EADY J. 1909 SWINFEN financial position of the hospital and the urgent need for further assistance. The secretary specially called the testator's attention to the overdraft of the hospital upon their current account ATTORNEY loan and to the above-mentioned rule giving donors of 1000l. the privilege of naming a cot, and the testator then promised that HOSPITAL. he would leave the hospital 1000l. by will. GENERAL v. BELGRAVE This action was brought by the Attorney-General at the instance of the Charity Commissioners, asking for a declaration that the hospital were bound to invest the legacy of 1000l. and use only the income for the general purposes of the hospital on condition that a bed named "the Eleanor bed " was maintained, and for an order that the money should be invested in the name of the Official Trustee of Charitable Funds. The case had been adjourned that inquiry might be made whether there was any general practice as to investing legacies of this kind and now came on for hearing. The secretary to the hospital proved that he had made inquiries at the principal hospitals and found that there was no established practice. If it was thought advisable, and the financial position of the hospital admitted, the legacy was invested. If not it was not. The secretary to the Charity Commissioners produced a long list of legacies, generally of 1000l., of a similar character which had been to their knowledge invested as capital. In these cases, however, the words "endow" or "maintain" or similar words occurred either coupled with "found" or alone. There was no case in which the word "found" occurred alone. There was evidence that the annual cost of maintaining a bed or cot in a London hospital was about 751., much more than the income of 1000l. invested in trust investments. E. Beaumont, for the Attorney-General. The list furnished by the Charity Commissioners shews that the gift of 1000l. to establish or endow a bed in a hospital is a very common form of bequest, and it is considered to be a bequest of money to be invested and used as an endowment. I admit that the words in many of the cases are such as could not be understood in any other way, and "found" does not occur alone. But I submit that the intention of the testator clearly was that the 1000l. EADY J. 1909 should be set aside and kept for ever and the bed maintained swINFEN from the income. There is no direct authority on the point, but in Salusbury v. Denton (1) there was some discussion as to the meaning of the word "foundation,” and it appears to have been ATTORNEYheld that it implied maintenance. The Attorney-General will be satisfied with a declaration as to construction; he does not wish HOSPITAL. to press the charity for immediate investment. P. W. Baker-Wilbraham (Sargant with him), for the hospital. The list produced is not exhaustive; it is only a list of instances one way, and there may be as many the other way. The words are different. "Found" never occurs alone in the list and is much more colourless than the words in the list, which all include "endow" or some equivalent word. We have shewn that the practice of hospitals in these cases depends on their financial position, and the testator knew that this hospital was in such a position that a gift of 1000l., which must be invested and the income applied in maintaining the particular bed, would be more of a burden than a benefit. The evidence shews that a bed costs about 751. a year to maintain, much more than the income of 10007. The rules only give the donor the power of naming a bed. The testator knew of the rule and intended to make a gift in accordance with it. SWINFEN EADY J. The short point raised by this action is as to the true construction of the will of Alfred John Randall. The testator by his will gave 1000l. to the Belgrave Hospital for Children in the following terms: [His Lordship read the words of the bequest, and continued.] The question is whether the hospital was entitled to treat that sum as part of the annual income of the hospital, and apply it accordingly, or whether there was an obligation on the hospital to treat that sum as capital money for the purpose of endowing and providing income for a bed, and therefore to invest the sum and deal with the annual income only. Dealing with the language of the will, "To the Belgrave Hospital for Children to found a bed to be called the Eleanor bed,'" it is quite obvious that the intention of the testator was to establish something. He says "to found a bed," which (1) (1857) 3 K. & J. 529. GENERAL BELGRAVE 1909 GENERAL BELGRAVE SWINFEN involves the idea of establishing it; and it is established EADY J. by providing a capital sum, the revenue from which may maintain it or be applied to its maintenance. The suggesATTORNEY tion is that the language of the will would be satisfied if 1. some bed already existing in the hospital is called the “Eleanor HOSPITAL. bed," and that when that is once done the fund may be applied as part of the annual income of the charity and expended in the year in which it is paid over, if necessary, and dealt with as annual income. In my opinion the idea involved in founding a bed negatives any such dealing with the fund. It appears from the affidavit that has been filed by the secretary to the Charity Commissioners, who has searched the records of the Commissioners, that he has found a large number of cases shewing that it is a common practice of testators and of living donors, to give money for the purpose of establishing a bed or cot in some hospital, and frequently the sum is 1000l. The word "establishing" is not always used, nor is the word "founding" used, but various expressions are contained in the wills, and in letters evidencing voluntary gifts, involving the same idea. For instance, the words in a long list before me are sometimes "for endowing a bed or a cot," sometimes "for providing" for one, or "for the endowment in perpetuity," or for "founding and maintaining," or "establishing," and then sometimes "founding beds or cots in the hospitals." In my judgment it is not essential that any particular word or expression should be used in order that the fund may be treated as a capital investment. The question is whether on the true construction of the language used the gift was intended to be treated as capital. Whether the words are "to found a bed," or "to establish a bed," or " to endow in perpetuity a bed," or other similar or analogous expressions, the result is the same, namely, that the fund is to be used for the purpose of investment, so that by the income thereof, from time to time, so far as it will extend, the needs of the bed or cot may be satisfied. Then it was said that the money, 1000l., is not now sufficient to provide for one cot; that the annual expense is more than the income of that sum. The answer to that is that the income must be applied so far as it will extend. Then it was said that EADY J. 1909 - in this case the testator knew the needs of the hospital, knew SWINFEN there was an overdraft at the bank, and must, having regard to a certain conversation, really have intended the fund to be applied as annual income. But this is a question of the construction of his will, and the conversation is not admissible in evidence for the purpose of interpreting the language the testator HOSPITAL. has used in his will. Under those circumstances I decide that this fund can only be used for the purpose for which it was given, to found a bed; that is to say, as a capital fund. It is right that I should add that the only complaint is that the money has been applied for income purposes instead of capital, and in that sense not properly applied. It is, in my judgment, of the greatest importance, where property is given to a charity, that the terms of the gift should be strictly observed. I determine that, according to the true construction of the will, the 1000l. cannot be properly applied as annual income of the charity, but should be invested and the income applied, so far as it will extend, in the maintenance of a bed to be called the "Eleanor bed." It was suggested that that must necessarily involve establishing some new bed, but I see no reason for that. It would be sufficient for some bed already existing in the hospital to be appropriated for this purpose, and the bed named the "Eleanor bed," as I gather has been done. The fund must be invested, and the income will be applied towards the maintenance of the bed. The Attorney-General does not ask for any immediate order for the replacement and investment of the fund. The order made was a declaration in the terms above mentioned. Liberty to the Attorney-General to apply for the investment of the legacy in the name of the Official Trustee. Solicitors Treasury Solicitor; Hollams, Sons, Coward & Hawksley. J. R. B. ATTORNEY- t. BELGRAVE WARRING- 1909 Oct. 15, 23. In re KELLY'S SETTLEMENT TRUSTS. GUSTARD v. BERKELEY. [1909 K. 481.] Settlement-Appointment of Specific Sums of Stock-Surrender of Appointor's Date at which Value of Appointed Stocks should be ascertained. By the marriage settlement of Mr. and Mrs. Kelly stocks were assigned to trustees upon trust for Mrs. Kelly for life, and after her death (in the events which happened of her surviving her husband and no joint appointment by them having been made) then upon trust for such of the issue of the marriage as the survivor of them should by deed or will appoint, and in default of such appointment in trust for the children of the marriage in equal shares. The settlement contained a hotchpot clause in common form. Mrs. Kelly on the occasion of the marriage of one of her daughters appointed that certain sums of stock forming part of the settlement trust fund should immediately after the marriage be held in trust for the daughter for her absolute benefit, and Mrs. Kelly assigned and surrendered her life interest in the appointed stocks to the daughter. The stocks were accordingly transferred to the trustees of the daughter's settlement immediately after their marriage. Mrs. Kelly died and the trust funds became divisible: Held, that the daughter must bring into hotchpot the share appointed to her at its value at the date of the death of Mrs. Kelly. By the marriage settlement of Mr. and Mrs. Fitzroy Kelly, dated August 10, 1869, certain stocks and securities were assigned to trustees upon trust to pay the income thereof to Mrs. Kelly for her separate use, and after her death (in the event which happened of her surviving Mr. Kelly) upon trust for such of the issue of the marriage upon such conditions and in such manner as Mr. and Mrs. Kelly should by deed jointly appoint, and in the event (which happened) of no such appointment being made, then as the survivor of them should by deed or will appoint, and in default of such appointment in trust for all the children of the marriage who should attain twenty-one or being daughters should marry in equal shares. The settlement contained the following hotchpot clause:-" Provided always that no child who or whose issue shall take any part of the said trust fund under any appointment in pursuance of either of the powers herein before contained |