1. Sir Shapurji Bharucha died at Bombay on or about June 23, 1920, leaving his last will dated June 21, 1919, and two codicils thereto which are not material to the questions which I have to decide on this summons. Defendants Nos. 1, 2, 3, 4, and 14 are the executors and trustees of the will.
2. Clause 14 of the will provides as follows :-
I direct my Executors to stand possessed of investments to be selected by them of the market value on the day of my death of Ea. 17 lakhs upon trust to pay the income thereof from time to time as the same accrues duo to my sister Bai Dinbai the widow of Manekji Rusbomji Bennet for her life.
3. Clause 15 of the will runa as follows :-
After the death of the said Bai Dinbai my Executors shall divide and pay the said sum of Rs. 17 lakhs as follows namely : -
(a) 4 Lakhs bo Bai Putlibai the daughter of the said Dinbai absolutely,
(b) 4 Lakhs to Bai Bachubai the daughter of the said Bai Dinbai absolutely.
(c) 4 Lakhs to Bai Cooverbai the daughter of the aaid Bai Dinbai absolutely.
(d) 4 Lakhs to the children of Navazbai the predeceased daughter of the said Dinbai in equal shares.
(e) Rs. 50,000 to Bai Dosibai the widow of my nephew Bustomji Manekji Bennet absolutely.
(f) Rs. 50, 0011 to such persons and in snob, shares and in such manner in all respects as my said sister Bai Dinbai the widow of Manekji Rustomji Kennet shall by any deed, will or codicil appoint and in default of and subject to such appointment the said sum shall devolve as and form part of my residuary estate.
4. Bai Dinbai the testator's sister had three daughters who survived the testator, namely, Bai Putlibai, Bai Bachubai and Bai Cooverbai. Defendants Nos. 5 and 6 are the children of Navazbai referred to in Clause 14 of the will.
5. By her letter dated October B, 1920, Bai Dinbai informed the trustees that it was her desire to invest the said sum of seventeen lakhs in the 6; per cent. Bombay Development Loan Notes and stated further as follows:-
After my death you shall divide the said amount between my heirs in the form of the abovementioned Loan Notes, Such is my desire.
On October 9, 1920, the said Dinbai wrote to the executors and trustees as follows :-
With reference to the amount of Rs. 17 lakhs bequeathed to me and my daughters by my late lamented brother, I have to ask you to invest the whole 1928 amount in 6 1/2 per cent. Bombay Government Loan and have the same endowed in respective joint names, as per list attached.
To this letter a list was annexed showing that the loan was to be divided as directed in Clause 15 of the will, and the loan representing the proportionate of each of the legatees was Rangnekar I. to be endorsed in her name jointly with that of Bai Dinbai.
6. It appears from the evidence before me that on October 9, 1920, the firm of Shapurji and Tullockchand, in which defendants Nos. 1 and 2 were partners, purchased seventeen lakhs 6J per cent. Bombay Development Loan on behalf of the trustees in pursuance of the letter of Bai Dinbai dated 8th instant. It further appears from a letter dated May 9, 1922, written by defendant No. 1 to defendant No. 14 that the securities were kept in the safe custody of the National Bank of India Ltd. in the name of the bank, and that the bank collected the interest, and the same was paid to Bai Dinbai, The correspondence which has been put in shows that a question was raised in 1922 by the three surviving daughters of Bai Dinbai as to the loan standing in the name of the bank and the safe custody receipt of the bank in respect thereof standing in the name of defendants Nos. 1-3. The three daughters requested the trustees to get the securities transferred to the names of all the five trustees and get them lodged in the Imperial Bank of India. It further appears that defendant No. 1 agreed to transfer the securities to the names of all the five executors, and ultimately in November 1922 securities were transferred to the names of all the trustees and continued to be deposited in the National Bank of India. The request of Bai Dinbai for division and endorsement of the loan in the names mentioned in the list sent with her letter of October 9, 1920, was not carried out.
