CAMERON,
J.:—This
is
an
appeal
taken
under
the
provisions
of
Part
VI
of
the
Dominion
Succession
Duty
Act
(Statutes
of
Canada,
1940-41,
c.
14
as
amended)
from
an
assessment
dated
February
13,
1951,
in
respect
of
the
estate
of
Dr.
Walter
William
Chipman
(hereinafter
to
be
called
‘‘the
testator’’)
who
died
on
April
4,
1950,
domiciled
in
the
City
of
Montreal,
having
duly
enacted
his
will
in
notarial
form
dated
March
21,
1950.
The
appellants,
the
Royal
Trust
Company
and
Dr.
J.
R.
Fraser,
are
the
surviving
executors
and
trustees
of
the
testator’s
estate.
By
his
will
the
testator
gave
the
whole
of
the
property
which
he
possessed
and
to
which
he
was
entitled,
to
his
executors
upon
trust:
(a)
to
pay
his
debts,
testamentary
expenses,
succession
duties
and
the
like;
(b)
to
pay
certain
specific
bequests;
(c)
to
provide
certain
annuities
for
the
appellants,
Miss
J.
G.
Sime
and
John
Bath;
and
(d)
to
deliver
the
capital
of
the
residue
of
his
estate
to
his
cousin,
the
appellant,
Agnes
MacMillan
McLaughlin.
It
is
now
agreed
that
the
aggregate
net
value
of
the
property
of
which
the
testator
was
the
owner
at
the
time
of
his
death
was
$132,045.16.
In
his
assessment,
however,
the
Minister
placed
the
aggregate
net
value
at
$531,391.12
and
assessed
the
duties
payable
at
$81,371.50,
and
interest.
The
respondent’s
reason
for
increasing
the
aggregate
net
value
of
the
estate
as
set
out
in
his
decision,
following
the
Notice
of
Appeal,
was
as
follows:
“The
Honourable
the
Minister
of
National
Revenue
having
duly
considered
the
facts
and
reasons
set
forth
in
the
Notice
of
Appeal
and
matters
thereto
relating
hereby
affirms
the
said
assessment
as
having
been
made
in
accordance
with
the
provisions
of
the
Act
and
in
particular
on
the
ground
that
the
said
Walter
William
Chipman
was
at
the
time
of
his
death
competent
to
dispose
of
property
which
he
was
given
power
to
appropriate
by
the
Will
of
the
late
Maude
M.
Chipman
and
the
said
property
has
been
properly
subjected
to
duty
under
the
provisions
of
paragraph
(i)
of
subsection
(1)
of
section
3
and
subsection
(4)
of
the
said
section
3
of
the
Act.’’
The
said
Maude
M.
Chipman,
who
died
on
January
14,
1946,
domiciled
in
the
City
of
Montreal,
was
the
wife
of
the
testator.
In
her
last
will
and
codicil,
made
in
notarial
form
and
dated
respectively
February
7,
1940,
and
May
26,
1948,
and
after
reciting
that
she
was
the
wife,
separate
as
to
property,
of
Dr.
W.
W.
Chipman,
by
Clause
‘‘Thirdly’’
she
gave
the
whole
of
her
estate
to
her
executors
and
trustees
on
trust:
“
‘
(a)
To
pay
all
my
just
debts,
funeral
and
testamentary
expenses
aS
soon
as
possible
after
my
death
and
to
pay
all
succession
duties,
inheritance
taxes,
court
fees
and
similar
taxation
on
my
Estate
out
of
the
capital
of
the
residue
of
my
Estate
without
charging
same
to
my
respective
legatees
and
without
the
intervention
of
any
of
my
legatees.’
(b)
is
a
bequest
to
a
niece;
(c)
and
(d)
give
the
use
of
her
residence
and
its
contents
to
Dr.
Chipman
for
his
lifetime;
(e)
is
a
legacy
to
employees.
The
Will
continues
:—
‘(f)
To
pay
my
husband,
the
said
Walter
William
Chipman,
during
the
remainder
of
his
lifetime,
the
net
interest
and
revenues
from
the
residue
of
my
Estate
and
in
addition
thereto
to
pay
to
my
said
husband
from
time
to
time
and
at
any
time
such
portions
of
the
capital
of
my
Estate
as
he
may
wish
or
require
and
upon
his
simple
demand,
my
said
husband
to
be
the
sole
judge
as
to
the
amount
of
capital
to
be
withdrawn
by
him
and
the
times
and
manner
of
withdrawing
the
Same,
and
neither
my
said
husband
nor
my
Executors
and
Trustees
shall
be
obliged
to
account
further
for
any
capital
sums
so
paid
to
my
said
husband.
