Perpetual Trustee Co Ltd v Rawlinson

Perpetual Trustee Co Ltd (the plaintiff) brought proceedings against Rawlinson and another (the defendants) in the Supreme Court of New South Wales, Court of Appeal. The dispute concerned the interpretation of a will and the proper distribution of assets from the estate of the late Mr. Rawlinson.

The central legal issue before the Court of Appeal was whether a specific bequest of shares in a company, which had undergone a capital reconstruction prior to the testator's death, should be interpreted as referring to the shares as they existed at the time of the will's execution or as they were constituted after the reconstruction. This involved determining the testator's intention regarding the subject matter of the bequest in light of the subsequent corporate changes.

The Court of Appeal held that the testator's intention, as evidenced by the will, was to bequeath the shares in their altered form. Applying principles of testamentary construction, the court reasoned that where a testator makes a gift of specific property that is subsequently altered in a way that does not fundamentally change its nature, the gift will generally be construed to pass the property in its altered state, unless there is a clear indication to the contrary. The court found no such contrary intention in the will.

Consequently, the Court of Appeal dismissed the appeal and affirmed the primary judge's decision, finding that the bequest of shares should be satisfied by the shares held by the testator at the time of his death, reflecting the post-reconstruction entitlement.