IN the TRUSTS of the WILL of DAVIE DECEASED No. SCGRG-96-2068 Judgment No. 6382 Number of Pages - 6 Wills, Probate and Letters of Administration

[1997] SASC 6382

IN THE SUPREME COURT OF SOUTH AUSTRALIA

WILLIAMS, J

CATCHWORDS:

Wills, probate and letters of administration - construction and effect of testamentary dispositions - generally - what interest passes - estates for life or in fee - construction of will to determine whether testator created absolute or life interest in favour of his wife - whether words 'if deceased' referred to at time of death of widow or during testator's lifetime - testator intended life interest only. Public Trustee v Roberts (1966) SASR 269; Re Pryor (1923) SASR 199; In re Bagshaw's Trusts (1877) 25 WR 659; In re Coward
(1887) 57 LT 285; Bolitho v Hillyar (1865) 34 Beav 180; Hervey v McLaughlin
(1815) 1 Price 264; Browne v Moody 1936 AC 635, applied. Re Sandford [1901] 1 Ch 939; Re Wilcock's Settlement (1876) 1 Ch D 229; Watkins v Williams (1851) 3 Mac & G 622, discussed. In Re Ferguson (1957) VR 635, considered.

HEARING:

ADELAIDE, 18 July 1997 (hearing), 26 September 1997 (decision)

#DATE 26:9:1997

#ADD 7:10:1997

Appearances:

Plaintiff Public Trustee:

Counsel: Mr S Milazzo

Solicitors: Treloar & Treloar

Defendant Helen Masters-Clements:

Counsel: Mr D Haines

Solicitors: Frank Webster & Associates

Defendant Clifford Walter Masters:

In Person

Defendant Edith Mary Davie:

Counsel: Mrs A Simpson

Solicitors: Carpenter & Associates

Order: Questions determined.

WILLIAMS J:

Public Trustee as executor of the last will of Charles Davie has made this application for the determination (without administration of the deceased's estate) of questions arising as to the construction of the deceased's will dated 28 August 1952.

The testator died on 9 June 1953 and probate of his will was granted to Public Trustee the sole executor therein named on 17 July 1953. The will (omitting only the execution clause) was expressed as follows:

"THIS IS THE LAST WILL AND TESTAMENT of me CHARLES DAVIE of 27 Canterbury Ave. Trinity Gds. Adelaide in the State of South Aust made the 28th day of August in the year of our Lord one thousand nine hundred and 52 I revoke all other wills made by me I appoint Public Trustees Adelaide to be my executor and direct that my Funeral and Testamentary Expenses and all my debts shall be paid as soon as conveniently may be after my decease I GIVE UNTO my wife Irene Mary Davie all my personal belongings & money in bank and property at 27 Canterbury Ave. Trinity Gds. and at the death of Irene Mary Davie the property & furniture to be sold by auction and equally divided between James Davie 19 Raleigh St. Coogee N.S.W. son of the late James Davie who came from Bathgate West Lothian Scotland or if deceased his share to go to his child or children and Clifford Walter Masters of 16 Holland St. Southwark Adelaide."

The assets and liabilities of that estate of the testator as disclosed in the relevant Succession Duty Statement was as follows:

Assets:

House property at 27 Canterbury Avenue Trinity Gardens (pounds) 2750. 0 .0 being the whole of the land comprised in Certificate of Title Register Book Volume 1909 Folio 25

Cash at Savings Bank of South Australia (safe deposit) (pounds) 150. 0. 0

Cash held in Savings Bank of South Australia (pounds) 453.11. 8 Account No 419504

AMP Policy No 765474 (pounds) 126.16. 0

Balance of pension due (pounds) 5. 5. 0

(pounds) 3485.12. 8

Liabilities:

CA Berry - Funeral Expenses (pounds) 46. 7. 6

Testamentary Expenses (pounds) 25. 0. 0

(pounds) 71. 7. 6

Net Estate (pounds) 3414. 5. 2

The deceased was survived by his widow Irene Mary Davie (born 20 March 1894) who died on 7 February 1996 (at the age of almost 102); by her will Mrs I.M. Davie purported to dispose of her interest in the Trinity Gardens house property to Helen Elizabeth Masters-Clements, the first defendant herein.

Mr Clifford Walter Masters (referred to in the will) is still living and is the second defendant; he is the brother of Irene Mary Davie and the father of Helen Masters-Clements.

