Austin v Abigail [1933] HCA 24; (1933) 49 CLR 177 (11 May 1933)

Austin Defendant, Appellant; and Abigail and Others Defendants and Plaintiff, Respondents.

Loxton K.C. (with him Sturt), for the respondents Mabel Mary Abigail, Florence Kate Primrose, Ernest Robert Abigail and Gloria Abigail.

The appellant represents the next-of-kin of the testator. The appeal is against a decretal order made by Harvey C.J. in Eq. which, in effect, determines that at present, in the events that so far have happened, no part of the estate of the testator, capital or income, passes as on an intestacy. The question so determined arises out of the operation of a revocation provision of a codicil upon the obscure dispositions of a short but carelessly drawn will. The first disposition contained in the will is a trust to divide the rents and profits of the testator's real and personal estate equally between his wife, his wife's sister and his son during their lifetime. The codicil revokes the disposition in favour of the testator's son, but makes no provision in its place. When the will comes to the dispositions in succession to the life interests, it refers to the deaths of the testator's wife and of her sister only. It provides that after their deaths "the interest so payable to each or either of them" shall be paid to the two named children of his son in certain proportions, "until the younger of them arrives at the age of thirty years then to realize the whole estate and divide between those two children in the aforesaid ratio." The contention for the appellant is that this provision is confined to the two individual shares in which life interests are given to the testator's wife and her sister. The consequence of this construction would be that the share in which a life interest is given by the will to the testator's son would be undisposed of as to corpus and, the gift of the life interest having been revoked by the codicil, would pass altogether as on an intestacy. In support of the contention that the will should be so construed it was suggested that, otherwise, when the testator's wife and sister-in-law died and his two grandchildren attained thirty, the life interest given by the will to his son, if it had been unrevoked, would necessarily have been defeated before the death of the life tenant, the testator's son, in order that the two grandchildren should take. It is not impossible, however, to treat the disposition expressed in the words "then to realize the whole estate and divide between those two children" as subject in the will to the due determination of all the prior interests given by that instrument and not as operating in defeasance of any of them. But, whether this be so or not, the expression "realize the whole estate" is too clear and unambiguous to be controlled and restrained by the uncertain inferences which may be drawn from the unlikelihood of the testator's intending such a consequence and from the proximity of the reference to the deaths of the two female life tenants. Harvey C.J. in Eq. construed the words as extending to the entire corpus or residuary corpus of the estate and it is difficult to see how any other construction could be given to them. It follows that the share is not undisposed of in which under the will, if the provision stood unrevoked, the testator's son would take a life interest. Unless one of the two grandchildren die before the younger attains the age of thirty the question will be unimportant whether the remainders or executory interests limited to them are contingent. Whether the limitation is contingent or not, the fate of intermediate income not otherwise disposed of by the will would follow the fate of the corpus. Apart from statute, the intermediate income would have followed the destination of the corpus because, although the expressions "residue" or "residuary" are not used, the limitation is a general devise and bequest of the blended real and personal property of the testator after prior interests given by the will have been satisfied and, necessarily, after payment of debts, testamentary expenses and charges of administration. But, in any case, sec. 36B of the Conveyancing Act 1919-1930, which commenced before the will came into operation, appears to bring about the same result. If that construction of the will is adopted which results in the share given for life to the testator's son being limited to his two children as a vested or contingent remainder expectant upon his life interest, the remainder would be accelerated by the revocation of the limitation of the interest for life. For the revocation of the gift of the share of income to the testator's son does not operate to augment the shares given to his wife and her sister. (See Tompkins v. Simmons[1].) On the other hand, if the will is construed so that the two grandchildren might under it have taken in defeasance of their father's share if he survived the other life tenants, yet, on that construction, if he died before them, then the intermediate income after the cesser of his life interest would have followed the fate of the corpus. There appears to be no reason why, when the life interest is taken out of the way by revocation, the same result should not follow. The decretal order appealed from is accordingly right in declaring that the share of income directed by the will to be paid during his lifetime to the testator's son does not at present in the events which have happened pass as under an intestacy.

Acting, presumably, under sec. 43 of the Trustee Act 1925, Harvey C.J. in Eq. declared that the trustee might apply the income of the share to the maintenance of the grandchildren, who are infants aged nine and seven years. He also directed an accumulation of the balance of the intermediate income with power to resort to the accumulations for maintenance. The declaration and the direction are expressly confined in their operation to a period of twenty-one years from the testator's death, or to the death of the testator's son, whichever shall first happen. The first limitation observes the statutory restriction upon accumulation of income. The second was probably introduced by way of precaution because among questions contained in the originating summons which his Honor had refused then to decide was one enquiring whether the testator's widow and her sister took the income given them for the joint lives of themselves and his son or the survivor of them. Perhaps, in spite of the fact that the revocation of the testator's son's share did not augment the other shares, as in effect the decretal order declared, it may have been considered not impossible to find on the death of the son a limitation over of his share of income to the widow and her sister or the survivor. Whatever may be its reason, the restriction affects only the period during which this part of the order operates and does not prejudice rights. But there appears to be in the declaration dealing with maintenance an accidental omission of a provision restricting its operation to the infancy of the grandchildren. It seems desirable, if this restriction is inserted, to limit the direction to accumulate until further order, because if this is not done, it will or may operate on the whole income after the operation of the maintenance provision ends. Otherwise, the decretal order appealed from should for these reasons be affirmed.

The appeal should be dismissed. The will, though that of a solicitor, is badly expressed, but there is not much doubt, I think, that the words "then to realise the whole estate" apply to the whole estate of the testator, as Harvey C.J. in Eq. has declared, and not merely, as was argued, to the estate in respect of which E. R. Abigail Junior Secundus and Gloria Abigail were receiving interest.

Little was said at the Bar as to the other declarations of the learned Judge. The decretal order leaves open for further consideration the interest taken by these individuals, and whether that interest is absolute, defeasible or contingent. (See In re Buckley's Trusts[2].) But the declarations dealing with the income are nevertheless authorized by the provisions of the Conveyancing Act 1919-1930, sec. 36B, and the Trustee Act 1925, No. 14, sec. 43, except in so far as accumulation is directed beyond the infancy of E. R. Abigail Junior Secundus and Gloria Abigail, for it seems, under the Trustee Act 1925, sec. 43 (4)—though we heard no argument on the subject—that accumulation should take place only during infancy. It is advisable, perhaps, to make this limitation clear, though the learned Judge was no doubt cognizant of it and indeed it may be implicit in the order itself.

Decretal order varied by inserting in the further declaration with respect to maintenance after the words "one-third respectively" and before the words "until the death," and in the further order with respect to the accumulation of unapplied income after the words "further order that" and before the words "until either of such events" the words "during the respective minorities of the said infant defendants." Subject to such variation decretal order affirmed and appeal dismissed with costs. Respondents Bates and Cooper to abide their own costs. Trustee to be at liberty to retain its costs as between solicitor and client out of the estate so far as not recovered.

[1] (1931) 44 C.L.R., at pp. 552, 556-559.

[2] (1883) 22 Ch. D. 583.

High Court of Australia

Austin v Abigail [1933] HCA 24; (1933) 49 CLR 177 (11 May 1933)

HIGH COURT OF AUSTRALIA