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[1988] Part 5 Case 2 [HC,S'pore] |
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www.ipsofactoJ.com/archive/index.htm
[1988] Part 5 Case 2 [HC,S'pore] |
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HIGH COURT OF SINGAPORE |
Lee
- vs -
Ng
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Coram KC LAI J |
14 JULY 1988 |
Judgment
KC Lai J
The testamentary dispositions made on 2 March 1961 in the will of Lee Wee Nam, who died on 14 February 1964, have given rise to two issues of construction in these proceedings.
The problems of construction arise in the following factual matrix. The testator came from Swatow, in the southern part of the People’s Republic of China, when he was a teenager. He prospered as a businessman and a banker and had three wives, namely, Chew Mwee Khim, Bek Chew Tay and Kho Chew Kek, eight sons, the eldest of whom was adopted, and eleven daughters. He left behind by the male line several grandsons. By his will ‘the date of distribution’ is stipulated to be the date of expiry of five years after the date of his death, and accordingly ‘the date of distribution’ is 14 February 1969. The 26th defendant, Lee Siew Chong, is the youngest grandson born on or before ‘the date of distribution’, having been born on 2 August 1966. It will be relevant to note that he became 21 years old on 2 August 1987. For present purposes, it is also relevant to note that the 27th defendant, Lee Siew Ming, is the grandson of the testator who was born after ‘the date of distribution’, having been born on 16 April 1971. I should also mention that the 24th defendant is the personal representative of another grandson known as Lee Siew Liang who was born on 1 September 1961 but who died on 22 April 1968. He therefore died before ‘the date of distribution’. The various classes of possible beneficiaries are represented before me by learned counsel in these proceedings.
The testator after making several specific bequests mainly to the daughters made provisions for the distribution of the income of his residuary estate by cl 17 of his will. By the next clause, he dealt with the corpus of his residuary estate. The income of the residuary estate was divided into four parts, one part of which is by cl 17(c) directed to be accumulated and added to the capital for disposal under cl18. The remaining three-fourths of the income was divided into 40 shares under cl 17(b). Clause 17 of the will directed the plaintiffs who are the executors of the will and personal representatives of the testator to pay out once a year the income until the date of distribution by several paragraphs. The entire cl 17 has to be and is reproduced below:
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Subject to the payment of my just debts funeral and testamentary expenses. I give devise and bequeath all the rest and residue of my property both movable and immovable and wheresoever situate unto my trustees upon trust to sell call in and convert the same into money with power in their absolute discretion to postpone such sale calling in and conversion (subject as to my said businesses to the discretion contained in cl 16 hereof) and to invest the net proceeds thereof in their names in any of the investments authorized by law and in the purchase of freehold and 999 years leasehold properties and to stand possessed of such investments and properties and the investments representing the proceeds of sale of any of my said businesses or any shares and interest in any of such businesses and of all parts of my estate for the time being unsold (hereinafter called ‘my residuary estate’) upon the following trusts that is to say:
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The second wife of the testator Bek Chew Tay died intestate on 24 May 1961, leaving her surviving the following children:
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Name |
Relationship |
Plaintiff / Defendant |
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(1) |
Lee Hock Woon |
son |
2nd plaintiff |
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(2) |
Lee Hiok Huang |
son |
2nd defendant |
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(3) |
Lee Hiok Kiang |
son |
3rd defendant |
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(4) |
Lee Siang Keow |
daughter |
11th defendant |
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(5) |
Lee Lang Keow |
daughter |
12th defendant |
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(6) |
Lee Soo Keow |
daughter |
13th defendant |
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(7) |
Lee Hui Huang |
daughter |
14th defendant |
It has to be stated that there were no after-born sons born to the testator by the second wife.
With regard to the testator’s direction under cl 17(e) that 6½ shares out of the 40 shares were to be invested in the purchase of immovable property in China and that income therefrom was for the maintenance and upkeep of the ancestral home and ancestral worship, it was common ground that the purchase of immovable property in Swatow or elsewhere in mainland China was impractical since property ownership of private property was not allowed. It was also common ground that all parties concerned were not aware of any ancestral home of the testator in China, the testator and his three wives having died and were buried in Singapore. It was also not disputed that no ancestral worship was carried out by relatives of the testator in China and for the worship of the testator’s Sinchew and the Sinchews of his three wives.
