum of £3000 sterling, with interest of the same from the first term of Whitsunday or Martinmas after my death, till the said principal sum is paid; and which principal sum or provision of £3000 sterling to each I hereby declare shall not be payable till the first term of Whitsunday or Martinmas after my said daughters shall severally attain the age of twenty-one years complete; with an yearly annuity to each of my daughters above named, and to each other daughter I may yet have of my present marriage, while they remain unmarried, of the sum of £50 sterling, and which annuity shall be payable half yearly to each of my said daughters; and to commence at the first term of Whitsunday or Martinmas after their severally attaining the age of fifteen years complete, with interest while the same remains unpaid.”
After the declaration of the several purposes of the trust, the trustees were finally appointed “to convey and make over to David Russell, my eldest son, the haill free residue of my estate and effects.” And it was further declared, that in the event of the death of any of the younger children before attaining the age of twenty-one,” their provisions should fall and accresee to the residue to be conveyed to my eldest son as before mentioned.” At the time when this deed was executed Colonel Russell was in unembarrassed circumstances. He afterwards, however, contracted a considerable amount of debt, and, in 1828, he executed a deed of alteration and restriction, whereby he restricted the provisions to his younger sons to the sum of £2000 each. In 1880 he died, having been predeceased by his wife, and leaving four sons and four daughters, of the latter of whom
Captain Russell claimed to be ranked pari passu with his brothers and sister, as having a jus crediti under the marriage contract to the extent of £26,000, being the value of the estate (£34,000), minus the provisions to the younger children by the marriage contract, (£8000). The younger children, on the other hand, claimed a preference for their provisions; and the daughter further claimed a preference over her brothers for the annuity of £50, on the ground that it must be considered alimentary.
The Lord Ordinary reported the cause on Cases, adding the subjoined note. *
_________________ Footnote _________________
* “The Lord Ordinary reports this case without a judgment, partly that those concerned may have a final decision with the least possible delay and expense; and chiefly because the argument for the heir resolves very much into an appeal to the general equitable powers of the Court, which he cannot but feel that an individual judge should not be forward to exercise.
“He cannot say that he has perfectly made up his mind upon the question; but he is inclined to think that the younger children must be preferred, pari passu, to the whole fund in medio,—the sons, as creditors each for £2000,—and the daughters for £3000 plus the present value of her annuity of £50, as that may be ultimately ascertained.
“This is a hard result for the heir, and may be fairly held as one not actually contemplated by the father, at the date of any of his settlements. But it is difficult to hold this a mere questio voluntatis; and even if it could be so held, the Lord Ordinary apprehends that the voluntary contraction of debt,—without any subsequent alteration of the settlements,—must be taken as legal indications of a will to make that distribution of the property which the law, under such circumstances, should prescribe.
“The whole difficulty of the case arises from the shortcoming being occasioned by large debts, and not from an over-estimate, or a fall in the value of the property. If it had arisen from the last cause, though the hardship to the heir, and disappoint' ment of the actual will of the father, would be the same, the Lord Ordinary humbly thinks the argument would not be maintainable. If a man, believing his whole estate to be worth £50,000, settles it, in a marriage-contract, on the heir of the marriage, but under the special burden of £15,000 to younger children, and at his death the property is' so depreciated that, though there is no debt, it is only worth £15,000, it is conceived to be clear, that the heir could only get £100; and that, if it was only worth £15,000, the whole must be divided among the younger children, and the heir will get nothing. It will be the same if he directs trustees (as in this case) first to pay over £15,000 to the younger children, and then to convey the residue, in general terms, to the heir. If there is no residue, he will equally get nothing—though the persona predilecta.
“The question then is, whether the same consequence must follow, where the short-coming is owing, not to the failure or depreciation of the property, but to the claims of onerous creditors? This is very well put in the case for the heir; and the Lord Ordinary should be well pleased if the Court should enter into the distinction. The statement is,—Here is an estate (or the price of an estate) actually vested in the trustees, to the extent of £34,000. Of this they are directed to pay £8000 (or £9000) to the younger children, and the rest, or £26,000, to the heir; and in this proportion, if there were no creditors, the property would certainly be divided. But creditors come in, and take away £28,000, leaving only £6000, instead of £34,000 to the family. The provisions, both to the younger children and the heir, must therefore suffer abatement; but ought they not to suffer it equally? Now that the lands have been sold, it is as certain that the heir's share is £26,000, as that that of the younger children is £8000; and, if it had been so expressed in the settlements, would they not have been in pari casu? The younger children's £8000, it may be argued, is not properly a burden on the reversionary share of the heir, but generally upon the whole property destined to the family. If that whole property is insufficient to answer that burden, the heir may have no reversion; but, if it extend to a far greater extent at the father's death, and is taken up by his trustees, then the claims, both of heir and of younger children, may be held to attach to it in proportion to their extent, and only afterwards to suffer a rateable abatement, from the competition of onerous creditors. If the trustees had brought the whole £34,000 into Court, as the fund in medio in this multiplepoinding, and called the creditors as defenders along with the children, the result would have been, that the younger children would have been entitled to claim for £8000, the heir for £26,000, and the creditors for £28,000; and if the last had been preferred primo loco, why should not the other two have been ranked pari passu on the balance?
