The Gazette 1918-19

FEBRUARY, 1919.]

The Gazette of the Incorporated Law Society of Ireland.

51

Judges.— The Right Hon. Lord Justice' O'Connor, and the Right Hon. Mr. Justice Ross. Registrars. —Mr. J. J. McDonald, Solicitor, 116 Grafton Street, Dublin ; Major Ronald D. Ross, Oatlands, Stillorgan, Co. Dublin. Recent Legal Decisions Bonus Dividends on Stocks and Shares— Capital or Income—Rights of Tenant for Life and Remainderman. Questions of some difficulty not in frequently arise where settled property consists of stocks or shares, and the company in which the investment is made declares a bonus dividend in the form of new shares allotted proportionately to the holding in the company. Is the tenant for life entitled to the bonus as income, or are the new shares to be held by the trustees as capital ? A recent case, Ogilvie v. Ogilvie (35 T. L. R., 218), will repay perusal. The leading authority on the subject is Bouch v. Sproule (1887), 12 A. C., 385. In his judgment Lord Herschell, at p. 397, says :—" The general " principle for the determination of such a " question and in my opinion the only sound " principle is that which is well expressed in " the judgment of Lord Justice Fry. Where " a testator or settlor directs or permits the " subject of his disposition to remain as " shares or stocks in a company which has " the power either of distributing its profits " as dividend or of converting them into " capital, and the company validly exercises " this power, such exercise of its power is " binding on all persons interested under the " testator or settlor in his shares, and " consequently what is paid by the company " as dividend, goes to the tenant for life, and " what is paid by the company to the share- " holder as capital or appropriated as an " increase of capital stock in the concern " enures to the benefit of all who are " interested in the capital." Bequest of Moneys in Bank. It has been decided that a bequest of " all my moneys at the Bank " passes not only the money to credit at current account but money on deposit receipt. Usually in this country money on deposit receipt is payable on

demand, but when the amount is generally inserted entitling the bank to seven days' notice of withdrawal. Re Glendenning: Steel v. Glendenning (63 Sol. I., 156), decides there is no difference in principle in the nature of a deposit receipt requiring notice of withdrawal and a notice not requiring such notice, and that both pass on a bequest of " all moneys at bank." Double Portions. The doctrine of double portions laid down by Lord Eldon in the leading case, Ex parte Pye (White & Tudor, Leading Cases, 8th edition, Vol. II., 373), is that "Where a " parent gives a legacy to a child, not " stating the purpose with reference to which " he gives it, the Court understands him as " giving a portion, and by a sort of artificial " rule upon an artificial notion that the father " is paying a debt of nature, and a sort of " feeling upon what is called a leaning against " double portions, if the father advances a " portion on the marriage of that child, " though of less amount, it is a satisfaction " of the whole or in part." The rule is applicable where a testator has placed himself in loco parentis to the beneficiary. A recent case of interest on the subject is Re Dawson: Swanson v. Dawson, 1919, 1 Ch. D., 102. Shortly the facts were, that the testator divided the residue of his estate into five parts, three parts he bequeathed to his three unmarried daughters, a fourth part to a grandson, son of his only son who had predeceased him, and the fifth part to the children of a daughter who had predeceased him. Having made his will, he gave sub stantial sums by gift inter vivos to his children, and the question arose whether they were bound to account for these sums as a satis faction pro tanto of their shares of residue. On the question of fact the judge held that the grandfather had not placed himself in loco parentis to any of his grandchildren, and the case establishes the proposition of law that a grandfather is in the position of a stranger for the purpose of the doctrine against double portions, and that grand children cannot claim the benefit of the doctrine unless on proof that the grandfather had assumed the parental care of them. exceeds £1,000 a condition