Vassella & Anor v Fryer & Anor

[1999] QSC 388

SUPREME COURT OF QUEENSLAND

[Vassella & Anor v Fryer & Anor]

File No S 7344 of 1999

BETWEEN:

ANNABEL JANE VASSELLA

First Applicant

AND:

RACHEL ANNE VASSELLA

Second Applicant

AND:

NORMAN RUSSELL FRYER

First Respondent

AND:

RAYMOND ALAN GEORGE SAUNDERS

Second Respondent

MOYNIHAN J – REASONS FOR JUDGMENT

DELIVERED ON:

9 December 1999

HEARING DATE:

28 September 1999

ORDER:

APPLICATION DISMISSED.

CATCHWORDS:

WILLS – CONSTRUCTION OF WILL – gift over - application of Saunders v Vautier (1841) 49 ER 282.

COUNSEL:

Mr M J Byrne for the applicants.

Mr D G Mullins for the respondents.

SOLICITORS:

John Harris Solicitor for the applicants.

Nicolsons Solicitors for the respondents.

1. The applicants are the surviving daughters of Neville Cyril Vassella and the respondents are his executors.  They seek declarations that the whole of Neville Vassella’s estate is vested in them, that they have an immediate entitlement to the transfer to them of the whole of the estate and an order that the transfer be effected. 

1. Clause 10 of Neville Vassella’s will deals with the disposition of this estate.  The clause commences by providing that his executors “must hold my estate in trust”.  The outcome of the application turns on the effect to be given to cl 10.3 of the will.  This provides:

“10.3     Subject to clauses 10.1 and 10.2:

(a)to give absolutely and divide all the residue of My Estate equally (as tenants in common) among those of my Children who survive me provided that where any of my Children at the time of my death have survived me but have not attained the age of thirty (30) years then notwithstanding any other law or legislation My Executors will hold My Estate in trust until those of my Children who do survive me attain the age of thirty (30) years provided further that subject to clause 10.3(b) where only one (1) of my children survives me, then I give absolutely the whole of My Estate to that child provided that My Executors hold My Estate until my only surviving Child attains the age of thirty (30) years; and

(b)if any child of mine referred to in clause 10.3(a) has already died or dies before me or before attaining a vested interest leaving Children then those Children on attaining eighteen (18) years of age will take equally (as tenants in common) the share which their parent would otherwise have taken provided that same will be held by My Executors until same occurs.”

1. The applicants submit that on the true construction of the clause they have a vested interest not conditional on their attaining thirty with a direction that the trustees hold that interest so that the applicants do not receive the estate in possession until both of them attain thirty.  They then rely on the application of the rule in Saunders v Vautier (1841) 49 ER 282. This is to the effect that where a gift is vested absolutely in a beneficiary of full age and capable of granting a full discharge, a direction merely postponing payment is to be disregarded.

1. Annabel Jane Vassella was born on 24 April 1974 while Rachel Ann Vassella was born on 27 February 1978.  Each is competent to give a valid discharge. Neither has children but so far as the evidence discloses may yet die before attaining thirty leaving children entitled to benefit under cl 10.3(b).

1. Two interrelated questions arise.  The first is whether the will gives the applicants an unconditional registered interest (ie. one not conditional on their attaining the age of thirty) with a direction to the trustees to hold that interest so that they do not receive the estate in possession until they attain thirty.   In that event there is a question as to whether there has been a provision for a gift over in the event of a contingency.

1. The questions are interrelated because it seems to me that the provisions of cl 10.3(a) giving the testators residuary estate “absolutely” must be construed in the light of provisions of cl 10.3(b).  Read as a whole, it is in my view the intention of the testator to create a gift over in the event of an applicant beneficiary failing to attain thirty and leaving children.  The position is analogous to that considered by Miles CJ in In the Estate of Lee; Perpetual Trustee Company (Canberra) Ltd v Rasker (1986) 84 FLR 268 where a will provided that property passed to the testator’s son provided he was still living at a specific date and provided for a gift over in the event that he was not.

1. At p 271 of the report, Miles CJ said:

“From a consideration of the competing policies which give rise to the application of the rule in Saunders v Vautier (the policy of giving effect to the testator’s intention as against the policy of not withholding the vesting of an estate in a person entitled to it) and from a consideration of the authorities it appears to me that the better view is that the rule may be avoided either by the creation of an intervening discretionary trust or by provision for gift over in the event of contingency taking place.  Such contingency may include the death of the donee or legatee:  see In re Johnston, Mills v Johnston [1894] 3 Ch 204; Re Couturier, Couturier v Shea [1907] 1 Ch 470.”

1. He then turned to consider the gift over saying:

“I do not think that their (the beneficiaries under the gifts over) contingent interests can be disregarded.  The interests of the unborn children and of the charitable organization may be remote and there may be good reason why both the first and second defendants wish to have the first defendant’s interests in the testator’s estate vested absolutely in him.  However, it seems to me that as a matter of law the imposition of gifts over avoid a breach of the rule in Saunders v Vautier and the testator’s intention is to be respected and given effect.”

1. In re Kenny (deceased), Read v Issacs [1921] NZLR 537 there was a direction that insurance monies and other property be held in trust for a period of 10 years with the trust estate divided in fixed proportions between the testator’s sisters and the children. In the event of the death of any of the children before the 10 year period and the leaving issue, there was a gift over to the issue. It was held that the gift to the sisters were vested and indefeasible and that no person other than the legatees had any interest in that or the accumulations of interest. The sisters therefore had a right to put an end to the accumulation and claim immediate entitlements. The gifts to the children were held to be defeasible in the event of their death before the expiration of 10 years. The trustees had no power to pay those shares before the expiration of the 10 years.

1. The will in the present case seems to me to differ from that considered in Re the Estate of Eleanor Middleton (deceased) (No 2037 of 1998 unreported Wilson J, judgment delivered 23 September 1998).  In that case the will left the whole of the estate to the trustee on trust for the testator’s daughter:

“until she attained the age of thirty (30) years and thereafter for her sole use and benefit absolutely provided in the event that my said daughter does not so survive me and leaving issue surviving, then I bequeath to my trustee upon trust for such issue that share which is her or their mother would have taken under this my will had she survived me and if more than one in equal shares as tenants in common . . .”

The construction of the phrase “not so survive me” consistently with the use of that phrase in other provisions of the will, supported a construction that the clause merely intended that the applicant should survive the testator’s death and not that she should survive her and reach the age of 30 years.  Also the expression “until” rather than a conditional expression such as “if” or “when” suggests an absolute vesting immediately with enjoyment postponed until the beneficiary attained thirty.  Those characteristics are not to be found in the will in this case.

1. It is true that cl 10.3(a) commences by referring to absolutely but as I have already said that must be read in conjunction with the whole of cl 10.3 and the language of that clause otherwise for example “. . . will hold . . .” and sub clause (b) including but not restricted to its use of “vested” interest.  Clause 10.3(b) appears to contemplate the applicants’ interest not vesting at least in possession because of death without attaining thirty.  It manifests a different intent from that of the testator in the will in Middlton (ante).

1. The considerations being those to which I have referred the application should be dismissed.  I will hear submissions on costs.