Charities—Charitable gifts and trusts—Validity—Indefinite and uncertain objects—Testamentary gift for distribution of income between institutions and bodies exempt from State death duties—Whether gift charitable—Imperfect trust provision—Trustees Act, 1962 (W.A.), s. 102*—Administration Act, 1903-1965 (W.A.), s. 134 (1)*.
Decisions
November 12. The following written judgments were delivered:- BARWICK C.J. I have had the advantage of reading the reasons for judgment prepared in this matter by my brother Gibbs. I agree with his reasons and his conclusions and do not desire to add anything to what he has written. In my opinion, the appeal should be dismissed. (at p143)
MENZIES J. I have had the advantage of reading the judgment of Gibbs J., and I agree with it. (at p144)
WINDEYER J. I have had the advantage of reading the judgment of Gibbs J. I am relieved by it of the need to state the facts. I agree in his Honour's conclusion that, if the testator's direction as to the disposition of his residuary estate does not by its terms create a valid charitable trust, then s. 102 of the Trustees Act, 1962 (W.A.) saves it from invalidity. I concur too in his Honour's reasons for that conclusion. But I do not think that this statutory saviour was needed to rescue the trust from invalidity. In this I differ from his Honour and from Lavan J., the learned judge at first instance. I shall explain why I consider that, the Trustees Act apart, the will created a valid charitable trust. It is not necessary to do so as it cannot affect the result of this appeal. Nevertheless I do so as I am not able to accept a construction of the words of the will and of provisions of the Administration Act, 1903-1965 (W.A.) which I consider mistaken and which I think ought not to govern cases that may arise in the future. (at p144)
2. In the first place I cannot without some qualifications accept the view that the trustees of the testator's residuary estate, which he called the "J.P. Stratton Trust", could not distribute any of the trust income for the maintenance of a free ward in a hospital. Certainly they could not lawfully give any money to a "public hospital" for the general purposes of such hospital. That is because the testator has expressly put such hospitals outside the permissible range of his bounty. By cl. 15 of his will the testator directed that the income of his residuary estate be from time to time distributed by his trustees between the institutions and bodies (except any public hospital within the meaning of the Hospital Act, 1927) in respect of which at the date of his death any gift, bequest or legacy was by s. 134(1) of the Administration Act exempt from estate, succession or other duty under that Act. The sense in which the word "institutions" is…
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.
Continue reading Stratton v Simpson
Sign in free to access the full text
Details
AGLC
Stratton v Simpson [1970] HCA 45
Case
[1970] HCA 45
Decision Date
CaseChat Overview and Summary
In *Stratton v Simpson*, the High Court of Australia considered a dispute concerning the interpretation of a will. The primary issue before the Court was whether a specific bequest of shares in a company, which had undergone a significant reconstruction prior to the testator's death, should be construed as referring to the shares as they existed at the time of the will's execution or as they were at the time of the testator's death.
The Court was required to determine the proper approach to construing a testamentary gift of shares in a company that has undergone a reconstruction between the date of the will and the date of the testator's death. Specifically, the Court had to ascertain whether the testator's intention, as expressed in the will, was to bequeath the original shares or the shares that represented the testator's interest in the company at the time of death, notwithstanding the changes in the company's capital structure.
The High Court held that the general rule is that a gift of shares in a company refers to the shares as they exist at the time of the testator's death, unless the will clearly indicates a contrary intention. The Court reasoned that a testator's will speaks from the date of death, and therefore, any disposition of property should be understood in light of the property held by the testator at that time. In this instance, the reconstruction of the company did not fundamentally alter the nature of the testator's investment in the company, but rather changed the form of that investment. Consequently, the bequest was held to apply to the shares held by the testator at the time of his death, which represented his continuing interest in the company.