Scottish Court of Session Decisions

James Kinnaird, joiner, Greenock, and others, the trustees acting under the trust-disposition and settlement of William Sinclair, steamship agent, Greenock, presented a petition to the Court for authority to make advances of £50 a-year out of the surplus income of the trust funds to each of the testator's daughters Margaret and Jessie Sinclair. The testator died on 13th March 1908 leaving a widow and four daughters. By his trust-disposition and settlement he conveyed his whole means and estate to his trustees, giving among others the following directions:—“( Fourth) I direct my trustees to make payment to my said wife during her survivance of me of a free liferent annuity of Two hundred and thirty pounds sterling … declaring that the said annuity … shall be strictly alimentary and shall not be assignable by my said wife or subject to her debts or deeds or the diligence of her creditors: ( Fifth) I direct my trustees so long as my said wife shall survive me and shall remain my widow and the youngest of my daughters shall not have attained the age of twenty-five years, to pay out of the surplus of the annual produce and income of my said estate which shall remain after providing

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for the foresaid annuity … to my said wife, the following annual allowances to my daughters, viz.—to my daughter Jane the sum of eighty pounds and to each of my daughters Agnes, Margaret, and Jessie the sum of fifty pounds …; Declaring that in the event of the death or second marriage of my said wife before the youngest of my said daughters shall have attained the age of twenty-five years, then from and after such death or second marriage the said allowances to my said daughters shall be increased, as I hereby direct my trustees to increase the same, as follows, viz.—the allowance to my daughter Jane shall be increased to the sum of one hundred and thirty pounds, and the allowances to each of my daughters Agnes, Margaret, and Jessie shall be increased to the sum of ninety pounds, payable said increased allowances half-yearly and at the terms all as provided with regard to the said original allowances; Declaring that in the event of the death of any of my said daughters before the period hereinafter appointed for division of the residue of my estate, leaving issue, such issue shall be entitled equally among them, share and share alike, to the allowance which under this fifth purpose of trust would have fallen to their parent if in life, and that on the death of any of my said daughters before the said period without leaving issue the allowance which under this fifth purpose would have fallen to such daughter shall fall to the survivors of my said daughters jointly with the issue of such of them as may have predeceased said period leaving issue, the division being equally per stirpes, and declaring that in the case of any of my daughters or of their issue who shall be under twenty-five years of age it shall be in the power of my trustees to hold, apply, lay out, and expend the allowance or share of any such daughter or grandchild, and any interest or other income which may accrue upon accumulations therefrom, or so much thereof as shall in the opinion of my trustees be necessary for the purpose, in the maintenance, upbringing, and education or advantage otherwise of such daughter or grandchild, and that in such manner as my trustees shall deem best; of all which my trustees shall alone judge, and any portion of the allowance or share which may not be so applied shall be accumulated for behoof of such daughter or grandchild, and all such accumulations from any allowance or share shall on such daughter or grandchild attaining the said age of twenty-five years complete be paid over to the daughter or grandchild out of whose allowance or share the accumulations have arisen; and declaring that in the event of any such daughter or grandchild dying before he or she shall have attained said age, the accumulated interest or income on his or her share, or so much thereof as shall not have been expended for his or her behoof, shall form part of the residue of my estate and shall be dealt with accordingly; which allowances are and shall be strictly alimentary and shall not be assignable by my said daughters or their issue or any of them or subject to the debts or deeds of the daughter or grandchild entitled thereto or the diligence of creditors; and declaring also that any portion of said surplus of annual produce or income which shall remain after satisfying the allowances thereout hereinbefore provided shall be accumulated, as I hereby direct my trustees to accumulate the same, with the principal of my estate; and further declaring that in the event of the said surplus income being at any time insufficient to meet to the full extent the said allowances, such deficiency shall be made up, as I hereby direct my trustees to make up the same, out of the capital of my estate: ( Sixth) In the event of the marriage of any of my daughters before the period hereinafter appointed for division of residue I direct my trustees to make payment to such daughter out of the capital of my said estate of the sum of two hundred pounds sterling for her marriage outfit, which payment shall not be imputed as an advance to such daughter on account of her share in the final division of my estate, but shall be in addition to all other benefits provided to her under these presents …; ( Seventh) Upon the death of my said wife and upon the youngest of my daughters attaining the age of twenty-five years complete my trustees shall hold, apply, pay, and convey the whole rest, residue, and remainder as then existing of my said means and estate, including accumulations from income if any, among or to all my said daughters equally, share and share alike; declaring that the issue of any daughter dying previous to the period of division shall be entitled equally among them to the share which would have fallen to their parent if in life, and that in the event of any daughter dying without leaving issue the share of such daughter shall accresce to the survivors jointly with the issue of any predeceaser, the division being per stirpes; and also declaring that the shares of said residue shall become vested interests in the persons entitled thereto only upon the arrival of the period of division hereinbefore expressed.”