James Davie (of Coogee N.S.W.) died on 25 August 1985. (He is described in the Succession Duty accounts as a descendant of the Testator's brother). He was survived by his wife Edith Mary and by their three children (as I have called them) Brian James Davie, Diane Davie and Peter Michael Davie all of whom were living at the death of Irene Mary Davie and are now sui juris. Mrs Edith Mary Davie (to whom I have already referred) is the third defendant and is the sole executrix and beneficiary under the will of Mr James Davie although that estate has never been formally administered.

The present application requires a determination as to the person or persons now entitled to beneficial interest in the property at 27 Canterbury Avenue Trinity Gardens in which the late Mrs Irene Mary Davie continued to live until her death.

Argument 1

The first defendant asserts that in terms of the testator's will, his widow became entitled to the house property absolutely; in this respect the first defendant asserts that the provisions of the will which purport to direct dealings with the property after the widow's death are repugnant to the terms of the disposition in her favour and should be ignored.

Argument 2

In resisting this argument the third defendant argues that the intent of the will was that the testator's brother James Davie should share in the proceeds of sale of the property after the widow's death unless James died during the testator's lifetime; this argument in particular calls in question the manner of construing the words "if deceased" (with reference to James) in the will. The third defendant asserts that in the events which have happened James Davie succeeded to a vested interest under the testator's will and that this interest passes to the third defendant by virtue of the will of the late James Davie.

Argument 3

The three children of the late James Davie (by leave granted the order of a Master on 15 January 1997) entered an appearance by the same solicitors as their mother, (the third defendant) but they did not otherwise participate in the proceedings. However, counsel for the third defendant acknowledged the argument which was available to be put on behalf of the three children and counsel for the applicant developed that argument. The parties displayed a proper consideration toward the question of costs and in the circumstances justice has been achieved without introducing the need for further counsel.

The argument for the three children (contrary to the argument of the third defendant) is that as their father Mr James Davie died during the lifetime of the testator's widow they have become entitled; the argument which they may advance is that the expression "if deceased" in the testator's will refers to the state of affairs at the widow's death (rather than at the testator's death).

It was implicit in the arguments for the third defendant and canvassed on behalf of her three children respectively that the second defendant was entitled to a one half share in the proceeds of the real estate subject to the widow's life interest; Mr Masters was personally present during argument but was unrepresented; he declined to advance argument himself.

These arguments are foreshadowed by the formal questions raised upon the construction application namely: 1. "Whether the disposition by the deceased created:

(1) an absolute interest in the property at 27 Canterbury Avenue Trinity Gardens in favour of the said Irene Mary Davie, or

(2) a life interest in the said property at 27 Canterbury Avenue Trinity Gardens in favour of the said Irene Mary Davie.

2. If yes to 1.(2) hereof then the identity of the person or persons for whom the plaintiff should stand possessed of the remainder interest in the said property at 27 Canterbury Avenue Trinity Gardens."

(There are other questions which will not need to be answered by virtue of my views upon the abovementioned questions).

In my view it is clear that although the Testator intended that his widow Irene Mary should have an interest in the Trinity Gardens house property, he also intended that upon her death further dispositions were to take effect with respect to the proceeds of sale of that property. This is not a case where the widow was at liberty to consume the subject matter of the gift or to allow it to waste. Reading the will as a whole, the direction for sale by auction and the dispositions which are coupled with this event - consequential upon the death of the widow - indicate the limited extent to which the Testator was intending to make provision for his widow. It follows that I do not perceive any repugnancy in the Testator's provision for his widow which engrafts onto it a provision for the sale of the property at her death and distribution of the proceeds; indeed I consider that the Testator's directions as to the manner of dealing with his real estate upon his widow's death give a firm indication as to the limited interest which he intended his widow to enjoy.

The will contains detailed instructions for the conversion of the real estate into money. Upon the face of the will, not only does the widow's death establish the time at which the auction should take place but concurrently it provides a reference point for determining the ultimate beneficial entitlements. Expressed in another way it seems to me that the Testator intended that his widow should have an interest in the house property limited to the period of her lifetime; upon the widow's death the testator intended that the real estate should be realised at auction and that the proceeds of that sale should be the subject of a division between nominated persons as described in the will. These persons in any event include Clifford Walter Masters.

In applying the expression "if deceased" to James Davie for the purpose of determining the beneficial interests to participate in the distribution the testator was making use of the same reference point - the death of the widow - as he used to fix the time for the auction to get in the proceeds to provide a fund for that distribution. Within the context of the will, I consider that the testator's mention of the contingency of the death of James Davie is a reference to the possible occurrence of the death of James before the death of Irene Mary. I reject the contention that the testator's language was directed to the contingency of the decease of James during the testator's life.

