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High Court of Australia |
ATTORNEY-GENERAL (S.A.) v. BRAY [1964] HCA 3; (1964) 111 CLR 402
Charaties - Rule against Perpetuities
High Court of Australia
Dixon C.J.(1), Kitto(2), Taylor(3), Menzies(4) and Windeyer(5) JJ.
CATCHWORDS
Charities - Charitable purpose - Trusts to establish and maintain home for homeless, stray and unwanted animals - Construction - Validity - Practicability of trusts - Test for determining practicability - Cy-pres application.Rule against Perpetuities - Power to postpone carrying out of trusts until sufficient funds accumulated - Whether rule infringed - Costs.
HEARING
Adelaide, 1963, September 24, 25;DECISION
1964, February 25.2. The will of the testatrix after the usual clauses, including the appointment of the executor and trustee, directed that the trustee stand possessed of her estate upon the following trusts: "(a) To purchase and properly equip a home for the purpose of the maintenance and care of or for otherwise mercifully and kindly dealing with homeless, stray and unwanted animals (b) to invest the balance of such estate and to apply the income thereof for the permanent upkeep including wages of the aforesaid home (4) I empower my trustees to postpone the carrying out of the trusts contained in sub-paragraphs (a) and (b) of paragraph three hereof for such period as shall be necessary in order to accumulate a fund sufficient in the opinion of my trustees to carry out the trusts contained in sub-paragraphs (a) and (b) of paragraph three hereof and for this purpose to capitalize the net income of my estate during such period of postponement. (5) I empower my trustees to postpone the realization of my estate for such period or periods as they in their discretion shall think fit." The remainder of the will dealt only with the form of investments and estate, succession and other death duties, and so far as I can see nothing turns on it here. (at p410)
3. The originating summons was issued on 6th May 1959 by the executor and the defendants joined were simply the Attorney-General and Harry Midwinter Bray who represents the next of kin. The relief sought was the determination without administration of certain questions: First, whether the trust to purchase and properly equip a home for the purpose of the maintenance and care of or for otherwise mercifully and kindly dealing with homeless, stray and unwanted animals was and is a charitable bequest or is void for uncertainty or for any other reason. The second was based on the hypothesis that the first question was answered in the affirmative (which presumably means answered that the trust was valid). On that hypothesis the trustee seeks direction of a scheme for the purpose of carrying the trust into effect "or that otherwise directions may be given as to how the plaintiff as the present trustee of the said will ought to apply or deal with the said bequest". The third question inquires whether upon the true construction of the will the trust to invest the balance of the estate and to apply the income therefrom for the permanent upkeep including wages and so on is a valid charitable bequest or trust or is void for uncertainty or as infringing the rule against perpetuities or for any other reason. On the hypothesis that this question is answered in the affirmative, the fourth question asks that a scheme may be directed for the purpose of carrying the said trust into effect or that otherwise directions should be given as to how the plaintiff, that is the present trustee, ought to apply or deal with the balance. The fifth question inquires whether the power contained in par. (4) of the will to postpone the carrying out of the trust contained in par. (3) (a) and (b) for such period as should be necessary in order to accumulate a fund sufficient in the opinion of the trustee to carry out the trust and for this purpose to capitalize the net income of the estate during such period of postponement "can be" properly exercised. The sixth question inquires whether the testatrix died intestate as to whole or part of her estate. The seventh question asks for the ascertainment of the persons beneficially entitled if she died intestate. Then certain incidental and consequential questions are raised by the summons. (at p410)
4. In first instance the summons came before his Honour the Chief Justice who made an order for an inquiry whether at the date of the death of the testatrix it was practicable to carry into execution the trusts referred to in cl. (3) of the will. Pending the result of the inquiry the summons was adjourned for further consideration, with liberty to apply. (at p411)
5. In his Honour's reasons he said that he read the words in the will "home for stray and unwanted animals" as a reference to domestic animals, that is to say, such animals as are commonly kept and cared for in or about human habitations. His Honour proceeded: "Accepting that as the intention disclosed by the words of the will, I think that I am bound by authority to hold that this is a charitable purpose". His Honour then referred to the judgment of Kay J. in In re Douglas; Obert v. Barrow (1887) 35 ChD 472, at p 479 and quoted a passage from the judgment, pointing out that In re Douglas (1887) 35 ChD 472 had been accepted by the Privy Council in Adamson v. Melbourne and Metropolitan Board of Works (1929) AC 142, at p 148 . His Honour then held that the will did not disclose a general charitable intention, by which I understand his Honour to mean not merely a charitable intention wider than the care of homeless, stray and unwanted domestic animals but wider than the means prescribed of caring for them, viz. the purchasing and properly equipping of a home for the purpose of the maintenance and care of or for otherwise mercifully and kindly dealing with such animals, and presumably, the permanent upkeep of the home. His Honour said at one point in his judgment that he considered the provision in cl. (4) which authorized the trustee to defer the establishment of the home for the purpose of accumulating a fund to endow the institution to be another pointer to the intention of the testatrix. His Honour thought that it gave a clear indication of the importance which she attached to the form of her gift. His Honour said: "It seems to me that she was thinking of the home as the thing she was giving and not as a means to any other end". His Honour thought that it would be premature to express any opinion or to consider the bearing of cl. (4) empowering the trustees to postpone carrying out the trust in cl. (3) until