The petition set forth, inter alia—“The testator's daughters Margaret and Jessie, who are unmarried, were born respectively on 11th February 1883 and 11th May 1890, so that Jessie, who is the youngest of testator's daughters, attained twenty-five years of age on 11th May 1915.

The moveable estate of the testator as given up in the inventory of the personalestate was	£4505	0	0
from which there was deducted in respect of debts and funeral expenses	79	16	9
	£4425	3	3

The trustees have paid the debts, funeral expenses, and the pecuniary legacies, and have delivered the specific legacies in terms of the said trust-disposition and settlement, and have also settled the Government duties payable on the testator's death. The heritable estate of the testator was valued at the date of death at the sum of £7500.

The trustees have paid and are still paying the annuity of £230 to the widow of the testator. They have also paid the allowances to the four daughters up to the

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term of Whitsunday 1915. The youngest daughter having reached the age of twenty-five on 11th May 1915, the trustees thereafter discontinued payment of the allowances in terms of the fifth purpose of the trust-disposition and settlement.”

The petition then detailed the revenue balances shown by the accounts of the trust since its commencement amounting to £1909, 12s. 3d., and continued—“The widow of the testator has since Whitsunday 1915 maintained the two unmarried daughters Margaret and Jessie Sinclair wholly out of her own funds, except for a short period during the war, during which Jessie Sinclair earned a small salary as a bank clerk, with which salary she to some extent provided for her own maintenance. Mrs Sinclair's income at the present time amounts to about £290 per annum, made up of her annuity of £230 and about £60 from her own private investments, and is not capable of expansion. This income is subject to deduction of income tax. From time to time since 1915 Mrs Sinclair has felt very severely the increased cost of living, and has been obliged to remove from 81 Brisbane Street to a smaller house at 61A Finnart Street, Greenock. She has had to entrench upon capital to a considerable extent. She now finds that her total income is little more than sufficient to keep herself, and in consequence is unable to provide for the aliment of her two daughters who reside with her, and she declines to pay for the aliment of her daughters out of the capital of her estate so long as her husband's estate is available.

The daughters are not earning any income of their own, and have no private means. The elder daughter Margaret is unable to earn a living, not having received any training.… The other daughter Jessie … has recently been in hospital, and at the present time the state of her health does not permit of her taking any employment. She has had no training to enable her in these days to compete for a situation against the numerous other applicants who now apply for situations. Her assistance is not required by her mother in housekeeping so long as the elder sister is at home.

In these circumstances Misses Margaret and Jessie Sinclair applied to the petitioners for allowances out of the surplus revenues of the trust for their aliment, and the petitioners at a meeting on 27th October 1920 passed a resolution recording their willingness to grant them a yearly allowance of £50 each, provided the authority of the Court could be obtained for these payments.

The petitioners have very carefully considered the unfortunate circumstances in which the testator's two unmarried daughters have been placed, and they conceive that it is their duty to make this application on the ground that the present position can never have been in the contemplation of the testator, and that they are in fact endeavouring to give effect to his wishes.”

No answers were lodged.

On 4th January 1921 the Court remitted to Mr J. G. Kirkpatrick, W.S., to inquire into the facts and circumstances and to report. Mr Kirkpatrick's report included the following passage—“… The reporter respectfully suggests that the prayer be granted with two modifications—(1) that the allowances should be declared to be alimentary, and (2) that they should be deducted respectively from the shares which may ultimately come to these two daughters under the residuary clause in the trust-disposition and settlement, but without charging interest on the sums so advanced, such sums to be deducted from the first portion of the share of capital and accumulations of income to be paid to or set aside for these beneficiaries.”

Counsel for the petitioners was heard on 9th March 1921, when the following cases were referred to— Webster v. Miller's Trustees, 1887, 14 R. 501, 24 S.L.R. 368; Clark's Trustees, 1895, 22 R. 706, 32 S.L.R. 511; Robertson's Trustees, 1909 S.C. 236, 46 S.L.R. 139; Milne's Trustees, 1919, 57 S.L.R. 112.

At advising—