077-NLR-NLR-V-58-L.-P.-ABEYAWARDENE-Appellant-and-C.-S.-WEST-Respondent.pdf
£Ix the Privy Couxcir.]
1957 Present:Earl Jowltt, Lord Oaksey, Lord Mao Dermolf,Lord Cohen-and Lord Keith of AvonholmP. ABEYAVrARDENii, AppelJtint, and C. S. WEST, Respondent
Privy Council Appeal Xo. 37 of 1952
«V. C. o/2—D. C. Colombo, 2,6S9
Donation by parents to minor child—Acceptance—Fideiconimissum in Jacour of family—May be “ single'’ or “recurring (multiplex)”—Acceptance of such gifts—Itcvocabilily—Entail and Settlement Ordinance (Gap 54), ss. 4, 5, 7, S—Exchangeof fideicommissary properly thereunder—Effect thereof on rights of fiduciariesand fideicomtnissaries—Dona- fide purchaser from fiduciary—His position asagainst the fideicommissary—Partition of fideicommissary properly by thefiduciaries—Rinding effect on the fidcicommissaries.
Where both parents of a minor child jointly gift immovable property to l holatter, acceptance on behalf of the doneo by his nearest, male relatives, other thunhis father, would be sufficient acceptance of tlio gift.' (Xn the present eraseacceptance was by the two brothers and brother-in-law of tho donees.) •
A deed of gift which creates a fideiconimissum in favour of tho children notvet born of the fiduciary doneo is a fideicomniissuin in favour of a family. Insuch a case acceptance by tho fiduciary' is an acceptance for his children thofideicoiiiinissaries, and tho gift to tho fidcicommissaries cannot bo subsequentlyrevoked by the donor, even with the consent of the fiduciary, without theconsent of tho fidcicommissaries.
A fideicomniissuin in favour of a family need not necessarily bo a fideicom-missuni which goes on from generation to generation. A fideicoimnissuna whichconics to an end with tho first generation of fidcicommissaries, i.o., with thefiduciary’s children who aro free to dispose of the property as they wish, is also afideiconimissum in favour of a family. Tho presumption of acccptanco by aparent fiduciary for his immediate descendants is as valid as the-presumption ofacccptanco for descendants to tho third or fourth generation. Gurolis v. A licit(19-1-1) 15 Lr. R. 150, overruled.
Where the Court authorises an exchange of fideicommissary property on anapplication mado under tho provisions of tho iintuil and Settlement Ordinance,tho property becomes freo of tho fideiconimissum, but the terms of tho originalfideiconimissum aro preserved and are applicable to the land taken in excharge,even though no refercnco is expressly mado in tho Order of tho Court that tholaud is to devolve on tho fidcicommissaries on tho cessation of tho fiduciaries’interests; Tho Court may, however, with the consent of the fiduciaries, mo.difytho terms of the original gift in regard to tho powers of the fiduciaries in respectof their own rights and interests in tho land. But that cannot affect the rightsof tho fidcicommissaries.."
A fiduciary though vested in the dominium of the property gifted has thatdominium only during his life and cannot convey more than he enjoyed. On
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hig^elUl; or other event, tlio fitleicbrnmisgMy B^oine& tfie'Owner of'the pfoportywrit Jr title -which must prevail even' against a bona "fidcr purchase}- from the•fiduciary without any notice of n defect in his title.’
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Where the fiduciaries, or tlioso to whom they transfer their intersts. make npartition agreement inter ee in respect of tlio fideicommissnry properly, thepartition will bo good and binding on the respective fideicommissaries.
Siman and Maria, who were husband and wife, jointly gifted to their daughtersCecilia and Jane a parcel of land known as “ Tho Priory The gift was subjectto a life interst in the donors anil also created a fidcicommissum by which, aftertho death of the donees, tho title in the premises was to devolve on the children oftho donees. As tho donees were minors, the gift, was accepted on their behalfby their two brothel's anil their sister’s husband. Tho fideicommissries hadnot yet been born at the date of tho gift.
By application under tho Jin tail ami Settlement. Ordinance made on 17 thJuno IS90, in which Siman and Maria were petitioners and Cecilia anti Junewere respondents, the petitioners asked the Court to authorise Cecilia and Janeto convey “ The Priory ” to Siman free from all restrictions in consideration ofthe petitioners transferring to Cecilia and Jano another property called “ Siri-nivasa ” subject to certain conditions imposed on Cecilia and Jane ns againstthe petitioners. All parties consented to the application which was, accordingly,allowed by the Court. The Order of tho Court, however, made on IStli Juno1896, did not make any refercnco that “ Sirinivnsa ” should devolve after thedeath of Cecilia and Jano on their rcspcctivo issue.
Following on tho Order of Court two conveyances in respect oT "The Priory'*and “ Sirinivasa ” were executed on 23rd June 1S96. On the same day Ceciliaconveyed to Siman her undivided moiety of “ Sirinivasa ”, which slio had justreceived from her father, in consideration of the sum ofPs. 4.5,000. ” Sirinivasa”was thus held by Siman and Jane in undivided moieties. On 30th June1900 they agreed on a partition and Siman conveyed his undivided share in (lieeastern portion of “ Sirinivasa ” ns delimited in the deed to Jane and Janeconveyed to Siman her undivided share in tho western portion ns delimited.On 30th November 1905, Jane conveyed her divided share of ” Sirinivasa ”to Siman. Siman thereafter, in 1907, conveyed the wholes^tif “ Sirinivasa ”to liis son James. Under James’s will the land passed to trustees for charitablepurposes and was divided by them info separate lots, Tho father of the personwho is tho defendant in the present action became purchaser of two of theselots. When ho bought them ho did not- look further back in the chain of titlethan tho Order of the Court made in 1S96. Ho subsequently donated themto tlio defendant. The plaintiffs, who were the children of Jane, claimed titlein the present action to these two lots ffs fideicommissnries under the deed ofgift executed in 18S3.'
Held, (i) that, as regards the gift of 1SS3, the acceptance of it by the brothersand brother-in-law of the donees who were minors was a valid acceptnuco onbehalf of tho donees.