(g)
Upon
the
death
of
my
said
husband
or
upon
my
death
should
he
have
predeceased
me
to
dispose
of
my
Estate
as
it
may
then
exist
as
follows,
namely:—
1.
My
jewellery,
pictures,
household
furniture
and
household
effects
shall
be
disposed
of
in
accordance
with
any
memorandum
I
may
leave
with
respect
to
the
same
and
failing
any
such
memorandum
then
the
same
shall
be
divided
among
my
residuary
legatees
hereinafter
named
in
the
same
manner
as
the
residue
of
my
Estate.
2.
To
pay
to
The
Royal
Institution
for
the
Advancement
of
Learning
(McGill
University)
of
Montreal,
the
sum
of
fifty
thousand
dollars
as
a
special
legacy.
3.
To
pay
to
the
Royal
Victoria
Hospital,
Montreal,
the
sum
of
fifty
thousand
dollars
as
a
special
legacy.
4.
To
pay
to
The
Art
Gallery,
presently
situate
at
the
corner
of
Ontario
Avenue
and
Sherbrooke
Street
West,
Mon-
treal,
the
sum
of
fifty
thousand
dollars
as
a
special
legacy.
5.
To
pay
to
The
Church
of
St.
Andrew
and
St.
Paul,
presently
on
Sherbrooke
Street
West,
Montreal,
the
sum
of
twenty-five
thousand
dollars.
The
receipt
of
the
treasurer
for
the
time
being
of
each
of
the
foregoing
institutions
shall
be
a
good
and
valid
discharge
to
my
Executors
and
Trustees.
6.
To
dviide
the
capital
of
the
residue
of
my
fistate
between
my
brothers,
sisters,
niece
and
nephews
as
follows
:—One-
sixth
thereto
to
my
brother,
D.
Forbes
Angus,
of
the
City
of
Montreal;
one-sixth
thereof
to
my
brother
William
Forrest
Angus
of
the
City
of
Montreal;
one-sixth
thereof
to
my
brother,
David
James
Angus,
presently
of
Victoria,
British
Columbia;
one-sixth
thereof
to
my
sister,
Margaret
Angus,
wife
of
Dr.
Charles
Ferdinand
Martin
of
the
City
of
Montreal;
one-sixth
thereof
to
my
sister,
Dame
Bertha
Angus,
widow
of
Robert
MacDougall
Paterson
of
the
City
of
Montreal;
one-
eighteenth
thereof
to
my
niece,
Gyneth
Wanklyn,
widow
of
Durie
McLennan,
of
the
City
of
Montreal;
one-eighteenth
thereof
to
my
nephew,
David
A.
Wanklyn,
of
the
City
of
Montreal;
and
one-eighteenth
thereof
to
my
nephew,
Frederick
A.
Wanklyn,
presently
of
Nassau,
Bahamas;
and
I
hereby
constitute
my
said
brothers,
sisters,
niece
and
nephews
my
universal
residuary
legatees
in
the
aforesaid
proportions.’
The
Will
then
provides
for
the
possibilities
of
brothers,
sisters,
nephews
or
the
niece
of
the
testatrix
predeceasing
her
and
defines
the
powers
of
the
executors
and
trustees.
The
only
provision
of
the
will
or
codicil
other
than
those
quoted
above
which
it
is
suggested
may
have
relevance
to
the
inquiry
before
me
is
the
clause
entitled
‘Fifthly’,
reading
as
follows
:—
The
bequests
herein
made
whether
of
capital
or
revenue
are
intended
as
an
alimentary
provision
for
my
legatees
and
shall
be
exempt
from
seizure
for
their
debts
except
as
a
result
of
express
hypothecation
or
pledge.
I
direct,
moreover,
that
the
bequests
herein
made
while
in
the
hands
of
my
Executors
and
Trustees
shall
not
be
capable
of
being
assigned
by
the
beneficiaries.’
”
Following
the
death
of
his
wife,
the
testator
received
the
net
interest
and
revenues
from
the
residue
of
her
estate
as
provided
for
in
the
opening
words
of
Clause
3(f)
of
her
will;
and
under
the
remaining
provisions
of
the
said
clause,
he
demanded
and
received
payment
of
$33,164.41
out
of
the
capital
of
the
residue
of
her
estate.
It
is
agreed
that
at
the
testator’s
death
the
aggregate
value
of
the
residue
of
the
estate
of
Mrs.
Chipman
in
the
hands
of
her
trustees
was
$517,140.21.
After
making
certain
deductions,
exemptions
and
corrections
in
respect
thereof,
the
Minister
added
to
the
aggregate
net
value
of
the
testator’s
estate
the
sum
of
$393,533.11,
relying,
as
he
now
does
also,
on
Section
3(1)
(i)
and
Section
3(4)
of
the
Dominion
Succession
Duty
Act,
which
were
then
as
follows:
“3.
