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THE LAW OF GIFTS INTER VIVOS.

III.

exception conferred by the Statute of Frauds, s. 8.
collected in Lewin on Trusts, chap. ix.

See the cases

It should, perhaps, be added that in Sayre v. Hughes (5 Eq., at p. 382) Stuart, V.C., says: "Being a transfer of stock it was not like paying money down and taking a conveyance in the name of the daughter; the difference is not very great, yet it is something."

Purchase in the name of a child-(Continued).—The Married Woman's Property Act, 1882, provides (section 21) that "a married woman having separate property shall be subject to all such liability for the maintenance of her children and grandchildren as Gift distinguished from sale.-There is a broad distinction the husband is now by law subject to for the maintenance of his between a gift and an assignment for value. In the former case children and grandchildren.' In cases falling within the Act, the the nature of the transaction depends entirely on the will of the rule stated ante, p. 701, "that a transfer to, or a purchase by a donor; and if he has done something which appears to, but which, mother in the name of, a child does not amount to a gift in the on strict examination, does not, amount to a gift, it is tolerably absence of evidence that a gift was intended," requires some modifi- certain that, although he may have at one time intended to make a cation. gift, the gift is imperfect; he changed his mind; he did not carry Assuming the doctrine laid down by Jessel, M.R., in Bennet v. his intention into effect. On the other hand, where the transacBennet (10 Ch. D., at p. 476, cited ante, p. 701) to be correct, the tion is for value, and for some reason the assignment of the proreason why a purchase by a father in the name of a child amounts | perty is imperfect, we have to consider the intentions of two persons prima facie to a gift is that the father is under a legal obligation to the person who purports to make and the person who accepts the provide for his child, and that a purchase by him in the name of assignment; and if, on consideration of all the circumstances, it his child will, in the absence of evidence to the contrary, be taken appears that both parties intended that a perfect assignment should to be made for the purpose of discharging that obligation. Apply- be made, a court of equity will compel the assignor to do anything ing this principle to a transfer to, or a purchase in the name of, that is necessary to perfect the assignment. her child, made by a married woman after the commencement of the Married Woman's Property Act, 1882, of or with property with which she is able to deal without her husband's assent, it would seem that such a transfer or purchase will amount, in the absence of evidence to the contrary, to a gift to the child. We are not aware, however, of any decision on the subject.

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Transfer as distinguished from purchase of realty. The question whether the rules, given in the preceding article, apply to a transfer of real property by the owner to another person, as distinguished from a purchase in the name of the latter, is one of some nicety, and has given rise to a difference of judicial opinion. The answer to this question depends upon the question whether, since the Statute of Frauds, any trust can be implied in favour of the person who conveys real estate to another without consideration. Lord Hardwicke says, in Lloyd v. Spillet (2 Atk., at p. 150): "I am bound by the Statute of Frauds to construe nothing a resulting trust but what are there called trusts by operation of law and what are those? Why, first, where an estate is purchased in the name of one person but the money or consideration is given by another; or, secondly, where a trust is declared only as to part and nothing said as to the rest, what remains undisposed of results to the heir-at-law, and they [sic] cannot be said to be trustees for the residue " Again, he says (Young v. Peachy, 2 Atk., at p. 256): "It might be said in every case where a voluntary conveyance is made that a trust shall arise by implication; but that is by no means the rule of the court; trusts by implication or operation of law arise in euch cases where one person pays the purchase-money and the conveyance is taken in the name of another, or in some other cases of that kind; but the rule is by no means so large as to extend to every voluntary conveyance.' James, L.J., says in Fowkes v. Pascoe (10 Ch., at p. 348): "I will assume that the implication of a resulting trust does arise as much in the case of a transfer as in the purchase of stock, although that certainly is not the case with respect to a conveyance of land."

It must be observed that the Statute of Frauds (29 Car. 2, c. 3, s. 8) exempts all declarations or creations of trusts of lands, tenements, or hereditaments, which arise or are transferred or extinguished by implication or operation of law, from the operation of the statute. We have, therefore, to consider whether any trust arises by operation of law in favour of a person who makes a voluntary conveyance of hereditaments to another, as, if this is the case, the statute does not apply.

It is a well-known rule that if A. conveys land to B. in fee simple by a conveyance operating at common law, and there is no consideration and no declaration of uses, there is a resulting use to A. in fee simple: See E. N. & C. on Interpretation, p. 286; also 1 Preston Est. 190. Bearing in mind that a use and a trust are the same thing, except that it is usual to confine the word "use" to a trust which confers the legal estate by virtue of the Statute of Uses, it appears that where an absolute transfer of land is made to A. without any consideration, there must be, in the absence of special circumstances, a resulting trust for the person conveying, and, if this view is correct, the case falls within the

This distinction between a gift and an assignment for value is of primary importance. The reader who has thoroughly grasped it will find but little difficulty in understanding the decisions, puzzling though they appear to be at first sight. These decisions lead to the cardinal rule, that "an incomplete voluntary gift creates no right that can be enforced." In other words, "No person can be compelled to perfect a gift which in the mode of making he has left imperfect; there is a locus penitentice so long as it is incomplete": Antrobus v. Smith (12 Ves. 39); Edwards v. Jones (1 Myl. & Cr. 226. See Lyte v. Peny (Dyer, 49a), where a man bailed to another a sum of money to the use and behoof of a woman, and to deliver it to her on the day of marriage, and countermanded i before the marriage.