(ii) that the gift created a fidcicommissum in favour of a family. Acceptancetherefore, by the fiduciary donees was an acceptance for their children thefideicommissaries, and the gift to tho fideicommissaries could not be revokedsubsequently by the donors, even with the consent- of the fiduciaries.
fill) that- the cfTcct of the Order of Court of ISlh June 1S96 was that ” Siri-nivasa ” when received in exchange for “ Tlio Priory ” was bound by the termsoftlie original fidcieommissuin of 1SS3. Subject, therefore, to any limitationsplaced upon the rights of the fiduciaries with their consent the rights of thelideicoinmissaries in relation to “ Sirinivasa ” were not affected. The effect oftho.Untail and Settlement Ordinance was to write t-lie terms of the original
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lirlcii-otnnii.ssum into llio substituted gift nnd the consequences of what wastlono in 1&S3 must be considered at the date of the present action when thefideicommissnrics made their claim and not in 1S9G when there was none inexistence.
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(i-) (hnt llio fact that the defendant's father did not look further back in thechain of title than the Order of Court of 1S9G nnd wnSj therefore, a hona titlepurchaser without any notice of a defect in his title could not avail the defendantas against the fideicoinmissnrics.
(v) that when tho partition of " Sirinivasa ” took place between Jane nndher father Simon in 1900 the fideicoinmissum attached to each of the divided|K>rtions for the benefit of Jane's issue and Cecilia’s issue respectively. Simonstood in Cecilia's shoos ami was entitled to make a partition agreement withJane.
jA.PPE.-VL from a judgment of the Supreme Court reported inr,3 X. L. Ti 217.
X. Prill, Q.C., with John Stephenson and L. Kadirgamar, for theplaintiffs appellants.
Frank Gahan, Q.C., with R. O. Wilberforce, Q.C., and S. N. Bernstein,for the defendant respondent.
Cur. adv. vult.
January 14, 1057.[Delivered by Loud Keith of Avoxiiolm]—
The appellant is plaintiff for himself and as substituted for other twoplaintiffs, his brothers, both now deceased, in an action brought in theDistrict Court of Colombo for declarator that tho original plaintiffs wereentitled to a parcel of land in Colombo known as “ Sirinivasa ” and forother relief. The respondent is defendant in the action. She holds theland under gift from her father,^'ho bought the land in dispute (on atitle traceable back to the same source from which the appellant’s claimis traced), and thereafter gifted it to the respondent subject to a fidei-commissum. The District Judge granted the declarator sought subjectto certain conditions that it is not material hero to notice. The respondentappealed to the Supreme Court which allowed the appeal with costs boththere and below. From that judgment appeal has been taken, with leaveof the Supreme Court, to their Lordships’ Board.
The dispute turns upon the effect of a gift of land made in 1SS3subject to a fidei-commissum and subsequent transactions. The materialportions of the deed of gift, deed No. 2110, are in the following terms :—
– *s Know all men. by these Presents that we, Mututantrige SimanFernando and Colombapatabe-ndige Maria Perera, husband and wiferesiding at Horctuduwa in Panadura being desirous, of inakirfg/some
provision for our children and in consideration of the Jove and.affection we bear to our daughters Mututantrige Cecilia Fernandoand Mututantrige Jane Fernando and for divers other good causesand considerations us Jiercunto moving do hereby give grant, assign,set over and assure by way* of gift subject to the conditions herein-after stated, unto the said Mututantrige Cecilia Fernando andMututrantirge Jane Fernando (hereinafter called- the donees) thefollowing property, to wit:'
(description of property)
To have and to hold the said promises with the easements, rightsand appurtenances thereunto belonging or used or enjoyed therewithor known as part and parcel thereof unto them the said MututantrigeCecilia Fernando and Mututantrige Jane Fernando, their heirs,executors and administrators in equal undivided shares forever subjecthowever to the conditions following that is to say that the saidMututantrige Si man Fernando shall during his life time be entitledto take xisc and appropriate to his own use the issues, rents andprofits of the said premises and that after his death and in the eventof his wife Colomba Patabendigc Maria Pcrera surviving him sheshall, during lier life time be entitled to take use and appropriateto her own use a just half of the said issues, rents and profits theother half being taken used and appropriated by the donees to wit,the said Mututantrige Cecilia Fernando and Mututantrige JaneFernando and subject also to the conditions that the said doneeMututantrige Cecilia Fernando and Mututantrige Jane Fernandoshall not nor shall cither of them be entitled to sell, mortgage, leasefor a longer term than four years at a time or otherwise alienateor encumber the said premises nor shall the same or the rents andprofits thereof be liable to be sold in execution for their debts orfor the debts of any or either of them and t-lie said premises shallafter their death devolve on their lawful issues respectively and intho event of anyone of the said donees dying without lawful issueher share right and interest in the said premises shall devolve onand revert to the surviving donee subject however to the conditionsand restrictions aforesaid.
And these presents further witness that Mututantrige John JacobCooray also of Horetuduwa aforesaid doth hereby on behalf of thesaid Mututantrige Cecilia Fernando and Mututantrige Jane Fenando,who are minors jointly with Mututantrige Alfred Thomas Fernandoand Mututantrige James Fernando, brothers of the said minor doneesaccept the gift and grant of the said premises subject to the respectiveconditions aforesaid.
In witness whereof we the said Mututantrige Siman Fernando andColomba Patabendige Maria Perera and we tho said MututantrigeJohn Jacob Cooray, Mututantrige Alfred Thomas Fernando andMututantrige James Fernando do set- our respective hands to three
of the same tenor as these presents at Horctuduwa aforesaid, thisFourth day of October, in the year One thousand eight hundred andeightjr-thrce.
Signed, scaled and delivered in the presence of us :
Sgd. (Illegibly).
,, (In Sinhalese).
„ John* J. Co on ay.
,, A. J. Ferxaxdo.
,, James Ferxaxdo.
,, X. 3L Ferxaxdo.