(1)
A
‘succession’
shall
be
deemed
to
include
the
following
dispositions
of
property
and
the
beneficiary
and
the
deceased
shall
be
deemed
to
be
the
‘successor’
and
‘
predecessor’
respectively
in
relation
to
such
property
;
(1)
property
of
which
the
person
dying
was
at
the
time
of
his
death
competent
to
dispose.
3.
(4)
Where,
upon
the
death
of
a
person
having
a
general
power
to
appoint
or
dispose
of
property
a
person
takes
a
beneficial
interest
in
the
property
as
a
result
of
the
failure
of
the
deceased
to
exercise
the
power,
the
taking
of
the
interest
in
the
property
shall
be
deemed
to
be
a
succession
and
the
beneficiary
and
the
deceased
shall
be
deemed
to
be
the
‘successor’
and
‘predecessor’
respectively
in
relation
to
the
property.”
Then
Section
4
is
in
part
as
follows:
“4(1)
A
person
shall
be
deemed
competent
to
dispose
of
property
if
he
has
such
an
estate
or
interest
therein
or
such
general
power
as
would,
if
he
were
sui
juris,
enable
him
to
dispose
of
the
property
and
the
expression
‘general
power’
includes
every
power
or
authority
enabling
the
donee
or
other
holder
thereof
to
appoint
or
dispose
of
property
as
he
thinks
fit,
whether
exercisable
by
instrument
inter
vivos
or
by
will,
or
both,
but
exclusive
of
any
power
exercisable
in
a
fiduciary
capacity
under
a
disposition
not
made
by
himself,
or
exercisable
as
mortgagee
;
(2)
A
disposition
taking
effect
out
of
the
interest
of
the
deceased
shall
be
deemed
to
have
been
made
by
him,
whether
the
concurrence
of
any
other
person
was
or
was
not
required.’’
The
appellants,
among
whom
are
included
the
beneficiaries
in
the
residue
of
Mrs.
Chipman’s
estate
or
their
legal
representatives,
ask
that
the
assessment
be
declared
invalid
on
the
ground
that
Section
3(1)
(i)
and
Section
3(4)
do
not
apply
to
the
facts
of
this
case
and
that
there
is
no
provision
in
the
Act
which
authorizes
the
inclusion
of
the
residue
of
Mrs.
Chipman’s
estate
as.
an
asset
of
the
estate
of
the
testator.
They
ask
for
an
Order
directing
the
respondent
to
fix
the
aggregate
net
value
of
the
successions
derived
from
the
testator
at
the
sum
of
$132,
045.
16,
the
agreed
net.aggreg.ate
value
of
the
testator
’s
own
assets.
At
the
hearing,
counsel
for
the
respondent
conceded
that
the
residuary
beneficiaries
of
the
principal
of
the
residue
of
Mrs.
Chipman’s
estate
took
their
legacies
under
her
will
and
not
from
the
testator’s
estate.
He
also
admitted
that
as
to
these
legacies,
there
was
no
“succession”
within
the
definition
of
that
word
in
Section
2(m)
of
the
Act
in
the
testator’s
estate.
I
shall
first
consider
the
applicability
of
Section
3(1)
(i)
to
the
facts
of
this
case.
Counsel
for
the
appellants
submits
that
in
order
to
uphold
the
assessment
under
this
subsection,
it
must
be
shown
that
the
testator
was
competent
to
dispose
of
the
principal
of
the
residue
of
Mrs.
Chipman’s
estate
and
that
he
did,
in
fact,
dispose
of
it.
I
am
in
agreement
with
that
submission.
Then
he
says
that
the
testator
was
not
competent
to
dispose
of
that
principal
and
that
even
if
he
were
so
competent,
he
did
not
in
fact
dispose
of
it.
In
my
opinion,
the
testator
at
the
time
of
his
death
was
competent
to
dispose
of
the
capital
of
his
wife’s
estate.
Under
Clause
3(f)
of
her
will,
the
testator
at
any
time
up
to
the
moment
of
his
death
could
have
made
the
capital
his
own.
On
this
point
it
is
not
necessary
to
consider
whether
her
will
gave
him
a
general
power
of
appointment
or
to
refer
to
the
extended
meaning
of
“competent
to
dispose”
in
Section
4(1).
As
pointed
out
by
Lord
Greene,
M.
R.,
in
Parsons
case,
[19421
2
All
E.R.
496
at
497:
‘‘The
phrase
‘competent
to
dispose’
is
not
a
phrase
of
art,
and,
taken
by
itself
and
quite
apart
from
the
definition
clause
in
the
Acts,,
conveys
to
my
mind
the
ability
to
dispose,
including,
of
course,
the
ability
to
make
a
thing
your
own.
