Barby v Perpetual Trustee Co (Ltd) - [1937] HCA 64

BARBY AND OTHERS

PERPETUAL TRUSTEE COMPANY (LIMITED)

AND ANOTHER

RESPONDENTS.

PLAINTIFF AND DEFENDANT, Charities-Gift for returned soldiers, their widows and descendantsGeneral charitable

intention-Scheme propounded by testatrix-Impracticability-Cy-prés

The testatrix bequeathed her residuary estate to her trustee with a direction Nov. 24, 25.

to apply the whole of the capital and income thereof for the relief of neces- sitous returned soldiers and their widows children or grandchildren who may be in necessitous circumstances (that is those only earning the basic wage for the time being or under and not possessed of more than £200) in the manner and in accordance with the scheme following that is to say": then followed a definition of persons eligible to receive benefits under the scheme, and a detailed scheme under which the trustee was to expend the money in the purchase in its name of virgin land, unfenced and unenclosed, in the State of New South Wales and not less than fifty miles from the General Post Office at Sydney, and to let such land at a peppercorn rent to persons within the scheme, who were to covenant to reside upon and work the land. There was a provision by which the trustee was empowered to let the premises even to the great-grandchildren of returned soldiers and others eligible under the scheme and even though they were not in necessitous circumstances. Finally, the testatrix directed " 'my trustee to complete the distribution of the whole of my residuary estate both capital and income 5.9 at a certain date " by trans- ferring in fee simple without consideration to each of the then occupant or occupants of the lands SO to be purchased under the terms of this my will and

58 CLR 317

the remaining part of my estate (if any) to be converted into cash and such cash distributed between and amongst such then occupant or occupants."

Held that the gift was a valid charitable gift, and that the will contained a general charitable intention sufficient to justify the application cy-près of the fund in the event of the testatrix's scheme proving impracticable.

Decision of the Supreme Court of New South Wales (Nicholas J.) affirmed.

APPEAL from the Supreme Court of New South Wales.

By her will dated 3rd March 1933 the testatrix, Elizabeth Kirby, bequeathed her residuary estate to her trustee with a direction to apply the whole of the income and capital thereof " for the relief of necessitous returned soldiers and their widows children or grand- children who may be in necessitous circumstances manner and in accordance with the scheme following." Then there followed a scheme which, with other relevant facts, sufficiently appears from the judgment of Latham C.J. hereunder.

The trustee of the will, the Perpetual Trustee Co. (Ltd.), took out an originating summons for the determination of the following ques- tions :-(1) Whether the trusts for the relief of necessitous returned soldiers and their widows, children or grandchildren were valid charitable trusts. (2) If so, whether it…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [1937] HCA 64
Decision Date: 25 November 1937

CaseChat Overview and Summary

The case of *Barby v Perpetual Trustee Co (Ltd)* involved an appeal to the High Court of Australia concerning the interpretation of a testatrix's will. The testatrix, Elizabeth Kirby, bequeathed her residuary estate for the relief of necessitous returned soldiers and their widows, children, or grandchildren, outlining a specific scheme for its application. The trustee sought to determine the validity of these trusts, the practicability of the scheme, and whether the estate should be applied cy-près if the scheme proved unworkable. The primary dispute was whether the will disclosed a general charitable intention or merely a particular one tied to the specific, potentially impracticable, scheme.

The legal issues before the court were whether the trusts established by the will constituted valid charitable trusts, and if so, whether the testatrix had demonstrated a general charitable intention sufficient to permit the application of the estate cy-près. This involved determining whether the detailed scheme for settling returned soldiers on virgin land was so integral to the testatrix's wishes that its failure would invalidate the entire charitable purpose, or if it was merely a subsidiary method for achieving a broader charitable aim.

The High Court, affirming the decision of the Supreme Court of New South Wales, held that the gift was a valid charitable gift. The court reasoned that the introductory words of the will, expressing an intention to relieve necessitous returned soldiers and their descendants, indicated a general charitable intention. The detailed scheme that followed was considered a subsidiary means to achieve this paramount purpose, rather than an essential condition that would defeat the gift if impracticable. The court applied the principle that where a general charitable intention is evident, and the specified mode of carrying it out fails, the court will apply the fund cy-près to give effect to that intention.

The appeal was dismissed, and the order of the Supreme Court was affirmed with a variation to clarify that the entire residuary estate was subject to the charitable trust. The costs of the Attorney-General and the trustee were to be paid out of the estate as between solicitor and client, and the appellants' costs were to be paid out of the estate as between party and party.

Orders