I now refer to cl 18 of the will which deals with the capital of the residuary estate. Clause 18 reads as follows:
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As to the corpus of my residuary estate my trustees shall on the date of distribution pay and divide the same between all the beneficiaries referred to in cl 17(b) hereof in the same proportion and shares in which the rents income and profits of my residuary estate referred to therein are to be divided among them. Provided that in the distribution of the corpus of my residuary estate my trustees shall observe and perform the same trusts and powers as are declared and contained in the said cl 17 of this my will in respect of the application of the rents income and profits of my residuary estate except that my trustees shall in carrying out and performing the said trusts substitute the word ‘corpus’ in place of the words ‘rents income and profits’ in all respects as if the word ‘corpus’ has therein been expressed instead of the words ‘rents income and profits’. |
For the purpose of this clause, it is relevant to state the particulars of the grandsons of the sons of the testator and they are as follows:
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Sons |
Grandsons |
Date of Birth |
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(1) |
Lee Hiok Tng (1st plaintiff) |
Lee Siew Khai (15th defendant) Lee Siew Peng (16th defendant) |
19 July 1954
27 June 1959 |
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(2) |
Lee Hiok Woon (2nd plaintiff) |
Lee Siew Ling (17th defendant) |
15 Feb 1961 |
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(3) |
Lee Hiok Huan (1st defendant) |
Lee Siew Chiang (18th defendant) |
5 July 1958 |
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(4) |
Lee Hiok Siang (14th defendant) |
Lee Siew Lam (19th defendant) Lee Siew Kwan (20th defendant) Lee Siew Khwang (21st defendant) |
28 Dec 1958
26 June 1961
9 Oct 1965 |
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(5) |
Lee Hiok Huang (2nd defendant) |
Lee Siew Kuan (22nd defendant) Lee Siew Hua (23rd defendant) Lee Siew Liang (24th defendant) Lee Siew King (25th defendant) |
25 Jan 1957
30 Dec 1957
1 Sept 1961 - died 22 April 1968 29 Dec 1963 |
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(6) |
Lee Hiok Chuan (5th defendant) |
Nil |
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(7) |
Lee Hiok Kiang (3rd defendant) |
Lee Siew Chong (26th defendant) Lee Siew Ming (27th defendant) |
2 Aug 1966
16 April 1971 |
The testator took care to provide against any invalid or ineffective testamentary disposal of his property. He directed that any property ineffectively disposed of by his will shall pass to his seven sons, namely Lee Hiok Tng, Lee Hiok Woon, Lee Hiok Huan, Lee Hiok Siang, Lee Hiok Huang, Lee Hiok Chuan and Lee Hiok Kiang. Clause 23 provides as follows:
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I direct that if any court of competent jurisdiction shall declare any devise or bequest contained in this my will to be invalid with the result that the property thereby devised or bequeathed would but for this clause pass as on an intestacy then and in such event I expressly devise and bequeath all and any such property:
I also expressly give devise and bequeath all or any property whatsoever not otherwise hereinbefore disposed of by me effectively or in accordance with law to the same persons and in the aforesaid proportions subject in both cases to the provisions in cl17(f) and (g) and cl 19 contained. The names of the grandsons by Lee Hiok How, the adopted son of the testator, and born to his wife Koh Nguang Keow are:
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In these circumstances, the plaintiffs as the executors of the will and personal representatives of the testator seek the determination of the following questions on the true construction of the relevant clauses of the will and having regard to the events which had happened:
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(1) |
Whether, on the date, of distribution defined in cl 17(a) of the said will, one and a half shares in the corpus of the residuary estate of the said testator became divisible under cll 17(b)(vi) and 18 of the said will
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(2) |
Whether, on the said date of distribution, six and a half in the said corpus became or will become applicable under cl 17(b)(vii) and cl 18 of the said will
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The third question for the court’s determination, which is consequential upon the answers to the second question, is in the following terms:
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(3) |
Whether any part, (and if so, what part), of the corpus of this residuary estate of the testator
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I now turn to the first question whether on the date of distribution the one and a half shares in the corpus of the residuary estate of the testator, became divisible under cll 17(h) and 18 of the will to the second plaintiff and the second and third defendants or whether it has lapsed and should be added to the six and a half shares under cl 17(e). Counsel for the plaintiffs, Mr. Ching Chiak Yong, submitted that cl 17(h) has provided for an alternative or substitutional gift. He contended that in view of the fact that the second wife, Bek Chew Tay, had predeceased the testator, the three sons of the testator by her should take in equal shares. He relied on Ive v King (1852) 16 Beav 46; 51 ER 693.