T. l?rnvA*nn
Sgd. C. de A. Gukaratnjb,
N.P. ”
There is appended to this deed the notary’s doequet attesting that it-had been read over and explained to the parties and that they and thesubscribing witnesses were all known to him, the notary.
It is not disputed that this deed was effectual to constitute a validfidei-commissum, subject to a question at issue between the parties asto its revocability. The plaintiff and his. two brothers, now deceased,were the children of Jane and so indicated as fidci-commissarii underthe deed, though not bom at its date. The parcel of land thus gifted,was known as “ The Priory
By application under Ordinance Xo. 11 of 1S7G in the District Courtof Colombo, made on the 17th Juno 1S9G in which Siman and Mariawere petitioners and Cecilia and Jane and James Fernando were respon-dents, the petitioners asked the Court to ajjpoint James as guardian.ad litem of Jane, who was then 19-1- years of age, to authorise Cecilia andJames as such guardian to convey “ The Priory ” to Siman free from allconditions and restrictions in consideration of the petitioners transferringto Cecilia and Jane another property called “ Sirinivasa ” subject tocertain conditions which need not be here set out as they are incorporatedin the order of the Court next to bo noticed. All parties consented tothe application. The professed reason for the exchange was that it wasnot desirable or beneficial for Cecilia and Jane to hold in common “ ThePriory ” and that Siman was anxious to make better provision forthese two daughters. ” The Priory ” was valued at Rs. 45,000 and“ Sirinivasa ” at jRs. 90.000.
On the following day, the ISth June, the District Judge pronouncedthe following order:—
“ It is hereby adjudged and ordered that James Fernando of ITore-tuduwa be and he is hereby appointed guardian of Jane Fernando(the second respondent) in this matter to represent her in theseproceedings.
It is further ordered and decreed that upon the petitioners trans-ferring and assigning unto the first and second respondents CeciliaFernando and Jane Fernando the allotments of land (fully describedin Schedule 33 to the said petition of the petitioner) situated at liklin-burgli Crescent, Flower Road and Green Path, Colombo, and thebuildings thereon called and known as “ Sirinivasa ” bearing assess-ment jNo. 8 subject to the conditions following, that is to say, viz.,that they the 1st and 2nd respondents shall not sell, mortgage or other-wise alicnatetlie said premises except witli'the consent of the petitionersor the survivor of them and that the first petitioner shall during hislife time be entitled to make, use, enjoy and appropriate to his own usethe rents, issues and profits of the said premises and that after his deathand in the event of the second petitioner surviving him she shallduring her life time be entitled to take use, enjoy and appropriate to herown use one just half of the said rents, issues and profits the other halfthereof being taken, used, enjoyed and appropriated by the 1st and 2ndrespondents that the sajd Cecilia Fernando and James Fernando asguardian of the said Jane Fernando, do and they arc hereby authorisedand empowered to convey and assign unto the said Mututantrige SimanFernando, the 1st petitioner, the aforesaid lands and premises called andknown as “The Priory” (fully described in Schedule A in the saidpetition) absolutely and free from all conditions and restrictions con-tained in Deed 3STo. 2,110 dated the 4th day of October, 1SS3, and thatthe said Cecilia Fernando and James Fernando as guardian as aforesaiddo and they are hereby empowered and authorised to execute anddeliver the necessary Deed of Conveyance of the said premises in favourof the said Mututantrige Siman Fernando absolutely and free and clearof all conditions and restrictions. ”
Following on this Order an exchange of lands was made by a conveyanceby Cecilia and James, as guardian of Jane, of “ The Priory ” to Siman“ freed and clear from all and every restrictions and conditions” in theDeed of Gift of 1SS3 and a conveyance by Siman and Maria “ by way ofgift ” to Cecilia and Jane of “ Sirinivasa ” subject to the conditions, set outverbatim, contained in the said Order of Court. The respective convey-ances arc each dated 23rd June, 1S06. On the same date by anotherconveyance Cecilia conveyed to Siman her one undivided moiety of“ Sirinivasa ”, which she had just received from her father, in considera tionof the sum of Rs. 45,000. By a fourth conveyance of the same dateSiman conveyed to Cecilia “ns a gift absolute and irrevocable ” “ThePriory ” which had just been conveyed to him by Cecilia and Jane.
So far as “Sirinivasa ” was concerned Siman and Jane held this now inundivided moieties. On 30th' June, 100G, they having agreed on a parti-tion, Siman by Deed of Indenture conveyed his undivided share in theeastern portion of “ Sirinivasa ” as delimited in the deed to Jane andJane comajycd to Siman her undivided share in the western portionas delimited. '
On 30tli November, 1905, by Deed of Indenture, Jane, who was nowmarried, with consent of her husband and of her mother. Maria, conveyed
licr divided share of “ Sirinivasa ” to Simaa in consideration of tlie sumof Its. 75,000. Sinian thereafter by Indenture dated Gth December. 1907,conveyed the whole of *' Sirinivasa ” to his son James Fernando, in con-sidcration of the sum of Its. 175,000. Under James’s wilL the land passedto trustees for charitable purposes and was divided by them into separatelots. The respondent’s father became purchaser, inter alia, of two ofthese lots. These are the subject matter of this action and as alreadyindicated, were gifted to the respondent by her father subject to a fidei-commissum in favour of her issue, failing whom, her brother and hisissue.
On these facts a number of difficult and important questions have beenargued before the Board. Xo question of registration arises in the ease.The appellant’s ease is based on the acceptance by Jane, his mother, of thegift of 1SS3, which acceptance he saj's enured to the benefit of himselfand his deceased brothers as fidei-commissaries under the deed of gift.Both. Jane and Cecilia were minors in 1SS3 and acceptance was made ontheir behalf by Cooray and their brothers Alfred and James. Cooray,as appears from the evidence in the case, was Jane’s brother inlaw, marriedto her sister Isabella. The deed was executed before a notary who attestedthat he knew all the parties. Their Lordships see no reason to thinkthat this was not a valid acceptance on behalf of Cecilia and Jane. Then-natural guardians, their father and their mother, could not accept for them,because they were the donors. In similar circumstances acceptance onbehalf of a minor donee by his grandmother (who was the other donee)was held good in Francisco v. Costa and Others, as was also acceptanceby a brother on behalf of his minor brother in Lewishamy v. De Silva -.One of the grounds of judgment in tlieso cases was that the donors hadallowed such acceptances to be made on behalf of their minor children.Forms to bo found in the. Appendix to Raj Chandra’s book on Fidei-Commissa disclose similar acceptances. The Supreme Court and thoDistrict Judge held that, in any event, the daughters had ratified theacceptance on their behalf by their subsequent conduct. Their Lordshipsdo not feel called on to consider this point. In the circumstances of thiscase they consider that acceptance on their behalf by three of their nearestmale relatives, other than their father, was sufficient acceptance of thegift to them.
