PART IV. OF PERSONAL ESTATE GENERALLY. No estate for life. CHAPTER I. OF SETTLEMENTS OF PERSONAL PROPERTY. PERSONAL property is capable of being settled, but not in the same manner as land. Land, being held by estates, is settled by means of life estates being given to some persons, with estates in remainder in tail and in fee simple to others. But personal property, as we have already observed (a), is essentially the subject of absolute ownership. The settlement of such property, by the creation of estates in it, cannot therefore be accomplished. And there is a striking difference in many cases between the effect of the same limitation, according as it may be applied to real or to personal property. As there can be no estate in personal property, it follows that there can be no such thing as an estate for life in such property in the strict meaning of the phrase. Thus if any chattel, whether real or personal, be assigned to A. for his life, A. will at once become entitled in law to the whole. By the assignment the property in the chattel passes to him, and the law knows nothing of a reversion in such chattel remaining in the assignor. And this is the case even though the chattel be a term of years of such length (for instance 1000 years) that A. could not possibly live so long (b). The term is considered in law as an indivisible chattel, and conse(b) 2 Prest. Abs. 5. (a) Ante, p. 7. quently incapable of any such modification of ownership as is contained in a life estate. An apparent exception to the above rule has long Bequest of a been established in the case of a bequest by will of a term term for life. of years to a person for his life: in this case the intention of the testator is carried into effect by the application of a doctrine similar to that of executory devises of real estates (c). The whole term of years is considered as vesting in the legatee for life, in the same manner as under an assignment by deed; but on his decease the term is held to shift away from him, and to vest, by way of executory bequest, in the person to be Executory benext entitled (d). Accordingly, if a term of years be quests. bequeathed to A. for his life, and after his decease to B., A. will have, during his life, the whole term vested in him, and B. will have no vested estate, but a mere possibility, as it is termed (e), until after the decease of Possibility. A.; and this possibility, like the possibility of obtaining a real estate, was formerly inalienable at law unless by will (f), though capable of assignment in equity (g). But by the act to amend the law of real property (h), How alienable. which repeals an act of the previous session passed for the same purpose (i), it is now provided that an executory and a future interest, and a possibility coupled with an interest, in any tenements or hereditaments of any tenure may be disposed of by deed. B. may, therefore, during the life of A., assign his expectancy by deed; and such assignment will entitle the assignee to the whole term on A.'s decease. If, how (c) See Principles of the Law of Real Property, 249, 2nd ed.; 256, 3rd ed.; 259, 4th ed.; 270, 5th ed.; 284, 6th ed.; 292, 7th ed. (d) Matthew Manning's case, 8 Rep. 95; Lampert's case, 10 Rep. 47. (e) See Principles of the Law W.P.P. of Real Property, 223, 2nd ed.; Ꭱ Life interests in equity. ever, no such assignment should have been made, B. will become, on the decease of A., possessed of the whole term, which will then shift to B. by virtue of the executory bequest in his favour. The mere circumstance, indeed, of the term being bequeathed to A. for his life only, will operate to shift away the term on his decease (j), independently of the bequest to B.; so that, if there had been no bequest over to B., the interest of A. would continue only during his life, and the residue of the term would then remain part of the undisposedof property of the testator. It may, however, be doubted whether the doctrine of executory bequests is applicable in law to any other chattels than chattels real (k). The strict and ancient doctrine of the indivisibility of a chattel, though still retained by the courts of law, has no place in the modern Court of Chancery, which, in administering equity, carries out to the utmost the intentions of the parties. In equity, therefore, under a gift of personal property of any kind to A. for his life, and after his decease to B., A. is merely entitled to a life interest, and B. has, during the life of A., a vested interest in remainder, of which he may dispose at his pleasure, and the Court of Chancery will compel the person to whom the courts of law may have awarded the legal interest to make good the disposition. Accordingly, if the personal property so given should