The real difficulty arises in determining whether that which has been done amounts to a complete transfer of the property, and, if it does, with what motive was the transfer made? It should, however, be remarked that where the equitable ownership is completely transferred the donee is in the ordinary position of a cestui que trust, and that whether the donor or a stranger is the legal owner. Where the donor remains the legal owner he can only transfer the equitable ownership by constituting himself a trustee. The question, therefore, that arises in cases of this nature is whether he has done so; and it will be found that where he has ineffectually attempted to transfer his legal ownership and has not expressly constituted himself a trustee the donee takes nothing.

There is a well-known rule of construction that, where an instrument fails to take effect in the manner intended, it will, if possible, be construed so as to take effect in some other manner which will carry the expressed general intention of the parties into effect: see this discussed E. N. & C. on Interpretation, p. 40, et seq. The reader who understands the principle above laid down will be prepared to learn that this rule does not apply to an instrument purporting to make a gift; however clearly the intention of the donor to make a gift, whether of the entire or the beneficial interest, may be expressed, still, if he has not transferred the legal or the equitable ownership, as the case may be, or has not constituted himself a trustee, the gift fails.

The principles that we have stated are laid down very clearly by Turner, L.J, in his judgment in Milroy v. Lord (4 De G. F. & J., at p. 274). He says: "I take the law of this court to be well settled that, in order to render a voluntary settlement valid and effectual, the settlor must have done everything which, according to the nature of the property comprised in the settlement, was necessary to be done in order to transfer the property and render the settlement binding upon him. He may, of course, do this by actually transferring the property to the persons for whom he intends to provide, and the provision will then be effectual, and it will be equally effectual if he transfers the property to a trustee for the purposes of the settlement, or declares that he himself holds it in trust for those purposes; and if the property be personal, the trust may, as I apprehend, be declared either in writing or by parol; but, in order to render the settlement binding, one or other of these modes must, as I understand the law of this court, be resorted to, for there is no equity in this court to perfect an

imperfect gift. The cases, I think, go further to this extent, that, if the settlement is intended to be effectuated by one of the modes to which I have referred, the court will not give effect to it by applying another of those modes. If it is intended to take effect by transfer, the court will not hold the intended transfer to operate as a declaration of trust, for then every imperfect instrument would be made effectual by being converted into a perfect trust." "The principle is a very simple one. A man may transfer his property, without valuable consideration, in one of two ways: he may either do such acts as amount in law to a conveyance or assignment of the property, and thus completely divest himself of the legal ownership, in which case the person who by those acts acquires the property takes it beneficially or on trust, as the case may be; or the legal owner of the property may, by one or other of the modes recognized as amounting to a valid declaration of trust, constitute himself a trustee, and, without an actual transfer of the legal title, may so deal with the property as to deprive himself of the beneficial ownership, and declare that he will hold it from that time forward on trust for some other person. It is true that he need not use the words 'I declare myself a trustee,' but he must do something which is equivalent to it, and use expressions which have that meaning; for, however anxious the court may be to carry out a man's intention, it is not at liberty to construe such words otherwise than according to their proper meaning" per Jessel, M.R., in Richards v. Delbridge (18 Eq., at p. 14).

LEGISLATION OF THE YEAR..

POLICE DISABILITIES REMOVAL.

CUSTOMS AND INLAND REVENUE ACT.

50 & 51 VICT. C. 15.-AN ACT TO GRANT CERTAIN DUTIES OF CUSTOMS AND INLAND REVENUE, TO ALTER OTHER DUTIES, AND TO AMEND THE LAWS RELATING TO INLAND REVENUE.

The present Act, in addition to imposing certain tea, tobacco, and income tax duties, contains one or two provisions of special importance. After two sections reducing to 1d. the duty on sea policies in cases where the premium does not exceed 2s. 6d. and limiting to ten days the period within which a sea policy made out of the United Kingdom may be stamped after execution without penalty, ten sections provide, with considerable elaboration, for the imposition of a new duty on the transfer of the debenture stock or funded debt of any company or corporation, and, what is more important, for the composition of the duty by the bodies concerned, thus allowing any company to place upon its whole body of shareholders the burden of the duty which in understood that these enactments, which like all Inland Revenue Acts strict justice ought to fall upon transferors and transferees. It is came into force on the 5th of July, when the Act received the Royal Assent, have caused considerable excitement and annoyance on the Stock Exchange, and not unnaturally, for section 7, incorporating by reference a portion of the Stamp Act, 1870, raises the duty in the case of debenture stock from 2s. 6d. on the nominal value of the stock transferred to "the same ad valorem duty" as is charged by that Act to the amount or value of the consideration for the sale." The upon a conveyance or transfer on sale of other property by relation schedule of the Act of 1870 tit. " duties, from which we gather for example that the duty on the transconveyance" gives a long scale of fer on £100 Debenture Stock at par will be raised from 2s. 6d. to 10s. Conveyance on mortgage, however, is excluded from the Act, and conveyance otherwise than on sale or mortgage is chargeable with a ten shilling duty only, whatever may be the amount transferred.