There remains, however, the question whether the acceptance by Janeand Cecilia (the fiduciaries), was an acceptance for their children the fidei-commissaries. This is one of the major issues between the parties. Ifthere was no acceptance for the fidei-commissaries the gift to them wasrevocable in the lifetime of the donors at any time before tlicir acceptanceand there is no doubt that the conduct of the donors and the fiduciariesin the various transactions already mentioned would amount to suchrevocation. The District Judge held on earlier authority in Ceylon, thatacceptance by Jane was acceptance for her issue. The Supreme Court on areview largely of passages from commentators on Roman-Dutch law.held that there was no acceptance for the fidei-commissaries.
{1000} 3 Balamngham, 13.
Their Lordships would observe that the learned jurists of the 16th and17th centuries were far from united in their opinions on various pointsarising with reference to donation and fidei-commissa and this left muchscope for the consolidation of debatable points by legal decision. TheirLordships also accept as a correct approach in considering the authorityof the early Dutch jurists the following passage from Professor Lee’sintroduction to Roman-Dutch Law (4th Edn. p. 15) :
“ Tiie works of the older writers, on the contrary, have a weightcomparable to that of the decisions of the Courts, or of the limitednumber of ‘ books of authority ’ in English law. They arc authenticstatements of the law itself, and, as such, hold their ground untilshown to bo wrong. Of course the opinions of these writers are often,at variance amongst themselves or bear an archaic stamp. In suchevent the Courts will adopt the view which is best supported byauthority or most- consonant with reason ; or will decline to followany, if all the competing doctrines scc-ni to be out of harmony withthe conditions of modern life ; or, again, will take a rule of the oldlaw, and explain or modify it in the sense demanded by convenience. ”
On the question of acceptance for or bjr a fidei-commissary reference wasmade in the Supreme Court and before their Lordships to Perezius’sPraclectiones (1653) Bk. VIII Tit. LV §§7 to 12. This learned com-mentator opens paragraph 7 thus :—
“ The greater dispute is whether a donor who has gifted property toanother with this pact and limitation that after a certain time hoshould restore it to some third person can in the meantime revoke thispact. ” 1
He proceeds to point out that there was a divergence of opinion on whetherthe third party needed to accept to prevent revocation by the donor, themajority view being that no acceptance was necessary. In subsequentparagraphs he considers special cases of events happening before the datoof restoration, viz., acceptance by a notary for the third party, death ofthe donee, delivery by the donee of the subject of gift to the third party,death of the donor, confirmation of the gift by the donor’s oath. Hethen comes to another case which he deals with in paragraph 12. Thefollowing is a translation of the relevant portion of this paragraph.
“ Lastly the former opinion [by which Pcrczius means the opinionof the majority stated in paragraph 7] would be the more correct ifthe gift made to one person is made in favour of a family in whichthe donor wishes the property gifted to remain ; for by no pa.ct canit be revoked in respect of after-coiners ; for it is sufficient in orderthat it may be considered a perpetual donation that the first donee hasaccepted it so that- there is no need of a subsequent acceptance where-the burden imposed on a first donee results in an action available toall as Molina says (de Hisp. primog. L. 4 c.2 n.75) bccauso it would
1 llmilrretmanai/at:€*s translation, p. 20,_
be absurd, in order to make a fidcicommissum irrevocable, to requirethe acceptance of infants and persons not yet born ; so that as thegift cannot be revoked in respect of these it follows that the samething must be said with regard to those who precede them lest propertyleft to the family should go to more remote relations to the exclusionof closer ones. See Anton Gomez in L. 40 Tauri n. 34 ; also Molina(d.Ioeo) who say that it has thus been decided at the present day bythe laws of the King of Spain, especially L. 44 Tauri where deliveryalone made to the one first called to the succession of the Majoratohas the effect of making the Majorato itself absolutely irrevocable bothin respect of himself and also of after-comers. ” 1
Of this passage their Lordships would observe that the writerspea ks ofa “perpetual donation” not of a perpetual fidei-commissum. “ Saliscnim est it l ccnsealitr donatio per pel ua quodprinius earn acceplaverit. ulterioreacceptations ojius non sit.” In its context their Lordships think it clearthat perpetual donation here means an irrevocable donation.
Their Lordships have not had their attention directed to any other com-mentary of the early writers which deals with this matter as fully asPerezius lias done. Mr. Juticc Basnayake in the Supreme Court quotescertain passages from Van Lceuwcn’s Consura Porensis (1662) and Pot bier'sLaw of Obligations (1761). Van Lceuwen does not appear, however, tobe dealing with fidci-eommissa, but with donations generally and indeedwould seem to exclude fidei-coinmissa as appears from the following passage(iv.12.lS) : “ But there is a doubt whether a gift can bo conferred on any-one through an intermediate person, as it verges on a fidei-commissum,which cannot be created by gift or other disposition inter vivos, nor canit hold good ”. This view that a fidei-commissum cannot- be created by giftinter vivos, if at one time doubtful, does not now prevail in Boman-Butchlaw. But the passage would seem to exclude Van Lecuwen as an authorityon the problem with which their Lordships arc concerned. Pothier wasnot of course an authority on Koman-Dutch law. He did not acceptthe doctrine of jus guaesilum terlio but he did recognise gifts made subconditions or sub modo. In this connection he jioscs the question (Law ofObligations, Evans translation, Vol. I. p. 39) :
“ Hence arises another question, whether after giving you anythingwith the charge of restoring it to a third person in a certain time,or of giving him some other thing, I can release 3'ou from the chargewithout the intervention of such person, who was no party to theact, and who has not accepted the liberality which I exercised in hisfavour. ”
Here again, as did Perezius, he sets out the two conflicting views oflearned writers on this question without arriving at any conclusion. TheirLordships are then left- in the position that, so far as has been shown,there is nothing in the older writers more definite than the passagequoted from Perezius.
