on the

These events may not happen till long after the certain legatees will or may incur liability for a death of the testator. At the testator's death, proportion of the immediate estate duty on the and also at the time of the general winding-up testator’s death, if no special clause is inserted of his estate, it may be impossible to say how to the contrary, will be considered by many as many of these events may in fact operate so as sufficiently establishing that it will not always to attract duty, or how future legislation may do to be silent in the will on the subject. For affect the rates of duty, or indeed how such instance, when there is a gift to one beneficiary legislation may otherwise increase the death of a house and its furniture, it is difficult to duty liabilities. Of this last there is an obvious believe that the testator truly intended that the instance in the case of any will by a testator legatee should be relieved by the general estate who died before 1914, where the settled fund from liability for estate duty on the furniture, goes over on the death of a liferenter after but should be left to bear the estate duty upon 15th August 1914. That is the position which the house. occurred in Dunn's case, though there the On the construction of more or less general precaution was taken of obtaining a decision relief clauses, there is not needed the authority of the Court in advance of the event, and of Lord Sterndale in In re Wedgwood and of during the lifetime of the liferenter, so as to the Lord Justice-Clerk in Dunn for the proprotect the trustees by letting them know position that it is difficult to lay down rules what they required to provide for before dis- to govern all cases. In Wedgwood's case the tributing the residue, at least so far as it is Master of the Rolls proceeded : “In my opinion possible to do that. By the Finance Act of the natural time to ascertain the meaning of 1914 settlement estate duty was abolished, and the words 'free of all death duties ' is when an additional estate duty liability was created the legacies are paid in the sense of having

passing ” of the fund on the deaths been transferred out and out from the testator's of liferenters or other limited beneficiaries, estate.” This dictum contemplated the very and it is this legislative change which is the ordinary course in an English will of the appointspecial fons et origo of the problem. Apart ment of trustees, followed by a legacy of, say, from the other unknown quantities above £10,000 to those trustees upon certain trusts. mentioned, there is the inherent difficulty When the money is handed over, by probably involved in the principle of aggregation, the same persons as executors, to themselves as which augments the rate of duty on future trustees, that satisfies his Lordship’s condition deaths by what may, for the present purpose, be that the legacy is paid in the sense of having called the wholly irrelevant, and certainly the been transferred out and out from the testator's unassessable, factor of the amount of the life- estate. In Dunn's case the trustees had in renter's own estate heritable and moveable, point of fact appropriated in their own hands and all his or her other liferented estate, or a special investment to meet the particular estate from which he or she may have been settled fund. This was done without any drawing annuities.

special direction or authority in the will, and Before considering what, if any, clause on it might or might not have been effectual so as the subject should be introduced into a will, to entitle the fiars to any appreciation and to it is helpful to see what is the result in the throw upon them the risk of any depreciation. absence of any such clause. Excluding residu- But however that might be, the appropriation ary gifts (referred to later), the results are—(1) was not allowed by the Court to affect the Estate duty payable on the testator's death. This question of the incidence of the estate duty is payable out of residue, to the exoneration of which would become payable on the death of all the other beneficiaries, except legatees of the liferenter. specific heritage and legatees of foreign move- All that can be said is that the tendency of able assets ; in both of those excepted cases the most recent English decisions, exemplified the legatees must themselves bear the immediate in In re Wedgwood and in In re Beecham, is to estate duty; and possibly the same bolds in restrict the import of general words. In the regard to general legacies which have to be former of these cases Lord Sterndale, speaking satisfied out of heritable property. 2) Estate of the date down to which the obligation of duty payable on subsequent devolutions. This is exoneration of death duties was to be carried, in all cases payable by the settled fund or said : “ If it be intended to postpone this date property, and so it falls on the special bene- to that of payment or transference to the ficiaries thereof to the exoneration of the ultimate beneficiary, words should be used residuary legatee. (3) Legacy and succession clearly expressing that intention. It can of duties. These are in every case payable by course be done, but I think it should be done the special beneficiaries, to the exoneration of by clear words." It is helpful to see exactly the residuary legatee.

what happened in the latest English case, which The mere fact that, as is mentioned above, is In re Beecham. The will followed a scheme

