Standard Bank of South Africa Ltd, NO v Betts Brown and Others

• Jurisdiction: South Africa

Standard Bank of South Africa Ltd, NO v Betts Brown and Others
1958 (3) SA 713 (N) [*]

1958 (3) SA p713

Citation	1958 (3) SA 713 (N)
Court	Natal Provincial Division
Judge	Holmes J and Milne J
Heard	April 16, 1958; April 17, 1958
Judgment	April 30, 1958

Flynote : Sleutelwoorde A

Will — Construction — Disposition ad pias causas — What constitutes — Trust — For charitable purposes — What constitutes — Disposition to assist certain inventors lacking financial resources — Trustee given subsidiary power not charitable — Does not invalidate disposition mainly for charitable purposes — B Test of permissible extent of uncertainty — Question is whether it is workable — Restriction of beneficiaries to persons of 'pure British stock' not invalidating — Whether trust not valid even if not ad pias causas.

Headnote : Kopnota

A disposition in a will to assist certain inventors who lack financial C resources may be classed as being one for charitable purposes.

The fact that a clause in a schedule to the will empowers the trustees to exact up to 10 per cent of gross profits, the sums so acquired to be added to the capital of the trust, and this in turn to be available to help other inventors, does not preclude the disposition from being so classed.

The same applies to a clause in the schedule which empowers the trustees to use moneys from income for the protection or defence of any invention 'in which the trust is interested as aforesaid'.

D A testamentary disposition is not prevented from being ad pias causas if the trustee is given a subsidiary power which is not charitable.

The test to be applied to determine the extent of permissible uncertainty in dispositions 'ad pias causas' is essentially a practical one, namely, 'Is it workable?'

Where the schedule of a will purporting to create a charitable trust to assist bona fide inventors 'of British nationality' who lacked financial E resources commenced as follows: - 'My wishes and directions to be carried into effect as far as practicable. 1. I want to benefit by the charity only persons of pure British stock and descent and in particular I exclude nationals of Eire and persons of Asiatic Oriental and Jewish descent. I want especially to assist young inventors'.

Held, as the trustees, with the use of common-sense, should very readily be able to make the trust work, that the disposition which was ad pias causas, was not void for uncertainty.

Quaere: Whether a valid trust cannot, in our law, be constituted by a F testator if it is intelligible, practicable and not contra bonos mores, whether it is ad pias causas or not, as long as the testator says what the trustees are to do with the property entrusted to them, i.e. on the footing that if he says that they are to use it for certain purposes specified by him they will, in executing the trust imposed on them, be carrying out the testator's wishes, not their own, even though some details may be left to their discretion? G

Case Information

Return day of a rule nisi. The facts appear from the reasons for judgment.

D. G. Fannin, Q.C. (with him J. B. Talbot), for the applicant: This is the return day of a rule nisi. The application is made by the executor testamentary for a declaration regarding the validity of the will. H Applicant, as is his duty, upholds the validity of the will and we would have advanced argument to support it, but for the fact that the testator's widow, on the one side, is asking for a declaration that no valid trust was created and the charity trustees, on the other side, are asking for

1958 (3) SA p714

confirmation of the rule. Because these conflicting contentions are being advanced by the testator's widow and the charity trustees respectively, the applicant abides the decision of the Court, as was done in similar circumstances in Ex parte Ford and Langham: In re Estate Boediker, 1953 (4) SA 338 (N). Applicant agrees to the A attorney-and-client costs of all parties being paid out of the estate because the testator's widow was invited by the applicant to resist the validity of the will and the charity trustees have no personal interest in the matter.