1 It"ihrainana-jithcs translation, p. -30.
In connection -with this passage from Pcrezius there was canvassedbefore this Board—a matter which entered into the ratio of the judgmentof the Supreme Court-—whether the gift in tire present ease is a giftmade in favour of the family, “si donatio concernat favoretn familiae ”.The view of the Supremo Court was that it was not a gift in favour ofthe family because it came to an end with the first generation of fideicommissaries, that is with Jane’s children who were free to dispose ofthe property as they wished. What the Court required was a fidei-commissum enduring indefinitely from generation to generation, in other-words a perpetual fidei-commissum. Reliance for this view was placedparticular^ on certain passages in Sande’s Treatise on Restraints onAlienation (1033) (Webber’s translation). Their Lordships are unableto draw the same conclusion from the passages in question when takenin their context with other passages. The material passages arc to befound in Part III, Chapter V of the treatise and their Lordships will,quote more full3r from this chapter than was done in the Supreme Court.Chapter V is headed “ What fidei-commissum is induced from thisprohibition upon alienation ”. The writer first considers two types offidei-commissum which he calls conditional and simple or absolute.Broadly the distinction is between a prohibition of alienation outsidethe family (conditional) and a direct bequest such as “ I leave my landedproperty to the family ” coupled with a prohibition against alienation(simple and absolute). It- is to be observed that the writer is speakingof testamentary dispositions and not of gifts inter vivos but that would notappear to be material. The importance of the distinction was in theresults that might follow and Sancle discusses these very fulhx .Sarnieclearly favours restricting restraints on alienation as much as possible.In paragraph 10 he says :
“ And in ease of doubt a testator should not be considered to burdenhis descendants with the perpetual and indefinite ficleieommissum, by-aprohibition restraining the heir from alienating. And a substitutionmade in favour of a family, of descendants, or of several persons under acollective name, takes place in the highest grade which survives at thetime when the condition arises, and it is not extended to the lower grades-unless the testator has expressly so willed. ”
He returns to this point in paragraph 11 :
“ But- the point we arc discussing is not in what order successionto a fidcicommissum to a family takes place, but whether a testator,by a simple prohibition against alienation outside the family, wishesto induce a perpetual fidcicommissum among the members of thefamily, and to make this apply to many, so that one after another,and so on, .as long as a single member of the family survives, is con-sidered to be burdened by fidciconimissary substitution. We sayit is not so, because in cases of doubt a direct substitution ratherthan an oblique and fidciconimissary one is presumed. ”
Sanfle elaborates tlie mutter further in paragraphs 13, 14 and 1.5 which,to preserve the context their Lordships quote in full :—
st 13. The argument which the supporters of the opposite view taketip is very weak. They say, since persons of different grades arc des-cribed under a collective term, and since they therefore cannot beadmitted to the inheritance all at the same time, but must succeed inthe order of succession, one after the other, that the term must havesome extended meaning. This is quite true ; but the extension is onenot of time, but of grades, so that many grades are called to the fidei-commissum, which, however, rest only in the first grade of those whoare admitted, and is not extended from that to lower grades ; andthus many grades may be called, but only one can be said to beadmitted.
14. Since this is what takes place when a fidcieommission isexpressly bequeathed to a family, it would much rather take place ina tacit fidcieommissuni, which is induced by interpretation from aprohibition against alienation outside the family, for otherwise a tacitfideicommissum would induce a greater multitude of fidcicommissathan an express one. Therefore a fideicommissum which is impliedfrom a prohibition upon alienation is binding only on one person(unicuin), and therefore if he, who has succeeded by virtue of sticktacit fideicommissum to the estate on account of alienation which hasbeen made by another, afterwards alienates the same estate to astranger he would do so with impunity. -'
15. This is so except where it can be gathered from the words ofthe Will itself that the intention of the testator was otherwise ; forexample, if wishing to provide for the preservation of Iiis family,- liesays, “ J will, or I order, that the landed property be retained, remainand be left in the family, so that it may never go out of the family.
Tor from these words would be induced a real, multiplex and per-petual fideicommissum, which would last as long as any one of thefamily survived. And therefore, even although the landed propertyhas once been left in the family, yet it would be against the :will ofthe testator that it should at any time thereafter go out of the family.
Sandc concludes Chapter V with the passage : “ The truer view is thatwhen the testator wills that his goods remain in his family- and his namein perpeluo, then the fideicommissum is never closed but is indefinitelyextended. ”. :•
Consideration of the effect of prohibitions of alienation in favour of a-family will be found in others of the early commentators. Their ..Lord-ships would quote only one passage from Voct’s Commentaries on thePandects (1G9S—1704) dealing with Fidci Commissa placgrcgor’stranslation) XXXVI. 1.23:
“ Where a fideicommissum is left to a family the nature and effbetof such a bequest is not the same in every case. For the bequestmay be of such a kind that the fideicommissum is a single one ; and.
where it has operated once, or where there has been one restitutionto the family, the fideicommissary obligation is determined ; nor is.the person who by virtue of such a restitution to the family lias acquiredthe property or the inheritance obliged after his death to restore it toanother member of the same family, but he is able to transfer it to astranger by act inter vivos or by last Will. But on the other hand, itmay be a recurring (multiplex) fideieommissum, circulating as it werethroughout the family, with the result that the person to whom in thefirst instance restitution has been made as being one of the family isbound to restore the inheritance to another member of the family, andhe again to a third member, and so on, so long as there are members ofthe same family surviving. ”
Their Lordships are unable to extract from these passages that a fidcicommissum in favour of the family is confined to a fidci commissumwhich goes on from generation to generation. The writers seem to con-template a fidei commission which comes to an end with the first genera-tion as being a fidei commissum in favour of the family. The questionwhether it is perpetual or not will depend on the language used by thetestator, or donor. Nor can their Lordships see any reason why it shouldbe so limited. When the gift in this case was made Jane was a child.It would be impossible for any issueof hers to accept for very many 3-ears.The reason given by Perezius that “ it would be absurd, in order to makea fidci commissum irrevocable, to require the acceptance of infants andpersons not yet born ” is as valid in the case of her children as it wouldbe in the case of children to come into existence in a perpetual fideicommissum. No doubt the same could be said of a fidei commissumto stranger beneficiaries yet unborn. But a donation in favour of thefamiljr is an exception and the presumption of acceptance by a parentfiduciary for his immediate descendants is as valid as the presumptionof acceptance for descendants to the third or fourth generation.