The
husband,
in
the
present
case,
from
the
moment
of
death
was
able
to
make
the
legacy
his
own;
in
fact,
if
he
had
done
nothing
but
had
proceeded
to
die,
his
executors
would
have
been
entitled
to
that
legacy
from
the
mere
fact
that
he
had
not
disclaimed
it.
During
the
period
between
death
and
disclaimer,
he
was
unquestionably
to
my
mind
‘competent
to
dispose’
within
the
meaning
of
those
words,
which
I
think
are
wide
and
in
a
sense
popular
in
meaning.”
Reference
may
also
be
made
to
In
re
Penrose.
Penrose
v.
Penrose,
[1933]
1
Ch.
793
at
807.
That,
however,
does
not
conclude
the
matter.
Under
the
Finance
Act,
1894
(Eng.),
it
would
probably
not
be
necessary
to
go
further.,
-
Under
that
AcL
estate
duty
is:levied
on
the
value
of
property
“which
passes
‘on
the
death”
(Section
1)
;
by
Section
2^property;
passing
on
the
death
of
the
deceased
is
deemed
to
include
property
of
which
the
deceased
was
competent
to
dispose;
and
by
Section
22(2)
(a)
‘‘competent
to
dispose’’
and
‘‘general
powers’’
are
defined,
that
subsection
being
almost
identical
with
Section
4(1)
of
The
Dominion
Act.
Under
the
English
Act,
therefore,
an
estate
duty
is
levied
on
the
value
of
property
of
which
the
deceased
was
competent
to
dispose.
Section
3(1)
(i)
of
our
Act
does
not
purport
to
do
that.
Here
it
is
the
“disposition
of
property
of
which
the
deceased
was
at
the
time
of
his
death
competent
to
dispose’’
that
is
deemed
to
be
a
succession
and
therefore
subject
to
duty.
(I
think
that
“disposition”
as
used
in
the
opening
words
of
Section
3(1)
means
a
disposition
by
the
deceased—in
this
case
the
testator.)
It
is
suggested
by
counsel
for
the
respondent
that
to
restrict
the
meaning
of
“disposition”
in
that
way
would
be
to
render
Section
3(1)
(i)
completely
ineffectual,
for
if
the
deceased
had
disposed
of
it,
then
at
his
death
there
would
be
nothing
of
which
he
was
still
“competent
to
dispose’’.
One
answer
to
that—and
there
are
many
others—is,
of
course,
a
case
in
which
he
had
a
general
power
of
appointment
over
the
corpus
by
will
and
had
disposed
of
it
by
his
will.
The
word
‘‘dispositions’’
cannot
be
disregarded.
It
involves
the
action
of
disposing.
In
Hanson
9
s
Death
Duties,
9th
ed.,
pp.
31-2,
the
author
points
out
that
to
create
a
succession
there
must
be
a
transfer,
the
effect
of
which
is
to
make
some
person
beneficially
entitled
upon
the
death,
and
that
the
transfer
may
be
either
by
disposition
or
by
devolution.
At
page
32
he
states:
“A
disposition
comprises
any
sort
of
conveyance,
will,
assignment,
covenant,
undertaking,
contract,
act,
or
obligation
by
which
one
person
confers
a
beneficial
interest
in
property
on
another,
otherwise
than
for
money
or
money’s
worth.”
I
am
strengthened
in
my
opinion
that
there
is
no
succession
under
Section
3(1)
(i),
unless
there
has
been
a
disposition
by
the
deceased
(in
this
case—the
testator),
by
considering
the
provisions
of
Section
3(4)
which
seem
to
have
been
designed
to
apply
to
certain
situations
in
which
the
donee
of
a
general
power
to
appoint
or
dispose
of
property,
has
in
fact
failed
to
exercise
the
power—where
there
was
no
“disposition”
by
the
deceased.
If
mere
‘‘competency
to
dispose’’
resulted
in
a
“succession”
without
an
actual
disposition
by
the
deceased,
there
would
have
been
no
necessity
for
enacting
Section
3(4).
Now,
in
the
instant
case,
Dr.
Chipman
made
no
disposition
whatever
of
the
principal
of
the
residue
of
Mrs.
Chipman’s
estate.
For
the
reasons
which
I
have
stated,
I
am
of
the
opinion,
therefore,
that
there
was
no
‘‘succession’’
in
respect
to
that
residue
under
Section
3(1)
(i)
so
far
as
the
testator’s
estate
is
concerned.
Counsel
for
the
appellant
further
submits
that
Section
3(4)
(supra)
has
here
no
application,
his
submission
being
that
the
testator
had
no
general
power
to
appoint
or
dispose
of
the
residue
of
Mrs.
