Wijeratnc v. Public Trustee
1976Present : Wimalaratne, J., Sirimane, J. and
ANTON WIJERATNE, Plaintifi-Appellantand
THE PUBLIC TRUSTEE OF CEYLONDefendant-Respondent
S.C. 165/69 (F)—D.C. Colombo 235/Trust
Trust—Last will—Property devised in favour of three persons—Legateepredeceasing the testator—Does legacy lapse in such c cose—'Communication by testator to trustee of terms of trust—Is suchrequirement essential.
By his last will dated 11th May, 1950, A appointed the PublicTrustee as his executor and trustee and left certain monies, othercash assets and shares in companies to be held by the Public Trusteefor the benefit of his wife, his daughter and his sister in equalshares. It was also provided that in the event of the death of thesaid sister her share should be distributed among her children freeof the trust.
A died on 20th February, 1964, but had been predeceased by hissister who died on 28th October, 1962. The children of the saidsister instituted an action to compel the Public Trustee to distributethe share of their mother amongst them free of the trust. ThePublic Trustee pleaded that A’s sister having predeceased him didnot acquire any rights under the said last will and that thereforeher children did not become entitled to the benefit in favour oftheir mother, the relevant provision of the will having lapsed. Thelearned District Judge dismissed the plaintiff’s action on the groundthat the said sister of A had predeceased him and the childrenwould not be entitled to any interest under her.
Held: (1) That the principle of the lapse of a legacy in theevent of the devisee p edeceasing the testator had no applicationon the facts of the present case. The property was devised to'the trustee in trust for distribution and the share claimed by theplaintiffs did not lapse on the death of their mother.
(2) That the trust in relation to this property was declared bythe last will of the testator and there was no need for communi-cation to the Public Trustee during his life time of the terms of thistrust. Under section 6 of the Trusts Ordinance a valid trust hadbeen created.
Case referred to :
Re Gardner, (.1923) 2 Ch. 230; 129 L.T. 206; 92 L.J. Ch. 569.
APPEAL from a judgment of the District Court, Colombo.
C. Ranganathan, Q.C., with Y. D. S. Perera, for the plaintiffs-appellants.
H. W. Jayewardene, Q.C., with J. W. Subasinghe and MissManel Kalatuwawa, for the defendant-respondent.
Cur adv. milt
1 •—A46C88 (70/10)
WI MAX. All AT NE. J.—Wijaratne v. Public Trusts*
July 27, 1976. Wimalaratne, J.
By his last*will No. 2065 dated 11th May, 1950, Don MartinAmarasinghe appointed the Public Trustee as his executor andtrustee, and gave all his money invested in mortgages and lyingin banks and all h s other cash assets as well as shares in com-panies to be held by the Public Trustee for the benefit of (1)his wife Rosalin Amarasinghe, (2) his daughter Mopsey Jaya-wardena, and (3) his sister Mary Elizabeth Wijeratne, in equalshares, subject to the trusts set out in the Last Will.
The will provided, inter alia, that upon the death of any ofthe above three beneficiaries, the Public Trustee should windup the share of the trust estate of the person so dying and dis-tribute the same in the manner set out therein. In the event ofthe death of his sister Mary Elizabeth, it was directed that hershare should be distributed among her children freed from thetrust.
The testator died on 20th February, 1964, and probate of thelast will was issued to the Public Trustee in October of thesame year. Mary Elizabeth predeceased the testator, having diedon 28th October 1962. The plaintiffs, who are the only childrenof Mary Elizabeth, instituted the present action against thePublic Trustee, praying for an order directing him to executethe trust in accordance with the provisions of the last will, andto d stribute the share of their mother amongst them, freedfrom the trust.
The defendant pleaded that Mary Elizabeth having pre-deceased the testator, did not acquire any rights under the will,and that the plaintiffs, as her children, did not become entitledto the benefit in favour of their mother, and that the relevantprovision T>f ttie will had lapsed.
The learned District Judge dismissed the plaintiffs’ action forthe reason that Mary Elizabeth could get rights only under thewill, and that as she preleceased the testator, her childrenwould not be entitled to any interest under her.
It has been contended on behalf of the plaintiffs-appellantsthat the learned District Judge has erred in applying the prin-ciple of the lapse of a legacy in the event of a devisee predecea-sing the testator, for in the present case as the property wasdevised to the trustee in trust for distribution, the share claimedby the plaintiffs did not lapse on the death of their mother. Ithas also been contended that the District Judge has failed togive effect to the intention of the testator as expressed in thelast will.
WI MAX. AH ATlt'E, J.—Wijeratnc v. Public Trustee41}.
The paramount consideration being the intention of thetestator at the time he made his will, it is necessary to deter-mine that intention before applying the law to the facts of thiscase. The testator provided that (a) in the event of the deathof his sister, her share should be distributed among her children,free from the trust, and (b) in the event of the death of h s wifeher share should be divided between his daughter and his sister,if they be alive, or if they not be alive, between their children,free from the trust. The children of his sister were thereforemuch in his mind when he included these provisions in his will.Could it then be said that he intended that these children shouldshare the benefit only in the event of their mother survivinghim. Could it be said that they were not to be his beneficiariesif their mother died even one day before him ? I think that thetwo provisions referred to above clearly indicated his intentionto provide for them after their mother’s death, whether thatevent occured before his death or after his death.