7. On the correspondence and the evidence I have no doubt that the direction in Clause 14 of the will was carried out by the trustees who held the loan upon the trust created by that clause and this was done with the consent of all, at any rate, the adult beneficiaries mentioned in Clauses 14 and 15 of the will.
8. Bai Dinbai died of November 15, 1927, leaving a will dated March 4, 1926, of which defendants Nos. 11 and 12 are executors. By her will she exercised the power of appointment given to her under Clause 15 of the will as regards the sum of Rs. 50,000.
9. One of the daughters Bachubai died on July 7, 1924, leaving a will of which plaintiffs Nos. 1-4 are the executors. The other daughter Bai Cooverbai died on May 18, 1926, leaving will probate of which was granted to plaintiffs Nos. 5-8.
10. One of the executors and trustees, F, E Dinshaw, now defendant Nos. 1, 2, 3 and 4 are the retired from the office of a trustee. Defendants Nos. 1, 2, 3 and 4 are the trustees of the will and Sangnehar J. codicils of Sir Shapurji Bharucha. Defendants Nos. 7, 8, 9 and 10 are residuary legatees under the will of Sir Shapurji Bharucha. Defendant No. 13 is the legatee under Clause 15 (e) of the said will.
11. The present summons is taken out by the plaintiffs and defendants Nos. 5 and 6, and they contend that in the events that have happened they have become entitled to the said investments in the proportions mentioned in Clauses 14 and 15 of the will and are entitled to have the securities divided between them. They state that they requested defendants Nos. 1-4 to have the securities endorsed and transferred in accordance with their directions, but on November 30, 1927, defendants Nos. 1, 2, 3 and 4 by their attorneys' letter of that date contended that the securities could not be divided as the reversioners were entitled to specific sums mentioned in the will, and not to the securities. It is under these circumstances that the present summons is taken out, and the main question for decision is whether in the events that have happened plaintiffs and defendants Nos. 5 and 6 are entitled to have the securities endorsed over and distributed in the proportion directed by Clause 15 of the will, or whether they are only entitled to pecuniary legacies in that proportion.
12. In construing the clauses, and in trying to find out the intention of the testator, I can only be g aided by the will itself and the language used therein. It must be remembered that I am not construing the will of an ignorant or an illiterate man. Sir Shapurji Bharucba was one of the shrewdest men of business in Bombay well conversant with the state of the market, and when a man in that position directs that a particular amount should be invested in securities, he must know what it means. It is contended on behalf of the defendants that the two Clauses 14 and 15 are separate and independent, and that in Clause 14 there is a trust of the income of the securities of the value of seventeen lakhs and in Clause 15 only pecuniary legacies are given to tha legatees mentioned therein.
13. Turning to the will, by Clause 8 the testator gives to his executors a sum of three lakhs upon the trust therein mentioned, The said clause runs as follows :--
I give to my Executors the sum of Rs. 3 lakhs upon the trusts hereafter declared concerning the same, that is to say:
(1) My Executors shall invest the said sum of Rs 3 lakhs in the names of my Executors in or upon any shares or investments to be selected by them.
(ii) My Executors shall pay the income of the said sum of Rs. 3 lakhs and the property for the time being representing the same, to my wife during her life.
(iii) After the death of my wife, my Executors shall divide and pay the said sum of Rs. 3 lakhs as follows.
Then follow directions as to how the said sum of rupees three lakhs was to be distributed amongst several legatees after the death of the testator's wife. By Clause 4 the testator directed the executors to purchase investments to be selected by them which should realize a monthly income of Rs. 2,000, and to hold such investments upon trust to pay the income thereof as the same accrues due to his wife during her life. By Clause 5 the testator directs that after the death of his wife the securities mentioned in Clause 4 should devolve as and form part of his residuary estate. Clause 6 is immaterial. By Clause 7 certain legacies are given, as also by Clause 8. By Clause 9 a trust is created in favour of the widow of a servant of a sum of Rs. 5,000, and the testator directed that during her life the income should be paid to the widow and after her death the amount, to use the words of the legacy 'the said legacy', should be held upon trust for the benefit of the children and grand children of the said widow in equal shares. By Clause 10 a similar trust is created in favour of a legatee Jal Nusserwanji and another in favour of another legatee by Clause 11. Clause 12 gives pecuniary legacies to servants. Then oome Clauses 14 and 15 which I have to construe on this summons.
