SUPREME COURT.

Taranaki Herald, Volume LXVI, Issue 16049, 6 February 1918, Page 3

SUPREME COURT.

THIS MORNING’S SITTING, INTERPRETATION OF A WILL. The .sitting of the Supreme Court in New Plymouth was continued this : morning, Mr. Justice Edwards presiding. In the case of G. H. Bell v. M. I. Courtney, an originating summons for an order interp-sting the will of William Courtney (deceased), Mr. J. C. Nicholson appeared for Bell, Mr. J. H. Quillia.ru for Mrs. Courtney, widow of tho deceased, Mr. A. H. Johnstonefor the beneficiary legatees (11. M. Courtney, Herta Courtney, Annie Woodhouse and Geo. H. Bell), and Mr. D. Uutchen for tho residuary devisees (Thomasina Dalton, Mary Bell,. Mar--tha Harding, Kate Courtney and imoy Bell). , , Mr. Nicholson said the executors would submit to tho order of the court and ho proposed merely to narrate the facts. The testator in lus wpl purported to give gifts amounting to more than £4OOO, plus 600 acres ox unencumbered freehold land, and then proceeded to direct that the residue should be divided among five or six persons. In actual fact he was insolvent. The land was valued at £IB,OOO and was mortgaged for £17,000, and there wero unsecured debts of about £l6oo* In spite of the actual fact that he was insolvent, it was evident that the testator considered he was worth a considerable sum of money, and the explanation in some measure as regards the discrepancy between the testator’s and the Government valuer’s idea of- the value lay in the fact that a large proportion of tho ‘ property consisted of unproductive suburban sections. Another feature was that the very large proportion of 'the mortgages to the value of the land (£17,000 to £18,000) represented accumulated interest, etc., in addition to the original sums. The executors could now show- net assets of a value of perhaps £ISOO. This was not sufficient to pay oven one class of beneficiary, and tho executors were therefore confronted with tha difficulty qf deciding which class of beneficiary was entitled to he considered first. " his arose chiefly from the fact of the deficiency and not from the form of the wilt itself. Another question arose from tho fact that “Niger Hoilse” (specially devised ,to the w-idow) was sold and bought in by the second mortgagee shortly after the testator's death. Other questions for determination came out of the actual wording of tho will. The funds in the estate wore not sufficient to pay in full even- the pecuniary legatees, ( and therefore there must he an abatement. Mr. Quillinm said that the main points in tho will were; (1) A specific devise of Niger House to the widow-, the mortgages thereon to be charged to tho rest of the estate; (2) a specific tievieo of 500 acres to the testator's nephew, C. H. Courtney, free from encumbrances. As this property was sold in the testator’s 'ife-time, no question rose in regard to it; (8) the rest of the dispositions fell into three classes, winch differed only in respect to priority ; (a) provision for the purchase of (in annuity to the widow, which it was submitted had priority over the other general legacies; (b) tho legacies of £3OO to R. M. Courtney, £2O to H. Courtney, £IOO to Geo. Woodhonao and £IOO to Geo. Bell, were all general legacies nay able out of the general fund; (o)" after the payment of these legacies, which wg(o payable out of what the testator himself indicated was the general fund, the residue was to he equally divided among Mrs. Dalton, Mrs. John Bell. Mrs. Harding, Miss K. Courtney, mid Miss Lucy Bell. Dealing with question 1, 1 hffi speaker continued, tho testator used the words: “I wish my wife to receive Niger House and the whole of the land belonging to it, being a little under if acres, having a frontage to Pendnrves and Eliot Streets, the executors to pay off all mortgages on such property and to hand it over free of all encumbrances.” The facts set out in the affidavit showed that the widow was deprived' of the benefit of Niger Housa by tho of a creditor. Mr. Quilliam submitted that tho principle-was that a legatee was not to he disappointed by the action of a creditor, and the property having been sold to satisfy a creditor the devisee was entitled to stand in the shoos of the creditor and to claim compensation. Later in the will were the words: “I wish them to buy an annuity of £l2O a year either fronv.the Government Life-Insurance Office or tho Australian Mutual 'Provident Society, with preference for the former, same to be paid to my wife.” The speaker said he thought that counsel for the legatees would, while admitting that tho widow was entitled to compensation, say that the claim should be postponed in the interests of the pecuniary legatees; hut he cited authorities against this proposition. The words: “I should wish her (the widow) to will the property to her four children. . • ” which occurred in the will raised the question whether this created a trust in favour of the four children. Three of the four children had resigned all their rights in favour of their mqther, and the fourth, who was in England, would no Tfoubt do tho same. As it was necessary I°’’ bi* Honour to determine whether or not a trust was created Mr. Quilliam cited a number of cases shelving that a more expression of intention would not create a trust, and therefore tho widow was entitled to the property free from any trust _ in favour of tho children. In conclusion, he claimed that under question 1, the widow was entitled to be paid compensation for the loss of Niger House amounting to £1680; (2) the words did nut create a trust fund m favour of the children; (3) the annuity was perpetual, and not merely for life. As to the other questions the w-idow’s claim in respect of Niger House and the annuity ranked in priority over the other dispositions of the will. Mr. Johnstone did not agree that the i-osidue of the estate was expressly charged with the repayment of the iportsagcs on Nigci* House. On beluilt of the residuary legatees ho said that what Mrs. Courtney was entitled to was Niger House encumbered with tho mortgages, together with the right to have these mortgages repaid out of the estate provided that there was money in (the estate to pay, it. The pecuniary legacies, including £IB6O to purchase the annuity to Mrs. Courtney, were payable first out of t.he assets. _ The pecuniary legatees had a prior claim to the funds over the compensation in respect of Niger House, His. Honour remarked that it was apparent that the testator meant first of nil that his wife was to have the residence and £l2O a year. Mr. Hutchon admitted that the pecuniary legatees, including the widow, had priority over the .residuary devisees, hut hold they were, liable to contribute to the payment of debts rateably. with the residuary -devisees. His HofloK teeswsd dgciswa. ■ J

A FURTHER CASE, ' ' A second application for an order interpreting a will was made in the case of A. S. Sole v. Henry Ward and others, the will concerned being that of " Joe Ward, (deceased). Mr. J. H. Quilliam appeared for the plaintiff, Mr. Johnstone for jiac children of Sidney A. Ward, and: Mr. Hutchen for all the defendants with the exception of S. A. Ward. . Mr. Quilliam .-aid that- the plaintiff nv-'-ely desired an interpretation of the • will. Mr. Johnston- said the question for decision was whet was to become of the share of S. A. -VaVd in the estate of Joe Ward. He submitted on behalf of S. A. AVard’e children that his share belonged to the children by virtue of the will. In support of this ha related ii clause in the will providing, among other things, that in the case of any one of the legates becoming bankrupt prior to the .final distribution of the property he or she should absolutely forfeit a right tt a share in the estate, such share To be equally divided among . the children of tho legatee. The scheme of the will was that the whole of the property, with 'certain exceptions, was left to the widow her life, and there was a direction that on her death tho property was . to he got in within two years and distributed among the residuary legatees at the end of that two years. S. A. Ward be. came bankrupt on February 6, 1916, and the two years stated did not elapse xntil September 17. 1917. It was shown in the clause'referred to that it was the intention of the testator that if his, son became bankrupt before the date of the final distribution, his share ! should at the final distribution go-to his children, and the ■ question was whether that was a sound, clause, Tho court then adjourned for lunoh.-