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Arunachala Udayan v. Pachayammal
Summary of Opinion: Construction of Settlement Deed Clause (Ex. A, 6 August 1914)
Factual and Procedural Background
This opinion concerns the construction of a clause in a settlement deed (Ex. A) dated 6 August 1914. The relevant clause, in literal translation, provided that the settlor's "second daughter's son Swaminathan on his attaining majority shall enjoy with absolute rights enabling him to make gifts, sell, etc., the house, house-site, etc., nanja, punja lands mentioned in Sch. B."
At the time of the settlement Swaminathan was a minor (aged 13 as stated in the preamble). Swaminathan died before attaining majority. His father (the plaintiff) brought a suit to recover the property settled on Swaminathan, asserting that Swaminathan had acquired a vested interest and that, as Swaminathan's heir, the plaintiff was entitled to that property.
The Subordinate Judge held that Swaminathan had acquired a vested interest and decreed the plaintiff's suit. On appeal the learned District Judge held that Swaminathan had only a contingent interest that would arise only on attaining majority, and because Swaminathan died before attaining majority the settlement in his favour did not take effect; the District Judge therefore dismissed the plaintiff's suit.
This opinion arises from the further appeal challenging the District Judge's construction of the settlement clause and asking whether Swaminathan's interest was vested (capable of transmission to his heir) or merely contingent upon attaining majority.
Legal Issues Presented
- Whether, on the proper construction of the clause in Ex. A, Swaminathan took a vested interest in the B schedule properties (such that his heir could claim on his death), or only a contingent interest which would arise only upon his attaining majority.
- Whether the language used (including the Tamil word translated to "shall enjoy") indicates present vesting as opposed to future contingent entitlement.
- Whether the settlement falls within the exception to Section 21 of the Transfer of Property Act (i.e., whether any direction for part of the income being given during minority brings the settlement within that exception).
- The consequences for the management of the charitable (C schedule) properties where Swaminathan died and no provision was made for his heirs to conduct the charity.
Arguments of the Parties
Appellant's Arguments
- The appellant (plaintiff below) contended that Swaminathan acquired a vested interest in the B schedule properties under Ex. A, and that as his heir the appellant was entitled to succeed to that property after Swaminathan's death.
- It was argued that the Tamil word used in the clause means that the minor "shall enjoy" the properties (indicating present vesting and future enjoyment), rather than "become entitled" only on a future event (attaining majority).
- Reference was made to the tenor of the whole document (including the preamble and Clause 5), which shows the settlor intended to divide property between the surviving daughter and the grandson and to hand over possession of B schedule property to the grandson through his guardian (Karuppanna Udayar).
- Mr. Subramania Aiyar (for a party) raised a contention that Swaminathan had been given a portion of the income and that, therefore, the settlement might fall within the exception to Section 21 of the Transfer of Property Act.
Respondent's Arguments
- The respondent contended that Swaminathan would become entitled to the property only upon attaining majority; because he died before attaining majority, his heir was not entitled to the property (i.e., the interest was contingent).
- The respondent relied on English authority In re Francis, Francis v. Francis to support the contention that a devise on attainment of a specified age creates a contingent bequest.
- Mr. Varadachariar (for the respondent) also suggested that if the appeal succeeded, certain modifications should be made in the decree because not all of the property mentioned in the B schedule had been properly decreed; he asked that the Subordinate Judge's decree be restored but with omissions of shares excluded in Ex. B.
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| Harris v. Brown | That vesting of an estate in a son was not suspended by a direction that the estate remain in the hands of an executor who should "make over" the share on attaining majority; such words point only to possession/enjoyment, not to postponement of vesting. | The court relied on this authority to support the proposition that directions as to possession or to an executor holding and making over do not of themselves prevent prior vesting of the beneficial interest. |
| K. Subramaniam Chetti v. T. Subramaniam Chetti | That executors (or certain beneficiaries) had a vested interest in property and their heirs were entitled where the will treated their interest as vested. | The court cited this case as an example where a purported fiduciary holding or direction did not defeat vesting, supporting the conclusion that a beneficiary may have a vested interest despite directions about management. |
| Cally Nath Naugh Chowdhry v. Chunder Nath Naugh Chowdhry | Referenced in connection with decisions interpreting vesting in wills/settlements. | The court cited it as an additional authority (see also) in the context of vesting principles; no detailed application beyond citation was made in the opinion. |
| In re Francis, Francis v. Francis | Illustrates an English decision where devises "when she shall attain the age of 26" were held to create contingent bequests. | The court considered and distinguished this case, holding it inapplicable because the language and context of Ex. A could not be interpreted to mean Swaminathan was to get the property only upon attaining majority. |
| Pearson v. Dolman | Authorities relied upon in relation to the exception to Section 21 of the Transfer of Property Act where a direction to give a portion of income to a legatee is relevant. | The court noted the case but held it unnecessary to consider its applicability because Ex. A contained no direction for giving whole or any portion of the income specifically for Swaminathan's maintenance during minority. |
| In re Holt's Estate, Balding v. Stringell | Another authority cited in connection with the principle concerning income payments and Section 21 exceptions. | The court referenced the authority but did not consider it in detail because it found Ex. A did not contain the income-directed provision that would engage the exception. |
Court's Reasoning and Analysis
The court's analysis proceeded from textual construction of Ex. A and from the document as a whole, with attention to language, context and the cultural background relevant to Hindu settlements and wills.