C

were en

with which we are not familiar in Scotland. interests in the fund until the final exhaustion There were first managing trustees, who, of the special trusts. according to the view taken by Sir Ernest In Dunn's case the decision of the Second Pollock M.R., were to clear up the estate,' Division was unanimous, and, if one may say after which they were to hand it over to a so, there does not appear to have been any

real custodian trustee. There were various settled doubt of what the result must be, namely, that legacies which were to be administered by the the second estate duty must fall, not upon the custodian trustee over what might be long special fund, but upon the general residue. tracts of time. The first purpose of the The second purpose of the will provided for residuary clause was to pay all death duties 'payment to the legatees hereinafter named of of every kind on every part of my estate, and the following legacies namely . . . . To A in so that this direction shall operate to exonerate liferent, and after his death to his four children any part of my estate which otherwise might B, C, D and E, £12,000,” and later on there be charged with or liable for any death duties." occurred the following: “I hereby declare that The question was whether this was merely a the whole of the foregoing legacies are given direction to pay out of residue all death duties free of legacy or other duty and shall vest at payable at the death of the testator, or whether my death.” Thus we have the following facts it extended also to future death duties which (1) the testator himself describes the gift to A's would arise later on the deaths of annuitants named children of the capital of the £12,000 as or tenants-for-life of the settled legacies. Mr a legacy; (2) he declares that all legacies are Justice Eve felt himself compelled to hold that given free of duty; (3) that the duty-free the language was so wide that all persons clause applied to the gift of the capital of the beneficially interested in the estate

£12,000 was further made clear by the provision titled to immunity from death duties present as to vesting, which manifestly applied to the and future. This was reversed, and the reversionary gift of the capital of the £12,000 ; narrower view was taken, in the Court of and (4) the testator thus clearly sbewed his Appeal, consisting of the present Master of the intention that the immunity from duty should Rolls and Lords Justices Warrington and apply, not merely to the occasion of his death, Sargant. It is thought to be correct to say but to all the devolutions prescribed by his will. that this, along with in re Wedgwood, is an It remains to glance at residuary gifts as indication of a check on the earlier inclination affected by such relief clauses. It has been to a very wide interpretation. But, after all, assumed above that all interests in residue the decision of every such case must depend would be excluded from the benefit of these upon the words used, and it does not appear clauses, but it appears that even in that respect that English forms can in this respect be very there may be what one might be disposed to readily transported into Scotland. In In recall a miscarriage. This occurred in In re Beecham the Master of the Rolls said that it Kennedy ([1917] i Ch. 9, C.A.). In an English was important to notice that the clause spoke will consisting of numbered clauses, clause 6 of duties“ on every part of my estate " and provided that “ all the legacies, annuities, and not on every

interest in my estate.” If the bequests bequeathed by this my will shall be latter expression had been used there can be given and paid free of all death duties.” Then little doubt that the wider interpretation would in a subsequent clause the residuary estate have been declared, no matter what incon- was given in liferent and fee through the medium venience that might have caused. Two of the of trustees. The estate duty was paid out of earliest cases are in re Hatch ([1916] 115 L.T. residue, and no question was raised regarding 472) and In re Stoddart (1916] 2 Ch. 444). In that. It happened that the life-tenant and the former case the immunity clause applied to remainder-men under the residuary clause were

annuity, succession, or other liable in different rates of legacy duty, and the duties payable in respect of all and every the life-tenant claimed that her life interest in the benefits given by this my will,” and in the residue was a bequest” in the sense of the latter case the testator directed“ all the legacies, relief clause, and that therefore the legacy duty whether settled or otherwise, and the annuities on it, calculated as an annuity,” should be herein before bequeathed, to be paid and en- paid out of capital and not out of her income. joyed free of all death duties." "Benefits” in Mr Justice Astbury decided against that view, the one case and enjoyed in the other but his judgment was reversed in the Court of were very strong, for neither word is really Appeal. Lord Cozens-Hardy M.R. had no applicable to the interest taken by a mere difficulty in giving effect to the claim. His trustee-legatee of a settled legacy. Accordingly Lordship said : in both of those cases the wider view was taken, It is no doubt true that in general a gift and the exemption was held to be applicable to of residue or of a share of residue free from duty all successive duty claims in respect of all is ineffective, for the duty must be paid out of