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The terms of composition are fixed at sixpence for every hundred pounds of the whole " shares, stock, and funded debt" of the compounding body (sections 7, 8, 9, 10), but composition, it is hardly necessary to state, is not compulsory. It is merely provided (section

50 VICT. SESs. 2, c. 9.-AN ACT TO REMOVE THE DISABILITIES OF 9) that "any company or corporation may agree with the CommisTHE POLICE TO VOTE AT PARLIAMENTARY ELECTIONS.

Peers and women are disqualified from voting at Parliamentary elections by the common law, but not constables. The disqualification of constables is purely statutory, and has not been for a long time in operation. It was first imposed by Sir Robert Peel in 1829, in his well-known Act establishing the Metropolitan Police, which derives from him its two familiar names (10 Geo. 4, c. 44, s. 18), and the example thus set was followed in two later Acts as to counties and borough police (2 & 3 Vict. c. 93, s. 9, and 19 & 20 Vict. c. 20, s. 9). The preamble to the present Act recites the inexpediency of such a disqualification, and the operative part boldly repeals portions of the above-mentioned and other less important enactments (seven in all) having a similar effect. It is material to bear in mind that only portions of these enactments are repealed, and that certain unrepealed portions, following a common form, prohibit the police from canvassing, and also, except in the case of the Metropolitan Police, from voting at municipal elections. A further section provides for the case of a constable "who is, or who is likely to be, on the day of any election, sent or employed in the discharge of his duty so as to prevent him voting at the polling-booth or station at which he would otherwise by law be entitled to vote." Such a constable may obtain a certificate from the chief constable stating the fact with particulars, and the presiding officer at any polling station is to allow him to vote at such station, upon the production of the certificate, which he is forthwith to cancel, and "deal with in the same manner as the counterfoils of voting - papers are directed by law to be dealt with "'-as to which detail rule 29 of schedule II. of the Ballot Act, 1872, should be consulted. This enabling provision might possibly, even in the case of the most lawabiding set of citizens, tempt a man to vote early and vote often, so the Legislature imposes the penalties of personation (as to which see Corrupt Practices Prevention Act, 1883, s. 6, sub-section 2, by which personation is felony punishable by two years' imprisonment, with hard labour) upon any constable who should so far forget himself. It is also provided that temporary absence on duty for not more than four months shall not cause a break of the continuous "inhabitant occupancy " required as a qualification for the franchise (as to which see section 3 of the Representation of the People Act, 1867, and Ford v. Barnes (15 Q. B. D. 254) ).

Such is the Police Disabilities Removal Act, 1887-a statute which "explains itself" less than any statute of recent years, which is saying a good deal. It only remains to point out that, though the prohibitions in the repealed Acts are against voting, not against being registered, registration is in all cases, by virtue of section 7 of the Ballot Act, 1872, a condition precedent to the right to vote, but that a constable wrongly registered in past years becomes entitled to vote at once by virtue of the present Act.

sioners of Inland Revenue, if the commissioners in their discretion think proper, for the delivery of an account of their shares and stock. Upon such an account being delivered, the duty becomes chargeable upon the amount appearing from it (section 8), while by section 12 any company or corporation not delivering an account as agreed, or failing to pay the duty" in conformity with the Act," is liable to the very heavy penalty of ten pounds per cent. on the amount of duty payable, and a like penalty for every month after the first month during which such neglect shall continue." By section 15, upon the account being rendered and duty being paid, transfers of any shares or stock included in the account become exempt from duty, but by section 16 the compounding bodies are enabled to recoup themselves for what they have paid by way of composition by levying additional fees "in addition to any fee exigible upon registration of any transfer "" as to which fees, see sections 15 and 47 of the Companies Clauses Act, 1845, relating to registration of transfers and bonds respectively, and authorizing fees as prescribed in the special Act, or, if no fee be prescribe, then 2s. 6d. for each registration, but it is, perhaps, doubtful whether section 47, which applies to bonds, would, without some connecting link in the special Act, apply also to debenture stock. Section 16 is only an enabling provision, but it may perhaps be assumed that each compounding body will, in justice to its shareholders or constituents, put the section in force.

It only remains to point out that the germ of these stamp-compounding enactments is to be found in the Metropolitan Board of Works Loans Act, 1870 (33 & 34 Vict. c. 24), ss. 3 and 4, and in the Inland Revenue Act, 1880 (43 & 44 Vict. c. 20), s. 53, which later enactment applies to municipal loans only under the Local Loans Act, 1878. The provisions of 1880 are, by section 14 of the present Act, to be no longer in force as to stock issued after the passing of the Act, and the provisions of 1870 are likewise to cease after the 1st of August next, but will still have to be consulted in respect of the very numerous loans contracted before those dates-a highly incon venient arrangement, which it may become next to impossible to carry out by reason of the two sets of loans becoming blended in cases where (see, e.g., section 5 of the Metropolitan Board of Works Act, 1869), the stockholders having no priorities, there has been no keeping of separate account in respect of successive parcels bor

rowed.