the Court was further informed upon the question of fact, viz. whether at the time of the death of the testatrix it was practicable to give effect to the trust in cl. (3) with the funds then available for that purpose. His Honour's reason for this view was that, as it seemed to him as then advised, if the question should be answered in the negative the gift would fail. On the other hand, if the trust could be carried into effect without recourse to the power given to the trustee by cl. (4), there was no reason why that clause should be deemed to invalidate the gift made in cl. (3). The difficulty is, however, that it might be possible to carry the gift into effect only by means of cl. (4), the question of the validity of which would therefore become critical. His Honour concluded: "For these reasons there will be an order directing an inquiry whether at the date of the death of the testatrix it was practicable to carry into execution the trusts referred to in cl. (3) of the will. Pending the result of the inquiry further consideration of the summons will be adjourned, with liberty to apply". (at p412)
6. The Master inquired accordingly into the question thus remitted to him and gave a report and certificate dated 5th April 1962. The report recounted the course of the proceedings leading to his inquiry and the course of the inquiry. He observed as a result that it seemed to him that his first consideration must be directed to the species of animal which the testatrix intended to benefit by her disposition. The Master said that he was guided by the observations which I have already quoted from the Chief Justice's judgment that the phrase referred to such animals as are commonly kept and cared for in or about human habitations, and added that Dr. Bray, who represented the defendant Bray and therefore the next of kin, did not challenge that interpretation but did contend that the institution to be established must be such as to be capable of caring for all kinds of such animals. He contended, too, that the language used by the testatrix manifested no intention to restrict the categories of animals to dogs and cats and that other animals kept for domestic purposes, such as horses and goats, fell within the benevolent objects of the testatrix. This distinction between the language and the benevolent intention was not accepted by the Master who thought that the problem to which the testatrix turned her attention was that of protecting domestic animals which in a real sense are homeless or have wandered or have been turned away from their homes, and added: "This, as the evidence shows, is the protection of stray and homeless dogs and cats." The Master added: "Accordingly, I think that for practical purposes I should confine my attention to the question whether, with the resources available to the plaintiff" (that is to say, the executor) "the object of establishing and maintaining an institution to serve as a refuge for dogs and cats could have been achieved." The Master added that the plaintiff had presented its case (scil. before him) by showing what the Lost Dogs Society Incorporated, a body confronted with substantially the same problem as that facing the plaintiff, had been able to do for the protection of lost and unwanted dogs. The Master ended his report and certificate by stating that his conclusion was that it was impracticable at the date of death of the testatrix to carry into execution her object in making the disposition contained in cl. (3) of her will and that he so found. It might be, he said, that the interpretation he had placed upon the words "domestic animals" was too narrow for the purpose of the inquiry "but if it were the intention of the testatrix to provide a home for all categories of domestic animals, then I think the impracticability of carrying the trust into effect would be all the greater". He observed that he said this, bearing in mind that the gift projects not only the purchase and equipment of an institution but that the animals received into it should be treated in a merciful and kindly way. (at p413)
7. An application was made by the Attorney-General to discharge or vary this report and certificate and to direct the Master to consider and report on the question of whether it would not have been practicable to carry out the terms of the trusts by the trustee applying the funds properly available to or in favour of the Lost Dogs Society Incorporated. The application came before his Honour the Chief Justice. His Honour approved the certificate of the Master and added: "It follows that the gift fails, the fund must be distributed as on an intestacy, and the summons will be answered accordingly" (1963) SASR, at p 175 (at p413)
8. An order was made on the originating summons by the learned Chief Justice dated 22nd November 1962, whereby the Supreme Court declared that upon the true construction of the will of the testatrix, the trusts contained in cl. (3) of the said will are a valid charitable trust but that it appearing from the Master's certificate that it was impracticable at the date of the death of the testatrix to carry into execution the said trust and it further appearing to the Court that the charitable gift contained in cl. (3) of the will was not applicable cy-pres to charitable purposes, the Court declared that the charitable gift had failed and that the fund ought to be distributed as on an intestacy and the Court did so order the same accordingly. A consequential inquiry was also ordered. The Attorney-General appealed to the Full Court from this order in so far as it declared that the gift contained in cl. (3) of the will failed and that the fund the subject of the gift could not be applied cy-pres and that the fund accordingly was to be distributed as on an intestacy. On behalf of the defendant Harry Midwinter Bray, his intention was notified to cross appeal and ask that the order of the Chief Justice should be varied by deleting the declaration that the trusts in cl. (3) are valid charitable trusts, and instead declaring that they are not valid charitable trusts. (at p414)
9. The appeal was heard before Millhouse, Travers and Hogarth JJ. who dismissed the appeal and as to a cross appeal (presumably by Harry Midwinter Bray) stated that the Court did not think fit to make any order with respect to the said cross-appeal (1963) SASR 173. From this order the Attorney-General gave notice of appeal to this Court and sought an order declaring that the will of the testatrix evinced a general charitable intention and asked that the gift be applied cy-pres and that an appropriate scheme be settled accordingly. No objection was taken to the competence of the appeal but the defendant Harry Midwinter Bray cross-appealed from that part of the judgment of the Full Court which decided that it was not necessary to deal with the matters raised by the cross-appeal. (at p414)
