It is not clear to me whether the remaindermen of the below clause are the surviving children of the testator at his death or the surviving children of the testator at the time the life interests of all the children end or the surviving children of the testator at the time of sale. Any thoughts?
Subject to the payment of rates and keeping of the same in good repair but free of rent I give devise and bequeath unto my Trustees [child A child B child C] my house together with the contents and I direct that no sale shall take place of this property or the contents until either child A child B child C or the survivor of them consents or until or until such time as child A child B child C shall marry or die and I direct that after such consent marriage or death as beforehand enabling the said house to be sold that the house and the contents be sold and the proceeds divided equally between all the surviving children of the said [name of testator].
The testator had 6 surviving children at his death. If the clause means the surviving children of the testator at the time the property is sold, it seems likely there will be no such children as currently only one of the three children with a life interest is alive and one other child of the testator is alive who it seems reasonably likely will die before the child with the life interest. Accordingly, on the basis of the presumption against intestacy, I am leaning against that interpretation.
The will also contains a residuary clause leaving the residue to âall my childrenâ. It seems possible to argue that, given that phrase in the residuary clause, clearly means children surviving him at his death, the will writerâs use of the words surviving children in the life interest trust clauses means something else, namely children surviving at the date the property is sold.
It seems to me that the effect of the clause is to attempt to prevent a sale of the property unless the specified conditions are met.
I question whether these conditions are sustainable and suggest the gift is an immediate gift to the testatorâs children.
The property is given to the children specifically as trustees but, other than in the closing words, no beneficial entitlement is identified, hence my suggestion that they take an immediate, absolute, gift.
Paul Saunders FCIB TEP
Independent Trust Consultant
Providing support and advice to fellow professionals
I agree with Paul. The Court in accordance with equitable principles favours early vesting and would I think focus on the opening words and hold that what follows âI directâ is not dispositive but an expression of wishes, albeit detailed, and precatory rather than prescriptive of the beneficial interests.
TOLATA 1996 will apply especially s6(1) and I doubt the qualifying words âsubject to the trustâ would have any effect (though we only have an extract) as regards the quoted âdirectionâ. And Saunders v Vautier seems to apply.
I see what you are saying Paul, but, for a few reasons, it seems strange to me to interpret this as an absolute gift:
The clause says that the trustees take the property âfree of payment of rates and the keeping of the same in good repair but free of rentâ. To me that indicates that the trustees are also the beneficiaries and have a right to live in the property for life as those conditions are normal conditions to impose on a life tenant. Those conditions also donât make sense if the gift is an absolute gift.
It also seems strange to me to give the property to only three children outright and then express a wish that the property should be sold and divided amongst his surviving children (which could include his other children as he had more than three children) if those three children get married, die, or consent. Why not just give the gift outright to all the children? Why take the risk that his three children wonât follow his wishes?
The will makes clear that the executors are also trustees. As this is the only clause in the will containing a possible trust, it would be odd to make clear that the executors are also trustees if there is no trust in the will.
I jumped to the conclusion that the 3 were his only children. If the other children can only benefit from the trust property upon a future contingency then the alternative view is that it is an IPDI trust for IHT and settled property for CGT. If the class has closed Saunders v Vautier will arguably apply. As the settlor is dead the class must surely have closed, however defined. It is odd for an operative contingency to be a sale of an asset but there you are. What the testator intended is obscure or perhaps the drafter made a meal of it.
Clearly, Jack and I fell into the same trap (albeit, I appreciate that none was intended).
On reflection, I am inclined to think that there is an interest in possession in favour of the sole survivor of A, B, and C and that on termination of that IIP, the property (or the proceeds of sae thereof) passes to those children who survived the testator, rather than the terminating event. As Jack says, the courts lean in favour of early vesting (and against an intestacy).
Paul Saunders FCIB TEP
Independent Trust Consultant
Providing support and advice to fellow professionals