Chipman’s
estate
within
the
meaning
of
the
Act
or
of
the
general
law
;
and
in
any
event
because
even
if
he
had
such
alleged
general
power,
the
residuary
legatees
of
Mrs.
Chipman’s
estate
took
no
beneficial
interest
in
the
residue
thereof
upon
Dr.
Chipman’s
death
as
a
result
of
his
failure
to
exercise
any
power.
Subsection
(4)
was
added
to
Section
3
by
Statutes
of
Canada,
1944-5,
c.
37,
Section
2.
It
would
seem
that
the
general
intention
of
the
draftsman
may
have
been
to
provide
that
in
certain
cases
where
the
donee
of
a
general
power
to
appoint
or
dispose
of
property
(the
meaning
of
‘‘general
power’’
being
amplified
in
Section
4(1))
died,
without
having
exercised
the
power,
and
a
person
took
a
beneficial
interest
in
the
property,
the
taking
of
the
interest
in
the
property
would
be
deemed
to
be
a
succession.
It
could
be
assumed,
perhaps,
that
a
person
holding
such
a
general
power
of
appointment
over
property
is
in
effect
in
the
same
position
as
the
actual
owner,
as
he
could
at
any
time
exercise
the
power
in
his
own
favour
and
make
the
property
his
own.
Upon
his
death,
therefore,
it
might
be
logical
to
regard
him
as
being
the
predecessor
of
the
persons
thus
benefiting.
If
he
had
exercised
the
power,
I
think
it
would
have
been
such
a
disposition
as
to
come
within
Section
3(1)
(i).
Such
a
provision
as
I
have
suggested
may
have
been
in
the
mind
of
the
draftsman,
would
have
filled
in
the
gap
where
there
was
a
failure
to
exercise
the
power
and
therefore
no
disposition.
The
power
of
Parliament
to
so
provide
is
not
challenged
and
the
question
is
whether
on
a
proper
construction
of
the
section
it
has
done
so.
Now
the
subsection
is
limited
to
cases
in
which
the
person
dying
has
a
general
power
to
appoint
or
dispose.
As
I
have
said,
counsel
for
the
appellant
submits
that
there
was
here
no
such
power.
It
becomes
necessary
at
this
point
to
refer
to
certain
other
proceedings
in
which
the
provisions
of
Mrs.
Chipman’s
will
and
the
nature
of
the
interests
thereby
conferred
on
Dr.
Chipman
and
on
the
residuary
beneficiaries
in
her
will
were
under
consideration.
Following
Mrs.
Chipman’s
death,
an
assessment
to
succession
duties
was
made
upon
her
estate
on
the
basis
that
under
her
will
a
general
power
of
appointment
over
the
principal
of
the
residue
thereof
was
given
to
Dr.
Chipman,
and
that
duties
were
assessable
as
if
the
capital
of
the
residue
had
been
given
to
him
outright.
Upon
appeal
to
this
Court,
Saint
Pierre,
D.
J.
affirmed
the
assessment
[[1952]
Ex.
C.R.
219;
[1952]
C.T.C.
68].
A
further
appeal
was
taken
to
the
Supreme
Court
of
Canada
(Wanklyn
et
al.
v.
Minister
of
National
Revenue),
[1953]
S.C.R.
58;
[1953]
C.T.C.
263
and
by
a
majority
the
appeal
was
allowed.
It
was
held:
“That
the
appeal
should
be
allowed
and
the
assessment
set
aside;
the
dutiable
value
of
the
succession
to
the
husband
in
respect
of
the
residuary
estate
of
the
testatrix
was
the
value
as
of
the
date
of
her
death
and
the
estimated
net
revenues
from
such
residuary
estate
and
the
residuary
legatees
were
assessable
as
having
on
the
death
of
the
testatrix
become
beneficially
entitled
to
the
capital
of
the
residue
in
remainder
expectant
upon
the
death
of
the
husband,
subject
to
the
appropriate
adjustment
due
to
his
having
received
a
certain
amount
from
the
capital.”
(It
should
perhaps
be
noted
here
that
at
the
time
the
assessment
was
made
in
Mrs.
Chipman’s
estate,
Dr.
Chipman
was
still
living;
but
at
the
time
the
appeal
was
heard
in
the
Supreme
Court
of
Canada
he
had
died.
It
is
agreed
that
succession
duties
in
Mrs.
Chipman’s
estate
have
been
paid
on
the
basis
of
the
judgment
of
the
Supreme
Court
of
Canada.)
The
majority
judgments
were
delivered
by
Cartwright
and
Fauteux,
J
J.
and
by
Estey,
J.
They
did
not
find
it
necessary
to
reach
a
concluded
opinion
as
to
whether
the
power
conferred
on
Dr.