14. On a careful consideration of the various provisions in the will, it seems to me that, subject to the payment of certain pecuniary legacies, the scheme of the will was to provide for his widow for life and thereafter certain relations to the extent of a sum of three lakhs and also to provide another monthly sum of Rs. 2,000 for his widow during her life and to provide for his sister Bat Dinbai for her life and thereafter for her heirs to the extent of seventeen lakhs and to give the residue to the persons mentioned in Clause 18 of the will.
15. The question then is : Are these two Clauses 14 and 15 independent as argued by Sir Chiinanlal Setalvad I think not. By Clause 14 the testator makes a trust of certain investments for the benefit of his sister Dinbai for her life, and then proceeds to deal with the sum which he has directed to be invested for the benefit of Dinbai for life, and which he must know would exist 1928 when the life tenant Dinbai died, Now there is no indication in these clauses as to what was to happen to the investments after Dinbai death. If it was the intention of the testator only to give the income of the investments to Dinbai for life, he could Bangnekar. 7. have carried it out without creating a trust for her life as he does by the use of the words 'upon trust'. There is clear indication in the will that where the testator intended that there was to be a trust for life for the benefit of a life tenant, and intended that after the death of the life tenant the subject matter of the trust should form part of the residuary estate, he used appropriate language to indicate that intention. This appears clearly from Clauses 4 and 5 of the will. If the two Clauses 14 and 15 were put together in one paragraph, undoubtedly there would be a trust (a) for the benefit of the life tenant, (b) after the death of the life tenant, for the benefit of the remainder-men. Is it then any the less a trust, and are there two trusts because the two Clauses 14 and 15 are separated Looking at the clauses, Clause 15 says 'After the death of the said Bai Dinbai my executors. In my opinion the words 'After the death of the said Bai Dinbai' show a clear intention to connect the subject matter of legacies in Clause 15 with the legacy in Clause 14. But if there is any doubt on this point, it is removed by what follows. By Clause 15 the testator directs that after the death of the said Bai Dinbai the executors 'shall divide and pay the said sum of rupees seventeen lakhs as follows etc.' Now, which is the 'said sum' One of the rules of construction is that the testator is rather to be presumed to calculate on the directions in his will taking effect than the contrary. That being so, the testator, a business man, familiar with the market and the rise and fall of securities, would certainly know, after he had drafted Clause 14, and when he came to Clause 15, that a sum of seventeen lakhs, which he identified by the use of the term 'the said', would not be existing at Bai Dinbai's death. He must know that even if the investments are sold the sum of rupees seventeen lakhs referred to in Clause 14 would not be in existence when the legacies in Clause 15 would fall in. It may be more or less. Therefore the word 'said' is meaningless if it is supposed to refer to seventeen lakhs set apart or directed to be set apart for being invested under Clause 14. As soon aa the investments would be made the sum of seventeen lakhs mentioned in Clause 14 would cease to exist. Apart from that, if it was the intention to give cash or pecuniary legacies, would pot the testator have indicated it by directing the sale of the investments after the death of the life tenant, and in the event of there being deficiency, to make it up out of the residue He knew that the sum of seventeen lakhs would not be in existence when the time came for distribution under Clause 15, and would, in my opinion, certainly indicate, in case of there being deficiency, how the sum should be made up, or in the event of there being appreciation, who was to take the same, or whether it was to fall into the residue. Another rule of construction is that upon a consideration of the whole will and all the circumstances, if the Court could clearly ascertain the intention of the testator, that intention would determine the sense in which the particular words are to be read, and if it be impossible to reconcile any words with that intention the Court will reject them, and if any particular word is wanting to express the intention, the Court will supply it. I have carefully considered the arguments addressed to me on this question. The only conclusion to which I can come is that Clauses 14 and 15 are not independent clauses, and they are connected, in my opinion, by the expression of a common purpose, and 'there