King v Philcox

The High Court of Australia considered a dispute between King and Philcox concerning the interpretation of a will. The primary issue revolved around whether a specific bequest of shares in a company, which had undergone a significant corporate restructure prior to the testator's death, should be satisfied by the shares held in the restructured entity or by the original shares.

The court was required to determine the proper construction of the will, specifically whether the testator's intention was to bequeath the specific shares as they existed at the time of the will's execution, or as they were constituted at the time of death, given the intervening corporate changes. This involved an analysis of the principles governing the ademption of specific bequests when the subject matter of the bequest has been altered or replaced.

The High Court held that the bequest of shares was specific and that the corporate restructure had fundamentally altered the nature of the shares. Applying the principle that a specific legacy fails if the subject matter is not in existence at the time of the testator's death in the form in which it was bequeathed, the court found that the original shares had been replaced by new shares in the restructured company. Consequently, the specific bequest of the original shares had adeemed. The court therefore ordered that the appeal be dismissed.