Chipman
was
or
was
not
a
general
power,
being
of
the
opinion
that
in
either
case
the
appeal
must
succeed.
Estey,
J.
said
:
‘“There
is
much
to
be
said
in
principle
for
the
contention
that
a
power
of
appointment
that
permits
one
to
appoint
only
to
himself
is
not
a
general
power
of
appointment.’’
Cartwright
and
Fauteux,
JJ.
stated
that
they
regarded
this
question
as
difficult
and
doubtful,
and
added:
“If
it
were
necessary
to
decide
this
question,
careful
consideration
would
first
have
to
be
given
to
the
appellant’s
argument
that
the
wide
terms
in
which
the
power
given
to
Dr.
Chipman
is
expressed
in
clause
3(f)
are
modified
and
restricted
by
clause
‘Fifthly’
quoted
above.
Even
if
the
respondent’s
contention
that
Dr.
Chipman
was
entitled
to
take
the
whole
capital
be
accepted,
the
power
given
to
him
does
not
at
first
sight
appear
to
fall
within
the
text-book
definitions
of
a
general
power.
See,
for
example,
Halsbury,
2nd
ed.,
vol.
25
at
p.
211
:
‘A
general
power
is
such
as
the
donee
can
exercise
in
favour
of
such
person
or
persons
as
he
pleases,
including
himself
or
his
executors
or
administrators.’
”
Had
I
to
reach
a
conclusion
on
this
point,
it
would
be
necessary
to
give
careful
consideration
to
the
terms
of
the
will.
It
is
clear
that
the
power
conferred
on
the
testator
was
to
appoint
to
himself.
Clause
‘‘Fifthly’’
states
that
all
bequests
are
intended
as
an
alimentary
provision,
that
they
are
exempted
from
seizure
for
debts
except
in
certain
cases
and
that
while
in
the
hands
of
the
executors
they
may
not
be
assigned
by
the
beneficiaries.
In
the
instant
case
I
am
also
of
the
opinion
that
it
is
unnecessary
to
determine
that
question,
since
I
have
reached
the
conclusion
that
the
appeal
must
succeed,
even
if
it
were
held
that
a
general
power
to
appoint
or
dispose
of
property
was
conferred
on
the
testator.
Section
4(1),
as
I
interpret
it,
does
not
purport
to
create
a
statutory
succession
in
all
cases
in
which
the
donnée
of
the
general
power
fails
to
exercise
that
power.
It
is
only
in
cases
44
where
.
.
.
a
person
takes
a
beneficial
interest
in
the
property
as
a
result
of
the
failure
to
exercise
the
power,
that
the
taking
of
that
interest
in
the
property
is
deemed
to
be
a
succession.’’
The
majority
decision
of
the
Supreme
Court
of
Canada
in
the
Wamklyn
case,
it
seems
to
me,
indicates
that
the
beneficiaries
of
the
principal
of
the
residue
did
not
take
beneficial
interests
in
the
property
as
a
result
of
the
failure
of
the
testator
to
exercise
the
power,
but
took
them
directly
from
the
provisions
of
Mrs.
Chipman’s
will.
In
construing
the
relevant
clauses
of
the
will,
Cartwright
and
Fauteux,
JJ.,
stated
at
p.
71
[[1953]
C.T.C.
275]
:
The
first
question
is
as
to
the
proper
construction
of
the
relevant
clauses
of
the
will.
Under
the
rules
of
the
law
of
Quebec,
which
do
not
appear
to
differ
in
this
regard
from
those
of
the
common
law,
it
seems
clear
that
Dr.
Chipman
was
entitled
to
the
income
from
the
residue
for
life
and
that
on
his
death
the
capital
was
divisible
among
the
residuary
legatees,
pursuant
to
clause
3(g)
of
the
will,
subject
to
the
possibility
of
part
or
all
of
the
capital
having
been
paid
to
Dr.
Chipman
during
his
lifetime;
and
the
shares
received
by
the
residuary
legatees
passed
to
them
from
Mrs.
Chipman
and
not
from
Dr.
Chipman.
The
provisions
of
the
Dominion
Succession
Duty
Act
do
not
purport
to
alter
this
result,
but
in
the
submission
of
the
respondent
they
have
the
effect
of
providing
that
duties
shall
be
levied
as
if
(i)
the
whole
residue
had
been
given
outright
to
Dr.
Chipman
by
the
will
of
Mrs.
Chipman,
and
(ii)
the
shares
of
Mrs.
Chipman’s
estate
received
by
the
residuary
legatees
on
Dr.
Chipman’s
death
had
passed
to
them
from
him
and
not
from
her.
