Royal Bank of Ireland and Others v Brooke-Alder and Others

• Jurisdiction: Ireland
• Judgment Date: 01 January 1954
• Date: 01 January 1954
• Docket Number: (1952. No. 139.)
• Court: High Court

(1952. No. 139.)

In re Cochrane, Deceased; Royal Bank of Ireland and Others v.

In the Matter of the Estate of SIR STANLEY HERBERT COCHRANE, Deceased, and In theMatter of the Trusts of his Will, dated the 28th October, 1946, and two Codicils thereto, dated respectively the 9th June, 1947, and the 4th March, 1949. Between THE ROYAL BANK OF IRELAND LIMITED, ROBERT NESBITT KELLER and PERCIVAL HUGH BROWNE, Plaintiffs, and BRIAN BROOKE-ALDER, SARA ELIZABETH GRAHAME DAY, WINIFRED MARGARET COCHRANE, MARGARET (PEGGY) COCHRANE, ELIZABETH MARGARET STEEN, MICHAEL DAVID COCHRANE ELSWORTH STEEN, an infant, by Robert Elsworth Steen, his father and guardian ad litem, and DESMOND ORIEL ALISTAIR GEORGE WESTON COCHRANE

Defendants.

Will - Construction - Priority of annuities - Whether annuities charged on corpus - Continuing charge on income - Annuities "free of income tax"- Whether annuitants obliged to account to testator's estate for refunds of income tax - Income Tax Act, 1918 (8 & 9 Geo. 5, c. 40), ss. 16, 29; All Schedules Rules, rr. 19, 21, 23.

Construction Summons.

By his will, dated the 28th October, 1946, Sir Stanley Herbert Cochrane, the testator, appointed the plaintiffs and the defendant, Sara Elizabeth Grahame Day, to be executors and trustees thereof and, after certain directions and specific devises and bequests, by clause 4 thereof devised and bequeathed all his real and personal estate not otherwise devised or bequeathed by him (therein and hereinafter called his Trust Estate) to his trustees upon trust for sale and conversion with the fullest power and discretion to postpone the sale and conversion of the whole or any part of his said estate, and the testator then declared that no dividends or other income received by his trustees after his death should be apportioned but that they should be treated as income of his estate arising after his death. By clause 5 of his will the testator declared that his trustees should out of the moneys arising out of the sale and conversion of his residuary estate pay his funeral and testamentary expenses and debts and the legacies by his will or any codicil thereto bequeathed and the death duties properly payable thereout and should invest the residue of such moneys in the investments thereby authorised and should hold any investments and the income thereof upon trust to pay out of the income thereof to the defendant, Brian Brooke-Alder, during his life an annuity of £1,500, free of tax at the standard rate in force for the time being in Éire éire, such annuity to commence from his death and to be payable quarterly in advance. Out of the balance of the income of his Trust Estate after payment of the above annuity the testator directed his trustees to pay to his sister, Sara Elizabeth Grahame Day, during her life an annuity of £1,000, subject to deduction for income tax, such annuity to commence from his death and to be payable by equal half-yearly payments, and, as to the balance, if any, of the income of his Trust Estate after payment of the annuities and all arrears thereof to divide the same during the joint lives of the annuitants in the proportions of two-thirds to Brian Brooke-Alder and one-third to Sara E. G. Day. The testator then declared that in the event of the death of Sara E. G. Day during the life of Brian Brooke-Alder the annuity given to the latter should be increased as from the death of the former to £2,000, free of tax at the standard rate in force for the time being in Éire éire,and, subject to the annuities the testator directed his trustees to hold his Trust Estate, both as regards capital and income, upon trust for the defendant, Elizabeth Margaret Steen, during her lifetime and on her death for her son, the defendant, Michael David Cochrane Elsworth Steen, absolutely.

By a codicil, dated the 9th June, 1947, the testator, after reciting the devise and bequest of his Trust Estate to his trustees and after reciting his desire to make provision thereout for his cousin, William Lindley Bloomer Cochrane, devised and bequeathed the house and premises known as Corke Lodge to his trustees to the use of his cousin during his life but to take effect only in the event of his being obliged for any reason to leave his then quarters at Woodbrook and directed that subject thereto the house and premises should remain subject to the trusts declared by the said will regarding the Trust Estate, and as a further provision for William L. B. Cochrane the testator declared that his Trust Estate should be subject to the payment by his trustees out of the income thereof to the said William L. B. Cochrane during his life of an annuity of £180 per annum, free of income tax at the standard rate in force for the time being in Éire éire,such annuity to commence on his death and to be payable monthly in advance.

