1842.

Jan. 28.

SHADWELL,
V.-C.

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[ *644]

GODDEN v. CROWHURST (1).

(10 Simons, 642–657; S. C. 11 L. J. Ch. 145.)

Will--Construction-Trust to take effect on alienation or bankruptcy. A testator bequeathed his residuary estate to trustees; and, after making a provision out of it, for the benefit of his son, for his life, and, after the son's death, for his wife and children, directed that, if his son should assign or charge the interest to which he was entitled for life, or attempt or agree to do or commit any act whereby the same, or any part thereof, might, if the absolute property thereof were vested in him, be forfeited to or become vested in any person or persons, then the trustees should pay and apply the said interest for the maintenance and support of his son, and any wife and child or children he might have, and for the education of such issue, as the trustees should, in their discretion, think fit. Some years after the testator's death, the son became bankrupt: Held, that the trust for the benefit of the son, his wife and children, was valid, and that the assignees were not entitled to any part of the provision. GEORGE STAFFELL, by his will dated the 25th of April, 1829, devised his real [and personal estate to trustees upon trust to convert the same (with power to postpone the conversion of the real estate), and to invest the residue thereof, after paying his debts and certain other charges, and, subject as thereinafter mentioned, he gave the income of one moiety of unto his son, Henry Staffell and his the income] of the other moiety of the his daughter, Grace Allen, the wife of Justinian Allen, and her assigns, during her life: provided always, and he declared it to be his will that, as the interest, dividends and proceeds of the residue of his estate, and the rents of his real estate until sold, should be received by his trustees, the same should, after paying thereout the costs of keeping the messuages, buildings, and premises then remaining unsold in good repair and insured from loss by fire or other incidental expenses, be laid out and invested again, as his trustees, in their discretion, should think most advantageous, and be accumulated for the space of five years from the day of his decease; and, at the expiration of that period, he directed his trustees to make out an account of all such interest and dividends and the accumulations thereof, and pay one moiety of such interest, dividends and accumulations to his son, Henry, for his own use and benefit, and to pay the other moiety of such interest, dividends

(1) But the appropriation of money or of goods purchased therewith by the trustees for the benefit of the bankrupt would confer a title upon

the residue of his estate, assigns, for his life; and residue of his estate, unto

the assignees to the property thus appropriated: In re Coleman (1888) 39 Ch. Div. 443, 58 L. J. Ch. 226, 60 L. T. 127.-0. A. S.

:

r.

and accumulations to his daughter, Grace Allen, for her own use. GODDEN and benefit and he directed that, after such division of such CROWHURST. interest and produce, the interest, dividends and annual produce of the residue of his estate, should, subject to the deductions aforesaid, be again accumulated for five years, when a like division should be made thereof between his said son and daughter as before mentioned; and that such accumulations and divisions should continue to be made at the expiration of every five years; it being his wish and desire that the interest and produce of the residue of his estate should only be divided once every five years, until the respective moieties thereof should become divisible amongst his grandchildren as thereinafter mentioned: and in case his son, Henry, should die in the lifetime of his then present or any future wife, he directed that the interest, dividends and annual produce of the moiety of the residue of his estate to which his son, Henry, was entitled, should be paid to such wife during her life, but, nevertheless, at the same periods and in the same manner only as such interest or produce was payable to his son during his life; and, in case his daughter, Grace, should die in the lifetime of her then husband or any future husband she might have, he directed that the interest, dividends and produce of the moiety of the residue of his estate to which she was entitled for life, should be paid to such husband surviving her, during his life, but nevertheless at the same periods and in the same manner only as such interest or produce was payable to his daughter during her life: and he directed that, in case his son should, at any time or times, make any assignment mortgage or charge of or upon, or in any manner dispose of, by way of anticipation, the said interest, dividends or accumulations, or any part thereof, to which he was entitled for life as aforesaid, or attempt or agree so to do, or commit any act whereby the same or any part thereof could or might, if the absolute property thereof were vested in him, his said son, be forfeited unto or become vested in any person or persons, then and in any of the said cases his trustees, should, thenceforth, pay and apply the said interest, dividends and accumulations for the maintenance and support of his said son and any wife and child or children he might have, and for the education of such issue or any of them. as his trustees for the time being should, in their discretion, think fit; and that, after the decease of his son and of his then present or any future wife, and after the decease of his daughter and her then present or any future husband, his trustees should pay, share

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v.

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GODDEN and divide the moiety of the clear residue of his estate to which CROWHURST. each such son or daughter was entitled for life, unto and equally between and amongst all and every his and her children, if more than one, who, whether sons or daughters, should attain the age of 21 years, share and share alike; and in case there should be only one child who should attain 21, then the whole of such moiety of his estate unto such child: and in case either his son or his daughter should die without leaving any child that should live to attain the age of 21 years, he directed his trustees to stand possessed of such moiety upon the same trusts, for the benefit of the other of his son or daughter and his or her children, as were thereby mentioned and declared with respect to the moiety thereby given to or in trust for him or her and his or her children and in case both his son and his daughter should die. without leaving any child who should attain the age of 21 years, then he declared that the whole of the residue of his estate, and the stocks, funds or securities on which the same should be invested, should be payable to his own next of kin living at the time of such event happening, and be divisible according to the statute made for the distribution of intestates' estates; such bequests over, however, to be without prejudice and subject to the interest therein before given to any wife of his son, Henry, or any husband of his daughter, Grace, who might respectively survive them.