is, to my mind, an apparent design to connect them. Reading the two clauses together, there is only one conclusion to which I can come, and that is that a fully constituted trust was created thereby, complete in itself. By the first clause the testator directed that investments should be made up to the extent of seventeen lakhs, the trustees were to hold the same for the benefit of the tenant for life, and after the demise of the life tenant, to hold the investments for the benefit of the remainder-men. If I am right in this, then the moment the investments of seventeen lakhs are made by the trustees to carry out the trust, that much portion was severed off and became appropriated to the first trust. Then, does the second trust attach to anything different from the investments which were brought into existence in accordance with Clause 14 It seems to me the intention was that in the first instance a sum of seventeen lakhs was to be severed from the general estate and set apart to constitute a fund, and after the expiry of the life tenancy, it was that fund which was to become available for distribution 'among the ultimate beneficiaries. They take it, to use a well-known expression, 'for better or wise,' that is to say, if the securities appreciate, that would be for their benefit, if they depreciate they would have to bear the loss. The only objection, so far as I can see, to this construction is the use of the word 'sum' That seems to me to be clearly a misdescription. Having directed a sum to be invested the cash is gone and only investments remain, and to take the words in the literal sense, there is no such 'said sum,' as by the time the said Clause 15 came into effect the sum had gone The constcruet on is I think, supported by the language used in the other part of the will. In my opinion, therefore, the purchase of the loan was valid appropriation to the legacies in Clauses 14 and 15.
16. I, therefore, hold that the intention of the testator was to create a trust of investments of the value of seventeen lakhs in which Dinbai was to take life interest, the corpus going to the ultimate beneficiaries as indicated in Clause 15. This really disposes of the summons, and it is not necessary to consider the other arguments which have been advanced by the learned Counsel before me.
17. But it is alternatively contended on behalf of the plaintiffs that even if these legacies mentioned in Clause 15 were pecuniary legacies, still the moment they were appropriated to the trust declared by these clauses, the legatees became entitled to them in specie, and reliance is placed on a case, In re Hall: Foster v. Metcalfe  2 Ch. 226 .
18. The general principle on the subject is stated in Roper on Legacies, 4th Ed., Vol. I, p. 931 :
Where a legacy in sterling money is given on a contingent event, and not any interest payable in the meantime, there the legatee cannot have the legacy separated from the bulk of the testator's estate, and, strictly speaking, appropriated; because it cannot be ascertained what sum of stock will, at the time of payment, produce the exact amount of the legacy in sterling money; and in such case it is the practice of the Court of Chancery to order the fund to be paid to the person entitled to the residue, he giving real security to the legatee for the payment, when the contingency happens.
The learned author refers to Webber v. Webber  1 S. & Section 311 as an authority for the proposition. The true principle then is that in the case of a vested legacy payable at a future time, there is a complete severance of the legacy from the residue.
19. The case relied upon by Mr. Desai shows that where there is a contingent legacy and interest in the meantime is not given to the legatee, the interest remains part of the residue, and the principal will fall into the residue if the contingency does not happen. But if the interest in the meantime is given to the legatee, or if there is a direction to accumulate the interest, there would be a severance from the residue. In re Hall: Foster v. Metcalfel  2 Ch. 226 which was a, case of contingent legacy, Vaughan Williams L.J. put the position in this way (p. 231) :-
The question is whether the executors had any right to make such an appropriation as they have made without the consent of the legatee, and then to say that the loss arising from the depreciation of the stock which they purported to appropriate must be borne by her. In my opinion, it is not true to say that they could make such an appropriation and then throw upon the Bungntkar J. legatee the loss which has resulted. The question really, in each case is this: when the investment! which it is sought to appropriate was made, whose property was it Did is become the property of the legatee, or did it remain a portion of the testator's estate ?
