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between contingent and non-contingent interests after a particular estate of freehold) is that the language used bears on its face absolutely no suggestion of a reason for the distinction described. One may even read Professor Gray's exposition, which appears to the writer to be one of the most illuminating, and yet come away without the slightest idea of the reason for making the distinction indicated. If the inquirer has any preconceived idea that he is approaching a distinction between contingent and non-contingent interests, he is at the outset warned that this is not so by the hint that 'the word “vested” had originally [that is from the feudal point of view] no reference to the absence of contingency 2.' Then he is brought face to face with the following definition of a vested remainder: 'A remainder is vested in A, when, throughout its continuance, A or A and his heirs have the right to the immediate possession, whenever and however the preceding estates determine?' This formula, it is believed, so far as appears from its face, gives no hint of the rationale of the distinction. The reader may look in vain for an explanation of the reason upon which it is based. It is no excuse to say that the definition is the result of feudal conceptions, for even feudal rules have a reason which can be understood to some extent to-day. It is believed that a greater clearness of ideas can be obtained by a comparatively slight shifting of the point of view. It should be indicated with some emphasis that the distinction developed under the feudal or common law of land, and that the vested remainder is the future interest limited by act of the settlor to a stranger after a particular estate of freehold, which the feudal land law always recognized as valid, while the contingent remainder is precisely the future interest after a particular estate of freehold limited by act of the settlor to a stranger, which the common law at first refused to recognize and afterwards did so only upon particular terms. The moment, then, that it is determined upon what principle the feudal system recognized the validity of one class of future interests and refused recognition of the other, you have the rational principle upon which the distinction between vested and contingent remainders is to be drawn. The distinction, then, between vested and contingent remainders was actually set out when in Part I it was determined what future interests the common law always recognized and what ones it at first refused to recognize, but afterwards accepted upon particular terms. It has only remained in Part II (after distinguishing certain modern and exceptional notions of what remainders are vested and what contingent) to point out that what we have always called vested and

· Rule against Perpetuities, ist and 2nd ed., ss. 100-112.
2 Ibid., 8. 100.

Ibid., S. 101.


contingent remainders correspond exactly to these two classes of interests. This method of exposition has, it is believed, not only given the distinction an historically rational basis for existence, but has resulted in more clearly divorcing the distinction itself from questions of construction and expressing the distinction in terms of a formula as mathematical and certain as the Rule in Shelley's case or the Rule against Perpetuities.



THE desire to render property inalienable by operation of law

must necessarily be as old as the law of execution. But the early efforts of conveyancers in this direction at first met with scant success. It was no doubt a difficult problem so to delimit an estate that the owner might enjoy substantial advantages in it without the possibility of his creditors doing the same. The reports show that the problem was solved by a process of evolution.

The settlement by one person on another until alienation or bankruptcy and then over to some one else, a very old plan, was open to the obvious objection that bankruptcy or alienation entirely put an end to the original beneficiary's interest.

Another ingenious experiment is illustrated by the cases like Graves v. Dolphin (1 Sim. 66; 27 R. R. 166) and Green v. Spicer (1 Russ. & Mylne, 395; 32 R. R. 232). Property was limited for the exclusive personal maintenance and support of the beneficiary, with an express declaration that it was not to be liable to his debts. But the bottom was soon knocked out of this device by the principle that settlors cannot by mere declarations exclude the ordinary incidents and liabilities that the law has attached to property.

In cases of the class of Page v. Way (3 Beav. 20; 52 R. R. 2) and Kearsley v. Woodcock (3 Hare, 185; 64 R. R. 255), the trusts were for the maintenance and support of the bankrupt and his family; and it was held that the bankrupt's interest passed to the assignee. These decisions are generally explained by the absence of a power in the trustees to exclude the bankrupt altogether. The judgments, which are very short, say nothing to that effect; and it cannot be that the Court was merely giving effect to the settlement according to its terms, and allowing the assignee in bankruptcy such interest only as the bankrupt took under the settlement. Because such reasoning overrides the discretionary power in the trustees to give the bankrupt bare maintenance and support—that is an interest which would not pass to his assignee—and to appropriate the balance to his family. It would appear rather that the ViceChancellors looked at the substance of the thing and regarded the trust for the maintenance and support of the bankrupt as a trust for him simpliciter; although no doubt the absence of a power to exclude bim helped them to take this view of the instrument. At



any rate they made short work of the trustees' discretion, and in practically all cases gave the bankrupt's aliquot share to the assignee, and sometimes even the whole fund, subject only to the maintenance of the bankrupt's family.

