D. C. 1908 IN RE Boyd, C. testamentary disposition of property which is his own, and the case in hand is not covered by any decision in our courts. Where a trust is clearly and distinctly expressed on the policy COCHRANE. itself in favour of one beneficiary, so that it becomes a vested trust for that person, it should not be displaced or altered except by a document of equal evidential force in clearness and distinctness of designation. Here, reading the will by itself, you have no evidence of identity between the policies in question and the vague expressions in the will: "$200 out of my life insurance funds to my sister, and the residue of insurance funds to my daughter." Then, it is said affidavits may be used to shew that there was nothing else to which the reference would apply but to the policy in question. The policy is not his property, and you can only infer that he may have intended to dispose of this policy, although his designation of $200 of it is not warranted by the statute ch. 203, because not being to a preferred beneficiary. I doubt whether this method of explaining the will and making out the identification is within the scope of the words "or otherwise." He may have thought erroneously that the policy was payable to himself or his order, and so was in his control to dispose of to his sister as well as to his daughter. He may have intended to acquire other insurance on his life which would be part of his estate at his death. He may, also, have intended to provide for the case of the wife dying before him, in which case the policy might form part of his estate, under 4 Edw. VII. ch. 15, sec. 7 (8) O. (enacted April 26th, 1904), and so speak of it and dispose of it as his policy. All these possible contingencies are open to conjecture, and so displace that clear, sure and certain identification which seems to be imperative, having regard to the repeated and particular expressions of the Insurance Act. There is no explicit revocation of the trust vested in the wife, and there is no implied revocation expressed with unequivocal certainty. The policy in question was not part of the testator's estate, so, perhaps, cases upon the exercise of powers in making appointments of property afford more light than can be elsewhere obtained. A leading case is Webb v. Honnor, 1 Jac. & W. 352 (1820): A testator had a general power of appointment over a sum in the funds, and had no other funded property, He bequeathed all his personal estate, consisting of money invested in any of the public funds, household furniture, etc. This was held to D. C. 1908 IN RE Boyd, C. be no execution of the power. The circumstances of his having no other funded property was not to be adverted to as material. COCHRANE. The Master of the Rolls (Sir J. Plumer) said, at p. 357-8: "In this instrument (the will) there is nothing to shew that the testator meant to dispose of anything but his own property; every part of it is satisfied by giving all that he was possessed of. He speaks of his personal estate, and every word he has used ties it up to the property that then belonged to himself or that he might before his death become entitled to. It would, therefore, be impossible by any evidence to shew an intention in this will to pass property not belonging to himself, but over which he had a power. He speaks, among the different articles of personalty that he enumerates, of property in the funds; and it is possible that he might have been considering this sum, but it would be too dangerous for the Court to presume that when he has used language not applying to it." Mr. Lawrence cited another later case since the Wills Act, which also proceeds upon and sustains Webb v. Honnor. That is Re Mattingley's Trusts, 2 J. & H. 426 (1862). The testator had power to appoint a trust fund, consisting of a sum of consols. He disposed of all his personal estate and his money in the funds. Apart from the consols, he had no money in the funds. Held, the will was not an appointment. Page Wood, V.C., said "the point to be ascertained in all these cases is whether the testator appoints to a specific fund in existence, or is merely enumerating the different particulars of which he supposed his property may consist at his death. The words of this will favour the latter view:" p. 428. Re Mattingley has been quoted with approval by Kay, J., in In re Mills, Mills v. Mills (1886), 34 Ch.D. 186, 193, where it is laid down that the burden of proof rests on those who assert affirmatively that the power was exercised, and that the Court must be satisfied with this by sufficient evidence. And In re Mills was approved by the Court of Appeal in In re Esther Williams, Fou'kes v. Williams (1889), 42 Ch.D. 93. The Wills Act, R.S.O. 1897, ch. 128, sec. 29, has no application to the case of limited power such as that exercisable with reference to beneficiaries under the Insurance Act: Cloves v. D. C. 1908 IN RE Awdry (1850), 12 