Later on the learned Judge said as follows (p. 231):-
I think there has been some little confusion in the argument between a legacy payable in future and a contingent legacy. If there is a vested legacy which will certainly be able in future, I take it the legatee has an absolute right to go to the trustee or executor and say, ' Although my legacy is payable in future it is a vested legacy, and I require you to invest the amount of it and not only would the legatee have the right to require that, but he could insist upon its being done, and when it was done that) would be an appropriation in the strict sense of the word, and the gain or loss upon the investment (as the case might be) would go to or fall upon the legatee.
Romer L.J. stated as follows (p. 233) :-
If executors have to provide for a vested legacy and the person entitled to it cannot be found, so that there is no one competent to give a valid receipt for it, undoubtedly both the executors and the Court would have power to appropriate a sum of money to answer the legacy, and in a proper case to invest it for the benefit of the legatee. Further, if a legacy is settled upon trusts, the same considerations would apply. And, even if there is a contingent legacy, and by the will some of the income arising from the legacy is to go to the legatee before the contingency on which it becomes payable happens, then you may properly infer that the testator intended that a fund should be set apart and invested to answer the legacy. In such a case also I see no reason to doubt that the executor or the Court would have power to set apart and invest a sum of money to carry out the testator's wishes.
Therefore, the reasoning of the judgment in In re Hall suggests that where a legacy is not contingent it can be appropriated either by payment into Court or by the executors setting aside and investing the amount of the legacy.
20. To the same effect are the observations made in Lewin on Trusts (13th Edn.) at p. 350 :
Where a legacy is to be held by the executors upon trust, and the will is silent as to the mode of investment, the powers of the Trustee Act, 1923, will be applicable, so that an investment in the securities authorized by the Act will be a proper mode of appropriation... Where an appropriation has been validly made it will be binding on the beneficiaries, who will alike share in any increment in value, and bear any loss arising from depreciation, of the investments of the severed fund, and thereafter there can be no community of loss or gain between appropriated legacies inter se as to either income or capital; nor can the trustees claim any right of indemnity for subsequent loss as against the general trust estate.
The authority cited for these observations is Fraser v. Murdoch (1881) 6 App. Cas. 855 which in its turn cites Roper on Legacies, 4th Ed., p. 942. In In re Waters (1889) W.N. 39 Kay J referring to the authorities last cited namely, Fraser v. Murdoch and Roper on Legacies, said (p. 39) ;__
[It was] clear that where a deferred legacy was bona fide set apart by an - executor, the legatee must take it for better or worse.' And his Lordship added (though the words do not appear in the report), 'If the security improves in value, so much the better; if it deteriorates the loss must be theirs; but the executors have full power to make the appropriation without coming to the Court for an authority so to do, and when it is done, it is final and conclusive, and binding upon everybody. That is the undoubted law.' Bee foot-note (y), p. 360, Lewin on Trusts.
21. Sir Chimanlal relies on In re Salomons : Public Trustee v. Worthy  Ch. 290 . This was a case where certain legacies were given which inter alia included a pecuniary legacy to an infant and the Public Trustee was appointed executor. He paid out all the testator's funeral and testamentary expenses and debts, invested sums to provide for annuities bequeathed by the will, paid all the pecuniary legacies other than legacies bequeathed to legatees who were still infants, and divided parts of the residue in accordance with the trusts of the will. He then took out a summons for determination whether he as executor of the testator's will had power to appropriate a sum of 1000 cash to answer the legacy of 1000 bequeathed to the defendant Joan Wortley (the infant) and to invest such sum of cash, with interest thereon at the rate of 4 per cent, per annum from September 23, 1916, until the date of investment, for the benefit of the defendant Joan Wortley in the name of the plaintiff at his discretion in any proper investment, and whether upon such appropriation and investment being made he was at liberty to distribute the residuary real and personal estate of the testator without regard to this legacy. The question undoubtedly was whether he was released from all liability in respect of the legacy, Eve J, held that an executor cannot by appropriating the amount of a pecuniary legacy given to an infant, and investing the same in any investment in which money under the control of the Court ought properly to be invested, render himself free to distribute the residue of his testator's estate without incurring personal liability in respect of the legacy and prevent recourse to the testator's residuary estate by the legatee if the fund so created should prove insufficient to pay the legacy in full upon his coming of age.
