Will construction and estate duty: widow's managerial powers did not amount to a right to the whole income.

On a true construction of the will, the properties vested on the testator's death in the widow and six sons as tenants-in-common. The widow had only powers of management and control, including maintaining accounts, realising monies and making investments, but no right to enjoy the whole income; her interest was confined to her own share. Later settlement documents could not alter the testator's intention and, at most, created only a life interest in her favour. As she did not have an interest in the whole income, section 40 of the Estate Duty Act did not apply, and the properties were not includible as property passing on her death.

---

---

Issues: Whether the properties dealt with by the will were includible in the deceased's estate as property passing on her death under the Estate Duty Act, 1953, and whether the widow had such an interest in the whole income of the properties as to attract section 40 of the Act.

Analysis: On a true construction of the will, the estate vested on the testator's death in the widow and the six sons as tenants-in-common. The widow was given only powers of management and control during her lifetime, together with authority to maintain accounts, realise moneys and make investments in her name. The will did not confer on her a right to enjoy the whole income of the properties; her interest was confined to her own share. Subsequent settlement documents could not alter the testator's intention, and at the highest they created only a life interest in favour of the widow, which would not result in property passing on her death within the meaning of the Act. Since the widow's interest did not extend to the whole income, section 40 had no application.

Conclusion: The answer to the reference was in the negative, and the inclusion of the properties in the estate on the widow's death was not justified.

Ratio Decidendi: Where a testamentary beneficiary has only managerial possession and no right to enjoy the whole income of the property, the property does not pass on that beneficiary's death so as to attract estate duty under section 40.

---