Report No. 70
Restrictions as to Interests for Unborn Persons
21.1. Kind of interest created in favour of unborn person.-
Now, assuming that after a prior interest is created in favour of an existing person, and subject to such prior interest, a transfer can be made conferring the interest for the benefit of the person not in existence, the next question to be considered is-what kind of interest may be created in favour of such a person? To deal with this problem, English law evolved what is known as the "rule against double possibilities. This was not a very expressive phrase. It sacrificed clarity for brevity;1 but it came into vogue.
Under this rule, it was requisite that on the birth of an unborn person the estate must vest in him within the proper period. The emphasis in England was on the date of commencement or first taking effect of the limitation. The estate must vest within the proper period. It was also requisite that if land is limited to an unborn person during his life, a remainder cannot be limited so as to convey an estate to that person's children. In legal literature, the matter is discussed conveniently under the head of the rule in Whitby v. Mitchell, (1890) 44 Ch D 85, but the propositions enunciated above were evolved long before the decision in Whitby v. Mitchell.
1. See criticism in Ardeshir, AIR 1945 Born 395 (Biagden, J.).
21.2. English common law.-
The scope and direction of English common law rules-whatever they were-was slightly different from the provisions of section 131 To draw attention to a few major points of difference, in England, it was not necessary that the interest conferred on the unborn person must be the entire interest. It was permissible, for example, to give the unborn person a life interest, provided it vested within the requisite time and provided further that the later interest was not limited to the issue of the unborn person to whom the life interest was given.
21.3. The rule here, laid down was expressed in the old legal language, that you could not limit a possibility, (now abolished by statute).1 It means, first, that there might never be such a person as an unborn person. That was a possibility, not a certainty. Besides, there was another possibility. There might never be issue of that person. Therefore, there was double contingency or a double possibility.2
1. Chapter 21, infra.
21.4. Rule in Whitby v. Mitchell.-
The rule against double possibility, known as the rule in Whitby v. Mitchell, (1890) 44 Ch D 85, is actually older than the case of Whitby v. Mitchell, as was pointed out by Farewell, J.1 For some time both the rule in Whitby v. Mitchell and the rule against perpetuities operated together in England. But, in 1925, when the law of property was revised, this rule was abolished in regard to instruments taking effect after 1925.
The policy of the law of restricting the period of time during which an owner of property may control its future devolution was regarded as sufficiently implemented by the residue of the rule against perpetuities. Section 161 of the Law of Property Act, 1925, which was in these terms,2 the altered position:
"161(1). The rule of law prohibiting the limitation, after a life interest to an unborn person, of an interest in land to the unborn child or other issue of an unborn person is hereby abolished, but without prejudice to any other rule relating to perpetuities.
(2) This section only applies to limitations or trusts created by an instrument coming into operation after the commencement of this Act."
1. Nash (in re:), (1908) 1 Ch 1.
2. Section 161, Law of Property Act, 1925.
21.5. Perpetuities Act, 1964.-
Section 4(1) of the Act of 1964 (which applies to gifts over, as well as to direct gifts), provides1 that where there is a gift to an unborn person, which vests at an age greater than twenty-one, and the gift is not saved as a result of the procedure introduced by section 3 of the Perpetuities and Accumulations Act, 1964, then the specified age must be reduced, not to twenty-one but to the age nearest the specified age, which will permit the gift to take effect. Section 4(2) makes a similar provision for the saving of gifts where there are two or more specified ages (a case which was not provided for in section 163 of the Law of Property Act, 1925).
1. Section 4(1), Perpetuities and Acquisitions Act, 1964.
21.6. Section 113, Succession Act.-
The provisions of section 13 of the Transfer of Property Act broadly correspond to section 113 of the Indian Succession Act, 1925-with one difference which will be noted later. Section 113 created certain serious problems by virtue of the decision of the Privy Council in Sopher's case1.
It was held in that case that if under a bequest in the circumstances mentioned in section 113, there is a possibility of the interest given to a beneficiary being defeated either by a contingency or by a clause of defeasance, the beneficiary under the later bequest does not receive the interest bequeathed in the same unfettered form as that in which the testator held it, and therefore the bequest does not 'comprise the whole of the remaining interest' of the testator in the thing bequeathed, within the meaning of section 113.
1. Sopher v. Administrator-General of Bengal, AIR 1944 PC 67.