10. The first point argued on behalf of the Attorney-General as appellant was the correctness of the view that the testatrix had no general intention to benefit animals of the type she described which for convenience at this point may be called "domestic animals", other than by the establishment of a home and that therefore an order for a cy-pres application of the fund which involved no home would not be justified. I agree in this interpretation of the clause and I do not think that the Milly Milly Case and the principle there put into effect apply to this case: Attorney-General (N.S.W.) v. Perpetual Trustee Co. (Ltd.) [1940] HCA 12; (1940) 63 CLR 209 It of course depends on the intention of the testatrix as disclosed by her will. If she regarded the means only as incidental, that is to say, the use of a home established by funds from her will, and not as an essential part of her will, then the cy-pres method of attempting to obtain the same end might be considered. On the whole I think the view is right that she did regard the establishment of the home as an essential part of her gift and not merely as a subsidiary means of giving effect to it. An allegation that that means was impossible was therefore not irrelevant to the validity of the gift. The important words are those in par. (3) (a) of the trust, viz. "to purchase and properly equip a home for the purpose of the maintenance and care of or for otherwise mercifully and kindly dealing with homeless, stray and unwanted animals". The difficulty is that there is no intimation of the scale of the home and it will be observed that the place where it is to be established in South Australia is not specified. I think it is right to treat it as intended for domestic animals who are liable to be found homeless, stray and unwanted, but it is only too clear that the number of these in want of a home must depend upon the locality. That is a deduction from ordinary experience. Further, the amount of money available must depend upon the use of the fund over a period of time during which it may be accumulated under cl. (4). That clause speaks of "such period as shall be necessary in order to accumulate a fund sufficient in the opinion of my trustees to carry out the trusts contained in subparagraphs (a) and (b) of paragraph three". The will further directs that during the period of postponement the income is to be capitalized. The case of Attorney-General v. Vint [1850] EngR 284; (1850) 3 De G & Sm 704 (64 ER 669) and the case of Martin v. Maugham [1844] EngR 784; (1844) 14 Sim 230 (60 ER 346) should be compared. It seems to be clear upon the text of this will that although the testatrix confined the means of executing her charitable intention the whole fund was devoted to the charitable intention. This observation means that there is no violation of the rule against perpetuities in cl. (5) or in cl. (4). It is notable that the trustee has not made any practical attempt to carry out the trust and it seems to me rather remarkable that the sum of money which has been realized should be insufficient to carry out the intention of the testatrix on a moderate scale. It must be borne in mind that in the affidavit of Mr. Packham it is said that the estate accounts as at the date of death on 30th October 1957 showed a balance, after taking into account the debts of the deceased, of 21,533 pounds 4s. 5d. However, if the trustee thinks it impracticable in any appropriate place to establish a home for homeless animals of the kind in question and leave a surplus which would enable the estate to conduct it, I am of opinion that an accumulation may be made under these clauses at least for twenty-one years from her death or until such shorter period as enough money seems to be in hand to enable her project to be carried out. (at p415)
11. It appears to me that a conception of what is necessary in order to fulfil the direction of the will has been adopted which may involve too high a standard. Often in practical affairs the amount of money available must govern the standard of what should be done. I think that the bequest contained in the will cannot be declared impracticable and void at this stage. (at p415)
12. The appeal should be allowed. (at p415)
KITTO J. In this case there is an appeal and cross-appeal against an order of the Supreme Court of South Australia (Full Court) dismissing an appeal and declining to make any order upon a cross-appeal to that Court from an order which Napier C.J. had made upon an originating summons relating to the will of one May Annie Sarah Hodge deceased: In re Hodge, deceased (1963) SASR 173 (at p416)
2. The will was in simple enough terms. The whole estate was given to a trustee company and subject to the payment of debts, funeral and testamentary expenses and death duties trusts were created by means of a direction (a) to purchase and properly equip a home for the purpose of the maintenance and care of or for otherwise mercifully and kindly dealing with homeless, stray and unwanted animals, and (b) to invest the balance and apply the income thereof for the permanent upkeep including wages of the aforesaid home. This direction was contained in par. (3) of the will. By par. (4) the testatrix empowered the trustee to postpone the carrying out of the trusts contained in sub-par. (a) and (b) of par. (3) for such period as should be necessary in order to accumulate a fund sufficient in the trustee's opinion to carry out those trusts, and for the purpose to capitalize the net income of the estate during the period of postponement. No other provision of the will need be mentioned. (at p416)
3. The originating summons was taken out by the trustee company for the determination of questions as to the validity of the trusts in par. 3 (a) and (b) and the power in par. (4) and for consequential determinations and directions. The Attorney-General for South Australia and a representative of the next of kin were made defendants. When the summons first came before the learned Chief Justice, his Honour made no order except one directing an inquiry whether at the date of the testatrix's death it was practicable to carry into execution the trusts in par. (3) of the will. In giving his reasons for making this order his Honour expressed the opinion that while the trusts in par. (3) were valid charitable trusts no general charitable intention appeared. The Master held the inquiry and made a report and certificate that it was impracticable at the death of the testatrix to carry the trusts into execution. (at p416)
