Bermuda Trust (Singapore) Ltd v Wee Richard and Others

• Jurisdiction: Singapore
• Judgment Date: 26 November 1998
• Date: 26 November 1998
• Docket Number: Originating Summons No 949 of 1997
• Court: High Court (Singapore)

Bermuda Trust (Singapore) Ltd

Plaintiff

and

Wee Richard and others

Defendant

[1998] SGHC 390

Judith Prakash J

Originating Summons No 949 of 1997

High Court

Trusts—Purpose trusts—Construction of will—Applicable principles—Objects of trust—Test to determine whether trust failed—Trusts—Purpose trusts—Purpose trust for observing and performing of Sinchew rites—Purpose trust of imperfect obligation—Exception to general rule

The first defendant was the great-grandson of the testator, and the plaintiff was the court-appointed trustee of his will. Clause 9 of the will directed the trustee to select and use one of the testator’s properties as a house for the primary purpose of residence for his family and for the observance of Sinchew rites (“the Sinchew house?).

The Sinchew house was continuously tenanted from the time it was selected. Neither the trustee nor the testator’s descendants ever lived in it or carried out any Sinchew rites there. In 1991, the roof collapsed, but the Sinchew house was not demolished as it was within a conservation zone. Further, the accumulated income under the trust was insufficient to meet the costs of restoration and conservation.

The defendants testified that they and other descendants of the testator were practising Christians and had never performed any rites pertaining to ancestral worship at the Sinchew house. The plaintiff testified that no member of the testator’s family had ever requested them to provide premises for the purposes of Sinchew worship.

The plaintiff contended that the trusts created by cl 9 had failed as the execution of the objects of the trust was impossible or impracticable.

Held, that the trust had failed:

(1) The gift in cl 9 did not create a charitable trust but a purpose trust of imperfect obligation. It was so called because while no one could compel the trustees to execute the trust, no one could prevent them from doing so as well. Such trusts were exceptions to the general rule that private purpose trusts were void. In the present case, the trust did not violate the rule against perpetuities: at [6].

(2) The following rules were applied in the construction of cl 9: (a) effect should be given to the testator’s intention as declared in his will; (b) the intent had to be collected from the words of the will; and (c) the intention was to be collected from the will read as a whole: at [7].

(3) A purpose trust failed when it was either impossible or impracticable to execute its objects. However, the failure of an object would not suffice to set aside the whole trust if there was still an object which could be effected: at [6]and [17].

(4) The first object, viz, the use of Sinchew house as a family house where family members might reside for the purpose of observing Sinchew, failed as the Sinchew house was not habitable and restoration was also not practical due to insufficient funds. Moreover, the whereabouts of the original ancestral tablet of the testator was not known: at [24].

(5) The second object, viz, the use of Sinchew house for the deposit of the ashes and ancestral tablets, failed as no one knew where either of them were. As no member of the testator’s family had ever lived there from the time it was selected, the court inferred that neither was ever deposited there: at [22].

(6) The third object, viz, the performance by the testator’s son or grandsons of the Sinchew rites and memory of the testator, failed as the living grandsons and great-grandsons were all practising Christians who would find the performance of such rites repugnant to their beliefs. It was highly unlikely that any amongst them would one day be willing to perform such rites. In any event, it was impossible to perform such rites because of the absence of the ancestral tablets: at [25].

Choa Choon Neoh v Spottiswoode (1869) 1 Ky 216 (refd)

Dominion Students’ Hall Trust,In re [1947] Ch 183 (refd)

Khoo Cheng Teow, Deceased, Re [1933] MLJ 119; [1932] SSLR 226 (folld)

Lee Moey Chye, deceased,Re [1966] 1 MLJ 131 (refd)

Lim Leng Cheak, deceased,Re [1969] 2 MLJ 228 (refd)

Tan Lip Buoy, deceased, ReWill of [1996] 1 SLR (R) 970; [1996] 2 SLR 663 (refd)

Yau Yok Seong v Yau Yok Foo (1923) 4 FMSLR 151 (folld)

Yeap Cheah Neo v Ong Cheng Neo (1872) 1 Ky 326 (refd)

Suhaimi Lazim (Shook Lin & Bok) for the plaintiff

Low Chai Chong and James Wong (Rodyk & Davidson) for the first defendant

Charles N Mendis and Deepak Natverlal (Charles N Mendis & Partners) for the second defendant

Lee Chin Seon (C S Lee) for the third defendant

Timothy Kho and Joseph Chen (David Lim & Partners) for the fourth defendant.

Judgment reserved.

Judith Prakash J

1 This summons raises a number of questions on the will of Wee Kay Siang who died on 31 July 1925. The testator was a rich man who owned vast tracts of immovable property in Singapore. He made detailed provisions for the use of his lands and houses. These involved making the same available for the benefit of his son and four daughters during the period of 21 years from his death. The trustees were directed to, thereafter, subject to the trust created by cl 9 of the will, use the capital and income to pay certain specified bequests to each of his daughters (or her children if any daughter was not alive at the distribution date) and to pay the balance to his son, Wee Kah Kiat or his surviving children.

2 Clause 9 reads:

I direct my Trustees to select any one of my houses with the lands attached thereto out of my houses and lands situate on the Thompson Road Mohamed Sultan Road or Beach Road at Singapore to be the Sinchew house to be held upon the trusts hereinafter declared and when such house shall have been selected as aforesaid (but not until) I direct my Trustees to stand seised or possessed of the same during the respective lifetimes of all such my children and grandchildren as shall have been living in Singapore at the date of my death during the lifetime of the last survivor of them my said children and grandchildren and during a period of 21 years calculated from the death of such last survivor Upon Trust during the said period to use and permit the use of the same as my family house in which members of my family may reside free of rent and free of cost for the purposes of the observance and performance of the rites and usages of Sinchew according to the usages and customs of the religion of the Chinese in the Straits Settlements for the purpose of the deposit of the ashes and Memorial Tablets of my parents my wife myself and my children and for the performance by my son the said Wee Kah Kiat or his son or sons of the yearly rites prayers and religious ceremonies according to the usages and customs aforesaid in memory of my parents my wife myself and my children dying during the period aforesaid and Upon Trust …

The clause continues by specifying the manner in which the person to whom the Sinchew house should be conveyed at the expiration of the trust period is to be identified and also by directing the trustees to use certain moneys from the income of the estate to maintain the family members living in the Sinchew house and to repair and maintain that house. It should also be noted that by cl 10 the trustees were directed by the testator to set apart from his estate a portion of capital sufficient to provide an income for the payments directed by cl 9 to be made in respect of his Sinchew house.

3 The initial question which arises for my determination is whether upon the true construction of the will and the events which have happened, the trusts created by cl 9 and cl 10 in relation to the Sinchew house have failed. Depending on my decision on this issue, there are other subsidiary questions to be answered, but it has been agreed that this issue should be decided first and the other questions will be dealt with at a subsequent hearing.

Validity of the trust

4 As can be seen from the way that I have formulated the question for decision, none of the parties (being the trustees and various descendants of the testator) has seriously contended that the trust created by cl 9 is not a...