Another, and the only remaining, important provision of the Act is that contained in the 18th section as to the income tax of agriculturists. This section provides that "it shall be lawful for any person occupying lands for the purposes of husbandry only to elect to be assessed to the duties of income tax chargeable under schedule D., and in accordance with the rules of that schedule, in lieu of assessment to the duties under Schedule B.," the election to be signified by notice to the surveyor of taxes for the district within two months after the commencement of the year of assessment, so that

an agriculturist, if he so elect, may now be assessed upon an average of three years' profits instead of upon the annual value of his holding. It is to be observed that the section applies to agriculturists who may be owners as well as occupiers, if they occupy for the purpose of husbandry only; that the duty under Schedule B. is only half that under Schedule D. and the other schedules, and that in estimating profits, if any, agriculturists will not only not be allowed to deduct anything for the cost of maintaining themselves and their families, but also ought to add to their profits money which they have escaped the spending of by reason of consuming their own produce.

CORRESPONDENCE.

THE TRANSFER OF LAND BILL, 1887.

[To the Editor of the Solicitors' Journal.] Sir,-The Bill is suspended until next session. Happily a breathing time is obtained, and it will be well if the proposed alterations receive more careful consideration than they appear to have hitherto had. The scheme of registration seems, unfortunately, to be accepted pretty generally as inevitable; and this merely because it is brought forward by the Lord Chancellor, and may therefore be regarded as a Government measur; but the objections of those most capable of judging of the practical effect of what is proposed deserve more than a careless examination. The report on the Bill issued by the Council of the Incorporated Law Society shews that the measure is regarded with much disfavour by that very competent representative body; and it may be taken that there is not a law society throughout the provinces which views the proposal otherwise than with repugnance. Moreover, it must not be forgotten that one of the most eminent of the Lord Chancellor's predecessors was strongly opposed to compulsory registration. The late Lord Cairns, who was an exceptionally skilled real property lawyer, was decidedly of opinion that such a mode of registration would be in the highest degree inexpedient; and indeed, in his evidence before the Committee of the House of Commons, he went so far as to say that its effect was "frightful to contemplate." His adverse opinion dictates that the proposed measure should receive the most thorough examination, and not be blindly accepted, however high the authority by whom it is introduced. There is no doubt that the Bill will be brought forward again next year, and no time should be lost in preparing to resist it.

The Registration Acts of 1862 and 1875 have proved absolute failures. The best proof of this, perhaps, is the fact that, of the few titles registered, a large proportion have actually been taken off the register. The principle has thus been tested for more than a quarter of a century. Having proved it to be unpalatable, a paternal Government steps in, and says to the nation "You do not know what is good for you. Registration is a grand thing, and whether you like it or not you will be compelled to register your deeds and wills." It will be urged that the previous schemes were mistakes, and that what is now offered is so very different, and is so undoubtedly right, that it in fact becomes the duty of Government to compel its adoption. However high an opinion the promoters of the Bill may have of the proposed registration system, it cannot be demonstrated without actual experience that it possesses all the advantages claimed for it. Does not common sense suggest that the new mode of registration should be left to rely on its intrinsic merits for a period of, say, five years? If its adoption during the tentative period had been sufficiently general to shew that the system was appreciated, then it might prudently be rendered compulsory; but if such a reasonable trial be denied we shall be compelled to take a leap in the dark.

It is thought by some, and the idea is a very pleasing one in theory, that the transfer of land should be made as easy as that of Consols, but that of course can never be. A transfer of shares in a public company is the nearest approach to this simplicity of operation; but even this transfer cannot be effected without a deed. Such deed is simple and invariable in form, being a transfer from A. to B. in consideration of money paid, and without recognition of any trust; but deeds of settlement, conveyance, and mortgage, and wills, are infinite in their variety; trusts cannot bedis regarded; and, if a register is to record all dealings with all kinds of properties throughout England, the contemplation of such a mighty, gigantic task oppresses and appals the mind.

Thanks to the admirable Act of 1881, conveyancing has been brought to such a state of extreme simplicity that improvement might well be regarded as impossible: and the authorised scale of charges appears to give general satisfaction, as well to clients as to practitioners. The Settled Land Act of 1882, by the powers conferred on the tenant for life, effected a very valuable alteration, and got rid of the popular objection that land was too much tied up. We seemed at last to have reached a happy state of calm, with a prospect of settled rest, but our peace was destined to be short. The whole system of conveyancing would appear to be threatened. It is

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pronounced to be unsatisfactory, and in its place it is proposed to
substitute a scheme which would be very suitable for a new colony.
To come to the Bill itself. It is not an easy matter to know what,
under the head of registration, it really means. This much, how-
ever, is certain, that registration of some kind is intended to be
compulsory and universal, and that there are to be two kinds of
registration, one with a possessory" title, which is compulsory; and
the other with an absolute title, which is to be optional. The first
title is to be obtainable immediately-that is, presumably, after official
investigation; the second, after a delay of five years, if a notice,
attended with due publicity, and repeated annually, does not pro-
duce a claimant proving a superior right. The operation of the
first-named registration would appear to be a mere notice to the
world that, say, A. B. claims to be the fee simple owner of a certain
estate; but then his title would require the ordinary examination the
same as hitherto. This process of registration of the possessory title
is to be repeated as often as the property changes hands by sale. I
say by sale, for there does not appear to be any provision requiring
the registration of a mortgage. The advantage of obtaining a mere
possessory title is, therefore, not apparent, except so far as it leads
obtained his possessory title, the owner might, by a prescribed pro-
up to the acquisition of what is termed an absolute title. Having
cess, after a tedious waiting for five years, procure what the Bill
calls an "absolute title." The expression is misleading, since the
title does not amount to an indefeasible one.
section 5, a registered proprietor would have to pay compensation to
Under section 13, sub-
20, sub-section 1, compensation out of the insurance fund would be
any person deprived of any interest in the land; and, under section
paid to any person for loss arising "from an entry in the register
obtained by forgery or fraud, or from any error on the part of the
Land Transfer Board, or its officers, or from any of the other matters
prietor might have to give up the land itself, and be content with
in the scheme mentioned." Then, under section 21, a registered pro-
compensation from the insurance fund.
reconcile these several sections; but it is clear that, under the pro-
It is not an easy task to
visions of the Bill, in no case could a title, absolutely free from
attack, be procured. Consequently, registration, even with an abso-
lute title, would not dispense with the investigation of title which is
required at present.
indefeasible title can be obtained, and the certificate of registration is
Now, under the Act of 1875, an actually
the root of title.

