M'Ardle v Gaughran

• Jurisdiction: Ireland
• Judgment Date: 01 May 1902
• Date: 01 May 1902
• Court: Chancery Division (Ireland)

M'Ardle

and

Gaughran.

M. R.

(1900. No. 14.)

CASES

DETERMINED BY

THE CHANCERY DIVISION

OF

THE HIGH COURT OF JUSTICE IN IRELAND.

AND BY

THE IRISH LAND COMMISSION,

AND ON APPEAL THEREFROM IN

THE COURT OF APPEAL.

1903.

Limitations, Statute of — Trust, express or constructive — Receipt of trust fund — Husband and wife — Trust for separate use — Fiduciary relation — Agency — Breach of trust — Accounting party — Rate of interest chargeable — Trustee Act, 1888 (51 & 52 Vict. c. 59), s.8.

The wife of O. was entitled, under the will of her mother M., to a life interest for her separate use in a certain business and trade assets, with remainder on her death (in the events which happened) to the persons who would be beneficially entitled to her personal estate if she had died intestate and unmarried. The business and trade assets were vested in trustees under the will of M., and with their consent O. carried on the business for his wife as manager. The wife died in 1890. From 1890 till his death, in 1899, O. remained in possession, and dealt with the business and trade assets as if they were his own. He had full notice and knowledge of the trusts of the will of M. By his own will he left a legacy and a share of the residue of his estate to each of the persons who would have been sole next-of-kin of his wife, if she had died unmarried and intestate, coupled with a condition that each of them should execute a release of all claims he or she might have against the assets of M. under the provisions of her will:—

Held, that 0. having retained possession of the business and trade assets after his wife's death, with full knowledge of the trust attaching thereto, and having dealt with the property as if it were his own, his estate was liable to the estate of M. without regard to lapse of time or the Statute of Limitations.

Held also, that, in exercise of the discretion of the Court, and under the circumstances of the case, four per cent. per annum should be allowed as the rate of interest chargeable against the estate of 0. from his wife's death till his own death, in respect of the amount invested in or represented by the furniture on the business premises and the stock-in-trade, and debts due to the business.

Further Consideration.

By her will, dated the 29th March, 1848, Mary Dougherty devised and bequeathed all her real and personal property to trustees upon trust (alter payment of two legacies) to raise and set apart out of her property the sum of £1000, and to invest and hold same on certain trusts as therein provided, and to hold all the rest, residue, and remainder of the property of the testatrix, exclusive of the two legacies previously mentioned and the sum of £1000, and inclusive of the stock-in-trade, debts, furniture, goods, and chattels owing or belonging to the testatrix at the time of her death, in trust for her daughter Maria O'Ferrall during her life for her separate use, and to allow her to carry on the trade in which the testatrix was at the date of her will or at the time of her death engaged, and to receive the profits thereof, and to manage, sell, order, and dispose of the premises and property, which for the time being should be engaged in the said trade, in all respects as if she were unmarried, and after her decease then in trust for such child or children of the present or any future marriage as appointed by Maria O'Ferrall, and in default of such appointment and subject thereto in trust for such child or children who should attain twenty-one or marry with consent, and if more than one in equal shares as tenants in common, and in case there should be no such child, then in trust for such uses, intents, and purposes as Maria O'Ferrall should by deed or will appoint, and subject thereto in trust for such person or persons as would be beneficially entitled in case Maria O'Ferrall had died sole and unmarried and intestate. The will directed that the trustees should procure to be done and carried on by the present or any future husband of Maria O'Ferrall, at the cost of the trust estates, all acts, deeds, matters, and things, etc., necessary to assure and secure the trust premises so that same should be at all times held and enjoyed according to the trusts thereof, and the will authorized the indemnifying of the husband of Maria O'Ferrall in respect of any expenses or losses he might incur in respect hereof.

Mary Dougherty carried on business as a grocer and spirit merchant in licensed premises in Kells. She died on the 18th December, 1857, and her will was duly proved. Her daughter Maria had married James O'Ferrall in 1845, and a settlement was executed on the marriage. On the death of Mary Dougherty James and Maria O'Ferrall entered into possession of the licensed premises in Kells previously occupied by the deceased, and carried on the business.

By deed, dated the 23rd May, 1868, made between James O'Ferrall of the first part, Maria O'Ferrall of the second part, the Rev. Patrick Kelly of the third part, and the Rev. Michael Fitzsimons of the fourth part, the Rev. Michael Fitzsimons was appointed a trustee of the will of Mary Dougherty in the place of the Rev. Michael Geoghegan. The deed, after reciting the will of Mary Dougherty, contained this recital:—“And whereas by and with the permission of the said trustees” (that is the trustees of Mary Dougherty's will] “the said Maria O'Ferrall took possession of the stock-in-trade, furniture, and goods and chattels of the said testatrix at the time of her death in and upon the house and premises in the town of Kells in pursuance of the trusts and directions of the said will, and the said Maria O'Ferrall has ever since by and with the advice and assistance of her...