consist of moveable goods, equity will compel A., the owner for life, to furnish and sign an inventory of the goods, and an undertaking to take proper care of them (). This doctrine, however, is comparatively of (j) Eyres v. Faulkland, 1 Salk. 231; Ker v. Lord Dungannon, 1 Dru. & War. 509, 528. (k) Fearne, Cont. Rem. 413. See, however, 1 Jarm. Wills, 793; 747, 2nd ed.; Hoare v. Parker, 2 T. Rep. 376. (1) Fearne, Cont. Rem. 407; Conduitt v. Soane, 1 Coll. 285. Ancient dis tinction be tween a gift of goods and a gift of the use of goods. Articles quæ ipso usu consumuntur. modern date; for formerly the Court of Chancery followed the rules of law in the construction of such gifts; and if a gift of moveable goods had been made to A. for his life, and after his decease to B., they would not have afforded to B. any assistance after A.'s decease (m). But if the gift had been of the use or enjoyment of the goods only to A. for his life, and after his decease to B., the court would then have assisted B. by declaring A.'s representatives after his decease to be trustees only for the benefit of B. (n). But this distinction is now exploded; and the only case in which the tenant for life is now entitled absolutely to things given to him for life is, that of articles quæ ipso usu consumuntur, as wines, &c., a gift of which to a person for his life vests in him the absolute ownership (o). In all other cases, as we have said, modern equity will assist the donee in remainder, to whom any gift of personal estate may be made after the decease of another who is to have them only for his life (p). When, therefore, it is wished to Settlement of make a settlement of any kind of personal property, the personal pro doctrine of the Court of Chancery is at once resorted of trusts. to. The property is assigned to trustees, in trust for A. for his life, and after his decease in trust for B., &c. This assignment to the trustees vests in them the whole legal interest in the property; and in a court of law they are held to be absolutely entitled to it; for the Statute of Uses (q) has no application to any kind of personal estate. But in equity the trustees are compellable to pay the entire income to A. for his life, and after his decease to B., and so on according to the trusts of the settlement; and if B. should alien his interest during the life of A., the trustees will be bound, (m) Fearne, Cont. Rem. 402. (n) Ibid. 404. (0) Randall v. Russell, 3 Meriv. 190; Andrew v. Andrew, 1 Coll. 690. (p) Fearne, Cont. Rem, 406. (g) 27 Hen. VIII. c. 10; Principles of the Law of Real Property, 126, 2nd ed.; 131, 3rd and 4th eds.; 136, 5th ed.; 142, 6th ed.; 146, 7th ed. perty by means Bonus. Apportionment of in come. on having notice of the disposition, to stand possessed of the property, after A.'s decease, in trust for the alienee (r). When shares in joint stock companies are settled in the manner above mentioned, it sometimes becomes a question whether any extraordinary profit which may be divided amongst the shareholders by way of bonus should be considered as capital or as interest. The equitable tenant for life is too frequently inclined to consider himself entitled to any bonus in the same manner as to ordinary dividends. The Court of Chancery, however, usually considers every bonus, whether consisting of additional joint stock or shares (s), or simply of money (t), as part of the capital, unless it appear to be nothing more than an increased dividend arising from the increased profits of the year (u). In the absence, therefore, of any special provision to the contrary, every bonus ought to be invested upon the trusts of the settlement, and the income only paid to the tenant for life. By a modern act of parliament (v), on the decease of a person entitled to a life interest in any income, made payable or coming due at fixed periods, of any property, whether real or personal, his executors or administrators are entitled to recover from the remainderman an apportioned part of the next payment of the income, according to the time which shall have elapsed since the last period of payment, up to and including the day of the (r) A form of marriage settlement of stock and other personal estate upon the usual trusts will be found in Appendix (B). (8) Brander v. Brander, 4 Ves. 800; Hooper v. Rossiter, 13 Price, 774; S. C., M'Cleland, 527. (t) Paris v. Paris, 10 Ves. 185; Ward v. Combe, 7 Sim. 634. See also Gilly v. Burley, 22 Beav. 619, 624, and the cases there collected. (u) Barclay v. Wainewright, 14 Ves. 66; Price v. Anderson, 15 Sim. 473; Preston v. Melville, 16 Sim. 163; Maclaren v. Stainton, 3 De Gex, F. & J. 202. (v) Stat. 4 & 5 Will. IV. c. 22, s. 2; Re Maxwell's Trusts, V. C. W., 9 Jur. N. S. 350; 1 Hem. & Mill. 610. |