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229:, the accumulation trusts were to continue until the beneficiary was 25, and (at 21) the beneficiary wished to terminate the accumulation. Similarly, if the trusts are held for a tenant for life, and then for the benefit of a remainderman, both tenant for life and remainderman may decide to terminate the trusts and obtain the capital immediately, and agree a partition of the funds between them; this situation often occurs where changes in the revenue laws means that upon the death of the tenant for life the trust fund may be subject to
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as well as fixed trusts. However, some caution is in order, as that decision was made at a time when the law was understood to require that a valid discretionary trust need to be able to draw up a complete list of the beneficiaries of the trust in order to be valid; subsequent to the decision of the
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on trust for his great-nephew, Daniel Wright
Vautier, and his wife and heirs. According to the terms of the trust, it was to accumulate until Vautier reached the age of 25. The stock's dividends were to be accumulated along with the capital. Daniel Wright Vautier's father (confusingly, also named
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I think that principle has been repeatedly acted upon; and where a legacy is directed to accumulate for a certain period, or where the payment is postponed, the legatee, if he has an absolute indefeasible interest in the legacy, is not bound to wait until the expiration of that period, but may
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Although the case is most famous for the principle enunciated above, the court also held that the fact that an earlier maintenance order may have been made erroneously should not have precluded the Master of the Rolls from hearing and determining the case rather than remitting it to the Lord
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Daniel Wright
Vautier then turned twenty-one (the age of majority at the time) in the month of March 1841, and as he was about to be married, he presented a petition for the trustees to be ordered to transfer to him the East India stock, or it be sold and the proceeds transferred to him. His
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application came before the Master of the Rolls, who on becoming aware of the earlier order dated 25 July 1835 remitted it to the Lord
Chancellor for hearing to enable other residuary legatees to present an appeal petition from that order to the Lord Chancellor.
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Daniel
Vautier) died in the testator's lifetime, but after the testator's death, Daniel Vautier's widow, Susannah, commenced a suit for payment out of maintenance to her son during his minority. That order was made on 25 July 1835.
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In summary, a discretionary trust is now valid if, of any person it can be said whether they are within the class or not. Clearly such a test would not ordinarily lend itself to termination of the trusts under the rule in
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AC 424, this is no longer the appropriate test, and accordingly it may be that not all discretionary trusts are capable of being terminated by the beneficiaries under the rule.
262:, and between them absolutely entitled to the trust property, they may require the trustees to end the trusts and distribute the funds as the beneficiaries agree.
222:), the rule is not limited to those circumstances. However, if there is more than one beneficiary, then all of them need to be adults and without any disability.
316:, but there seems no reason in principle where a discretionary trust with a specific list of named beneficiaries could not terminate the trust under the rule.
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The case was ruled in
Vautier's favour. The rights of the beneficiary were held to supersede the wishes of the settlor as expressed in the trust instrument.
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302:). In the reported judgment of the final appeal he held that "I have no recollection of the case", referring to the earlier hearing.
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to transfer the legal estate to them and thereby terminate the trust. The rule has been repeatedly affirmed in
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The case was adjudicated by the Lord
Chancellor, Lord Cottenham, after being remitted to him by the then
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Although the rule is most often exercised where there is a sole trustee holding the trust fund on a
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for a sole beneficiary (usually where the trusts were held for the benefit of a
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There are a number of reasons why the beneficiaries may elect to do this. In
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in a way that was not envisaged when the trust fund was originally set up.
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require payment the moment he is competent to give a valid discharge.
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52:(1) John Saunders and (2) Thomas Saunders v Daniel Wright Vautier
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376:(1841) 4 Beav 115, as quoted in G. Thomas and A. Hudson (2004),
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jurisdictions, and is commonly referred to as "the rule in
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and under no disability, the beneficiaries may require the
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157:, one Richard Wright, had bequeathed £2,000 worth of
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218:, who has died, and the sole beneficiary is the
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236:It has also been held that the rule in
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121:which provides that, if all of the
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363:G. Thomas and A. Hudson (2004).
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42:High Court of Chancery
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94:Trusts, beneficiaries
242:discretionary trusts
433:1841 in British law
292:Master of the Rolls
314:Saunders v Vautier
272:English trusts law
238:Saunders v Vautier
227:Saunders v Vautier
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163:East India Company
143:Saunders v Vautier
115:English trusts law
113:115 is a leading
102:Saunders v Vautier
24:Saunders v Vautier
378:The Law of Trusts
365:The Law of Trusts
352:Re AEG Unit Trust
252:McPhail v Doulton
192:held as follows:
190:Lord Cottenham LC
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61:4 June 1841
402:Categories
336:Re Chardon
324:References
212:bare trust
139:common law
346:Ch 920n;
344:Re Nelson
260:sui juris
131:adult age
390:Re Smith
350:Ch 479;
342:Ch 915;
340:Re Smith
338:Ch 464;
266:See also
174:Judgment
155:testator
89:Keywords
66:Citation
161:in the
135:trustee
129:are of
125:in the
58:Decided
354:Ch 415
119:equity
392:Ch 15
278:Notes
159:stock
149:Facts
127:trust
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38:Court
111:Beav
249:in
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300:MR
294:,
153:A
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