In examining the language of the will in the first instance (as I have done without reference to authority), I am mindful of the comments of Adam J in Re Ferguson (1957) VR 635 at 636 -

"The temptation to construe one will according to the construction given by a Court to another will in terms not obviously dissimilar is always present, but in a will such as this where slight differences may well signify a different intention, it is essential to recall the oft repeated injunction, one expression of which was given by Joyce, J., in Re Sanford, [1901] 1 Ch. 939, at p.941: "It has been said by the Court of Appeal that the true way to construe a will is to form an opinion apart from the decided cases, and then to see whether these decisions require any modification of that opinion; not to begin by considering how far the will in question resembles other wills upon which decisions have been given."

Re Ferguson is but one of a legion of cases in which the particular language employed in the will leads to the conclusion that the gift to the widow is to be regarded as absolute and the subsequent inconsistent gift over has not been allowed to stand.

In Public Trustee v Roberts (1966) SASR 269 Mitchell J reviewed the authorities.

The principles are not in doubt, although by reason of the differences in language no two cases exactly coincide. I adopt the approach taken by Poole J in Re Pryor 1923 SASR 199 at 201-2 where he said: "The real difficulty in the construction of this will is to determine which of two conflicting rules should be applied. The first rule is that where an estate in fee-simple is given any limitation by way of remainder is void, and where an absolute interest in personal property is given it cannot be given over to any other person in succession (In Re Wilcock's Settlement, (1876) 1 Ch. D. 229; Watkins v Williams, (1851) 3 Mac. & G.622; Theobold on Wills, 7 ed., p.648). The second rule is that an absolute gift can be cut down by anything in the will which indicates with reasonable certainty the intention of the testator to cut it down, or, in other words, that though a particular passage in a will, taken by itself, would give an absolute interest, the whole will is to be regarded and the intention of the testator gathered from the whole (In re Bagshaw's Trusts, (1877) 25 W.R. 659).

The language of the first gift does, standing by itself, undoubtedly give an absolute interest to the wife, and, if the first rule is applied, the subsequent gift in favour of the children is inoperative, but if the second rule is considered apart from the first it is equally clear that the testator intended to confer some benefit upon his children on the death of their mother.

There are many instances of a gift absolute in itself being cut down by other words, for, I quote the words of Cotton L.J. in In re Coward, (1887) 57 L.T. 285, at p.287:- "Undoubtedly, where an absolute estate is given to a person, whether in realty or personalty, any attempt to deprive that person of the right of dealing with it is inofficious, inoperative and useless. But...this rule is only a rule of construction,...which must be dealt with with reference to the other provisions...contained in the will. Being a rule of construction, it is to be followed only when the testator has not expressed his own intention - has not given any other guide to the Court which has to consider his will."

My reading of the authorities confirms my initial view that upon a fair reading of the whole of the will the testator only intended his widow to have an estate for life in his house property.

In considering the further point as to the meaning of "if deceased" in relation to James Davie I have obtained assistance from Bolitho v Hillyar
(1865) 34 Beav 180, (especially per the Master of the Rolls Sir John Romilly at 184), Hervey v McLaughlin (1815) 1 Price 264 and Browne v Moody 1936 AC
635. These cases support the view that I am entitled to treat the gift to James Davie as a vested interest subject to divestiture in favour of the three named children of James Davie in the event of his death during the life of the life tenant before the time of distribution - in this case the death of the life tenant.

In my opinion in considering the possible death of James, the testator was doing so in the context of dealing with the ultimate destination of his real estate; he was concerned to deal with a contingency which might occur before the time of distribution rather than before his own death. In my view the testator's reference to distribution upon the death of Irene Mary Davie coupled with a reference to the death of James Davie makes it clear to me that the testator is dealing with the contingencies as they may have happened at the point in time of distribution of the proceeds of the real estate.

I will answer the formal questions upon this application as follows: 1. The testator's will created a life interest in the property at 27 Canterbury Avenue Trinity Gardens in favour of Irene Mary Davie.

2. Upon the death of Irene Mary Davie in the events which have happened the plaintiff should stand possessed of the proceeds of sale of the abovementioned real estate (when sold by auction) as to one half for Brian James Davie, Diane Davie and Peter Michael Davie (the children of James Davie) and as to the other one half for the second defendant Clifford Walter Masters.

There will be an order accordingly. I will hear the parties as to the question of costs.