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Showing contexts for: settlor trust in Official Trustee, West Bengal & Ors vs Sachindra Nath Chatterjee & Anr on 13 December, 1968Matching Fragments
The settlor administered the trust property for sometime and thereafter thought of effecting by deed inter vivos certain changes in the trust. To enable him to do so he took out an originating summons on the original side of the Calcutta High Court under Chapter XIII of the Original Side Rules of that Court seeking primarily two reliefs viz., (1) to have the Official Trustee, Bengal appointed as the Trustee in his place and (2) to empower him to alter the clause relating to variation of the quantum of interest given to each of the beneficiaries by a deed inter vivos. From the averments made in the application, it is clear that relief was sought under the provisions of the Indian Trusts Act (Central Act 2 of 1882) and the Official Trustees Act (Central Act 2 of 1913). In the body of the petition the settlor definitely prayed for permission to revoke the clause in the trust deed relating to his power to vary the quantum of interest of the beneficiaries by will alone and in, its place authorise him to make that variation "by deed inter vivos and not by will alone". The relevant reliefs asked for in the petition read as follows (1) "that the provisions contained in the Deed of settlement dated the 6th December 1930 whereby the persons therein named were appointed Trustees of the said Trust Estate and whereby power was reserved to petitioner to alter the said quantum of interest by will alone and in no other way be revoked and . . . .
At this stage it is necessary to emphasize that what the settlor asked for was the court's permission to revoke the clause in the Trust deed empowering him to alter the quantum of interest given to each of the beneficiaries "by will alone" and in its place to confer upon him power to make the said alteration by deed inter vivos. The court in specific terms ordered the revocation and granted the authority sought for. Acting under the power purported to have been given by the order of Ramfry J., the settlor executed a second Trust deed on March 22, 1938. Under that deed, in the- place of the Trustees nominated under the original deed, the Official Trustee was constituted as the sole trustee. Sachindra, (the first respondent herein) one of the sons of the settlor was deprived of all his interest as a beneficiary in the corpus of the trust properties. He was given a meagre allowance of Rs. 20 per month during his life-time. The settlor died in 1946.
On December 18, 1950, the first respondent filed the suit out of which this appeal has arisen praying for following declarations :
(a) that the power reserved by the settlor in the original Trust deed for altering the quantum of interest of the bene-
ficiaries 'by will alone and by no other means was irrevocable; (b) that the order passed by Ramfry, J. on August 25, 1937 was null and void as having been made without jurisdiction; and (c) the original Trust deed stood unaffected by the second Trust deed and therefore he was entitled to the benefits provided under the said deed. He also asked for a decree directing the Official Trustee to pay him 1/4th of the income of the Trust Estate, so long as Santimoyee Devee was alive and on her death to make over one-fourth of the corpus of the Trust Estate to him and further render accounts to him of the profits of the Trust Estate since the time of the death of the settlor. The Official Trustee as well as some of the other defendants resisted the suit. They contended that the settlor was entitled to execute the second Trust deed in exercise of the power reserved by him under the original Trust deed and in any event he could do so, because of the order of Ramfry, J. The trial court decreed the suit as prayed for but the first Appellate Court reversed the decree of the trial court and dismissed the suit upholding the contentions advanced on behalf of the contesting defendants. In second appeal the High Court reversed the decree of the first Appellate Court and restored the decree of the trial court. Two questions that -arise for decision in the appeal are (1) whether the settlor was entitled to execute the second Trust deed in pursuance of the power reserved by him under the original Trust deed and (2) whether in any event the validity of the second Trust deed is not open to challenge in view of the order made by Ramfry, J. on August 25, 1937. Mr. B. Sen, learned Counsel for the appellant contended that on a proper reading of the Trust deed it would be seen that the settlor had reserved to himself the power to vary the terms of the Trust, in so far as they relate to the quantum, of interest given to each of the beneficiaries after the death of the settlor. According to him the recital in the deed that such a variation can be done only by an instrument of will and not otherwise is not a " matter of substance but only a form. Therefore we must hold that the settlor had the power to make the variation in question. He did not dispute the proposition that a settlor is incompetent to vary any of the terms of a Trust settled by him unless he had reserved for himself the power to make the variation in question. The real question for decision is whether the stipulation in the Trust deed that the variation in question can only be made by will and not otherwise is binding condi- tion. If it is held to be a material condition then the settlor must be held to have had no power to vary the same. The law on the point is stated by Halsbury (1) thus Defects not of the essence. Equity relieves only against defects which are not of the essence of the power; relief will not be granted so as to defeat anything material to the intention of the donor of the power. Thus mere defects in the mode of execution will be aided, and so will an appointment by will made, under a power to appoint only by deed. But no aid will be given to an appointment by irrevocable deed made under a power to appoint only by will or to an 3rd Edn. Vol. 30 p. 272 Paragraph, 518.
(2) [1964] 1 S.C.R. 495.
102Under this provision the court could have only given "opinion, advice or direction on any presented question respecting the management or administration of the trust property" and not on any other matters. The relief prayed for by the settlor did not relate to the management or administration of the trust Property but on the other hand it asked for authority to alter the quantum of interest given to each of the beneficiaries by a deed inter vivos. The jurisdiction confrere on the court under s. 34 is a limited jurisdiction. Under that provision, the court has not been conferred with overall jurisdiction in matters arising under a Trust deed. The statute has prescribed what the court can do and inferentially what it cannot do. From the fact that the court has been conferred power to grant only certain reliefs it follows as a matter of law that the court has been prohibited from granting any other relief. The jurisdiction of the court is circumscribed by the provisions of s. 34 of the Trusts Act. The court had no jurisdiction to pronounce on the pleas put forward by the settlor. From the facts stated in the petition and from the relief asked for, it was obvious that the case did not come within the scope of s. 34 of the Trust Act. Therefore when the learned judge granted the relief asked for, he did something which he was not competent to do under s. 34 of the Trusts Act.