been imported into the Bill. One has to grope about from one to
It surely is a mistake that the lengthy Act of 1875 should have
the other in search of light. Far better would it be if so ambitious a
scheme were contained in its integrity within the four corners of a

Bill.

The Bill, without the rules, to be issued under the proposed Act is, as regards registration, extremely incomplete. In fact it is but a mere skeleton, and it gives rise to all sorts of questions. For instance, the memorandum prefixed to the Bill states that the Bill "proposes to make registration universal." Registration of what? Does this mean that every deed affecting land shall appear on the register? Would any advantage be gained beyond what is now obtained by registration in Middlesex and Yorkshire? If none, is the working of registration in those counties so conspicuously beneficial as to justify the application of the system to the whole of the kingdom? On the contrary, does not experience shew that registration in those particular counties confers no practical advantage, and only causes trouble and expense? What is to be the mode of registration; by memorial, or by copies of deeds and wills placed in the books of the registry?

The avowed object of the Bill is to facilitate and cheapen the transfer of land. Neither of these objects would be likely to be obtained. It has been calculated that the number of deeds dealing with land executed in England in the course of a year is some 300,000. But that is probably under the mark. An army of officials and numerous district registries would be required to cope with the enormous work, and the heavy expense occasioned would have to be paid by landowners, who just now are certainly not enjoying excessive prosperity. It cannot be denied that registration would cause delay, and where there happened to be a pressure of work in the office, perhaps long delay. The principal sufferers would be small owners. Where the consideration is under £100, the purchaser's costs of purchase at present are the maximum sum of £3 and the stamp. In the majority of the cases the title to small properties is well known, and a sale can be completed with great rapidity. But should registration become compulsory, the fees of registering and of insurance will become an additional expense, and to this hardship will have to be added delay.

Should the Bill pass into law the country may expect such a deluge of officialism as we have never before experienced. Great inconvenience would be occasioned unless the district registries are very numerons. For if large areas are attributed to these offices, additional delay, trouble, and expense will be caused as to deeds coming from a distance. The publicity of the contents of deeds which will be inevitable, may, in many cases, be very undesirable.

Loss of property through fraud or mistake occurs so very seldom at present that it might seem superfluous to provide for such cases. Yet insurance forms an important feature in the Bill. It would appear as if it were apprehended that the new system would give such facilities for forgery and fraud, and that so many mistakes will be made by officials, that an indemnity for the sufferers must be provided. The insurance system is based on the very extraordinary principle that good titles shall be made to pay for bad ones. Sound titles are to be made to idemnify those that prove to be tainted! This, indeed, would be robbing Peter to pay Paul. The insurance scheme is specious. It is calculated to lead the multitude, who do not take the trouble to think for themselves, to believe that this novel process would practically render every title safe. Titles are now quite sufficiently safe; but even were additional security to be obtained, and which is doubtful, the fact remains that insurance is intended to cover the risks of a crude and arbitrary system which even the promoters view with undisguised distrust; and that it is sought to make landowners, whose titles are good, insurers against all sorts of fraud, forgery, and blundering; and this without the slightest resulting If you will permit me, I may in a future letter comment on the amendments of the law of real property proposed by the Bill. August 19.

benefit to themselves.

J. B.

P.S.-I am reluctant to trespass further on your space, but I desire to call attention to the following statement in the memorandum which precedes the Bill:

"When a branch office for local registration has been organised in a district, the Act will be applied by Order in Council, and after an appointed day every purchase of legal interests in land in that district will be made by means of the register."

It is important to know the meaning of this vague statement. Is it that it is intended that all conveyancing_relating to purchases shall be done by the officials of the Land Transfer Board? Such would appear to be the most obvious construction. If it be the correct one, then, indeed, a scheme of insurance against errors is of vital importance.

PROBATE AND ADMINISTRATION DUTY ON ESTATES UNDER £300.

[To the Editor of the Solicitors' Journal.] Sir,-Leaseholds form part of the assets of a small estate, and, in arriving at their value, a mortgage debt is deducted. This brings the value of the estate below £300, and administration is sought under the provisions of section 38 of the 44 Vict c. 12. The department holds that the deduction of a mortgage debt is not permissible in connection with a grant under that section. It is submitted, however, that section 7 of 31 & 32 Vict. c. 124 lays down clearly the principle on which the value of leaseholds has to be ascertained for purposes of administration duty—i.e., "that the mortgage debt on such leasehold may be deducted from the value of such leasehold, and the stamp duty shall be chargeable on the value after deduction therefrom the amount of such mortgage debt. Sub-section 1 of section 33 of 44 Vict. c. 12 provides that the estate, in order to obtain the benefit of that section, must be under the value of £300 without any deduction for debts or funeral expenses. The class of debt is governed by section 28, which gives the power to deduct debts and funeral expenses from the value of the estate. Debts in this latter section could not mean mortgage debts, because mortgage debts had already been provided for by section 7 of 31 & 32 Vict. c. 124.