“all legacy,

the residue. But it by no means follows that from legacy duty, and B is liable to legacy duty when the residue is settled, and the duty is at 10 per cent. The result of a relief clause payable at different times and at different rates, being held to apply would be that the 10 per the duty in respect of the life interests cannot cent. duty on the one-half of the residuary by the language of the will be made payable out estate would be borne by A and B equally, of capital. It seems to me that the trustees instead of being borne wholly by B. So the should pay the four instalments of legacy duty clause would not be ineffective, as it becomes due out of capital, diminishing On the constructive side it is suggested for thereby the ultimate residue to be divided. consideration : This will give effect to the directions in the will." 1. That the ordinary first purpose of a Scottish

This case is calculated to convey a warning, trust disposition and settlement should be for it is difficult to believe that that can have expanded by including a direction to pay out of been what the testator really intended. Nor is residue all estate duty payable at the testator's that the end of it, for the claim might be pressed death, to the exoneration of all bequests other a good deal further. With deference to Lord than residuary bequests. It is thought that Cozens-Hardy it may be questioned whether, on the true intention must almost always go at the assumption that the relief clause applied least as far as this. It may be that to effect to the life-tenant of residue, the direction of that intention it is necessary to add the express that clause was carried into full effect by the words of exoneration. That is suggested by course which was followed. To give full effect the analogy of specific bequests of mortgaged to the clause, that is to say, to give the same assets, where it is settled that, in the absence of effect to it in favour of the life-tenant of residue special words of relief, the legatee must take as in favour of any non-residuary beneficiary, the property with its burden notwithstanding it would be necessary that the life-tenant should a general direction to the trustees to pay be placed in exactly as good a position as if no “all debts.” Incidentally, therefore, attention

“ legacy duty claim had existed. In point of would need to be given to see that express fact the life-tenant did suffer from the legacy words added with reference to death duty did duty claim, for, though the legacy duty on her not extend also to debts charged on the subjects life interest was paid out of capital, that meant of specific legacies, unless indeed the true that she drew the income of a reduced fund, intention be that the legatees should be relieved and therefore to a degree suffered the burden of of the debts. One ventures to think that that legacy duty. Full indemnity to her under the often is the true intention, and that it is frusrelief clause would have required that capital trated through lack of consideration. should be drawn upon every year in her favour 2. That a general clause regarding legacy and for an annually increasing payment to make her succession duties, and future estate duty, is on income amount to what it would have been the whole dangerous and had better be avoided. if there had been no legacy duty payable. Nor The document will be only very slightly inis this at all far-fetched, for that full degree of creased in length and the testator's true intensatisfaction has been decreed under a carefully tions are much more likely to be carried out, by framed clause relieving an annuitant from the stating expressly in each separate instance what, far more onerous items of income tax and super- if any, duties beyond the initial estate duty are tax (Meeking v. Inland Revenue, 1920, 7 Tax to be borne by the residuary estate to the relief Cases, 603), though it was there pointed out of the special fund. by Mr Justice Rowlatt that it may be doubted 3. That it may be well to give heed to the whether testators and their advisers realise suggestion by Lord Justice Bankes in one of the how far such inroads on capital may go. cases that existing wills ought to be revised

Then there is the question whether such a on the point of the degree of immunity to be relief clause can possibly operate in favour of a accorded to settled legacies as against residue. legatee of residuary capital. It may be thought that the remarks of Lord Cozens-Hardy in In re Kennedy negatived the possibility of such The Lord Advocate has appointed Mr R. S. an application, but it is not clear that that was Henderson, solicitor, Dornoch, to be Procuratorintended by his Lordship, and in any case the Fiscal for the county of Sutherland. Mr question did not arise. On principle it is Henderson is at present Depute-Fiscal of the difficult to see why, if a relief clause which does county, and previously acted in a similar not mention residue can be held to apply to capacity at Ayr. He is thirty-two years of residue at all

, its application should necessarily age, and a native of Airdrie. "He served his be excluded from residuary capital. Dismissing apprenticeship with Messrs Borland, King, Shaw the idea of liferent and fee altogether, take the & Co., Glasgow, and thereafter was in the office simple case of a residuary gift equally between of Messrs Mitchells, Johnstone & Co., solicitors, two legatees A and B, where A is by law exempt Glasgow.

as

an

HIGH COURT OF JUSTICIARY, DUMFRIES.(Special Sitting.) Dumfries—Tuesday, 13th

LAW LIBRARY.
May 1924, at half-past ten o'clock. Pleading

BOOK NOTICES.
Diet-Saturday, 3rd May. Service-Saturday,
26th April. The Hon. Lord Cullen. J. M. A History of English Law. By W. S. Holds-
Hunter, Esq., Advocate-Depute; Alexander worth, K.C., D.C.L. Vols. IV. and V.
Rae, Esq., Clerk.