Mr. Tan Kok Quan, counsel for the grandsons born before and living at the date of distribution and the five grandsons by the adopted son, Lee Hiok How, submitted that the gift of one and a half shares to Bek Chew Tay had lapsed. He pointed out that cl 17(h) provided for the eventuality of her death before the date of distribution. He also submitted that since the will is silent with regard to her death before the testator, the gift was not effectively disposed of. However, it is plain that the situation has been catered for by cl 17(h) which gives her one and a half shares of the capital, if she dies, as she did, before the date of distribution, to those sons of the testator by his second wife, and they are, as I had mentioned, Lee Hiok Woon, Lee Hiok Huang and Lee Hiok Kiang.
I now turn to the second question whether on the date of the distribution the six and a half shares of his corpus became held upon trust
for the benefit of all the grandsons on the date of distribution until the youngest attain the age of 21 years, or
for the testator’s grandsons on the date of distribution.
The question is the date of vesting. I make reference again to cll 18 and 17(e) of the will which have been recited above. It will be seen that cl 17(e) provides that in the events which had happened and which I have recited, the plaintiffs are to accumulate the income and divide all the capital as accumulated amongst all the testator’s grandsons (the sons of Lee Hiok How are expressly included) living when the youngest grandson attains the age of 21 years. It will also be seen that cl 18 directs that the plaintiffs shall as regards the corpus of the residuary estate on the date of distribution pay and divide the same between all the beneficiaries referred to in cl17(b) above in the same proportion and shares in which the income of the residuary estate referred to therein are to be divided amongst them. It will therefore be seen that by cl 18 the testator has directed the capital to be divided at the time when the class cannot be ascertained and by cl 17(e) the testator has directed that all the grandsons living when the youngest grandson attains the age of 21 years are to take. Both counsel for the plaintiffs and counsel for the grandsons born before and living at the date of distribution contended, and I accept their submissions, that the difficulty may be resolved by the application of what are called the class closing rules. Mr. Karan Nair represented the grandsons born after the date of distribution and unborn grandson by the sons and daughters of the testator by the second wife Bek Chew Tay. His submissions were similar to those of Mr. Tan Kok Quan. So were the alternative submissions of Mr. Lo Kok Siong who represented the interests of the grandsons living at the date of t he testator’s death. I should also briefly refer to the submissions of Mr. Cheng Tim Pin who represented the three sons of the second wife Bek Chew Tay and all the sons of the testator. He submitted that the trusts under cl 17(e) are not affected by the date of distribution as several expressions there indicated an intention for the trusts to operate beyond the period of distribution. He also submitted that accordingly the class closing rules have no application and that cl 23 should apply. For the reasons hereinafter appearing, I do not accept his submissions.
In Re Ransome [1957] Ch 348, Upjohn J (as he then was), after referring to a ‘number of authorities’, conceded that the policy in favour of early vesting has created certain artificial rules of construction or what are called rules of convenience. In consequence, an immediate gift for example to the children of A when ‘contrary to its natural meaning’ would be construed as a gift to the children living at the death of the testator, to the exclusion of after-born children. He then referred to Re Manners [1955] 1 WLR 1096 where he held that a direction only to distribute the share on the youngest attaining 21 did not evince a contrary intention to displace the rule, though it has to be noted that it was there conceded that the gift vested absolutely on the death. Upjohn J also referred to the well-known rule in Andrews v Partington (1791) 3 Bro CC 401; 29 ER 610 which held that where there is a class gift to the children of A when they attain 21, the class closes when the eldest child attains 21. It is a useful reminder to understand the rationale for these rules of convenience in the construction of a will. As Upjohn J stated, the rules have been applied to enable a member of the class who has a share vested absolutely both in interest and possession to receive his share. That rationale seemed to Upjohn J ‘to be the whole reason for these rules’.
It is now convenient to refer to what is stated in 50 Halsbury’s Laws of England (4th Ed) paras 490 and 492, in relation to the first and second rules of convenience. Paragraph 490 states:
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The first rule of convenience is as follows: a class is prima facie composed of those members (if any) existing, ascertainable and capable of taking at the date of distribution, which is usually at the testator’s death, but where the date of distribution is later the class opens so as to let in all those members coming into existence before the date of distribution. |
Paragraph 492 states:
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The second rule of convenience deals with the determination of the date of distribution where the gift is of the corpus of property and is postponed by reason of the conditions attached to it, as where payment is to be made on the attainment by the donee of a specified age, or on his or her marriage, or in other cases, it appears, where such conditions are of a nature personal to the donees. The rule is as follows: where the postponement of enjoyment is due to conditions attached to the gift, the date of distribution is considered to be reached as soon as the conditions are so far performed that some one member of the class would be entitled to the enjoyment of his share, if the class were then not susceptible of increase, and the class is then closed. |
Thus, where there is an immediate gift to a class, to be paid on the members attaining a specified age, the date of distribution is the date of the testator’s death, if any member of the class has then attained that age, and if not, the time of the first occasion when a member attains that age.