But in the year 1840, the case of Twopeny v. Peyton (10 Simons, 487; 51 R. R. 301) was decided by Shadwell V.-C. A lady had bequeathed to her trustees the income of certain funds upon trust to apply the whole or such part thereof at such time or times in such proportion and in such manner for the maintenance and support of her nephew Peyton, as her executors in their discretion should think most expedient. Peyton was a person of weak intellect, and at the date of the bequest was also bankrupt. The assignee claimed his interest; but Shadwell V.-C., impelled perhaps by that sympathy which must ever temper the administration of human justice, held that the moneys were not applicable for the benefit of the nephew generally, but merely for his maintenance and support, and that the assignee could claim nothing thereunder.

Two years later Shadwell V.-C. followed a similar course of reasoning in Godden v. Crowhurst (10 Simons, 642; 51 R. R. 332), a case where the bankrupt was not the sole object of the discretionary trust. And it would appear that these two cases are the foundation upon which the modern protected life estate has been built: Mr. Davidson (Davidson's Precedents, vol. iii, pt. 1, p. 125 note) considered these cases had probably gone too far against the assignee, and they were virtually overruled in Younghusband v. Gisborne (1 Coll. 400; 66 R. R. 120). But the reports since show a chain of judicial decisions, which, if they do not always uphold the protected life estate, make it tolerably certain that, with properly framed limitations, most creditors will not think it worth while to challenge their validity.

For the nature of a beneficiary's right under these trusts is so shadowy, that there is nothing that an assignee or trustee in bankruptcy can take.

As Cotton L.J. said in Re Coleman (39 Ch. D. 451), “If the trustees were to pay an hotel keeper to give him a dinner he would get nothing but the right to eat a dinner, and that is not property which could pass by assignment or bankruptcy.' And so, no doubt, if a trustee arranged with an hotel keeper for the board and lodging of a named beneficiary for a year, no one else could step into the beneficiary's shoes. The hotel keeper might rightly say, No, I contracted to board and lodge A B, I ain not going to take X Y.' So that a bankrupt might be living in the lap of luxury such trusts. And inasmuch as it is really for the benefit of the bankrupt alone that the trustee of the settlement is given any discretion in the matter at all, so that even the trustees' discretionary powers may be said to form part of the bankrupt's beneficial interest, creditors may well feel that such a construction is narrow and artificial, and that, looked at broadly, these trusts confer valuable rights of property, which are on a different footing to personal earnings, and which might, without injustice to the settlor, be held to confer on the trustee in bankruptcy a right to an apportioned part of the trust income.

' while his creditors perforce content themselves with hopes of dividends. This is the inevitable result of a literal construction of

However, the Courts at present are not prepared to go that length, and, meanwhile, the full possibilities of such settlements do not seem to have reached the limits to which they might logically be carried. There is, of course, always the danger that the Courts might at this eleventh hour revolt from these schemes to defeat creditors and hold them void as frauds on the law. But it would appear at present logically possible, as a corollary upon the accepted form of protected life estate, for several persons to unite in a settlement which would for practical purposes place their property out of the reach of process of execution, and at the same time would reserve to them a substantial measure of dominion thereover.

The few guiding principles to be borne in mind in framing such a settlement are: (a) that a man cannot take an interest terminable on bankruptcy in his own property: Higinbotham v. Holme (19 Ves. 88; 12 R. R. 146); () but he can take such an interest in property settled by some one else : Lockyer v. Sarage (2 Stra. 947); and (c) a man can settle property upon trustees upon trust to apply tho proceeds for the maintenance and support of one or more persons of a group comprising himself: Holmes v. Penney (3 K. & J. 103). But there must be a clear power to exclude the bankrupt. And lastly, (d) these qualifications can only be attached to life interests and reversions, as they are repugnant to absolute interests in possession, Re Dugdale (38 Ch. D. 176).

Without going outside these limits, it seems possible to enlarge the sphere of utility for these protected life estates by a scheme on the following lines :

Four persons, A, B, C and D, having £1,000 each, desire to place it as far as possible out of the reach of creditors.

So A settles his £1,000 upon B and C as trustees, with the usual discretionary trusts in favour of such one or both of A and D as the trustees shall agree upon,' any part of the income as to the application of which they cannot agree to be paid absolutely to another person X. B settles his £1,000 on C and D with similar trusts in favour of

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