By a second codicil, dated the 4th March, 1949, the testator revoked the appointment of Sara E. G. Day as one of his executors and trustees. The testator then referred to the fact that he was then contemplating in conjunction with his brother, Sir Ernest Cecil Cochrane, releasing their life interests in his residence at Woodbrook to his nephew, Desmond O. A. G. W. Cochrane, and as protector of the settlement joining with him in the disentailment of the said property so as to accelerate his succession thereto and declared that if such intentions should materialise certain directions and dispositions contained in clause 2 of the said will would no longer be applicable and might be disregarded. As regards the further provision for William L. B. Cochrane the testator expressed the desire to make provision of a similar kind for his wife, the defendant, Winifred Margaret Cochrane, should she survive him and for his daughter, the defendant, Margaret (Peggy) Cochrane, should she survive her father and mother. Accordingly, the testator declared that his Trust Estate should be subject to the payment by his trustees out of the income thereof to Winifred Margaret Cochrane should she survive William L. B. Cochrane during her life of an annuity of £180 per annum, free of tax at the standard rate in force for the time being in Éire éire, such annuity to commence from the death of William L. B. Cochrane, and the testator further declared that his Trust Estate should be subject to the payment by his trustees out of such income to his cousin's daughter, Margaret (Peggy) Cochrane, during her life of an annuity of £180 per annum, also to be free of tax at the standard rate in force for the time being in Éire éire, such annuity to commence from the death of the survivor of his said cousin and his wife. The testator then recited the provisions of clause 5 of his will whereby he gave the annuity of £1,500 to Brian Brooke-Alder and the annuity of £1,000 to his sister, Sara E. G. Day, and directed that the annuity of £1,500 to be paid to Brian Brooke-Alder should be increased to £2,000 and that the annuity of £1,000 payable to his sister should be reduced to £500, both annuities to be free of tax at the standard rate in force for the time being in Éire éire, and, as to the balance, if any, of the income of his Trust Estate after payment of the annuities and all arrears thereof, the testator directed that the same should be paid to Brian Brooke-Alder instead of being divided as provided in the will and, further, that in the event of the death of his sister during the lifetime of Brian Brooke-Alder the entire income of his Trust Estate (subject to any other payment by his will or any codicil thereto directed to be made thereout) should be paid to Brian Brooke-Alder during his life. The testator then, having recited that he was entitled to part of the lands of Corke Little, including the house thereon known as Corke Lodge, adjoining Woodbrook, and that he was contemplating disposing of portion of such lands and acquiring in exchange another portion of the same, declared that if he should die possessed of the said property known as Corke Lodge and any portion of the Townland of Corke Little his trustees should be at liberty to offer the same for sale to his nephew, Desmond O. A. G. W. Cochrane, and sell the same to him at such price as they might be advised was a reasonable price having regard to the then market value on such terms as regards payment of such price as they in their discretion should think fit. The testator also declared that, failing such purchase by his nephew, his trustees should retain the said lands and premises so long as they should consider advisable having regard to the trusts of his said will and codicils so that the full income, or so much thereof as might be considered necessary, should be available for the purpose of giving effect to such trusts, and he further declared that clause 4 of his will should be deemed to be modified in so far as it might be inconsistent with the foregoing provisions. The testator also declared that his trustees should hold his Trust Estate, both as regards capital and income, subject to the prior trusts declared by him in respect thereof upon trust as to the said lands and premises known as Corke Little and Corke Lodge, or the proceeds thereof if purchased by his nephew as aforesaid, for his said nephew absolutely with a substitutional gift if his nephew should predecease him. He authorised his trustees during such period as the lands of Corke Little and Corke Lodge should form part of his Trust Estate to let or lease the same to the best advantage to his nephew or such part or parts thereof as he might desire to occupy and use and that any of such lands and premises as his nephew should not desire to become tenant of should at the discretion of his trustees be cultivated or let by his trustees as they might be advised. As to the residue and remainder of his Trust Estate, the testator directed that the same should be held upon trust for Elizabeth Margaret Steen, and, after her death, for her son, Michael D. C. E. Steen, absolutely...