It
is
with
the
first
only
of
these
two
questions
that
we
are
directly
concerned
on
this
appeal.
The
power
of
Parliament
to
so
provide
is
not
challenged:
the
question
is
whether
on
a
proper
construction
of
the
Statute
it
has
done
so.’’
Then,
after
quoting
the
definition
of
‘‘succession’’
as
found
in
Section
2(m)
of
the
Act,
the
judgment
continues:
“Applying
these
words
to
the
case
at
bar,
the
‘disposition’
with
which
we
are
concerned
is
the
will
of
Mrs.
Chipman,
the
‘property’
is
the
capital
of
the
residue,
the
‘death
of
the
deceased
person’
is
the
death
of
Mrs.
Chipman,
and
the
question
is
therefore
whether
under
her
will,
upon
her
death,
Dr.
Chipman
became
beneficially
entitled
to
that
capital
‘either
immediately
or
after
any
interval
either
certainly
or
contingently
and
either
originally
of
by
way
of
substitutive
limitation.’
It
appears
to
me
that
he
did
not.
I
am
of
opinion
that
upon
the
death
of
Mrs.
Chipman,
Dr.
Chipman
became
beneficially
entitled
to
the
income
from
the
residue
and
the
residuary
legatees
became
beneficially
entitled
to
the
capital
thereof
in
remainder.
I
have
already
indicated
my
view
that
the
legal
effect
of
the
relevant
provisions
of
the
will
of
Mrs.
Chipman
is
the
same
under
the
law
of
Quebec
as
under
the
common
law,
and
using
the
terminology
of
the
latter,
the
residuary
legatees
immediately
on
the
death
of
Mrs.
Chipman
took
not
a
contingent
but
a
vested
remainder
in
the
capital,
expectant
on
the
death
of
Dr.
Chipman,
subject
to
be
divested
in
whole
or
in
part
by
his
exercise
of
the
power
to
take
during
his
lifetime
such
portion
or
portions
of
the
capital
as
he
might
wish.
So
far
as
the
capital
of
the
residue
was
concerned
no
part
of
it
became
vested
in
Dr.
Chipman
upon
Mrs.
Chipman’s
death
or
under
any
disposition
made
by
her.
No
doubt
upon
his
exercising
the
power
Dr.
Chipman
became
entitled
to
the
part
of
the
capital
of
the
residue
in
respect
of
which
he
exercised
it,
and
became
so
entitled
under
Mrs.
Chipman’s
will
by
the
operation
of
the
rule
of
law
that
‘whatever
is
done
in
pursuance
of
a
power
is
to
be
referred
to
the
instrument
by
which
the
power
is
created,
and
not
to
that
by
which
it
is
executed
as
the
origin
of
the
gift.’
(vide
Farwell
on
Powers,
3rd
edition
at
page
318)
;
but
it
was
only
to
the
extent
that
he
exercised
the
power
that
he
became
beneficially
entitled
to
any
portion
of
such
capital
and
it
was
conceded
that
he
was
liable
to
pay
duty
in
respect
of
such
portion.
The
respondent’s
argument
depends
upon
the
proposition
that
a
person
who
is
given
a
power
over
property
thereby
becomes
beneficially
entitled
to
such
property
but
in
my
view
this
is
not
the
law
and
no
words
in
the
Statute
so
provide.
As
is
pointed
out
in
Halsbury,
2nd
edition,
vol.
25,
page
515
:
‘The
creation
of
a
power
over
property
does
not
in
any
way
vest
the
property
in
the
donee,
though
the
exercise
of
the
power
may
do
so;
and
it
is
often
difficult
to
say
whether
the
intention
was
to
give
property
or
only
a
power
over
property.’
I
have
already
indicated
my
view
that
as
a
matter
of
construction
it
is
clear
that
Mrs.
Chipman’s
will
gave
Dr.
Chipman
no
property
in
the
capital
of
the
residue
but
only
a
power
over
it.
During
the
argument
the
terms
of
Sections
3(4)
and
4(1)
of
the
Act
were
fully
discussed
but
they
appear
to
deal
with
the
question
of
what
duties
are
payable
upon
the
death
of
the
donee
of
a
power
rather
than
with
the
question
of
the
duties
payable
upon
the
death
of
the
donor
of
a
power,
and
their
relevance
to
the
question
before
us
is
limited
to
the
bearing
which
they
may
have
upon
the
proper
construction
of
Section
31.”’
Then,
after
considering
the
provisions
of
Section
31
of
the
Act
and
reaching
the
conclusion
that
it
could
not
be
construed
as
levying
any
duty
or
defining
any
succession,
and
that
there
was
no
other
provision
which
had
the
effect
contended
for
by
the
Minister,
the
judgment
continued:
‘‘for
the
above
reasons,
I
would
allow
the
appeal,
set
aside
the
assessment
and
order
that
the
matter
be
referred
back
to
the
Minister
in
order
that
an
assessment
may
be
made
upon
the
basis
that
the
dutiable
value
of
the
succession
to
Dr.