The great weight of authority derived from legal decision in Ce3'lonuntil the decision in the present case supports that view. In a matter inwhich so much was left open bj- the earty commentators their Lordshipsattach great weight to a current- of legal decision in a country in whichfidci eommissa are extensively resorted to by its inhabitants, are part ofits law and become frequent subject of consideration by its Courts. Theearliest authority to which their Lordships were referred is the ease ofPc-rcra v. Mnrilar1. The facts and judgment are concisely set out in thehead-note:
■' A father conveyed certain houses by post-nuptial settlement to hismarried daughter, subject to the condition that she should enjo3r thesame for her life with restraint on anticipation or incumbrance, andthat- after her death the3- should be enjoyed by her heirs and ilcscen-dants in pcrpetnit.v. The daughter accepted this gift. Afterwards, thedaughter having as yet no issue, the father made a will b}- which hedc-viscd the same houses to the daughter absolute^-, and died, and his
(ISSI) c a. C. C. J-jS.
{101 f) 17 -V. L. II. 279.
executor executed a conveyance of the houses in favour of the daughter,her heirs, executors and her assigns for ever. After the father’s deatha son, the plaintifF, was born to the daughter.
Held, (dissentients Burnside, C-J.), affirming the decision of thedistrict court, that the plaintiff, when he came into esse had an interestin the houses, which could not be defeated by any act of the testatorsubsequent to the settlement, and consequently that plaintifF, onestablishing that he was the son of the settlor’s daughter, was ejititledto recover the houses in ejectment from defendant, who claimed througha person to whom the daughter had conveyed the houses after theexecutor’s conveyance to her. ”
The judgment of the majority of the Court (Clarence and Dias, JJ.),was delivered by Mr. Justice Clarence. He refers to Voet and Pcreziusand quotes from the passage in Perezius already quoted by' their Lordshijw..Ho then proceeds ;
“ I find, therefore, the Roman-Dutch Jurists, so far as their hypo-thetical reasoning or imaginary cases go, favouring what seems tome the common sense view, that where a voluntary family settlementis made, by which somebody benefits immediately and other classescontingently on their being born and living to inherit the settlement-,takes effect in favour of these future classes immediately on its takingeffect, qua the immediate participator: and for these reasons I thinkthat the decision of the learned district judge in upholding the plaintiff 'sdemurrer must be affirmed. ”
It has been said in a later case (JIudaliyar W ijcltinya v. Dmrcdaye Rossiscl al.) that Percra v. JHarifcarwas notaeascofapcrpctualtidcicommissumbut a fidei commission unieum. But the point, in their Lordships’view is immaterial as the ratio of the judgment in the passage quoted fromClarence J. is not, in their Lordships’ view, dependent on the characterof the fidei commfssum so long as it is in favour of a family. The decisionwas a decision of the full Court-. It- has been followed in a scries of caseswhich their Lordships find it unnecessary to examine at- length. . Noneso far as their Lordships have noted was a case of a perpetual, or multi-plex, fidei commissum. The cases constitute a very long train of authority.
In Soysa- v. Jlohidccn- it was argued that the Pcrezius exception mustbe confined to the case of & Jamil in which includes other people besideschildren and descendants. De Sampayo A.J. said of this argument,
“ But no such distinction is intended, and the reasoning applies even morestrongly to a fidei commissum, in favour of a family in the narrower senseof a man’s own children and descendants. Pcrezius means to lay downgenerally that acceptance by the immediate donee, who is the head of thefamily, is valid acceptance on behalf of all those who follow him, and that,then, the entire donation is considered jtcrpeiua or at once completein respect of all the succeeding beneficiaries. ” In referring here to
“ descendants” the learned judge appeal's to mean children of the fiducia-ries because in that case the gift was to three nephews and a niece andtheir issue with a devolution over failing issue. In Abeyc-singhe v. Perera1where the fidei commissum Mas clearlj7 confined to the legitimate childrenof the fiduciary, Chief Justice Wood Renton regarded Soysa v. JSfohidecnas a precedent and followed it. Perera v. JSIarikar and Soysa v. JSIohideenwere followed in A yam perianal v. Hleeyan. – ; Fernando v. Ahcis ; SYije-tunga v. Rossie ct al.~ and VaUipuram v. Gusperson5, -which were allcases -where the fidei commissary heirs were confined to children of thefiduciary donees. Reliance was placed by Counsel for the respondent ondecisions in a contrary sense in De Silva v. Thom is Appu6 and Carol isv. Alicis7. In the latter case Soertsz J. found himself able to distinguishthe case in hand from Perera v. JSIarikar and JSIohidce.it v. Soysa. Forthe reasons already given their Lordships think he was in error in thinkingthat the ratio of the decision in Perera v. JSIarikar proceeded on the viewthat it M-as a perpetual fidei-commissum. He also seems to have been inerror in thinking that Perera v. JSIarikar was not a full Court decision.
