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Adlard, Re, Taylor v Adlard
sub nom Re Adlard's Settlement Trust, Re Campbell's Settlement Trust, Re Fulton's Settlement Trust, Taylor v Adlard

[1954] Ch 29, [1953] 2 All ER 1437, [1953] 3 WLR 914, 97 Sol Jo 814

Court: Ch D

Judgment Date: circa 1954

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Catchwords & Digest


SETTLEMENTS - NATURE AND VALIDITY OF SETTLEMENTS - IN GENERAL - VALIDITY AND AVOIDANCE OF SETTLEMENTS - ENFORCEABILITY - EFFECT OF TRANSFER TO TRUSTEES - WHETHER FUNDS RECOVERABLE

By a settlement, dated 14 June 1918, and made between the settlor, of the first part, his daughter A, who had attained the age of twenty-one and was then unmarried, of the second part, and trustees, of the third part, the settlor settled the sum of £3,500 war loan (referred to hereafter as 'the trust fund') on trust to pay the income to A during her life, and, subject thereto, on trust for her children or issue as she should by deed or will appoint, and in default of appointment, on trust for all her children who should attain the age of twenty-one, in equal shares. If there should be no child of A who should attain a vested interest, the trust fund was to be held on trust for the statutory next of kin of A who would have been entitled thereto if she had died possessed thereof intestate and a spinster. By the deed of settlement A covenanted with the trustees to assign to them all her after-acquired property, to be held by them on the trusts of the settlement. On the same date, viz, 14 June 1918, by means of settlements in identical terms mutatis mutandis with that in favour of A the settlor settled the same sum on each of his daughters, C and F, who were also over twenty-one and unmarried at the time. The daughters had no separate advice when they entered into the covenants. Subsequent to 14 June 1918, all three married. A and C each had children. F, who was now a widow, had no children. The settlor died on 23 December 1944, and his wife died on 25 August 1951. On their mother's death A, C, and F, and another daughter became entitled absolutely, in equal shares, to the following funds: (i) £8,000 under an appointment, dated 1 June 1934, and made by the settlor in exercise of a power contained in his marriage settlement; (ii) £16,000 under an appointment of the same date, made by the mother in exercise of a similar power; (iii) £40,000 under a voluntary settlement, dated 5 May 1943, and made by the settlor; and (iv) £10,000 under an appointment made by the mother by her will, dated 17 December 1947, in exercise of a power contained in the settlor's will, dated 4 June 1934. Each of the daughters expressed her desire to receive her share of the funds for herself, but believed at the time that she had no power to do so, and in January 1952, their respective shares were transferred to the trustees of their settlements. A, C, and F now sought to recover their shares from the trustees: Held assuming that A, C, and F could have arrested the funds and retained them in breach of their covenants contained in the settlements of 14 June 1918, they were not now entitled, either at law or in equity, to recover them from the trustees, who had duly received them by reason of the obligations imposed by the covenants and now held them, and were bound to continue to hold them, in accordance with the tenor and true meaning of the settlements from which their obligations were derived.