4. The Attorney-General then applied to discharge or vary the report and certificate, seeking a direction to the Master to consider whether it would not have been practicable to carry out the trusts by applying the available funds to or in favour of a body called the Lost Dogs Society Incorporated and permitting and requiring that body to carry on a home in accordance with par. (3) of the will. This was in effect a challenge to the Chief Justice's previously expressed opinion, for the order sought could not be justified unless as a direction for a cy-pres application of a fund the subject of a general charitable intention, on the footing that the particular intention had failed. This application came before his Honour together with the further consideration of the originating summons. His Honour refused to discharge or vary the Master's certificate, and made an order declaring that the trusts in par. (3) of the will were valid charitable trusts, and that, it appearing that it was impracticable at the death of the testatrix to carry the trusts into execution and that the fund was not applicable cy-pres for charitable purposes, the charitable gift had failed, and that the fund ought to be distributed as on intestacy. The order proceeded to direct an inquiry as to the persons entitled on that basis. (at p417)
5. The Attorney-General's appeal to the Full Court of the Supreme Court sought a declaration that the will evinced a general charitable intention and that the gift be applied cy-pres and an order that a scheme be settled. The representative of the next of kin by his cross-appeal challenged the validity of the trusts in par. (3) of the will - that is, even assuming their practicability. The Full Court upheld the decision of the Chief Justice that no general charitable intention appeared, and concluded that in view of the certificate of the Master the gift in par. (3) of the will failed. As this meant that the fund should be distributed as on intestacy the Court considered that no decision was required on the crossappeal. (at p417)
6. In this Court the Attorney-General again contends that the will evinced a general charitable intention and that if the trusts in par. (3) should be held to fail for impracticability the fund ought to be applied cy-pres. He was given leave to amend his notice of appeal in order to add a submission that the inquiry which the Master had been directed to make was too restricted for his certificate to be regarded as justifying a decision that the trusts in par. (3) failed as being impracticable. The representative of the next of kin contends by way of cross-appeal that the learned Chief Justice was in error in holding that the trusts were for a valid charitable purpose. (at p417)
7. The last-mentioned contention may conveniently be considered first. It presents, I think, no difficulty. Napier C.J. inferred from the adjectives "homeless", "stray" and "unwanted" that the animals referred to in par. (3) of the will were confined to domestic animals. With respect, I agree. On that basis his Honour held that he was bound by authority to uphold the trusts in par. (3) of the will as charitable. Again I respectfully agree. The principal decisions on the subject were approved in each of the judgments delivered in the House of Lords in National Anti-Vivisection Society v. Inland Revenue Commissioners [1947] UKHL 4; (1948) AC 31, Viscount Simon, Lord Simonds and Lord Normand expressly accepting the reason given by Swinfen Eady L.J. in In re Wedgwood (1915) 1 Ch 113, for conceding a charitable nature to gifts of this kind: "A gift for the benefit and protection of animals tends to promote and encourage kindness towards them, to discourage cruelty, and to ameliorate the condition of the brute creation, and thus to stimulate humane and generous sentiments in man towards the lower animals, and by these means promote feelings of humanity and morality generally, repress brutality, and thus elevate the human race" (1915) 1 Ch, at p 122 (at p418)
8. The next question is whether the destination of the capital and income of the estate should be decided on the footing that the precise scheme prescribed by the will must be held to have failed ab initio by reason of impracticability. The question has of course to be considered as at the death of the testatrix, for the trusts were expressed to take effect immediately. (Paragraph (4) recognizes as a possibility that the fund may be insufficient in amount until augmented by accumulations of income, but the devotion of the estate to the charitable purpose is not contingent upon any future event or circumstance.) The question to be considered as at the death, however, is not limited to the feasibility of an immediate execution of the trusts. To say of a charitable trust that it fails for impracticability as at the date of death is to say not only that it was impossible at that date to use the trust fund for the charitable purpose immediately but also that there was at that date no reasonable prospect of its becoming possible so to use the fund at any future time: see Attorney-General v. Oglander [1790] EngR 73; (1790) 3 Bro CC 166 (29 ER 468) ; Wallis v. Solicitor-General for New Zealand (1903) AC 173, at pp 185, 186. The formula now used in the Chancery Division in England for defining the scope of the relevant inquiry is designed to bring out both aspects of impracticability. It is the formula approved by Upjohn J. (as he then was) in In re White's Will Trusts; Barrow v. Gillard (1955) Ch 188 : "whether at the date of the death of the testatrix it was practicable to carry the intentions of the testatrix into effect or whether at the said date there was any reasonable prospect that it would be practicable to do so at some future time" (1955) Ch, at p 193 . In In re Tacon; Public Trustee v. Tacon (1958) Ch 447 the formula was used and its use was approved by the Court of Appeal. In that case the charitable gift was in remainder after a prior life interest but was not subject to any contingency. A misunderstanding seems to have arisen in the present case as to the significance of a passage in the judgment of Evershed M.R. in which his Lordship referred to the second branch of the inquiry - the question whether it could be said at the date of death that the gift would at any relevant time be