Thomas v Perpetual Trustee Co (Ltd) - [1955] HCA 74

94 CLR 537

It is interesting to note on the one hand that only one counsel appeared for the appellant in the Supreme Court, and on the other hand that four counsel appeared for the respondent in the High Court. When the junior counsel for the respondent took silk QUEENSLAND

another junior counsel was briefed. Why four counsel were employed by the respondent was not explained. The briefing of a very eminent leading counsel for the appellant may account for it. I have considered the fact that the respondent briefed four counsel on the appeal; but, having regard to all the other circum- stances, I do not think it affords a sufficient justification for inter- fering with the decision of the taxing officer.

In my opinion then the respondent should not be held liable to pay for more than two counsel.

The fifteenth item in question was a reduction by £1 1s. Od. to £4 14s. 6d. of a fee for the solicitor attending the High Court instructing counsel when the hearing concluded. Little or no reference was made to this item.

The application is dismissed with costs fixed at twenty guineas. Certify for counsel.

Order accordingly. Solicitors for the applicant, Chambers, McNab &Co. Solicitor for the respondent, H. T. O'Driscoll, Crown Solicitor for Queensland.

94 CLR 538

[ ]

THOMAS AND ANOTHER

DEFENDANTS,

PERPETUAL TRUSTEE COMPANY (LIMI-

RESPONDENTS. TED) AND OTHERS

PLAINTIFF AND DEFENDANTS, Will-Construction-Residuary state-Income-Trusts-Annuities-Payment out

of income-Surplus income-Accumulation-Direction-Rule against per- petuities-Void for remoteness-Intestacy-Disposition-Conveyancing Act 1919-1943 (N.S.W.), 8. 31-Thellusson Act (39 &40 Geo. III, c. 98).

A testator vested his residuary real and personal estate in trustees upon trust to pay out of the income thereof certain annuities, the annuitants being his wife, his daughter (an only child) and two sisters, and certain discretionary sums to provide for the children of his daughter should she die before they reached the age of twenty-one. He directed that any balance of income after payment of annuities and other charges should fall into and become part o his residuary estate, and that on the death of all the annuitants and on the youngest surviving child of his daughter reaching the age of twenty-six, his entire residuary estate should be converted and held upon trust as to one-half thereof to divide the same in equal shares among such children of his daughter as should have attained the age of twenty-six, with a restriction of such share in the event of there being only one such child to one-third of his residuary estate or to £7,000 whichever should be less, and as to the remainder upon trust to divide it among certain named charities.

When the maximum period (twenty-one years) of accumulation permitted by the Thellusson Act, 39 &40 Geo. III c. 98 (in N.S.W. the Conveyancing Act 1919-1943, S. 31 (1) ) expired, the testator's daughter was the sole surviving annuitant and there was a considerable surplus of income each year after paying the annuity and any other charges. Her only…

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: [1955] HCA 74
Decision Date: 19 December 1955

CaseChat Overview and Summary

This case concerned an appeal to the High Court of Australia regarding the construction of a testator's will and the distribution of surplus income. The primary dispute was between the testator's daughter and granddaughter, who contended that the entire surplus income should pass as on an intestacy, and several charities, who argued they were entitled to half of this surplus income. The High Court was required to determine the proper destination of income that, by virtue of the Thellusson Act (as enacted in New South Wales), could no longer be accumulated as directed by the will.

The court had to consider whether the charities, as contingent beneficiaries of the residuary estate, had an immediate interest in the surplus income released from the accumulation direction. The core legal issue was whether the testator's direction for surplus income to fall into the residuary estate created a valid disposition of that income, or if it remained undisposed of and thus passed on intestacy. This involved interpreting the effect of the statutory voiding of the accumulation direction and the nature of the interests granted to the charities and the testator's daughter and granddaughter under the will.

The High Court, in reversing the decision of the Supreme Court of New South Wales, held that the charities were not entitled to an immediate share of the surplus income. The court reasoned that the gifts to the charities were contingent upon a future event (the period of distribution) and did not carry intermediate income. Furthermore, the testator's direction for surplus income to fall into the residuary estate was found to be subject to the annuities and potential maintenance payments, meaning the charities did not have an immediate right to intercept this income. Consequently, the surplus income, not being validly disposed of by the will, passed as on an intestacy to the testator's daughter and granddaughter.

Orders