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The testator died on the 1st of January, 1830, leaving Henry Staffell, his only son and heir-at-law, and Grace Allen, his daughter and only other child, surviving him: and, upon the death of the testator, the trustees entered into the possession of his real estates; and, after paying the testator's debts and the other charges payable out of his personal estate, they invested the clear surplus thereof in the usual securities; and, in exercise of the discretion intrusted to them by the will, they retained the real estates unsold, and received the rents and profits thereof, and the dividends and interest arising from the investment of the surplus of the personal estate; and, during the period of five years from the death of the testator, they accumulated the same pursuant to the directions of the will; and, at the end of such period, they divided such accumulations between Henry Staffell and Grace Allen; and they received and accumulated the *rents of the real estates, and the dividends and interest of the personal estate which accrued from the time of the aforesaid division.

On the 31st of May, 1837, a fiat in bankruptcy was issued against

GODDEN

C.

Henry Staffell, under which he was declared a bankrupt, and the CROWHURST. plaintiffs, Henry Godden, and James Foster Groom, were appointed the creditors' and official assignee respectively under the fiat, [and they filed this bill] against Henry Staffell, his wife and children and the surviving trustees of the will.

The bill prayed that the will might be established; and that it might be declared that the plaintiffs, as the assignees of Henry Staffell, were entitled to the moiety of the rents, interest, dividends. and accumulations arising from the real and personal estates of the testator, which Henry Staffell would have been entitled to if he had not become a bankrupt: and that it might be declared that the direction contained in the will for the accumulation of the said rents, interest and dividends, was not binding upon Henry Staffell previously to his bankruptcy, and was not then binding upon the plaintiffs as his assignees and, if it should happen that the plaintiffs were not entitled to the whole of Henry Staffell's moiety of the rents, interest, dividends and accumulations accrued since his bankruptcy, then that the plaintiffs might be declared to be entitled to the whole of such rents, interest, dividends and accumulations as accrued previously to such bankruptcy, and to some part, not being less than an equal portion with H. Staffell's wife and children, of his moiety of the rents, interest, dividends and accumulations which had accrued since such bankruptcy, and of the rents, interest and dividends that should thereafter accrue during the life of Henry Staffell; and that the trustees might account for the rents, interest, dividends and accumulations which had accrued since the division made by them as before. mentioned; and might pay, to the plaintiffs, one moiety or such other proportion of the rents, interest, dividends and accumulations as they might appear to be entitled to during the whole or any part or parts of the *period elapsed since such division, and also a moiety or such other proportion as they might happen to be entitled to, of the future rents, interest and dividends of the testator's real and personal estate.

Mr. G. Richards and Mr. Bacon, for the plaintiff's [cited
Phipps v. Lord Ennismore (1)]:

If, however, the Court should be of opinion that the assignees are not entitled to the full extent which we have contended for, it

(1) 28 R. R. 27 (4 Russ. 131).

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*

GODDEN is impossible to hold that they are not entitled to any thing ; CROWHURST, as the son is one of the objects of the provision, and no discretion [ *651 ] is given to the trustees, to apply his moiety of the interest, &c. for the maintenance and support of him, or of his wife, or of his children. Therefore, if the assignees are not entitled to the whole of the son's moiety, they are entitled to one-half of it, at the least; for the testator places the son in one class, and his wife and children in another class.

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We also submit that the trust for accumulation cannot be supported, as it is repugnant to or inconsistent with the prior trusts of the will.

Mr. Lovat and Mr. Torriano, for Henry Staffell and his wife and children :

How is the Court to limit the discretion given to the trustees? There is no difference between this case and Twopeny v. Peyton (1), except that that case is stronger in favour of the assignees than the present case is: for, there, the bankrupt was the sole object of the provision.

Mr. Whitmarsh, jun., appeared for the trustees of the will.

Mr. Richards, in reply, said that Twopeny v. Peyton was plainly distinguishable from the present case; as, there, the party for whom the provision was made by the will, had become bankrupt at the date of the codicil; and that that circumstance was the ground of the decision.

THE VICE-CHANCELLOR :

This is a case quite sui generis. It has nothing to do with those cases in which it has been held that, where a trader settles his own estates with such a proviso, as has been introduced into this will, with respect to bankruptcy, the proviso is void as against the creditors and, therefore, this case must be decided upon the view of the will itself.

[His Honour here referred to the will, and read the proviso for accumulation (ante, p. 332), and then continued his judgment as follows:

I have looked to that part of the will with regard to the gift to

(1) Ante, p. 301.