practicable (as his Lordship expressed it in his judgment) - and used words which have been read as meaning that that question was material only because the charitable gift was not an immediate gift. His Lordship cited in this connexion In re Moon's Trusts (1948) 1 All ER 300 and In re Wright (1954) Ch 347 Reference to those cases, particularly the former, and to the judgment of Romer L.J. (1958) Ch, at p 457, will show that the point about the gift being postponed was not that that circumstance made the second inquiry necessary. The point was that notwithstanding that the gift was made subject to a life interest the date of death was the date as at which the question of practicability in both its aspects fell to be determined, because the charitable gift was what would be called, if it had been to an individual, a vested and not a contingent gift. The case of In re White's Will Trusts (1955) Ch 188, in which the modern formula was evolved, was a case of an immediate charitable gift. In the present case the order for an inquiry as to the practicability of the trusts did not follow the formula. Only the first branch of it was used, and the proceedings before the Master seem to have proceeded without sufficient attention being given to the fact that the prospects for a future execution of the charitable trust were as much a matter for consideration as the immediate possibilities. (at p419)
9. But in any case I think, with great respect to the learned Chief Justice, that the inquiry was ordered prematurely. The suggestion of impracticability was first made by the representative of the next of kin. The question it raised was simply one of the sufficiency of the trust fund and its income for the accomplishment of the charitable purpose. No doubt a charitable trust may fail for insufficiency of the fund: cf. Re Good's Will Trusts; Oliver v. Batten (1950) 2 All ER 653; In re Whittaker; Nobel v Attorney-General (1951) 2 TLR 955 But in the present case the representative of the next of kin launched his attack before the trustee company, on whom the duty lay of performing the charitable trust if it could, had reached the stage of trying to work out for itself whether a performance of the trust was feasible or not. The company's manager actually believed that it would be possible to carry out the trusts with a sum considerably less than what he took to be the net balance of the estate. To quote a passage from the Master's report: "From the evidence of Mr. Short (the company's assistant manager) it is abundantly clear that no officer of the plaintiff company has truly applied his mind to the question of whether the moneys held by the plaintiff would be adequate for the purpose of carrying into effect the trust declared by the testatrix. No actual scheme or plan has been put forward by the plaintiff for the establishment or upkeep of the proposed home, nor has any consideration been given to the nature of the services and facilities which would be required to enable it to function efficiently." Even assuming for the present purpose that the will discloses no general charitable intention, the appropriate course, in my opinion, was to refuse an inquiry until the trustee company should have reached the point of concluding that it could not see any way of obeying the precise directions of the will. (at p420)
10. The inquiry, however, was ordered, and, as I have said, it resulted in a certificate that the trusts were impracticable. The certificate is not conclusive in this appeal, for the Attorney-General appealed to the Full Court against the refusal of an order to discharge the certificate and his appeal to this Court raises the point again. An examination of the proceedings before the Master and of the contents of the report has led me to the conclusion that the declaration ought not to be affirmed. Not only were the prospects for the carrying out of the trusts at a future time insufficiently investigated in the evidence which the parties adduced, but the conclusion was reached on the basis of a number of erroneous assumptions. It is a mistake to construe the will as requiring that the home to be established shall be for more than one kind of domestic animals: a home for dogs alone or for cats alone would be sufficient. There is no warrant for determining practicability of the trusts by reference to some particular holding capacity or standard of equipment of the home: a very small and modestly equipped establishment would suffice. Nor is it to be determined upon the view that (to use words from the report) in an expanding community the home should have accommodation of reasonable extent, a degree of permanence and something more than casual or temporary facilities for a relatively small number of inmates: the will says nothing about such matters, and the gloss is not justified. There is no requirement in the will that the home must be "within a reasonable distance of Adelaide": it may be anywhere; or that the home must be staffed by full-time employees: any kind of employees will do, so long as the home gives the kind of service which the will describes; or that the home must be established within any particular period of time: the will leaves the question of time completely at large. Moreover, strange as it may seem since the attack upon the charitable trust was upon the ground of the inadequacy of the trust fund, the amount available or likely to be available was never established with any approximation to accuracy. Such figures as were placed before the Master were subject to an observation appearing in the trustee company's evidence that an appeal was pending in respect of succession duty and that if it should succeed "a very considerable sum of money" would be refunded to the estate. Before us the amount which could be applied for the charitable purpose even without any accumulation of income was conceded to be substantially greater than the Master had been given to understand. Then, in order to test the adequacy of a fund so uncertain in amount the Master was persuaded to adopt as the basis of his report an estimate of the cost of food alone at 500 pounds per annum, of veterinary treatment, tonics and drugs at upwards of 200 pounds, of the wages of the minimum staff ("an efficient resident caretaker and an assistant") at 1,000 pounds per year, and of the cost of upkeep and maintenance at a sum substantially in excess of 1,500 pounds per year. Evidence that was adduced as to an existing institution called the Lost Dogs Home, much of it quite irrelevant to the inquiry, led the Master to calculate that "it