Earl of Balfour v Keeper of the Registers of Scotland & Ors

This appeal concerned the application of sections 47 and 48 of the Entail Amendment (Scotland) Act 1848 to successive liferents created by a testamentary trust disposition and subsequent codicil. The central question was which deed or deeds constituted the trust "by virtue of" which the applicant was in lawful possession for the purposes of section 47, and therefore which execution date determined whether he was born after that date. The House held that the relevant deed is the one by virtue of which the applicant then holds the liferent; where a codicil merely made a temporary change whose effect was spent before the applicant entered possession and otherwise confirmed the original settlement, the date of the original trust disposition governs. The appeal was allowed and the Court of Session ordered to pronounce a declarator under section 47 that the appellant is fee simple proprietor, unaffected by the restrictions in the original trust disposition.

The appellant, the Fourth Earl of Balfour, petitioned under section 48 (and alternatively section 47) of the Entail Amendment (Scotland) Act 1848 for an act and decree declaring him fee simple proprietor of heritable property presently held in liferent under a trust disposition and settlement of the First Earl of Balfour (dated 1 January 1923) and two codicils (20 December 1927 and 20 September 1929). The trustees held the residue of the First Earl's estate and the liferent succession was governed by Purpose in the Seventh Place of the 1923 settlement; the first codicil changed the nomination of the first liferenter (cancelling Gerald and nominating the heir male of Gerald's body) and otherwise confirmed the settlement. The appellant was born in 1925, after the date of the 1923 settlement but before the first codicil. The Extra Division of the Court of Session refused the petition on the basis that the operative "trust settlement" comprised the 1923 settlement read together with the 1927 codicil, making the relevant date 1927.

The issue framed by the House was whether the trust deed "by virtue of which" the appellant was in lawful possession for the purposes of section 47 included the first codicil so that the relevant date would be 1927, or whether the operative deed was solely the 1923 trust disposition so that the appellant qualified under the section. The Lords analysed the structure of section 47 in three stages and focused on the critical first stage: identifying the deed or deeds by virtue of which the applicant was in possession at the date of application. Applying authority (including Miller's Trustees v Miller and Earl of Moray), and construing the statute strictly in light of its policy to prevent imposition of fetters on persons unborn at execution of the deed, the House concluded that where a codicil merely identified a particular first liferenter and its effect was spent before the applicant entered possession, it did not alter the operative date for section 47. The codicil was not a republication of the settlement and did not create or qualify the appellant's interest. The appeal was therefore allowed; the interlocutor of the Extra Division was recalled and the Court of Session directed to pronounce an act and decree under section 47 declaring the appellant fee simple proprietor. Costs directions were dealt with as agreed between parties.

Appeal allowed. The House held that for the purpose of section 47 of the Entail Amendment (Scotland) Act 1848 the relevant deed is the deed by virtue of which the applicant is in lawful possession at the date of application; where a subsequent codicil merely identified an earlier nominee and its effect was spent before the applicant entered possession, the date of the original trust disposition governs and the applicant born after that date qualifies. The interlocutor of the Extra Division was recalled and an act and decree under section 47 was ordered declaring the appellant fee simple proprietor.

Appeal from an interlocutor of the Extra Division of the Court of Session (Lord Cameron of Lochbroom, Lord Macfadyen and Lord Sutherland) refusing the petition (reported 2002 SLT 981). The appeal was heard and allowed by the House of Lords ([2002] UKHL 42).