1924. London : Methuen & Co. Ltd.

Professor Holdsworth's great work grows in John C. WATSON, advocate, Edinburgh, was bulk and in importance; and every additional introduced at the Sheriff Court, Paisley, last volume confirms the opinion, which we expressed week by the Sheriff-Principal on his appoint- in noticing the earlier volumes, that this book ment

Honorary Sheriff - Substitute. was destined to mark an epoch in the literature Sheriff Hamilton presided. Sheriff Hamilton of English law. For learning and thoroughremarked that Mr Watson came to the Bar in ness it is probably unique among historical 1909, but that he was on active service for six treatises on that law. Volume IV. contains years with His Majesty's Army during the war. an important contribution to the constitutional Mr D. A. Morrison, Dean of Faculty, extended history of England in the sixteenth century ; a welcome on behalf of the members of the Bar. and—perhaps more important—it treats of

that critical period in the history of European

law when the revival of the Roman law was The following graduated in law at the laying the foundations of modern systems. ceremony in Glasgow University on 22nd The peculiar attitude assumed at that important April :

period by the English lawyers to the Roman BACHELORS OF LAW (LL.B.).

system is fully and clearly discussed. That

attitude constitutes an epoch in the history of
John Harold Dickson, M.A. ; Alexander Macara,
M.A.; Allister M'Donald, M.A.; John Macfarlane, English law; for from it has largely flowed
M.A.; Thomas Henderson Adam Miller, M.A.; the fundamental cleavage between the English
William Wright, M.A.

common law and practically all the other legal

systems of Western Europe. The causes and BACHELORS OF LAW (B.L.).

results of that attitude, therefore, well deserve Archibald Francis Ferguson, Joseph Michael the full treatment which this learned writer Hughes, Muriel Isabelle Jeffrey, Robert Murray has given to them; and we know of no better MacGregor, Dora Creer Mathieson, M.A.; Henry treatment of the subject. The fifth volume William Nimmo, John James Somerville, B.A. deals fully with the development of the English (Dub.).

law during the sixteenth and early seventeenth

centuries. The elements contributed by the W.S. Society.—The following gentlemen various courts of Star Chamber, Admiralty,

SOCIETY— have been admitted members of the Society of Chancery, and so forth, are discussed in turn; Writers to His Majesty's Signet: Edward the little-known subject of the earliest published

and some interesting information is given on Maitland Campbell, 25 Ainslie Place, Edin

burgh; John Maxwell, Redford House,

law reports and their influence on the growth Colinton; and William Milne Sutherland, 28 of Edward Coke and his unique position as a

of the law. The volume ends with a full account Charlotte Square, Edinburgh.

formative element in the systematising of the

common law. MESSRS MARSHALL & MACLACHLAN, writers, The Law of Bills of Exchange, Cheques, Pro30 Renfield Street, Glasgow, inform us that

missory Notes, etc., By Bertram Jacobs, Mr Grant J. Mitchell, B.L., has been assumed

LL.B., Barrister-at-Law. Second Edition. as a partner. Mr Mitchell was trained in the

1924. London : Sweet & Maxwell, Ltd. office of Messrs M'Clure, Naismith, Brodie & Co.,

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This little volume, containing a concise and careful statement of the law relating to negotiable instruments, has established itself in the favour of the profession in England and has now attained to the dignity of a second edition. Its explanations are lucid ; and the work may be recommended to all who do not possess,

care to consult, the bulkier and more exhaustive treatises.

a

or

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The International Law Association. Report of the Conspiracy, as a term of art, is much oftener Thirty-second Conference, held at the Old Hall, found in use in English than in Scots law Lincoln's Inn, London, 4th October 1923. books; yet there is no great difference in the

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EDITOR'S NOTE. in the number of things which men might combine or "conspire to do without the The General Editor will be pleased to consider risk of a criminal indictment. Dr Harrison's Articles of Legal Interest, and if accepted for publicavolume, which was originally written as a thesis tion these will be paid for, but no responsibility is for his LL.D. degree, treats not only of the undertaken for the safe custody and return of MSS.