would be impracticable to conduct a home for stray and unwanted domestic animals at a cost less than 2,500 pounds per annum". He made findings that at the date of the death the funds available were adequate for the purpose of purchasing and properly equipping an institution under par. (3) (1) of the will, but that the minimum cost would be 6,500 pounds. The funds that would probably remain for investment he took to be about 15,000 pounds (it is now agreed that they are much larger), and the annual net income he took at about 850 pounds per annum. It was on these figures that he based his conclusion that the trust could not be carried into effect. What should have been done, assuming that the inquiry was to be conducted at all, was to take the directions of the will in all their simplicity and ask: can this be made to work at once, and, if not, is there any reasonable prospect of its ever being made to work ? These questions would of course be asked in relation to the date of the death, but it does not follow that information unavailable at that date should not be taken into account: cf. Willis v. The Commonwealth [1946] HCA 22; (1946) 73 CLR 105 and cases there cited (at p422)
11. For these reasons I am of opinion that it should not be held at the present juncture that the particular charitable trusts of the will have failed to take effect. It is therefore unnecessary, I think, to decide at this stage whether the will on the one hand exhibits a paramount general charitable intention of providing for the maintenance and care of and the mercifully and kindly dealing with homeless, stray and unwanted animals, coupled with a particular intention of serving that general purpose by means of the purchase, equipment and keeping up of a home, or on the other hand exhibits only one intention of which the purchase, equipment and keeping up of a home is an essential ingredient. Such questions are notoriously difficult. They are questions of construction but not merely of verbal interpretation: see Barby v. Perpetual Trustee Co. (Ltd.) [1937] HCA 64; (1937) 58 CLR 316, at p 325 As Sargant LJ said in In re Monk (1927) 2 Ch 197, at p 210, in a passage referred to by Dixon J in Barby's Case [1937] HCA 64; (1937) 58 CLR 316, at p 325, prefatory or separate words of charity are seldom found in the reported cases where a general charitable intention has been found, and the intention may be shown from the nature of the dispositions themselves. It is all a question of the emphasis which the reader of the will gathers that he should attribute to the testatrix: Royal North Shore Hospital of Sydney v. Attorney-General (N.S.W.) [1938] HCA 39; (1938) 60 C.L.R. 396, at p. 428. Was she placing emphasis on the home as an indispensable part of the end she had in view, or did she have the care and so forth of the animals predominantly in mind and think of the home as her chosen means for serving that end but still only as a means? The argument presented for the Attorney-General in favour of the latter alternative is not, I think, without force, considering the absence of particularity in the will as to the intended home: cf. Biscoe v. Jackson (1887) 35 Ch D 460; Morton v Attorney-General (1911) 11 SR (NSW) 473; Attorney-General for New South Wales v. Adams [1908] HCA 51; (1908) 7 CLR 100, at pp 124, 125 and In re Whittaker; Nobel v. Attorney-General (1951) 2 TLR 955 I prefer, however, to reserve my opinion as to whether the trust fund in the present case will be applicable cy-pres in the event of its turning out at some future time that the charitable trust has failed. (at p422)
12. There are two other questions in relation to which the existence of a general charitable intention was argued. One arises on par. (4) of the will. A suggestion was made that that clause purports to authorize an accumulation of income beyond the period permitted by the Thellusson Act legislation of South Australia (which according to the decision in In re Robb; Marshall v. Marshall (1953) Ch 459, applies to powers as well as to directions to accumulate), and that in the absence of a general charitable intention there is an intestacy as to the excess accumulations at least. There was also a suggestion that par. (4) has the effect of postponing the charitable gift until the trustee shall be of opinion that the accumulated fund is sufficient for the carrying out of the trusts in par. (3), and that as that may not occur during the period allowed by the rule against remoteness of vesting there is an intestacy unless a general charitable intention be found. But par. (4) does not postpone the gift, in the sense of the devotion of the estate to the charitable purpose: it merely authorizes the trustee to postpone for a while the acts which he is placed under an immediate duty to perform. Moreover, it does not purport to authorize such a postponement save for the purpose of accumulating a fund which the trustees shall consider sufficient for the carrying out of the trust; so that if at any point of time the law should stop the accumulation the power of postponement must come to an end also. The short answer to both the suggestions is that the estate is given immediately to charity, and either it is all applicable to the charitable purpose, income as well as capital, or it all passes as on the intestacy of the testatrix because it cannot be applied to the charitable purpose. (at p423)
13. In my opinion the appeal should be allowed and the crossappeal dismissed; the order of the Full Court should be set aside, the appeal to that Court allowed and the cross-appeal dismissed; and the order of Napier C.J. should be varied so as to leave remaining only the declaration that the trusts in par. (3) of the will are valid charitable trusts and the order as to costs. (at p423)
14. I do not think that this was a case in which the representative of the next of kin had such a justification for initiating and carrying on an attack upon the trusts of the will on the ground of impracticability that his costs of the appeals should be provided for out of the estate. I am prepared to leave standing the order of Napier C.J. as to costs, but I think the appropriate order as to the costs of the appeals to the Full Court and to this Court should be that the costs of the trustee company and of the Attorney-General, but not those of the representative of the next of kin, should be paid out of the estate. (at p423)