The same view has been taken in South Africa in a case -which isindistinguishable on its facts from the present case and on groundssubstantially the same as those which appealed to the judges of the CeylonCourts who followed the precedent of Perera v. JSIarikar. Sec Ex-partsOrlandini d> Others s. Much stress, however, was placed by the respon-dent on a recent case in the Supreme Court of South Africa, Crookesand Another v. Watson and Others °. This was a ease of an infer vivostrust, declared irrevocable, by which the settlor gifted certain shares totwo trustees under trust to hold the same for the purposes, inter alia,of paying his daughter, on Iter attaining 25 .years of age, the net incomeup to £1,000 per annum, to accumulate any balance of income and on thedaughter’s death to distribute the trust fund among her lawful issuecquallj', -whom failing among her surviving brothers and the issue of anydeceased brother and failing surviving brothers among her next of kin.The trustees -were empowered to realise the shares and invest the proceeds.In the trust deed the trustees declared that they accepted the gifts intrust and the trust mentioned. After the daughter had reached the ageof 25 years the settlor proposed to amend the trust deed to the effect ofpaying her £5,000 out of the trust fund and paj'ing her the whole of thenet income. The daughter’s husband and her brothers consented forthemselves and as guardians of their minor children. A curator ad litemwas appointed to represent unborn issue and other unascerfainablebeneficiaries. The decision of the majority of the Court (Gcntlivrcs, C-JVan den Hcevcr, J.A. and Stern. J.A., di-s-s. Schreiner, J.A. and I’agan,
J.A.) was that the ultimate beneficiaries acquired no rights under such atrust until they accepted and that the trust was revocable till accepted.It would appear that the daughter M as regarded as having accepted thebenefit conferred on her. The Court below had held that t.ho trust was-
1 (i960).v. l. j:. j go.
(100}) T X. L. It. 123.
(ioji) /; -V. l. n. no.
[1.9-711 O. P. D. 111.
*- a contract for the benefit of third parties having the effect of a fidei-commissum ” and that “in t ho ease of the settlement of property in afamily the acceptance of the first donee enures for the benefit of and isconsidered an acceptance by all the donees One member of thelower Court was prepared to siqiport the judgment also on an additionalground which seems to have appealed to the minority in the SupremeCourt but which it is not material to notice here. The English law oftrusts, it should be noted, does not prevail in South Africa and an intert iros trust appears to bo regarded as a contract entered into betweenthe settlor and the trustees for the benefit of third parties which in generalmay be revocable before acceptance by the third parties. The Court dealtinter alia with the question whether what was called the Perezius exceptionapplied to exclude the general rule that acceptance was necessary. Eorvarious reasons the Supreme Court held it did not. The shares were notgifted to the daughter but to the ultimate beneficiaries who took themfree of any fidei-commissum. The daughter took only the income up to£1,000 per annum and her acceptance of that could not be regarded asan acceptance by her of the corpus on behalf of the ultimate beneficiaries.The shares might be sold and so it could not be said that they camewithin the conception of Perezius and other authorities of a familysettlement by which “ the subject matter of the donation is inalienableand must remain intact Their Lordships are unable to find in thejudgments of t-lio majority any clear indication that in their view thePerezius exception is confined to t-Iic case of a perpetual fidei-commissumin favour of the family. Van den Hcevcr, J’.A. (p. 296), would appearto come nearest to that view. Centlivres, C.J. (p. 2S9) merely says, “ Inother words where there is a settlement in favour of a family and thefirst member of the family accepts, his acceptance enures for the benefitof all succeeding members of the family It appears to their Lordshipsthat the ratio of tho judgment did not require any consideration ofwhether the Perezius exception was confined to a perpetual fidci-com mis-sion. The judgment did not bear to overrule the earlier case of Orlandiniwhere it was not so limited. Their Lordships arc unable to take theview that tho decision is in conflict with the long tract of decision inCeylon which, in any event, their Lordships think for the reasons statedshould prevail.
If there was an irrevocable fidei-commissum of “ Tho Priory ’’ infavour of Jane’s children by virtue of the gift and acceptance of 1SS3,the next question is whether that applies to “ Sirinivasa ” as a result ofthe proceedings that took place in 1896, when “ The Priory ” was ex-changed for iSirinivasa ”. Mr. Justice Basnayakc in the Supreme Courttook the view that these proceedings were not initiated by the properparties, but this view was not supported by counsel-for the respondentbefore tho Board. Their Lordships would only observe that they failto understand why Siman as a person entitled to the possession andreceipts of the rents and profits of “ The Priory ” as usufructuary shouldnot- come under the express language ofscction oof tho Entail and Settle-ment Ordinance, 1S76, as a person entitled to petition the Court and inaii3r event the fiduciaries, Cecilia and Jane, were consenting parties to theOrder made.
A more important question is what was the effect of the Order of theCourt. It directed, in accordance with the terms of the application that“ the first and second respondents [Cecilia and Jane] shall not sell, mort-gage or otherwise alienate the said premises except with the consent of thepetitioners [Siman and Maria] or the survivor of them ”. No referencewas made, as in the original gift, to the premises devolving after the deathof Cecilia and Jane on their respective issue. Their Lordships wouldrefer hero to the provisions of sections 4, 7, and S of the Ordinance of1S7G, so far as relevant. These are as follows :—
“ 4. Whenever any immovable property is now or shall hereafterbe held under or subject to any entail, fidci commission, or settlement,-whereby the alienation of such property is prohibited or in any wayrestricted, it shall bo lawful for the District Court of the district inwhich such property is situate, if it shall deem it proper andconsistent with a due regard for "the interests of all parties entitledunder such entail, fidci commission, or settlement, and subject to theprovisions and restrictions hereinafter contained, from time to timeto authorize a lease, exchange, or sale of the whole or any part or partsof such property, upon such terms and subject to such conditions asthe said court shall deem expedient
7. All money received under or by virtue of an}' sale effected underthe authority of this Ordinance shall be applied, as the District Courtshall from time to time direct, to some one or more of the followingpurposes, that is to say :—
the discharge or redemption of any charge or incumbranceaffecting the property, or affecting any other property subject tothe same entail,.fideicommissum, or settlement; or
the purchase of other immovable property to be settled inthe same manner as the property in respect of which the money waspaid ; or
investments in the Loan Board or in Government securitiesthe interest thereof being made payable to the part}' for thetime being otherwise entitled to the rents and profits of the landsold ; or
the payment to any person becoming absolutely entitled.