22. This no doubt was the law prior to 1926, but the Administration of Estates Act, 1925, seems to have altered the law in England, and by Section 42 of that Act, under similar circumstances, the personal representative of a testator is not to be deemed to have incurred any liability if he invested a legacy given to an infant in proper funds, or because of his failure to pay or transfer the legacy or money into Court (see Section 42). The foot-note in on Trusts at page 355 runs as follows:-
Before 1926 it had been held that an executor and trustee could only free himself from liability and safely distribute the residue by paying the infants' legacy into Court, and could not, -without; liability, should the investment prove insufficient, invest the legacy even in securities authorized for funds under the control of the Court, (See Section 42 of the Administration of Estates Act, 1B25).
23. In view of the construction which I have placed on the Clausen in question, I do not think that this case applies. Here there was a trust and the trustees appropriated a certain sum to the legacies created by these clauses with the consent of the adult beneficiaries, The effect of such appropriation is stated in Roper on Legacies at page 942:-
When the appropriation is once duly made, whether by the direction of the Court or by the executors or trustees in pais. according to the rules of the Court, the rule appears to be, that the legatees entitled to the legacy for which the appropriation was made, must take it, subject to its chance a of fluctuation.
The authority cited for this rule is Burgess v. Robinson (1817) 3 Mer. 7 .
24. Therefore under these clauses the trustees were authorized to invest seventeen lakhs in investments, and the moment they severed that sum from the general estate and appropriated it to the trust declared, in my opinion, the beneficiaries became bound and took the investments for better or worse. In this view the question whether the consent of the minor defendants Nos. 5 and 6 was obtained or not is immaterial. The following observations at page 345 of Lewin on Trusts are to the point:-
But, under particular circumstances, the trustee is held capable of exercising the discretionary powers of the bona fide proprietor; for the trust estate itself might otherwise be injuriously affected. The necessity of the moment may demand immediate action, while the sanction of the parties who are beneficially interested could not be procured without great inconvenience (as where the cestuis que trust are a numerous class), or perhaps could not be obtained at all (as where the cestuis que trust are under disability, or not yet in existence). It is, therefore, evidently in furtherance of the cesluia que trust's own interest that, where the circumstances of the case require it, the trustee should be at liberty to exercise a reasonable discretionary power. But a trustee for adults should not take any proceeding without consulting his eesluis que trust; and if he do, and the proceeding is disavowed by them, he may have to pay the costs.
25. Another contention is advanced on behalf of the plaint-tiffs, namely, that all the legatees consented to the appropriation made by the trustees. That no doubt is the case made out in the plaint itself, and it is not denied by the contending defendants their written statement. But a specific issue having been raised, I have to consider the position. The evidence led before me shows that Bai Dinbai and all the daughters as well as other legatees were practically living together and in close touch with each other.
The two minors, defendants Nos. 5 and 6, were under the care and protection and lived with Bai Dinbai. The evidence shows that all the legatees consented to the sum being invested in the Bombay Development Loan, Defendants Nos. 5 and 6 being minors, it could not be said they consented, but that, I think, does not alter the conclusion to which I have come, if I am right on the construction of Clauses 14 and 15.
As to coats, I order that plaintiffs' coats and costs of defendants Nos. 1, 2, 3, 4 and 12, 13 and 14 to come out of the trust funds. Costs of defendants Not. 7,8, 9 and 10 to come of residuary estate.
Two counsel certified.
There was an appeal (Appeal No. 35 of 1928) against this judgment: but the Appeal Court (Kemp and Blackwell JJ.) dismissed the appeal as the parties were absent, on October 31, 1928.