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It is obvious that this question is not likely to be contested by parties applying for administration, because it affects only estates which are too poor to defend any proceedings by the department. It is very hard to have to pay duty on gross value of leasehold estates which may be of considerable worth, but subject to incumbrances of almost equal amount.

I shall be glad to obtain the views of your readers upon the point.

THE LIABILITY OF TRUSTEES.

J. N.

In his judgment in the recent case of Billing v. Brogden, Mr. Justice North made some important observations on the liability of trustees with reference to the case of Speight v. Gaunt (31 W. R. 401, 9 App. Cas. 1), and it may be useful to give, in advance of the regular report of the cases some extracts from the shorthand notes of the judgment.

It should be stated that the action was by cestuis que trustent against their trustees to compel them to make good a loss of the trust moneys caused by an alleged breach of trust. A father, on the marriage of his daughter, covenanted with the trustees of her marriage settlement that he,

in his lifetime, or his executors or administrators within five years after his death, would pay £10,000 to the trustees, to be held by them on the trusts of the settlement. The defendant Budgett was one of the trustees, the other trustees were two of the testator's sons, who afterwards became two of his executors. The £10,000 was not paid by the testator, or by his executors within five years after his death, but was retained by them in a business which they had carried on in partnership with the testator, and was ultimately lost. It was admitted at the trial of the action that the two trustees, who were also executors, were liable to the plaintiffs, and the main question was whether the defendant Budgett, who was the only in. dependent trustee, was liable for not having taken more active steps to compel payment of the trust money out of the testator's estate when it became due. He was brother-in-law to the other two trustees, and for this reason apparently was unwilling to proceed against them, but no dishonesty was imputed to him. The details of the case were extremely complicated, and it would be impossible to state them within any reasonable length.

It never

North, J., said that it had been contended that Speight v. Gaunt had established this proposition, that a trustee was justified in dealing with business would deal with his own estate. This was too broad a statea trust estate in the manner in which an ordinary prudent man of ment. In Speight v. Gaunt a trustee had, for the purpose of making a proper investment, placed trust funds in the hands of a broker, who applied them to his own use. Two points were considered there-(1) was the trustee warranted in employing an agent, instead of carrying out the transaction himself? (2) Was he justified in banding the cash to his agent, instead of paying it himself to the persons giving the security. Each question was answered affirmatively, upon the ground that a prudent man of business advancing his own money upon such a security would, in the and trusted him with the money. ordinary and regular course of business, have employed a broker Jessel, M.R., said (22 Ch. D. 739): "It seems to me that on general principles a trustee ought to conduct the business of the trust in the same manner that an ordinary prudent man of business would conduct his own, and that beyond that there is no liability or obligation on the trustee. In other words, a trustee is not bound because he is a trustee to conduct business in other than the ordinary and usual way in which similar business is conducted by mankind in transactions of their own. could be reasonable to make a trustee adopt further and better precautions than an ordinary prudent man of business would adopt, or to conduct the business in any other way. If it were otherwise, no one would be a trustee at all. He is not paid for it." And Lord Blackburn said (9 App. Cas. 19): "The authorities cited by the late Master of the Rolls, I think, shew that, as a general rule, a trustee sufficiently discharges his duty if he takes, in managing trust affairs, all those precautions which an ordinary prudent man of business would take in managing similar affairs of his own. There is one exception to this: a trustee must not choose investments other than those which the terms of his trust permit, though they may be such as an ordinary prudent man of business would select for his own money; and it may be that, however usual it may be for a person who wishes to invest his own money, and instructs an agent, such as an attorney or a stockbroker, to seek an investment, to deposit the money at interest with the agent till the investment is found, that is in effect lending it on the agent's own personal security, and is a breach of trust." But it was quite clear that, when those learned judges spoke, as other judges had spoken, of conducting the business of the trust, or managing trust affairs, as a prudent man would manage his own concerns, they were referring to cases in which the trust business was being done in accordance with the limitations of the trust. No one would contend that a trustee might safely ignore the terms of the instrument as would have been a prudent disposition of his own. creating the trust, so long as his disposition of the trust property was such When thus understood, the duty of a trustee not to select investments outside the securities authorised by the trust was in conformity with, and was not an exception to, the general rule. A trustee who invested trust funds in an unauthorised manner would be liable for any loss arising therefrom, however wise and safe such an investment of his own funds by a prudent man would have been considered; and a trustee who neglected to call in a sum of money, which ought to be called in at once under the terms of the do so, however safe and prudent it might have been to leave the money trust, would be liable for any loss which might arise from his omitting to outstanding if it had been his own. The defendant Budgett's conduct must, therefore, be tested, not by what a prudent man would have done as to his own moneys, with which he could deal as he liked, but by what he would have done with respect to moneys which it was his duty to proceed to call in at the end of five years from the testator's death. In considering this question his lordship adopted the very important observations of Jessel, M.R., in Speight v. Gaunt (31 W. R. 404, 22 Ch. D. 746): "My view has always been this, that where you have an honest trustee fairly anxious to perform his duty and to do as he thinks best for the estate, you are not to strain the law against him to make him liable for doing that which he has done, and which he believes is right in the execution of his duty, without you have a plain case made against him. In other words, you are not to done, for the purpose of finding reasons exercise your ingenuity, which, it appears to me, the Vice-Chancellor has for fixing a trustee with liability; but you are rather to avoid all such hyper-criticism of documents and acts, and to give the trustee the benefit of any doubt or ambiguity which may appear in any document, so as to relieve him from the liability with which it is sought to fix him." In. attention to the principles there laid down had in some cases led to trustees receiving less than justice. Adopting these principles as his guide, his lordship had reluctantly come to the conclusion that he could not hold the defendant Budgett free from liability, and that he ought to