S. Any property taken in exchange for any property exchangedunder the provisions of this Ordinance shall become subject to thesame entail, fideicommissum, or settlement, as the property for whichit was given in exchange was subject to at the time of such exchange.”
In their Lordships’ view it is clear from these provisions that thepurpose and intendment of the Ordinance was to preserve in the event of
any sale or exchange of premises subject to a fidci commissum the termsof the fidei commissum and to apply these to the land taken in exchangeor to the price of the premises sold which was to be treated as asurrogatum of the original gift- In the present ease it is section 8 thatapplies and, in their Lordships ’ opinion, t; Sirinivasa ” when received inexchange for “ The Priory ” must be taken to have been held in termsof the original fidei commissum. This was the view also of the DistrictJudge and of Mr. Justice Basnayakc in the Supreme Court. It wasargued for the defendant that the prohibition on alienation imposed onthe fiduciaries except with the consent of their parents was arelaxation of the absolute prohibition imposed in the original gift andso defeated the fidei commissum, but for the reasons already given thiswould be contrary to the terms of the Ordinance and if such is theconstruction of the Order the terms of the Ordinance in their Lordships ’view must prevail. But, in their Lordships ’ opinion, the better viewis that the Order affected only the powers of the fiduciaries in respectof their own rights and interests m the land in question and it may bethat, as they consented to the Order, it was competent to modify theterms of the original gift in this respect- But that could not affect therigiits of the fidci commissaries.
It was argued that on the law as it was understood in 1896 there wasno acceptance binding the donors and the fiduciaries in a question withthe fidei commissaries then unborn, and that it was open to the donorsand the donees and the Court to alter the terms of the original gift tothe effect of cutting out, or revoking the gift to, the fidei-commissaries.Their Lordships are unable to hold, as already indicated, that this was-understood to be the law in 1S96 or that the Court in 1896 gave anyconsideration to tiio question. But in any event the effect of the ordinanceof 1876 was to write the terms of the original fidei-commissum into thesubstituted gift and the consequences of what was done in 1SS3 must beconsidered to-day when the fidei commissaries make their claim and not-in 1S96 when there was none in existence.
It was further argued that the respondent, or her father who purchased,the property, need not look further back in the chain of title than theOrder of the Court in 1S96 and was entitled to rely on the terms of thatOrder. Their Lordships are unable to assent to the argument in viewof the imperative terms of section 8 of the Ordinance. Deference wasmade to the case of Mirando v. Coudert1 in support of the respondent’s-contention. In their Lordships’ view that case has no applicationto the circumstances here. That was a ease where property had beensold many years previously under the Ordinance No. 11 of 1S76. Therewere some irregularities in the procedure when the property was orderedto be sold and the Court apparent^'- thought that it had been subjectto a fidei-commissum. But the result was that until set aside theorder could be regarded as a sale under section 7 of the Ox’dinance whichwould discharge the property of the fidei-commissum. The pui'chaser was.
held to have acquired a free and absolute tit le unless the ■whole proceedingswere rescinded. Their Lordships see no reason to doubt the soundnessof that decision. The ratio of this decision would apply, in t-hei Lord-ships’ opinion, to “ The Priory ” which was exchanged free of any fidei-commissum for “ Sirinivasa ” but it could not affect “ Sirinivasa ” whichwas taken under burden of the fidei-commissum.
It was said also that the defendant’s father was protected as being abona fiide purchaser without any notice of a defect in his title. Their Lord-ships are prepared to assume that the defendant’s father was such apurchaser. 33ut this cannot avail the defendant. Fidei commissa havelong been recognised in the law of Ceylon and, apart from any questionof prescription, or of prior registration in a case where a conveyance hasbeen obtained from a fiduciary who may be taken to hold on an alter-native title of intestacy, they have been held to prevail against a bonafide purchaser. A fiduciary though vested in the dominium of the propertygifted has that dominium only during his life and cannot convey more thanhe enjoyed. On his death, or other event, the fidei commissary becomesthe owner of the property. The doctrines of English law have no play inthis sphere. This has already been recognised by this Board in the caseof Abdul Hameed Sitli Kadija v. De Saram 1.
The remaining point in the appeal concerns the partition of" Sirinivasa ” which took plac-c between Jane and her father in 1900.When Cecilia conveyed to Siman her undivided moiety of “ Sirinivasa ”on 23 June, 1S96, she parted with the dominium and, in their Lordships ’opinion, with all her rights and interest in the property. So long as sheheld her undivided share she could have made a partition agreement withher sister Jane and it is conceded that in such an event the fidei com-missum would have attached to each of the divided portions for thebenefit of Jane’s issue and Cecilia’s issue respectively. See Abdul Coderv. Habibu Umma 2. In their Lordships’ opinion Siman stood in Cecilia’sshoes and was entitled to make a partition agreement with Jane, liewas a co-owner with Jane ami had all the rights of a co-owner so long asCecilia was alive, otherwise there was no one who could effect a partitionwith Jane. Tiiis was the view taken by the District Judge. It wassuggested that there was no evidence that Cecilia was alive when thepartition was made. But it is clear from the proceedings in the Courtsbelow that it was the common assumption that Ccc-ilia was alive andthe District Judge held that the partition was good and binding on thefidei commissaries on that assumption. The Supreme Court did nothave to deal with the question of partition on the view that it tookof the question of acceptance.. But it is clear that no point was takenfor the respondent on appeal to the Supreme Court touching the questionof Cecilia's being dead. 2for is the point taken in the respondent’scase on appeal to this Board. The inference is that it was well knownthat Cecilia was alive at the date of the partition. But on any viewtheir Lordships would not be prepared to allow the point to be taken.now.'
1 [191G .-l. C. JOS.
(1926) 2S X. L. U. 92.
Dor these reasons their Lordships will humbly advise Her Majesty toallow the appeal, to set aside the judgment and decree of the SupremeCourt and to restore the judgment and decree of the District Court. Therespondent must pay the costs of the appeal to this Board and of the.appeal to the Supreme Court of Ceylon.
.-I jipccd allowed.