Report No. 70
28.21. Section 23.-
Section 23 pre-supposes that there is a terminable antecedent interest and a subsequent contingent interest.1 The object of the rule enacted in the section is to prevent an estate from remaining without an owner. It is on this principle that an artificial rule-artificial in the sense to be explained presently-is laid down in the section. It has often been thought2 that the rule is a relic of the ancient rule relating to the creation of a contingent remainder.
The ancient rule was usually expressed in the maxim that every contingent remainder must have a particular estate of freehold to support it.3
When there was a tenant for life with several contingent remainders, the tenant for life might have, not only by death but by surrender or other methods, determined or terminated his own life interest before the remainder vested. In such cases, it became necessary to have trustees appointed to preserve the contingent remainder. If, therefore, the estate for life determined otherwise than by death, then for the residue of his natural life, the trustees would take possession. To avoid such consequences, the rule seems to have been evolved. This rule, however, produced arbitrary consequences, and was not much favoured in England even at the time when the rule was enforce.
2. Abbis v. Burney, 17 Chancery Division 211 (229).
28.22. No need for supporting interest.-
We have already1 stated that the assumption that a contingent remainder cannot be created without a supporting precedent interest does not appear to be true of India. One must, therefore, read the words "if any" after the words "intermediate or precedent", in regard to cases where the very first gift is contingent. Where no precedent interest is created, and the case is one of the first gift, these words do not come in the way. Nor does the section apply where a time is fixed
No change, of course, is recommended in section 23.
1. See discussion as to section 21 paras 28.13 to 28.15, supra.
28.23. Section 24.- Section 24 reads-
"24. Where, on a transfer of property, an interest therein is to accrue to such of certain persons as shall be surviving at some period, but the exact period is not specified, the interest shall go to such of them as shall be alive when the intermediate or precedent interest ceases to exist, unless a contrary intention appears from the terms of the transfer.
A transfers property to B for life, and after his death to C and D, equally to be divided between them, or the surviver of them. C dies during the life of B. D survives B. At B's death the property passes to D".
28.24. Analogous Law.-
This section corresponds to section 125 of the Indian Succession Act,1 which runs as follows:-
"125. Where a bequest is made to such of certain persons as shall be surviving at same period but the exact period is not specified, the legacy shall go to such of them as shall be alive at the time of payment or distribution, unless a contrary intention appears by the will.
1. Section 125, Indian succession Act, 1925.
(i) Property is bequeathed to A and B, to be equally divided between them, or to the survivor of them. If A dies before the testator, and B survives the testator, it goes to B.
(ii) Property is bequeathed to A for life, and after his death to B and C, to be equally divided between them, or to the survivor of them. B dies during the life of A; C survives A. At A's death the legacy goes to C.
(iii) Property is bequeathed to A for life and after his death to B and C, or the survivor with a direction that of B should not survive the testator, his children are to stand in his place, C dies during the life of the testator; B survives the testator, but dies in the lifetime of A. The legacy goes to the representative of B.
(iv) Property is bequeathed to A for life, and after his death to B and C, with a direction that, in case either of them dies in the lifetime of A, the whole shall go to the survivor. B dies in the lifetime of A. The legacy goes to the representative of C."
Section 24 enacts a rule of construction and as Mulla observes, in best explained by the following passage from the judgment of Turner, L.J., in White v. Baker, (1860) 2 De GF&i 55 (64): "Where there is a bequest to A for life and after his death to B and C or the survivor of them, some meaning must, of course, be attached to the words "the survivor". They may refer to any one of three events-to one of the persons named surviving the other, or to one of them only surviving the testator, or to one of them only surviving the tenant for life, and in the absence of any indication to the contrary, they are taken to refer to the latter event as being the more probable one to have been referred to".
28.26. English law.-
The rule enacted in section 24 is generally in accordance with the English law, but it may be noted that the words "unless a contrary intention appears from the terms of the transfer" allow a wider latitude for construction. It may also be noted that such an interest does not vest before the occurrence of the event and therefore, the provision in section 19 relating to a vested interest will not apply. The interest to which section 24 refers is interest created to a contingent class which is to be as certained at the time when the intermediate or precedent interest ceases to exist-the time which is described in the corresponding section in the Succession Act1 as the time of payment or distribution.
1. Section 125, Indian Succession Act, 1925, supra.
28.27. Rule of construction.-
Section 24 is, to a large extent, a rule which construes the expression relating to survivorship as used in the instrument of transfer. Thus, under the illustration to the section, property is given to B for life and after his death to C and D equally to be divided between them or the survivor of them. Here the instrument does not mention the period with reference to which survivorship is to be ascertained.
The law creates the test of survivorship at the termination of the precedent interest of B. Therefore, if D survives B, the property passes to D. There is, of course, greater need for such a rule of construction in the case of wills, since one of the competing events in the case of a will is the date of death of the testator. The significance of section 24 lies in filling up the date for ascertaining survivorship, when it is not mentioned in the transfer. If the date is mentioned, the case falls within the last 11 words of the section which take notice of a contrary intention
We have no further comments on the section.
28.28. Section 25-Principle.-
The importance attached by the law to the intention of the transferor as expressed in the deed, granted the legality of the terms expressing that intention, basic. As far as possible the law will not make a new transfer, for if he has expressed his intention not in an unconditional transfer but in the creation of an Interest subject to a condition, the condition must be respected. There may sometimes be other considerations-such as, that an estate once vested is not easily divested-which operate to balance the importance attached to the transfer. But, the interest must first vest on the terms stipulated by the transferor. If therefore the condition cannot be upheld, the transfer subject to that condition cannot be upheld.
28.29. Section 25-Gist.-
This is the principle underlying section 25. Under section 25, an interest created on a transfer of property, and dependent upon a condition, fails if the fulfilment of the condition is impossible or is forbidden by law or is of such a nature that if permitted, it would defeat the provisions of any law or is fraudulent or involves or implies injury to the person or property of another or the court regards it as immoral or opposed to public policy.
There are four illustrations to the section, which take familiar and not difficult cases of impossibility or illegality of conditions. The section carries out the policy incorporated in section 6(h)(ii) under which no transfer can be made for an object or consideration which is unlawful within the meaning of section 23 of the Indian Contract Act, 1872. It has been pointed out in the commentaries that the conditions referred to in the section are conditions which, as agreements, would be void under sections 23, 26, 27 and 56 of the Indian Contract Act.1
1. Mulla, (1973), p. 148.
28.30. Effect of impossible condition.-
The section refers to conditions precedent, in contrast with section 32 which makes a provision for conditions subsequent which are void. The distinction is important, because where a condition precedent is void, the transfer does not take effect, while where a condition subsequent is void, the transfer takes effect and the condition subsequent is to be disregarded1 A surprisingly unusual instance of an impossible condition is furnished by a Calcutta case,2 in which the testator left a legacy on condition that the legatee should excavate a tank.
The testator, however, himself excavated the tank before his death. The bequest, it was held, failed. In this case, performance of the condition was regarded as the "motive" of the bequest, so that impossibility barred the claim of the legatee. The English law as to illegal conditions also appears to be substantially the same. If the condition precedent to a transfer is illegal, then the transfer is void.
1. Ram Sarup v. Bala, 1884 ILR 6 All 313 (PC).
2. Rajinder Lal v. Marnalinidasi, AIR 1922 Cal 116.