have taken more active steps, and at an earlier time than he did, to get in the trust money. A second and equally important question remained for considerationwhether, if the defendant Budgett had used due diligence in attempting to recover the trust funds, any good would have resulted therefrom; for it was clear that the court would not punish a trustee pecuniarily for his breach of trust, except so far as loss had resulted therefrom to the trust estate. In other words, if no loss had been incurred, or the loss had been replaced before action, there was nothing remaining for the trustee to make good, although no doubt the court might think fit to remove him from the trusteeship. In Hobday v. Peters (28 Beav. 603) a policy was assigned to trustees. They never obtained possession of it, or gave notice to the office, and the assignor first mortgaged and afterwards surrendered the policy. The trustees were held not liable, as they had no funds out of which they could have paid the premiums, and, if they had sued the assignor, it would have been useless, as Lord Romilly, M.R., was satisfied upon the evidence that the assignor could not have paid. In Ratcliffe v. Winch (17 Beav. 217) the court apparently acted on the same principle. In Clack v. Holland (19 Beav. 262) the law was stated in terms more favourable to the defendant Budgett than in any other case of which his lordship was aware. Lord Romilly, M.R., said (19 Beav. 271): “When it is the duty of a trustee or executor to obtain payment of a sum of money, the trustee or executor is exonerated and never required to make good the loss if he has done all he can to obtain payment, but his efforts have not proved successful. Nay, more, if he has taken no steps at all to obtain payment, but it appears that, if he had done so, they would have been, or there is reasonable ground for believing that they would have been, ineffectual, then he is exonerated from all liability." On the evidence his lordship came to the conclusion that loss had resulted from the defendant Budgett's omission to take proceedings to compel payment of the money: The defendant Budgett and the executors must pay the plaintiffs' costs of the action, but the liability of the executors must be limited by a direction that the costs which they had to pay were not to be increased by reason of the prolongation of the trial beyond the day on which they submitted to judgment.

the orders, which he had read, and which he could not go behind. He was not satisfied that the gentleman had the means of paying; it would be not only idle but mischievous to send him to prison. He should make the order, not to issue for a fortnight, the debtor to pay the costs.COUNSEL, E. Cutler, Q.C., and Whiteway; Lyttelton Chubb. SOLICITORS, Boxall & Boxall; A. B. Chubb.

TAXATION-SOLICITOR-UNDERTAKING-Order to Review.

In the case of Re W. F. Law and John Nicholls & Co., before Kekewich, J., on the 24th of August, a question arose as to the liability of a solicitor to carry out his undertaking to repay money received by him in the event of the judge ordering a review of the taxation. This was a motion Messrs. Nicholls & Co., solicitors, should be ordered to pay forthwith to on behalf of W. F. Law, a solicitor of the Supreme Court, asking that the agents of W. F. Law the sum of £46 18s. 9d., pursuant to an undertaking dated the 24th day of June, 1887, and costs. The undertaking was "57, Basinghall-street, E.C., 'London, 24th June, 1887. "Re W. F. Law.

as follows:

-

66

"Received of William F. Law, Esq., by payment of Messrs. Law & Worssam the sum of forty-six pounds eighteen shillings and ninepence, being the amount certified to be due by the taxing master's certificate in this matter, which we undertake to return to the said Messrs. Law & Worssam taxing master's certificate. within four days after the decision of the judge overruling or varying the "26.6.87. "JOHN NICHOLLS & Co."

By an order made on the 27th of July, 1887, on the application of W. F. review his certificate. Law, Kay, J., ordered that it be referred back to the taxing master to

KEKEWICH, J., said that he made an exception in this case to the rule that he laid down in doing vacation business, not to deliver formal judgments. The respondent here gave an undertaking to return a sum of money to the solicitors of the applicant within four days after the decision of the judge overruling or varying the taxing master's certificate. On the 27th of July an order was made sending back the certificate to the taxing master to review. It had been for years the settled practice and rule of the court that where one of the parties desired to appeal on a question of co-ts such as this, the money was paid to the solicitor at once on the against him. The rule rested on the faith that such an undertaking made by an officer of the court would be observed most strictly. Nicholls got enforce that undertaking. He ordered Nicholls to pay the money within the money on the faith of the undertaking, and his lordship would strictly seven days, and pay the costs.-COUNSEL, George Henderson; Bramwell Davis. SOLICITORS, Law & Worssam; Arnold Williams & Co.

