LARGE ESTATE

New Zealand Herald, Volume LXXI, Issue 21881, 17 August 1934, Page 14

LARGE ESTATE

'A BEQUEST OF £76.000 VALIDITY QUESTIONED RULING OF COURT SOUGHT CLAIM BY NEXT-OF-KIN Legal questions regarding tho disposal of the greater part of a very large Auckland estate were brought before Mr. Justice Herdman in tho Supreme Court yesterday. The amount involved is approximately £76,000, and the essence' of the question at issue is whether this is to become a charitable trust or is to bo divided among the next-of-kin. The estate is that built up by the late Captain James Smith, of Auckland, who had large interests _ ill shipping and coal mining companies. His widow, Catherine Smith, who died on August 12, 1933, "left an estate valued at approximately £126,000. Of this about £28.000 was left as legacies to relatives and certain charities, and the residue was left to tho trustee, the New Zealand Insurance Company, to be disposed of in such charities as the trustee might think fit. The next-of-kin held that the clause providing for this did not create a charitable trust and was therefore void. The trustee brought the action to test the validity of the clause.

Mr. McVeagh and Mr. lnder appeared for the plaintiff, the New Zealand Insurance Company, Mr. Meredith and Mr. McCarthy for the AttorneyGeneral, and Mr. Rogerson and Mr. W. S. Spence for the 13 next-of-kin of the testatrix. The next-of-kin were Norman Campbell, of Auckland, farmer; Roderick Campbell, of Kamo, farmer; Mrs. Annie McLean, Kamo; Mrs. Catherine Worner, Whangarei; Isabella McGregor, Whangarei Heads; Elizabeth, Margaret, John and Donald Urquhart, Auckland; Gill, Pukekohe; Jessie Green, Auckland; Esther Scott, Sydney, New South Wales; and Nellie Lynch, Suva. Mr. Inder said all the parties interested were before the Court. The will was made on December 23, 1930, and probate was granted to plaintiff on September 4, 1933. The will comprised a series of bequests to various relatives and to a. considerable number of religious and charitable organisations. Specific Bequests These included the Baptist Tabernacle, £500; the Tabernacle Sunday School, £500; the Bible Training Institute, £500; Baptist Missionary Society, £500; Baptist Women's Missionary Union, £500; Baptist Aged Ministers' Fund, £500; Children's Orphan Home at Manuretva, £250; Salvation Army, ' £250; Young Men's Christian Association, £500; ? Young Women's Christian Association, £250; Bible Society, £100; Auckland Free Kindergarten, £100; Knox Home for Incurables, £200; St. John Ambulance, £200; St. James' Presbyterian Church Sunday School, £500; St. James' Presbyterian Church, £500; Auckland Ladies' Benevolent Society, £100; Society for the Prevention of Cruelty to Women and Children, £SO; Baptist College at Remuera, £2OO There followed certain bequests to minors and relatives, creating a fund to

be invested. It was clear there was a general charitable intent. The proceedings were chiefly concerned with clause 7 of the will, which dealt with the residue of the estate and was as follows: "As to the residue and remainder of my real and personal property of whatsoever kind and wheresoever situate (including all money or property bequeathed or devised as aforesaid where 6uch bequest or devise shall have lapsed) I direct my trustee to apply the same in making other . . . bequests toward institutions, societies or objects established in or about Auckland aforesaid for charitable, benevolent, educational or religious purposes, /ind my trustee may? benefit such institutions, societies or objects in such amounts or amount as it in its absolute discreti6n shall deem advisable." Questions for Court

The point was whether or not that was a valid charitable bequest, and there were three questions being submitted to the Court. Is the bequest contained, in paragraph 7 a valid and enforceable bequest? If the answer is in the negative', is there an intestacy in respect of the fund affected by paragraph 7? If the answer tq the second question /is in the affirmative, who is entitled to participate in the fund .crpated by paragraph 7? If the bequest was found to be valid that ended the trouble of the Court at this stage of the proceedings, Mr. Inder said. If it was not yalid, then was there intestacy, and if so, who was entitled to benefit by that- intestacy? The next-of-kin were set out in a genealogical tree. The testatrix left no living issue n The final amount of the estate on which duty was paid was £126,595. Estate duty was paid to the extent of £27,978, and in addition succession duty of £986. The total debts were £1346'. The specific legacies to relatives andr charities amounted to £21,300, and there was a fund of £6-500 created for minors. Administration and legal expenses amounted to £1735, The balance or residue of the estate to be dealt with by the Court under claupe 7 was £75,961. Mr. Inder referred to several of the affidavits before the Court, particularly describing and identifying benevolent societies. Meaning of "Benevolent"

Addressing himself to legal aspects, Mr. McVeagh said the difficulty arose largely from the use of the word "benevolent." Tt would he contended that the word benevolent meant something larger than charitable. He was of opinion that if the word benevolent had not been used there would have been no difficulty. It would be a benevolent net for someone to leave money to the Auckland Racing Club to bold a certain race every year, but that would not He charity. Mr. Meredith: It might be. His Honor suggested that it would h* l benevolent to leave money to all who did not back winners on the totalisator. Mr. McVeagh said there was a real difficulty, but it had been overcome b.v the testatrix in the language she had employed. It must be conceded that if the trustees were at liberty to dispose oi the funds to something other than a charity then the disposition would be bad. The law did not allow a man to leave it to other persons to make a will for him. All the purposes set out were charities, but he had no doubt it woidd be stoutly contended that the bequest was vitiated bv the word "benevolent." _ Counsel said he must concede that it wrs not open to the Court to say, "admitting that the word 'benevolent' is vicious and should not have been employed, the remaining purposes stand." If the express purpose of a will was benevolence then such a {mrpjse was not charitable. Benevoence had a much wider connotation , than the word charitable. ' Way bad the Courts set themselves against dispositions for benevolent purThe reason was that a trust inertly for benevolent purposes, as ©npcsgd to benevolent institutions, was Cf tjo vague and uncertain a charac-

ter to be enforced by Courts. The term benevolence involved an extremely wide ambit of subjects. Counsel quoted the case of Mornce against the Bishop of Durham, in which judgment was given by Lord Eldon. The will there was for objects oj benevolence and liberality,' not limited to anv particular institutions or part of the world. It was decided that the trust was ill-declared, because it was of such a nature that it could not be under the control of the Court. His Honor said that in the present case there was a limitation imposed. Mr. McVeagh said that was so, and he would argue that point later.. He referred to another case, in which a residue had been left to "private charity," and the bequest had been held to be too vaguo and indefinite. Mr. McVeagh said the authorities clearly showed that if the word benevolent were eliminated the other objects stated were clearly charities. _ There might, however, be a context limiting the application of the word "benevolent" to organised associations or groups. Then it would bo a charitable trust, which the Court could enforce. Certainly it would not be invalid. Mr. Meredith: I shall argue further that this is a charitable trust in any event, and, secondly, it is a definite institution, which is capable of identification as well.

Mr. McVeagh said the institutions

referred to must be institutions in existence at tho time of the death of the testatrix, and they must be in or about Auckland. He quoted various other authorities, illustrating aspects of the law governing charitable bequests.. "When the charities specified in the will were being referred to Mr. Pogerson questioned whether the Young Men's and Young Women's Christian Associations could be held to be charities. Mr. McVeagh said he considered their objects were charitable. Further argument '""ill be heard when the Court resumes this morning.