Key steps in the reasoning were:
- Textual and contextual interpretation: The court treated the tenor of the entire document (preamble, clauses and paragraph 5) as material to construction. The preamble explicitly stated there were no male heirs, that there were two daughters (one deceased) and that the deceased daughter's minor son Swaminathan (aged 13) was entitled to share in the properties according to law.
- Language and translation: The court focused on the particular Tamil word used in the clause concerning Swaminathan. It held that the word's force is that the minor "shall enjoy" the properties rather than that he would "become entitled" to them only on the happening of a future event (majority). The court contrasted the word actually used with other words that would more naturally indicate a contingent future entitlement.
- Cultural and customary considerations: The court emphasised that, in construing Hindu wills and settlements, one must have regard to the habits, customs and sentiments of the people. It observed a strong cultural prejudice against imagining that a beneficiary (especially a son or grandson) would die before enjoying the property. The court reasoned that settlors and their advisers in the mofussil commonly did not contemplate devising over on the contingency of a beneficiary predeceasing the vesting event.
- Documentary evidence of possession and intent: Clause 5 (paragraph 5) delivered A schedule to Pachayammal and delivered B schedule properties to Karuppanna Udayar "on behalf of the minor Swaminathan," with clear language that they "should enjoy the whole of the properties as stated above" and with directions about payments for the settlor's maintenance out of the income. The court read this as indicating that possession of the B schedule properties had been handed over to the minor through his guardian, showing an intention to vest the interest in the minor.
- Distinguishing contrary authorities: The court considered In re Francis (an English decision holding a devise upon attainment of age to be contingent) but found it inapplicable because Ex. A's words could not be interpreted to create a contingent interest pending majority. The court relied on Harris v. Brown and other cited authorities to support the view that directions about possession or to an executor/guardian do not necessarily postpone vesting.
- Section 21 argument: The court addressed the contention that the settlement might fall within an exception to Section 21 of the Transfer of Property Act because of an alleged gift of income to the minor during minority. The court found no direction in Ex. A to give the whole or any portion of the income specifically for Swaminathan's maintenance during minority; consequently it was unnecessary to apply or analyse the authorities relied upon for that contention (Pearson v. Dolman; In re Holt's Estate, Balding v. Stringell).
- Charitable properties: The court noted that Clause 3 related to the management of charities. Because Swaminathan died and Ex. A contained no provision for his heirs to conduct the charity, the plaintiff was not entitled to succeed with respect to the charity properties.
Holding and Implications
Holding: The court held that Swaminathan took a vested interest in the B schedule properties under Ex. A. The appeal was allowed; the decree of the District Judge (which had dismissed the plaintiff's suit) was set aside, and the decree of the Subordinate Judge (which had decreed the property to the plaintiff) was restored subject to the modifications noted in the opinion (omitting such shares as were excluded in Ex. B). The appellant was entitled to costs in this Court and in the lower appellate Court.
Implications:
- The direct effect is that the plaintiff (Swaminathan's heir) succeeds in recovering the vested interest in the B schedule properties as decreed by the Subordinate Judge, with the specified modifications excluding certain shares as mentioned in Ex. B.
- The plaintiff does not succeed with respect to the management of the charity properties (Clause 3/C schedule) because Ex. A provided no mechanism for Swaminathan's heirs to conduct the charity after his death.
- The court did not make or purport to lay down a novel rule of precedent beyond applying established principles of construction for wills and settlements, and it expressly distinguished relevant English authority that was relied upon by the respondent. The opinion confines itself to construing the specific language, context and cultural considerations present in Ex. A.