Beav. 604; but only to cases in which the testator has power to appoint in any manner he may think proper. The power, if exercised by the testator in this case, would be so COCHRANE. in a manner not warranted by the terms of the Insurance Act, and so afford internal evidence that he was not acting with reference to this trust fund. As remarked by Kay, J., in In re Mills, at p. 191 (citing Doe v. Bird (1809), 11 East 49), such indications are not to be disregarded. Boyd, C. I am not at present prepared to accept the conclusion of Ferguson, J., as to the sixth policy of insurance effected after the date of the will, having regard to the 26th section of the Wills Act; but it is not necessary to dwell upon the matter in the present controversy. Altogether I am not satisfied that the policy payable to the wife, now in question, was in any certain way identified by the testator, and, therefore, I hold his will did not change the beneficiary. Judgment should be in favour of the wife (widow) as to the whole fund. No costs of the appeal. Costs below may be left as directed by that judgment. Taking this view as to the whole fund, it is not necessary to deal with the effect of the will on the $200 given to the sister on the supposition that the power has been duly exercised, but, so far as I have investigated the point, I am inclined to think that the claims of the widow to that much would not be disturbed. And I do not think the doctrine of lapse would enure to the benefit of the residuary legatee so as to give her the whole amount. The construction given by the Court to the case of lapsed legacies or lapsed appointments falling into the residue (as exhibited in Falkner v. Butler (1765), Ambler 514) does not seem warranted in dealing with attempts to change beneficiaries under the Insurance Act. The rule as to lapsed requests falling into the residue is not founded on the intention of the testator, but upon a theory that the residuary clause is intended to embrace everything not otherwise effectually given: Easum v. Appleford (1840), 5 My. & Cr. 59, 61. It rests upon a supposition or hypothesis which should not be employed to take away the vested rights of the existing beneficiary, unless that is explicitly and unmistakeably done by the testator. Here the testator designates so much to his sister, D. C. 1908 which fails because contrary to the Insurance Act (sec. 160). He designates the residue to his daughter, which does to that extent take it away from the widow, but I see no propriety or no reason for holding that the widow is also to lose the $200 ineffectually COCHRANE dealt with by the testator. MABEE, J., concurred. MAGEE, J.: I fully concur in the judgment of my Lord the Chancellor as to the trust in favour of the wife not being disturbed by the will. It is not necessary to enter into the question whether, if it had been, the daughter would be entitled under the bequest of the residue to the $200 invalidly bequeathed to the sister. A. H. F. L. IN RE Boyd, C. 1907 Dec. 10. 1908 March 23. [FALCONBRIDGE, C.J.K.B.] RE VICTOR VARNISH Co., CLARE'S CLAIM. Banks and Banking Security under sec. 88 of Bank Act-Assignment of— A security acquired under section 88 of the Bank Act, R.S.C. 1906, ch. 29, A guarantor to a bank, which also holds such a security for the debt guaranteed, is not subrogated to the rights of the bank in the security on payment of the debt by him. Judgment of the Master in Ordinary reversed THIS was an appeal by the liquidator of the Victor Varnish Co. from the judgment of the Master in Ordinary in so far as it held that the claimant herein, Frank Clare, was entitled to a lien on the stock in trade of the company. The contestation arose on a claim filed by Clare, who claimed to be a creditor, to the amount of $5,290, of the company, which was being wound up under the Dominion Winding-up Act, and that he was entitled to a lien on the stock of the company to that amount. The liquidator admitted that Clare was a creditor to the amount of $5,125, but disputed the validity of the lien. The facts, so far as material, are set out in the judgment of FALCONBRIDGE, C.J.K.B. On December 10th, 1907, the contestation came on before the Master in Ordinary, who at the close of the evidence delivered the following judgment. THE MASTER IN ORDINARY:-I have very little doubt in regard to what the law is in regard to this. It has long been recognized that where a surety pays the debt of one for whom he is surety to the creditor who holds the claim for the debt and has collateral to it certain securities, that the surety on paying the debt is entitled to an assignment of all the securities which the creditor holds in respect to the claim and debt for which he is surety. That is what is called the doctrine of the law of subrogation, and that law vests in the surety who pays the debt the same rights which the creditor held in respect to the claim for which the party was the surety. |