Reinhard v Bell

This case concerns the will of the late William Gotlett Reinhard. The will was made on 2 May 1925. Mr Reinhard died on 2 January 1929. A grant of probate was made by the Court on 20 March 1929 in respect of the will and a codicil made on 30 January 1928.

The plaintiffs are the present trustees of the trusts under the will. By prayer 1 of their Summons filed on 11 August 2014, the plaintiffs seek judicial advice pursuant to s 63 of the Trustee Act 1925 (NSW) with respect to a question of construction of clause 8(b) of the will. The hearing, in respect of prayer 1 only, took place before me on 1 April 2015.

The Summons names eighteen defendants, each of whom is either a surviving grandchild (in the case of the first and second defendants) or a surviving great grandchild (in the case of the third to eighteenth defendants) of the testator.

Ms G Mahony of Counsel appeared for the plaintiffs. Mr W Burke, solicitor, appeared for the first, second and fifteenth to eighteenth defendants. A number of other defendants were present in Court. Three of them addressed the Court to indicate their position or make a submission concerning the issue of construction. These were Ronald Reinhard (the twelfth defendant), Ann Gilberthorpe (the thirteenth defendant) and Glenn Reinhard (the eighth defendant). I was informed by Ms Mahony that all of the defendants had been served with the Summons (and, I assume, the accompanying Statement of Facts and the affidavit in support of the Summons). A number of defendants entered submitting appearances.

I observed at the outset that, as the question of construction of clause 8(b) of the will concerned the respective rights of the defendants as beneficiaries under the will, the appropriate procedure for the trustees was not the seeking of judicial advice, but rather the obtaining of a binding determination on the question (see J D Heydon and M J Leeming, Jacobs’ Law of Trusts in Australia, (7th ed 2006, LexisNexis Butterworths) at 588 and 590). Accordingly, and in circumstances where it appears that all interested persons have been named as defendants and have been given notice of the nature of the question of construction submitted to the Court by the trustees, the hearing proceeded on the basis that the Court would determine the question.

Following the hearing, the trustees produced a form of a declaration that they would seek if the construction advanced by them was accepted by the Court as the true construction. The defendants who actively participated in the hearing were given the opportunity to make further submissions concerning the proposed form of declaration.

After providing for the revocation of all former testamentary dispositions, and the appointment of executors and trustees, the will provided:

At the time of the testator’s death, he was survived by ten children and eight grandchildren. The last survivor of those persons died on 26 May 2013. It follows that the gifts of real estate will not vest indefeasibly in any beneficiary until 21 years after 26 May 2013.

By clauses 1 to 8, the will provides for various gifts of real estate amongst eight of the testator’s children. Such gifts are expressed to be “UPON THE TRUSTS and subject to the powers and provisions following”. Such trusts, powers and provisions include those set forth in paragraphs (a) and (b) of clause 8.

Clause 8(a) confers upon the testator’s wife and two of his daughters a right of residence on a property called “Ringaroo”, and provides for certain rent charges in favour of the testator’s wife and one of his sons.

Clause 8(b) commences with the following:

Such life estates are subject to termination in certain circumstances, in which case:

Clause 8(b) then provides for what is to occur following the deaths of the testator’s said children. It continues:

Clause 8(b) goes on to confer certain gifts of personalty, and then deals with the residue of the estate in the following terms:

Certain provisions concerning the Trustees then follow, including a direction in the following terms:

Clause 8(b) also contains a proviso in the following terms:

As can be seen, clause 8(b) of the will is an extremely lengthy provision which deals with numerous subjects.

The question of construction raised in these proceedings concerns that part of clause 8(b) which deals with the gifts of real estate after the expiration of the period of postponement of distribution. That should be taken as a reference to the period specified in the declaration on the first page of the will that the estates or interests given by the will are not to vest until twenty one years after the death of the last survivor of the testator’s children or grandchildren who are alive at the date of his death. It is apparent that the testator wanted his properties to remain for a very lengthy period under the control of trustees (who were directed to work them in the same manner the testator had).

After the expiration of such period, the land is then given:

The question of construction focuses upon the word “of” which appears immediately after the word “living” in the passage set out above.

The plaintiffs contend that “of” was there used in error, and that the passage should be read as if “or” was used instead. Ms Mahony submitted that the provision would otherwise be ungrammatical. In that regard she pointed to an opinion to that effect given by Mr Tobias QC, as his Honour then was, in 1988. Ms Mahony further submitted that the testator, who was approaching his seventies when he made his will, must be taken to have been aware that when the gifts of real property were to be distributed following their vesting, all of his children who survived him would be dead, as would all of his grandchildren who survived him, but it was possible that any grandchildren born after his death might be still alive. In those circumstances, it was suggested, it would be logical to provide in respect of each gift of real property that the property would be shared amongst any relevant grandchildren still alive, but where any such grandchild was no longer alive, the share of such grandchild would go equally to the children of such grandchild. It was submitted that reading “of” as “or” would achieve that result.

The first, second and fifteenth to eighteenth defendants did not seek to propound any particular construction. They took an essentially neutral position, although Mr Baker, solicitor, who appeared for them did observe that if “of” was read as “or”, the earlier reference to “such children of my said child” could be seen as giving content to both “those of them then living” and “those who may be dead”.