Result: Appeal allowed. Subordinate Judge's decree restored with specified modifications; appellant awarded costs.
The main question in this appeal is as to the construction of a clause in a settlement deed, Ex. A, dated 6th August, 1914. The literal translation of the clause is “My second daughter's son Swaminathan on his attaining majority shall enjoy with absolute rights enabling him to make gifts, sell, etc., the house, house-site, etc., nanja, punja lands mentioned in Sch. B.” Swaminathan died before attaining majority and his father had brought this suit for the recovery of the property settled on him inasmuch as be had a vested interest in the property and that he being the heir of his son is entitled to it. The Subordinate Judge held that Swaminathan had acquired a vested interest in the property and decreed the plaintiff's suit. On appeal the teamed District Judge held that Swaminathan had only a contingent interest and as he died before he came of age the settlement in his favour did not take effect and dismissed the plaintiff's suit.
In construing this clause the tenor of the whole document has to be taken into consideration. In the preamble of the document the following clause occurs:
“I have no male heirs. I had two daughters, namely Pachayammal and Puval. Of these Fuval is dead. She has a minor son aged 13 years, named Swaminathan. These two are entitled to get my properties according to law. In order that they may obtain them and live happily and for my benefit in the other world I have made the following arrangments.”
Cl.1 is:
“Pachayammal and her heirs from this day shall enjoy with absolute rights and powers of alienation by gift…………………….the nanja and punja lands described in Sch. A.”
Then the second clause relating to Swaminathan immediately follows Cl. 1 in favour of Pachayammal.
The third clause provides for the management of some charities.
The fifth clause reads as follows:—
“I have this day delivered the A schedule properties to Pachayammal, the B schedule properties to Karuppanna Udayar, Pachayammal's husband and my son-in-law on behalf of the minor Swaminathan and the C schedule properties for the charities to Pachayammal and Karuppanna Udayar for the minor. They should enjoy the whole of the properties as stated above and Pachayammal and her heirs and Karuppanna Udayar as guardian of minor Swaminathan should give us for our maintenance 10 kalams of paddy and Rs. 20 in cash every year out of the income of lands after deducting the sirkar kist, etc.”
From the nature of the document it is dear that the settlor wanted to divide the properties between Pachayammal the surviving daughter and the son of the predeceased daughter. In the case of Pachayammal possession was handed over from the date of the document and in the case of Swaminathan the minor grandson possession was postponed till he attained majority.
The contention on behalf of the respondent is that Swaminathan was to become entitled to the property settled on him only on his attaining majority and he having died before attaining majority his heir is not entitled to it. In the document itself there is nothing to indicate that the intention of the settlor was that Swaminathan should have a vested interest only on his attaining majority. In this connection we have to consider what the force of the Tamil word used in the document is. The word used is “.” The nominative of this is ‘the minor son.’ The word means that the minor son shall enjoy (the properties) and not shall become entitled (to it). The word that is commonly used to denote it is “inherit” or “become entitled to.” If the settlor intended that Swaminathan should be entitled to the property only on his attaining majority then the word “” would not have been used but the word “” or some other words which would indicate that he was to become entitled tothe property on the happening of a certain event; whether majority or anything else would have been used. In construing the clause of a Hindu will or settlement the Court should not overlook the habits, customs and prejudices of the people and the motives and reasons which influence them in making bequests or settlements. No Hindu would contemplate with equanimity the death of his grandson when he makes a bequest or settlement in his favour. He would be shocked at the very idea of his son or grandson dying without enjoying the property. There is a strong prejudice against the contemplation of the contingency of a beneficiary whether son or grandson or daughter or grand-daughter dying in the life-time of the settlor or dying before he or she takes the benefit under a settlement. In this case the settlor could not have possibly imagined that Swaminathan would die before attaining majority as the very idea of his son or grandson dying before he gets the benefit under a document is repugnant to Hindu sentiment. No Hindu would ordinarily make a bequest over in case the legatee dies before a certain thing happens. In construing Hindu settlements and wills we should not apply wholesale all those considerations which would apply to the construction of English wills or wills drawn up by Attorneys or Yakils. Where a settlement in made in the mofussil the document generally drawn up by a karnam or village lawyer the idea of a gift failing and the necessity for providing for a gift over in case of such failure very seldom enters into the mind of the settlor or the persons who advise him. As I have said above it would be considered very inauspicious to imagine that a legatee might not get the benefit of the legacy and this consideration applies with greater force to a settlement by a person who wants to benefit his daughter and grandson.