With regard to the application of the second rule of convenience, part of para 493 states:
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The second rule of convenience is adopted to reconcile inconsistent directions in a will that all the children or other persons comprising the class are to take, but that the fund is to be divided at a time when the class cannot be ascertained. |
In my judgment, notwithstanding the conflicting directions of the will under cll17(e) and 18, the class of grandsons who will take under the will should be treated as closed on the date of distribution and any grandson as defined born after the date will have no beneficial claim to the capital. As has been noted, Lee Siew Chong, the 26th defendant, was the youngest grandson born before the date of distribution, having been born on 2 August 1966. Accordingly, the capital will therefore be distributed amongst all the grandsons as defined born on or before the date of distribution and living when the said Lee Siew Chong attained the age of 21 on 2 August 1987.
Mr. TPB Menon, who was appointed by this court to represent the estate of Lee Siew Liang, the 24th defendant, who died on 1 September 1961 before the date of distribution, submitted that of the two possible dates of vesting, either on the date of death of the testator on 14 February 1964 or on the date of distribution on 14 February 1969, the court should take the earlier date as the date of vesting. Relying on Knox v Wells (1864) 2 Hem & M 674;71 ER 626 and Re Wood, Moore v Bailey (1880) 43 LT 730, he submitted that the intention of the testator was to benefit a particular class, namely his grandsons by blood including the sons of his adopted son, Lee Hiok How. He further urged the court to decide that a direction that the capital is to be distributed when the youngest grandson attains the age of 21 should not postpone the vesting. If, as he submitted, the interest of the estate of Lee Siew Liang in the capital had vested on the death of the testator, such interest would only be diluted in quantum by the birth of further members of the class. As a matter of construction, Mr. TPB Menon noted that a gift in this case was not restricted to grandsons living at the date of distribution or living when the youngest grandson attained 21 years. He said that the words ‘then living’ in cl17(e) were inserted to qualify the sons of the adopted son, Lee Hiok How, and not the grandsons by birth. Finally, he also called in aid the policy of the law to favour early vesting of class gifts and he relied on the decision in Re Ransome. To support his contention that this court should not permit the class to close artificially and belatedly on the date of distribution, he submitted that this court can give a literal interpretation to the will. Mr. Lo Kok Siong’s first submission supported Mr. Menon’s contentions. I must confess that Mr. Menon’s submissions have a great deal of force but at the end of the day I am not persuaded that the sting should take place on the date of death of the testator. This court has to recognize that there is a conflict in the testator’s directions to which I had referred. Since there is a conflict, the intention of the testator is therefore not clear. If it were, it would have been a simple matter of construction to give effect to such manifest intention. Because there is a conflict of testamentary directions the court has to resort to the rules of convenience. In the context of this will the testator has fixed the date of distribution which is or is most probably the date the residuary estate should be divided and vest in a class of beneficiaries though payment might be as is in this case postponed. Both rules of convenience are admittedly artificial. But in my view to close the class of grandsons on the date of distribution is significantly less artificial than to do so on the date of death of the testator and this court can only hope that its approach would more effectually and as nearly as possible approximate the wishes such as they could be gleaned of the testator.
As regards costs, I order that in view of the complexities of this case, the costs of all represented before this court shall be taxed on a solicitor and client basis and be paid out of the capital of the estate of the testator, There will be orders accordingly and parties are directed to settle the draft orders and appear before me on a date to be fixed by the registrar.
Cases
Andrews v Partington [1791] 3 Bro CC 401; 29 ER 610; Ive v King [1852] 16 Beav 46; 51 ER 693; Knox v Wells [1864] 2 Hem & M 674; 71 ER 626; Manners, Re [1955] 1 WLR 1096; Ransome, Re [1957] Ch 348; Wood, Moore & Bailey, Re (1880) 43 LT 730
Authors and other references
Halsbury’s Laws of England (4th Ed), vol.50
Representations
CY Ching (Ching & Co) for the plaintiffs.
TP Cheng (Yap & Yap) for the sons of Bek Chew Tay and the sons of the testator.
Karan Nair (Ong Tan & Nair) for the grandsons by the sons who were born after the date of distribution and unborn grandsons by the sons and the daughters of the testator by Bek Chew Tay.
KQ Tan (Lee & Lee) for the grandsons born before and living at the date of distribution and the five grandsons by the adopted son.
KS Lo (Allen & Gledhill) for the grandsons living at the date of the testator’s death.
TPB Menon (Oehlers & Choa) for the grandsons born but died before the date of distribution.
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