TAYLOR J. I have had the opportunity of considering the reasons prepared by my brother Kitto and I entirely agree that for those reasons the appeal should be allowed and the crossappeal dismissed. I also agree that, subject to one matter, the order disposing of the appeal should be in the form which he proposes. The qualification which I make is that in view of the general character and history of the litigation I think that the costs of all parties, including those of the representative of the next of kin, should be paid out of the estate. (at p424)
MENZIES J. I agree for the reasons given by the Chief Justice and Kitto J. that this appeal should be allowed. I share the opinion of Kitto J. that it is unnecessary at this stage to decide whether the will reveals so general a charitable intention that, if the establishment and maintenance of a home strictly in accordance with its terms should be found to be impossible, the gift should nevertheless be applied cy-pres. I agree with the order proposed by Taylor J. (at p424)
WINDEYER J. I need not repeat the facts. I shall merely state, somewhat categorically, my conclusions on the matters that were argued. (at p424)
2. The trust created by the will is a good charitable trust. Trusts for the care and protection of animals have been said by high authority to be charitable, provided that in any particular case the disadvantages to mankind of performing the trust do not outweigh the moral benefits that flow from the promotion of kindly feelings for animals and from arrangements which allow such feelings to have effect. Cases exemplifying this doctrine may be found collected in Halsbury's Laws of England 3rd ed. vol. 4, p. 231. They include cases of gifts, held to be valid, to a home for lost dogs (Adamson v. Melbourne and Metropolitan Board of Works (1929) AC 142, at p 148), and to a home for starving and forsaken cats (Swifte v. Attorney-General for Ireland (No. 2) (1912) 1 IR 133) Moreover, the practical benefit to the community of the removal of stray and unwanted animals is added to the moral advancement that the the trust promotes. (at p424)
3. The language in which the trust is expressed is not, in my view, in any sense indefinite. And, subject to the question whether the trust fund was at the death of the testatrix sufficient to make the execution of the testatrix's purpose practicable - a matter to which I shall come - there was then, and is now, no legal difficulty in giving effect to her wishes. I agree with the learned Chief Justice of South Australia that the words "homeless, stray and unwanted animals" refer to domestic animals, that is to say, as his Honour expressed it, "to such animals as are commonly kept and cared for in and about human habitations". It is probable that the testatrix had in mind mainly dogs and cats. To provide for other domestic animals, if homeless, stray and unwanted, would not be outside the trust, but the trust does not require the setting up of a home to cater for all kinds of animals kept by man. The suggestion that the testatrix had imposed an obligation to have such creatures as white mice, goats and pigs as inmates of the contemplated home is fantastic. The trust could, I consider, be properly performed if the home were set up for dogs only, and restricted to such number of dogs as could reasonably be accommodated in it. If anyone came with a stray or unwanted pig he could, without any breach of trust, be told that pigs were not accepted. (at p425)
4. The testatrix left her estate to her trustee for the charitable purpose of setting up a home for animals. If that purpose has failed because it is impracticable to give effect to it, it would be necessary to consider whether the setting up of a home according to the directions in the will was merely the particular means chosen by the testatrix to give effect to a wider charitable intent to benefit animals, or whether on the other hand the specified purpose, and nothing else, was that for which she gave her property. But I think it is unnecessary to decide that question, because I agree that it has not been shown that, looking at the matter as at the death of the testatrix, the particular trusts of the will were impracticable. The inquiry made by the Master of the Supreme Court went astray, I think, in two ways; and in the result his careful report does not establish that there was any failure of the trusts of the will. (at p425)
5. In the first place, the case as presented for the next of kin led the Master to proceed on an erroneous and lavish assumption as to the kind of establishment that would be needed to satisfy the terms of the trust. Secondly, the actual question to which the inquiry was directed was "whether at the date of death of the deceased it was practicable to carry into execution the trusts referred to in cl. 3 of the Will". And, as the judgment of his Honour the Chief Justice of South Australia shows, that was taken to mean whether at the time of death it was practicable to give effect to the trust in cl. 3 "with the funds then available for the purpose", and disregarding altogether cl. 4. It seems that the parties invited his Honour to submit the question in this form. Apparently this was at the instigation of counsel for the party representing the next of kin; for the trustee company, which had accepted the trusteeship of the will had not suggested that the execution of the trusts was impracticable. But assuming that the question whether the testatrix's purpose was or was not practicable of realization was appropriately raised at that stage, the actual question submitted for inquiry was not the appropriate question. There seems to have been a misunderstanding of the effect of In re Tacon; Public Trustee v. Tacon (1958) Ch 447, as my brother Kitto has pointed out. Furthermore the question here is not whether effect could be given to cl. (3) divorced from cll. (4) and (5). The question is whether it was impossible to give effect to the trusts of the will. The testatrix envisaged that the funds available at her death might not be sufficient to set up then the institution she intended. She provided for that by empowering her trustee to postpone setting up the home for such period as should be necessary to accumulate a fund sufficient in its opinion for that purpose. Looking at the matter as at the date of the death, there seems to be no reason to suppose that the estate of the testatrix, if not then already sufficient, would not, invested and accumulated, produce a fund sufficient for carrying cl. (3) into execution within a short space of time, certainly long before any accumulation would be cut short by the statutory provisions that in South Australia correspond to the Thellusson Act. But until the case reached this Court, all parties seem to have agreed throughout that cl. (4) of the will was invalid as a contravention of the rule against perpetuities. This view was mistaken. (at p426)