The intention of the settlor can be gathered from paragraph 5 of the document. Thereby he hands over A schedule properties to his daughter Pachayammal and B schedule properties are delivered to karuppanna Udayar On behalf of the minor. It is therefore clear that possession of the properties was banded over to the minor Swaminathan through Karuppanna Udayar. The recital in paragraph 5
“They should enjoy the whole of the properties as stated above, and Pachayammal and her heirs and Karuppanna Udayar as guardian of minor Swaminathan should give us for our maintenance 10 kalams of paddy and Rs. 20 in cash every year out of the income of the lands left after deducting sirkar kist etc,”
makes it quite clear that the intention of the settlor was to vest the property in the minor. On a careful reading of the document, Ex. A, it is clear to my mind that the settlor handed over the property to Karuppanna Udayar on behalf of the minor and Cl. 2 refers only to the enjoyment and not to the vesting of the property.
I therefore hold that Swaminathan took a vested interest in the property in Sch. B as the terms of Ex. A are clear. It is unnecessary to consider in detail all the cases relied on by the appellant and respondent. In Harris v. Brown(1) a testator by his will provided:
“That all his residuary estate shall descend in equal shares to the eldest son to be born to each of the daughters of my late brother who are now alive. The sons of those daughters shall, after their birth, remain under the control of the executor until they attain majority at the expiry of 21 years of age, and whenever the eldest son of any of the ladies shall attain majority the executor will make over his share to him to his satisfaction. By Cl. 15 of the will the testator declared that until the majority of whoever may be the eldest at the time amongst the sons of my brothers' daughters, the estate shall remain in the hands of the executor absolutely for all purposes.”
The Privy Council held that the vesting of the estate in the son was not suspended by the direction that the estate should remain in the hands of the executor who should ‘make over the share’ of each on his attaining 21 years. Those words merely pointed to the possession and enjoyment of the shares which had already been vested.
In K. Subramaniam Chetti v. T. Subramaniam Chetti(2) a Hindu testator appointed executors to conduct his affairs and directed them to pay during the life-time of his junior widow a monthly payment for life and after the death of the junior wife, the executors were directed to divide the property in equal shares between them and continue to enjoy the same in equal shares. The executors died during the life-time of the junior wife. It was held that the executors had a vested interest in the property and that their heirs were entitled to the property. See also Cally Nath Naugh Chowdhry v. Chunder Nath Naugh Chowdhry.
Mr. Varadachariar for the respondent relies upon In re Francis, Francis v. Francis as supporting his contention. In that case the “testator devised two specified freehold houses to his niece Hilda when she shall attain the age of 26 years, with similar devises of other freehold houses to another niece and nephew. Mr. Justice Swinfen Eady, held that it was a contingent bequest. That case has no application to the present case as the words in Ex. A cannot be interpreted to mean that minor Swaminathan was to get the property on his attaining majority. In an English will the words generally used are “I bequeath or devise such and such a property to so and so on his attaining majority or when he attains 25 years of age.” In In re Francis, Francis., v. Francis as observed by the learned Judge:
“There is nothing to control the effect of the words of the contingency.
Here as observed already Cl. 5 makes it quite clear what the intention of the testator was.
Mr. Subramania Aiyar raises the contention that Swaminathan was given a portion of the income and therefore the settlement came within the exception to Sect. 21 of the Transfer of Property Act. In the settlement there is no direction for the whole or any portion of the income being given for the maintenance of Swaminathan during his minority and therefore it is unnecessary to consider the cases relied upon by him, Pearson v. Dolman(3) and In re Holt's Estate, Balding v. Stringell(4). Where any portion of the income is given to the legatee no doubt the principle of exception to Sect. 21 would apply. It is unnecessary in the view I have taken to consider the effect of Ex. IV and it is not contended for the respondent that the settlor had a right to make a fresh settlement.
Cl. 3 of the will relates to the management of charities Swaminathan having died and there being no provision in Ex. A for his heirs conducting the charity the plaintiff is not entitled to succeed so far as the management of the charity properties are concerned.
Mr. Varadachariar suggested that in case the appeal is allowed certain modifications should be made in the decree inasmuch as all the property mentioned in B schedule was decreed to the plaintiff by the 1st Court. The decree of the Subordinate Judge will be restored by omitting such shares of his property as have been excluded in Ex. B.
In the result the appeal is allowed and the decree of the District Judge is set aside and that of the Subordinate Judge restored with the modifications mentioned above. The appellant will be entitled to his costs in this Court and in the lower appellate Court.
K.V.SAppeal allowed.
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