Some of the defendants submitted that “of” should not be read as “or”. The twelfth defendant, Ronald Reinhard, submitted that the words “those of them then living of the children of those who may then be dead” should be read as referring to living children of any generation who survive a parent who would otherwise inherit. He submitted that “children” ought be read in a recursive sense, and that this was consistent with an intention that the testator’s properties continue to be run as they were until they were distributed amongst the surviving descendants. This construction was supported by the thirteenth defendant, Ann Gilberthorpe, and I think the eighth defendant, Glenn Reinhard. The eighth defendant also drew to the attention of the Court a letter of advice he received in 1987 from Corrs Pavey Whiting & Byrne solicitors, which attached an opinion given by Dr Certoma.

After the hearing, the tenth defendant, John Trowell, provided a submission to the effect that “of” should continue to be read as “of”. He submitted that the words in contention should be read as creating a class consisting of a sub-set (those of them then living) of the children of those who may then be dead.

The general principles applicable to the construction of wills are not in doubt. The Court must construe the language of the instrument, read as a whole, in order to determine the testator’s intention. The words of a will are given their usual or ordinary grammatical meaning, unless the context indicates to the contrary, or the ordinary meaning lacks sense. Where the application of the ordinary meaning does not make sense, it may be necessary, in order to give effect to the testator’s intention, to depart from the ordinary meaning and adopt a different meaning. In some circumstances, it may be clear that words have been employed in error and that other words must have been intended; if so, the will is read as if it contained such words instead (see, for example, In re Dayrell; Hastie v Dayrell [1904] 2 Ch 496; Tatham v Huxtable (1950) 81 CLR 639 at 645 and 651; Aboud v Aboud [1960] NSWR 498).

Clause 8(b) of the will in the present case provides for life interests in realty to go to some of the testator’s children, and then specifies in some detail how the rents and profits of the land are to be dealt with following the death of “any of my said children”. Such income may be applied for the benefit of any widow or child “of such child” whilst they are alive and until “the expiration of the period of postponement of distribution”.

The will then provides that when the period of postponement expires, the property is given absolutely. At that point all of the testator’s children will be dead. So too will the testator’s grandchildren alive at the date of his death, and possibly, but not necessarily, any other grandchildren of the testator. The terms of the will indicate that the testator contemplated that his grandchildren may not then be alive. If there is no widow of a child, or if a widow of a child has died, the income is to be applied “among such children of my said child […] for their respective lives”. The testator should also be taken to have contemplated the possibility that one or more grandchildren might be alive at that time. The testator should also be taken to have contemplated that there may be great grandchildren (or even more remote issue) alive at that time. The language of the absolute gifts of the land must be considered in the light of that context.

The beneficiaries are described as “those of them then living of the children of those who may then be dead […]”. The question of who is encompassed within “them” immediately arises.

The defendants who submitted that “of” should be read as it was, suggest that the meaning of “them” or “them then living” is derived from the words that follow, in particular the expression “of the children of those who may then be dead”. It is then suggested that those words refer to a group consisting of children (of any generation) who survive a parent who would otherwise inherit. That is, “those who may then be dead” refers to parents (of any generation) who may by then be dead.

I regard such a construction as strained and unnatural, if not ungrammatical. Moreover, it seems to involve the reading in of concepts, in particular that the group can consist of a descendant of any generation. If it was intended that the gifts would be made to surviving descendants to any degree, then it would have been relatively simple to employ language apt for such purpose. The will is otherwise generally expressed with some precision and clarity. It is scarcely imaginable that the language actually used in this portion of the will would have been selected had that been the testator’s intention. In my opinion, the expression “of the children of those who may then be dead” plainly involved some error.

The plaintiffs suggest that a simple typographical error occurred, namely, the inclusion of “of” instead of “or”. If “or” was included, the content of both “those of them then living” and “the children of those who may then be dead” would be readily apparent from the context of the surrounding text. The words “them” and “those” would both take their meaning from the preceding expression “such children of my said child”. Accordingly, “those of them living” would refer to those grandchildren then living, and “those who may then be dead” would refer to those grandchildren who may by then be dead. So read, the words are grammatically correct, and in accordance with both the surrounding text and the provisions of the will generally.

As Mr Jarman himself stated, “to alter the language of a testator is evidently a strong measure” (see T Jarman, A Treatise on Wills, (1st ed 1884, London: Sweet & Maxwell, Ltd) at 441). Moreover, the existence of a clear error in a word or phrase is not itself sufficient; it must also be clear what word or phrase was meant to have been included (see Tatham v Huxtable (supra) at 645; T Jarman (edited by R Jennings), A Treatise on Wills, (8th ed 1951, London: Sweet & Maxwell) at 606-607). It is also necessary to bear in mind that (certain statutory powers aside) it is the function of the Court to construe wills, not remake or rewrite them.

Nevertheless, I consider that in this case it is sufficiently clear that “of” was erroneously included when “or” was intended. It is not surprising that in such a lengthy document a typographical error such as that might go undetected. I note that in the line immediately above, postponement is spelt incorrectly, and there is at least one other typographical error (“leberty” on page 5) in the will. The will otherwise appears to have been prepared with great care.

For the above reasons, it is my opinion that the question of construction should be answered in the manner contended for by the plaintiffs. A declaration to that effect will be made. The Court will also order that the plaintiffs’ cost be paid out of the trust estate on an indemnity basis. The balance of the Summons will be stood over for directions before the Registrar.

The Court: