RESIDUE OF BIG ESTATE

Taranaki Daily News, 13 September 1934, Page 7

RESIDUE OF BIG ESTATE

VALID CHARITABLE BEQUEST SUPREME COURT DECIDES POINT. QJJESTION OF WORD BENEVOLENT. INSTRUCTION GIVEN TO TRUSTEE. By Telegraph—Press Association. Auckland, Last Night. Whether’ a bequest made in a clause, dealing with the residue of the estate of the late Catherine Smith, Auckland, after certain specific legacies left to relatives and charities had been provided for was void for uncertainty or perfectly valid was decided by Mr. Justice Herdman in a reserved judgment delivered in the Supreme Court. Mrs. Smith died in 1933, leaving a will, probate of which was granted on September 4 of the same year. The value of her estate for duty purposes was £126,595, and specific legacies left to relatives and charities amounted in all to £21,300, and sums aggregating £6500 were set aside for certain named minors. A clause in the will in which the testatrix disposed of the residue of her estate directed her trustee, the New Zealand Insurance Co. Ltd., to apply the residue in making other bequests towards other institutions, societies or objects established at or about Auckland for charitable, benevolent, educational or religious purposes, the trustee to benefit such institutions, societies or objects and in such amounts as it is, in its absolute discretion, deemed advisable.

In his judgment Mr. Justice Herdman said that upon the question of whether the bequest referred to was void for uncertainty or perfectly valid depended the fate of £75,961. No difficulty arose about the words “charitable, educational or religious purposes.” Had these words stood alone the gift would have been sufficiently certain and could not have been questioned. It was the introduction of the word “benevolent” which had made an application to the court necessary. Had the word “benevolent” been absent the bequest would have been for charitable purposes and valid, even if the object of the gift had been uncertain. It would not have been void because “a charitable gift was never void for uncertainty in object.” INTENTIONS OF TESTATRIX. “In the present case the testatrix may have intended to create a general charitable trust, or she may have intended a kind of hybrid trust, part for charities and part for another purpose, which could be definitely ascertained. A gift to an existing benevolent institution dr society in or about Auckland presents no identification difficulties,” said His Honour. “A benevolent society exists at Auckland. The will, ifihows that, and another benevolent society is established at Onehunga. Are they to be deprived of a chance of succeeding to some part of the large sum left by the testatrix because the gift to benevolent institutions is uncertain? “That benevolent societies which are not charitable societies may exist in New Zealand is seen by looking at the Friendly Societies Act, 1908, which provides for the registration of benevolent societies for benevolent or charitable purposes. If the gift cannot be defended upon the ground that I have taken it cannot be defended at all. “It seems to me that in every case in which trustees propose to exercise the discretion, given them they must be satisfied before they part with trust funds that they are doing so to an institution or society which was in existence at the date of the death of the testatrix and which was established for a charitable purpose or for a benevolent purpose or for an educational or religious purpose. “It is conceded that a charitable institution is not the same kind, of thing as a benevolent institution. If they were identical in character I would not be troubled with this case. It is apparent to me that the testatrix in. dealing with the residue of her estate wished to give her trustee, whose duty it is to disburse it, the widest discretion. That is why she sought to benefit a benevolent institution or Society in addition to the institutions and societies which are not benevolent, blit which in the eye of the law carry the hallmark of charity.”

His Honour decided that there was a valid charitable bequest. Costs are to be paid out of the residue of the estate which was the subject of the action.