6. A gift for a particular charitable purpose only is void and fails if it is contingent upon the happening of an event which may not happen within the perpetuity period: Chamberlayne v. Brockett (1872) LR 8 Ch App 206 And, for this reason, a direction to accumulate a fund until it becomes sufficient for the accomplishment of a particular charitable purpose and thereafter to apply it to that purpose will be void ab initio unless the condition precedent, namely the fund becoming sufficient, must necessarily occur within the time allowed by the rule against perpetuities. If it may not, the vesting of the fund in charity might be at a time too remote. If, however, a paramount wider charitable intention accompanied the direction to accumulate the fund for the particular purpose stated, the gift will be applied cy-pres. That is because, in such a case, there is no question of a too remote vesting. The devotion of the fund to charity is immediate. It is not postponed to the happening of the event on which the particular mode of applying it was to come into operation. It is unaffected by the invalidity of that mode. Illustrations and expositions of these principles are to be found in numerous cases. Many are collected and referred to in the work, The Rule Against Perpetuties by Doctor Morris and Professor Leach 2nd ed. (1962) pp. 187, 299, 302. It is sufficient to refer here to Martin v. Maugham [1844] EngR 784; (1844) 14 Sim 230 (60 ER 346); In re Swain; Monckton v. Hands (1905) 1 Ch 669; and, among Australian cases, to Muir v. Archdall (1918) 19 SR (NSW) 10 and In re Dyer; Dyer v. Trustees, Executors and Agency Co. Ltd. (1935) VLR 273 There seemed, in the course of the argument we heard, to be a misconception concerning the last-mentioned case. There was a gift by a settlor to trustees upon trust to apply the income of the fund in or towards the maintenance of a metropolitan permanent orchestra in the State of Victoria. No such orchestra was in existence at the time of the settlement. The establishment of such an orchestra was held to be a condition precedent to the trust for its maintenance taking effect. In other words, the gift was construed as contingent upon an orchestra being set up; and there was no general charitable intent to be found in the deed, no wider purpose than the particular purpose it declared. The result was summed up in the judgment of Irvine C.J. and Gavan Duffy J. as follows: ". . . we think that the test is, Is the charity intended to benefit only on the happening of a condition, or is there an immediate dedication of the fund to charity, with particular directions as to its application super-added?" (1935) VLR, at p 285 Having regard to the way the Court construed the deed there, the decision is entirely in accordance with general principle and provides no ground for some of the arguments sought to be founded upon it. (at p427)
7. In the present case the power given by cl. (4) to postpone the immediate execution of the trusts of cl. (3) and to accumulate the fund in the meantime does not create a condition precedent to the charitable trust taking effect. It is an ancillary provision. If the trustee avails itself of the power given by cl. (4), the vesting of the estate upon a charitable trust is not postponed. And the will does not direct or contemplate that the accumulation authorized should be continued beyond the period permitted by law. It is true that the power given by cl. (4) is to accumulate the fund until in the opinion of the trustee it is sufficient. But the trustee must arrive at its opinion rationally and governed by the limit that the law sets to accumulations. On the material before us there is nothing that shows that, as at the date of the death of the testatrix, it was impracticable to give effect to the trusts, the particular charitable trusts in cl. (3) and (4), of her will. On the contrary there is everything to suggest that it was practicable to do so. (at p428)
8. I would allow the appeal and dismiss the cross-appeal. I have some doubts about the proper order as to the costs of the representative of the next of kin on whose behalf a mistaken issue of fact was raised. But, on the whole, I think all parties should have their costs in the Supreme Court paid out of the estate. The case seems to me to have got on to the basis that it did because there all parties accepted the view that cl. (4) was invalid and failed to notice that the question as submitted to the Master was not appropriately expressed. I think that the party representing the next of kin should bear his own costs of the proceedings in this Court. I would add that in my view the sufficiency of a testamentary fund to answer a particular testamentary charitable intention must be considered independently of any depletion of it by unnecessary litigation on mistaken questions of fact. (at p428)
9. The appeal should be allowed. (at p428)
ORDER
Allow the appeal to this Court and dismiss the cross-appeal. Discharge the judgment of the Full Court of the Supreme Court of South Australia dated 9th May 1963 and allow the appeal to that Court from the judgment and order of the Honourable the Chief Justice of South Australia made on 22nd November 1962 and discharge the lastmentioned judgment except in the case of both judgments as to costs and except and in so far as the said order of the Honourable the Chief Justice dealt with representation of the next of kin and any other matter covered by the second, third, fourth or sixth question in the summons.
In lieu thereof order that the questions in the originating summons herein
be answered as follows:-
1. (a) It is a valid charitable bequest and is not void
for uncertainty or for any other reason and is
not so far shown to be impracticable.
1. (b) It has not been shown so far that a scheme is
necessary.
1. (C) The said trust is a valid charitable bequest or
trust and is not void for uncertainty or as
infringing the rule against perpetuities.
1. (d) Declare that the plaintiff trustee, Bagot's Executor
and Trustee Company Ltd., do proceed to
carry out the directions of the testator in
accordance with the executor's views of what is
necessary to do so, accumulating income for the
purpose in the meantime.
1. (e) Yes.
1. (f) Not answered.
1. (g) Unnecessary to answer.
Let the costs of the appeal to this Court of all parties be paid out of the estate.
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