“This is the view of the heir's case which has most struck the Lord Ordinary; and he shall be glad if the Court can adopt it. But he has already intimated, that he thinks it is answered by the consideration, that the estate really left to the heir, under burden of the younger children's provisions, is not the gross extant Cstate, worth £34,000, but the free or disposable estate, worth only £6000; and that the specific provisions to the younger children are truly a burden upon this estate, and may totally exhaust it. The difficulty of the heir's case is increased by the special terms of the trust-deed (which in this respect are conceived to be clearly within the reservation in the contract of marriage), directing the trustees first to pay over the special provision to the younger children, and then to convey the residue in general terms to the heir. The rule of law as to special and general legacies, leads also to the same conclusion.
“This plan of ranking the heir and younger children pari passu, according to what would have been respective interests in the estate, if there bad been no creditors, is the only one which the Lord Ordinary thinks can be plausibly maintained for the heir. The idea of giving him an equal interest with the other children, upon some analogy to the law of collation, appears to him to be quite inadmissible.
“If the heir is totally excluded, and the younger children preferred to the whole fund, it will scarcely be worth while to determine whether they shall all rank equally (inter se) for £8000, in terms of the original marriage-contract, or the three sons for £6000, and the daughter for £3000, and her annuity, in terms of the trust-deed and deed of restriction; and, if the heir is to rank for £26,000, the point is still more immaterial. The principle upon which it turns, however, is one of some delicacy and importance; and with reference to it, the Lord Ordinary would observe, that such a general reservation, to vary or increase the provisions to younger children, as occurs in this marriage-contract, would not, in his opinion, warrant such an increase as would substantially defeat or render illusory the original provision of the estate, in favour of the heir; and that, on this account, he should have been inclined to hold the additional provisions in the trust-deed, previous to their restriction, as objectionable. But as, by that restriction, they are now brought back very nearly to the sum in the original contract (viz. to £9000 and some odds, instead of £8000), he should not be disposed, as things stand at present, to listen to any challenge on the ground of exorbitancy.
“It occurred to him at one time that the heir, if not found entitled to claim as above suggested, might still assert an interest in the fund, on that clause of the trust deed which provides that, in the event of the death of any of the younger children before attaining the age of twenty-one, ‘their provisions shall fall and accresce to the residue to be conveyed to my eldest son, as before-mentioned.’ No fewer than three of the daughters, it is understood, have died in this situation, and if their shares should not be held to have lapsed, but only to have passed and been transferred to the heir, as a substitute or conditional institute, he would now be entitled to rank, and his brothers and sister, to the extent of no less than £9000. He may consider whether such a claim may still be urged at the advising; but the Lord Ordinary inclines to think that it could not be maintained, and that the clause imports a total lapse or extinction of the claim for such shares, except merely to the effect of Increasing the residue, which is still insufficient to satisfy the other special claims which have not so lapsed, If it were otherwise, the exorbitancy of the provisions, even under the deed of restriction, would be liable to very serious question.
“The daughter's claim to a preference for her annuity, as an alimentary fund, cannot, as the Lord Ordinary thinks, be admitted. He does not think it alimentary; and, if it were, he apprehends this would not save it from an abatement, rendered necessary by debts of the testator. It should be very moderately valued, and upon a broad equitable estimate;—the whole of her provisions, beyond her equal share of the £8000 in the contract of marriage, being barely defensible.”
Pleaded for Captain Russell—
1. Under the contract of marriage, the heir who was the persona predilecta had an equal jus crediti to the estate minus the provisions to the
2. The shares of the three daughters deceased, but who survived their father, have fallen to him under the terms of the trust-deed,
Pleaded for the younger sons—
1. The jus crediti in favour of the heir of the marriage is by the contract itself expressly qualified by the provisions to the younger children, which are made burdens upon it, so that it is only the residue, after payment of these provisions, to which he has any right. The
2. The provisions of the younger children dying in minority are not specially destined to the heir as a substitute or conditional institute to them, but are directed to fall into the residue, and so merely lapse into the general fund.
Pleaded for Miss Russell—
The annuity of £50 to the daughters is obviously of an alimentary nature, as appears from its limitation to the period of their marriage, and from its being inserted in lieu of the stipulation as to the sons, but omitted as to the daughters, for their being “alimented, clothed, and educated,” till their provisions were payable. Being alimentary, therefore, it is preferable to the ordinary provisions in favour of the others.
The Court pronounced this interlocutor:—“Repel the claim of Captain David Russell, as heir of his father, to any part of the fund in medio: Find, that the funds fall to be divided equally among the younger children of the marriage, in terms of the antenuptial contract: Find, that the expenses of the present action ought to be paid out of the said fund: and remit to the Lord Ordinary to apply the findings, and to proceed accordingly.”
Solicitors: Robertson and Spence, W.S.— Dundas and Wilson, W.S.— M‘Millan and Grant, W.S.—Agents.