It is settled law that where a legatee dies before the testator,the testamentary gift will lapse—Jarman on Wills (Vol. 1)p. 438 ; Steyn on the Law of Wills in South Africa (2nd ed.)p. 131. Thus, if a devise be made to A and his heirs, and A diesin the lifetime of the testator, the devise absolutely lapses, andA’s heirs take no interest in the property.
The submission cf learned Counsel for the plaintiffs-appellantsis that the position is different where property is given in trust.Where A by will gives property to B in trust for the benefit ofC, there is no question of the trust lapsing on C predeceasing thetestator, if the intention to benefit C’s heirs is clearly indicated.
Support for this proposition is to be found in the followingpassage in iLewin on Trusts (15 th ed.) p. 49 :— “Where it isestablished that a trust for the benefit of individuals is engraftedupon property given to the donee by will or passing to him underan intestacy, the share under the trust of a beneficiary dying inthe lifetime of the testator or intestate will not lapse, as thebeneficiary takes, not under the will or intestacy, but under thetrust, which was created from the date of its communication tothe legatee ”.
The learned District Judge has held that there was no evidenceto show that the terms of the trust were communicated to thePublic Trustee before the death of Mary Elizabeth and that asshe could get rights only under the will, no rights would pass toher children because she predeceased the testator.
WIMALAKATNE, J.—Wijeratne v. Public Trustee
The need for “ communication ” has been dealt with inre Gardner, (1923) Ch. 230. In that case a testatrix, by herwill executed in 1909 left all her property to her husband forhis use and benefit duripg his lifetime, ‘ knowing that he willcarry out my wishes Four days later she signed an unattestedmemorandum expressing the wish that the money she left to herhusband should on his death be equally divided among twonieces, May and Mabel and a nephew Lancelot. She died 10years later and the husband died five days after her. Mabel diedin the lifetime of the testatrix, and the question arose as to whe-ther Mabel’s share was payable to her personal representative orwhether the trust in respect of Mabel’s share failed. It was heldthat the beneficial interest of Mabel was payable to her legalpersonal representative, notwithstanding that she had pre-deceased the testatrix. Romer, J. said, “Apart from authority,I should without hesitation say that in the present case the hus-band held the corpus of the property upon trust for the twonieces and nephew, notwithstanding that the niece predeceasedthe testatrix. The rights of the parties, appear to me to beexactly the same as though the husband, after the memorandumhad been communicated to him in the year 1909 had executed adeclaration of trust binding himself to hold any property that
should come to himupon trust as specified in the
memorandum. If I could construe the husband’s promise as apromise tq give ttie property on his death to such of the threenamed persons as should survive the testatrix or to such of themas should survive him, I should decide in favour of (the next-of-kin of the husband). I cannot, however, so construe his promisewithout introducing into the memorandum words that are notthere ” at p. 233. It would appear then, that from the fact of com-munication of the memorandum by the wife to the husband, apromise by the latter to carry out her wishes as contained in thememorandum, amounting to a declaration of trust by thehusband, was inferred.
Communication to and acceptance by the husband wasessential in that case because the memorandum designating thebeneficiaries was an unattested document, an informal instru-ment not complying with the formalities laid down by law.
WIMLALARATNE, J.— Wijeraine v. Public Trustee
If that memorandum had not been communicated to andaccepted by the husband during the lifetime of the testatrix, hewould, by reason of the will have been the legal as well asequitable owner. In the instant case tlje trust in relation to theproperty was declared by ttie last will of the author of the trust.It became valid under section 6 of the Trusts Ordinance becausethe author of the trust indicated with reasonable certainty (a) anintention to create thereby a trust, (b) the purpose of the trust,
the beneficiaries, and (d) the trust property. There was,therefore no need for communication to the Public Trusteeduring the testator’s lifetime.
Mr. Jayewardene referred to the following passage in Scott onTrusts—Vol. IV section 411.1 p. 2937 “An express trust may fail
and a resulting trust arise in a number of situationsIt
may fail in the case of a testamentary trust because the bene-ficiary predeceases the testator with the result that the devise
or bequest of the beneficial interest lapsesIn all these
cases if the trustee takes title to the property he holds it upon aresulting trust for the settlor or his estate
Section 412 p. 2947 “ Where an express trust fails, a resultingtrust in favour of the settlor arises, not because the settloractually intended that it should arise, but because he did notintend that the trustee should have the beneficial interest anddid not make any other disposition of the property in the eventthat the intended trust should fail ”.
But Scott also makes it clear that “ a resulting trust will notarise, however, if the settlor properly manifested an intentionthat a different disposition should be made of the property if thetrust should fail ”. In the instant case the settlor has made itclear that if his sister be not alive, then the trust should operatein favour of his sister’s children.
For these reasons I am of the opinion that the appeal shouldbe allowed, and that judgment should be entered in favour ofthe plaintiffs-appellants as prayed for with costs, both here andin the court below.
Sirimane, J.—I agree.
Wijesundera, J.—I agree.
ANTON WIJERATNE, Plaintiff-Appellant and THE PUBLIC TRUSTEE OF CEYLON Defendan