CASES BEFORE THE VACATION JUDGE. personal undertaking of the solicitor to repay the money if the order went

PRACTICE-Vesting Order-REAL PROPERTY-DESCRIPTION OF PARCELS IN ORDER-TRUSTEE ACT, 1850.

In the case of Re Adams, before Kekewich, J., on the 24th of August, sitting as Vacation Judge, a question arose as to whether property which was the subject of a vesting order was sufficiently described. It was also asked that the consent of the lords of the manor (the land being copyhold) to the vesting order might be recited in the order. The application was made by the persons beneficially entitled to certain copyhold property devised by the will of Samuel Adams, asking that the property should be particularly described in an order made under the Trustee Act, 1850, on the 6th of August, 1887, by Kay, J., vesting the property in the applicants. The registrar, in drawing up the order, proposed that "the hereditaments to which a former trustee of a testator's will had been admitted," should be vested in the applicants. On behalf of the applicants it was submitted that they were entitled to have the parcels set out in the vesting order or in schedules to it.

KEKEWICH, J., said that the parcels should be set out, and the consents recited, otherwise the applicants would not get a good title, and he gave directions to the registrar accordingly.-COUNSEL, George Henderson. SOLICITORS, Albert Batchelor, for Gisby & Son, Ware.

COMPANY-OFFICIAL LIQUIDATOR-APPOINTMENT-MEMBER OF COMPANY.

In the case of The Graduated County Schools Association (Limited), before Kekewich, J., on the 24th of August, a question arose as to whether an accountant, a stranger, should be appointed official liquidator or a person concerned in the management of the company. Chadwyck Healey's Company Law and Practice was cited on behalf of the accountant; In re London Australian Agency Corporation (29 L. T. Rep. N. S. 417) for the member of the company. The chief clerk had appointed an accountant, but the summons was adjourned into court.

KEKEWICH, J., said that he should not disturb the chief clerk's appointment.-COUNSEL, Marten, Q.C.; Spokes. SOLICITORS, Longbourne & Stevens; Whale & Clark.

ATTACHMENT-SOLICITOR-PERSON 66 ACTING IN A FIDUCIARY CAPACITY "DISCRETION-DEBTORS ACT, 1869, s. 4, SUB-SECTION 3; DEBTORS ACT, 1878, s. 1.

In the cases of Preston v. Etherington and Etherington v. Etherington, before Kekewich, J., on the 24th of August, a question arose whether a solicitor who was ordered to pay a certain sum of money was a "person acting in a fiduciary capacity" within the third exception in section 4 of the Debtors Act, 1869. A motion was made for leave to issue a writ of attachment against a solicitor for disobeying an order of the 8th of July, 1887, whereby he was ordered to pay a sum of money and interest. In support of the motion Marris v. Ingram (13 Ch. D. 338) was cited. It was contended on behalf of the respondent that the applicant had not proved that the debtor was fraudulent or dishonest. He simply was unable to pay, and the court should exercise its discretion under section 1 of the Debtors Act, 1878. The debtor never acted in a fiduciary capacity.

KEKEWICH, J., said that he was satisfied that it was a trust debt from

PRACTICE-MOTION TO COMMIT-SOLICITOR-SERVICE.

In the case of Jonas v. Long, before Kekewich, J., on the 24th inst., a question arose as to whether service of a notice of motion to commit on a solicitor at his private or business address was good. It was a motion to commit George Johnson, a solicitor, for contempt in assaulting a solicitor within the precincts of the court. The applicant was unable to effect personal service, either at the private or business address of JohnJohnson was not represented by a solicitor, so service could not be effected through his solicitor. Re A Solicitor (14 Ch. D. 152) was cited; in that case service of the notice of motion at the residence of the party was held sufficient.

son.

KEKEWICH, J., said that he was unwilling to send a man to prison without another attempt to serve him. The applicant must send two registered letters to the two addresses, stating that he did it by the direction of the judge. The matter was of some importance, and the motion would stand at the head of the list next Wednesday.-COUNSEL, Johnston Watson. SOLICITORS, Robinson & Dees.

LEGAL NEWS.

OBITUARY.

Mr. JOHN HOLTBY, solicitor, of York and Pocklington, died on the 15th inst., at the age of eighty-two. Mr. Holtby was born in 1804. He was admitted a solicitor in 1840, and he had ever since practised at York. He was a perpetual commissioner for the North and East Ridings of Yorkshire and for the City of York, and he had an important private practice. He had been for many years clerk of indictments and deputy-clerk of assize on the North-Eastern Circuit, and he was till recently clerk to the magistrates for the Pocklington Division of the East Riding. Mr. Holtby chairman of the York Board of Guardians. He was in partnership with was a director of the York Gas Light Co., and he was for fourteen years Mr. Robert Holtby, who is clerk of arraigns on the North-Eastern Circuit. Mr. Holtby was buried at the York Cemetery on the 19th inst.

APPOINTMENTS.

Mr. WILLIAM JOHN COURTHOPE, barrister, has been appointed a Civil Service Commissioner. Mr. Courthope is the eldest son of the Rev. William Courthope, and was born in 1841. He was educated at New College, Oxford, where he graduated first class in Classics in 1865. He obtained the Newdigate prize for English verse in 1864, and the Chancel

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