W. Pollak, Q.C. (with him D. D. Will), for the first respondent: A B testator must make his own will and he cannot commit to others the discretion as to who shall be beneficiaries under his will. Estate Watkins-Pitchford v C.I.R., 1955 (2) SA 437 (AD) at p. 458H; Voet, 28.5.29; Pritchard's Trustee v Estate Pritchard, 1912 CPD 87 at p. 94; In re Estate Grayson, 1937 AD 96; Blair v Duncan, 1902 A.C. 37 at p. 47; Grimond v Grimond, 1905 A.C. 124 at p. 126; Chichester Diocesan C Fund & Board of Finance v Simpson, 1944 A.C. 341 at pp. 348, 349 - 350, 371. A bequest ad pias causas is an exception to this rule. Estate Watkins-Pitchford v C.I.R., supra; Chichester Diocesan Fund case, supra. The meaning of 'ad pias causas' was discussed in Marks v Estate Gluckman, 1946 AD 289 at p. 311. Its meaning in our law is no wider D than in English law. R v Bowman, 1920 OPD 121 at pp. 123, 124. The English law should be followed as to the meaning of the four types of 'charity'. Marks v Estate Gluckman, supra at p. 309. The starting point is LORD MACNAGHTEN'S speech in Income Tax Special Purposes Commissioners v Pemsel, 1891 A.C. 531 at p. 583. The element of 'public benefit' is a necessary condition: National Anti-Vivisection Society v I.R.C., 1948 E A.C. 31 at p. 65; Gilmour v Coats, 1949 A.C. 426 at pp. 442, 446; Oppenheim v Tobacco Securities Trust Co. Ltd., 1951 A.C. 297 at p. 305. The present case does not fall under any of the first three divisions. The meaning of the fourth division was explained in Williams' Trustees F v. I.R.C., 1947 A.C. 447 at pp. 455, 458. The charity must be charitable in the legal sense. Fridman, Charities and Public Benefit, (1953) 31 Canadian Bar Review 537 and 538. The trust must be beneficial to the community and broadly analogous to other charitable trusts. In re Strakosch, 1949 Ch. 529 at p. 538; cf. Domat, Civil Law (Cushing's G ed.), vol. 2, para. 3587. This trust is not broadly analagous. 4 Halsbury, paras. 506 - 513. Research in itself is not a charitable object unless it is combined with teaching or education. In re Shaw, 1957 (1) A.E.R. 745 at pp. 752G - 753F. Non-scientific research cannot qualify as a charity. The trust may not embark on profit-making purposes. Tennant Plays Ltd v I.R.C., 1948 (1) A.E.R. 506. Marks v Estate Gluckman, supra, is distinguishable on this point. Nor can the H trust be used for non-charitable purposes such as defending patent actions. Oxford Group v I.R.C., 1949 (2) A.E.R. 537 at pp. 539H - 540A, 543C. The purpose may be benevolent but it is not charitable. A.G. for New Zealand v Brown, 1917 A.C. 393; A.G. for New Zealand v N.Z. Insurance Co. Ltd., 1936 (3) A.E.R. 888; Chichester Diocesan Fund case, supra. Benevolent purposes may go beyond charitable purposes. Bowman v Secular Society Ltd., 1917 A.C. 406 at p. 441;

1958 (3) SA p715

In re Gwyon, 1930 (1) Ch. 255 at p. 261; In re Shaw, supra at p. 752A. The trust not being for the public, the necessary element of public benefit must be found in the purpose of the trust. I.R.C v Baddeley, 1955 A.C. 572 at p. 615.

There is no reasonable certainty of the persons to be benefited. There A must be certainty. Marks v Estate Gluckman, supra at pp. 310 - 313. In re Gott, 1944 Ch. 195 should not be followed. The correct view appears from Scott, Trusts, 2nd ed., vol. 4, para. 395, and Mercantile Banking & Trust Co v Showacre, (1926) 48 A.L.R. 1138 at p. 1140. This is in accord with the cy-près doctrine. There must be over-riding charitable intention. Re Wilson, 1913 (1) Ch. 314 at pp. 320 - 321; B Breytenbach, N.O. & Ker, N.O v R., 1947 (4) SA 220 (T); In re Denton's Estate, 1951 (4) SA 582 (N); Ex parte Cauvin, 1954 (2) SA 144 (C). Marks v Estate Gluckman is distinguishable on this point. In this case the class from which beneficiaries are to be selected is not sufficiently defined. Ex parte Haworth, N.O., 1946 CPD 679 at pp. C 685, 686. The words 'of pure British stock and descent' are too vague. The exclusionary words 'persons of Asiatic, Oriental and Jewish descent' are too vague. Clayton v Ramsden, (1943) A.C. 320 at pp. 327 - 328, 330 - 331, 333; Grusd v Grusd, 1946 AD 465 at p. 476. Aronson v Est. Hart, 1950 (1) SA 539 (AD), is distinguishable. The question of D whether a person is 'of the Jewish faith' is different from whether a person is 'of Jewish descent'. Clayton v Ramsden, supra at p. 331; Barnett v Estate Schere schewske, 1957 (3) SA 679 (C).

D. G. Fannin, Q.C. (with him R. C. C. Feetham), for the second respondents: The general rule is that a testator must make his own will E and must himself nominate the beneficiaries. Two exceptions to this rule are bequests ad pias causas and bequests to trustees coupled with directions which oblige them to allocate the property bequeathed at their discretion to persons belonging to a limited class. Estate Watkins-Pitchford v C.I.R., 1955 (2) SA 437 (AD) at p. 458H. In re Estate Grayson, 1937 AD 96; Voet, 36.1.29; In re Myburgh, 13 S.C. 218; F Stanley v Botha's Executors, 17 S.C. 48; Estate Wilton v Estate Biddlecombe and Others, 1933 CPD 441. We rely upon both these exceptions. The requisites of a valid trust are (i) sufficient words to create it, (ii) a definite subject and (iii) a certain or ascertained object. In regard to each of these the testator's language must be such that his intention can be clearly ascertained. Steyn Law of Wills in G S.A., 2nd ed., p. 326; Ex parte Kemp's Executors, 1940 W.L.D. 26. Estate Hall v Findlay and Others, 1956 (2) P.H. G.21, refers to an 'ascertainable' object. If precatory words are used they can be ignored, according to the ordinary rule of interpretation. In re Morkel's Will, 1938 T.P.D. 432. The testator used clear peremptory...