Chipman
in
respect
of
the
residuary
estate
of
Mrs.
Chipman
was
the
value
as
of
the
date
of
her
death
of
the
estimated
net
revenues
from
such
residuary
estate
during
the
remainder
of
his
lifetime
and
that
the
residuary
legatees
were
assessable
as
having
on
the
death
of
Mrs.
Chipman
become
beneficially
entitled
to
the
capital
of
the
residue
in
remainder
expectant
upon
the
death
of
Dr.
Chipman,
subject
to
the
appropriate
adjustment
made
necessary
by
the
fact
of
Dr.
Chipman
having
received
$33,164.41
from
such
capital.
The
appellants
are
entitled
to
their
costs
in
the
Exchequer
Court
and
in
this
Court.”
In
a
separate
judgment
Estey,
J.
reached
the
same
conclusion
and
for
substantially
the
same
reasons.
In
allowing
the
appeal,
he
directed
41
that
the
matter
be
referred
back
to
the
Minister
for
a
reassessment
on
the
basis
that
upon
the
death
of
the
testatrix
the
capital
in
the
residue
of
her
estate
passed
to
the
parties
named
in
the
will,
subject
to
the
amount
received
by
Dr.
Chipman
in
the
sum
of
$30,164.41.”
The
opinion
of
the
majority
of
the
judges
in
the
Wanklyn
case
indicates
that
in
relation
to
the
principal
of
the
residue
of
Mrs.
Chipman’s
estate
(excluding,
of
course,
that
part
which
his
testator
had
appropriated
to
himself)
:—
(1)
there
was
no
"succession”
under
the
Act
to
Dr.
Chipman;
(2)
that
under
the
rules
of
the
law
of
Quebec
and
of
the
common
law
the
shares
received
by
the
residuary
legatees
passed
to
them
from
Mrs.
Chipman
and
not
from
the
testator
;
(3)
the
residuary
legatees
immediately
on
the
death
of
Mrs.
Chipman
took
not
a
contingent
but
a
vested
remainder
in
the
capital
expectant
on
the
death
of
Dr.
Chipman
subject
to
be
divested
in
whole
or
in
part
by
his
exercise
of
the
power
to
take
during
his
lifetime
such
portion
or
portions
of
the
capital
as
he
might
wish;
(4)
that
no
part
of
it
became
vested
in
Dr.
Chipman
upon
Mrs.
Chipman’s
death
or
under
any
disposition
made
by
her
;
(5)
that
it
was
only
to
the
extent
that
Dr.
Chipman
exercised
the
power
that
he
became
beneficially
entitled
to
any
portion
of
such
capital
;
and
(6)
that
Mrs.
Chipman’s
will
gave
Dr.
Chipman
no
property
therein
but
only
a
power
over
it.
It
seems
to
me
that
the
inclusion
of
the
words
‘‘the
taking
of
the
interest
in
the
property
as
a
result
of
the
failure
of
the
deceased
to
exercise
the
power’’
creates
a
condition
which
must
be
found
to
exist
before
there
is
deemed
to
be
a
succession;
there
must
be
a
taking
of
a
beneficial
interest
by
the
successor
and
that
taking
must
follow
as
a
result
of
the
donee
of
the
power
failing
to
exercise
it.
Here
the
beneficiaries
took
the
beneficial
interests
in
the
property
at
the
death
of
Mrs.
Chipman.
They
took
no
beneficial
interest
on
the
testator’s
death,
but
merely
retained
what
they
already
had,
namely,
a
vested
remainder
in
the
capital,
relieved,
it
is
true,
by
the
testator’s
death,
of
the
possibility
of
being
divested
thereof
which
had
existed
during
his
lifetime.
It
is
of
interest
to
refer
to
the
judgment
in
A.
G.
v.
Lloyd’s
Bank,
Ltd.,
[1935]
A.C.
382,
as
explained
by
Lord
Russell
of
Killowen
in
Scott
et
al.
v.
C.I.R.,
[1937]
A.C.
174.
In
the
latter
case
he
said
at
page
183
in
referring
to
the
former
case:
“I
would
like,
however,
as
one
of
the
majority
in
that
case,
and
in
view
of
observations
recurring
(if
not
concurring)
elsewhere,
to
state
in
fuller
detail
the
foundation
of
that
decision.
The
fund
under
consideration
was
the
fund
as
it
existed
at
the
moment
of
the
settlor’s
death—namely,
the
original
capital
increased
by
accumulations
of
so
much
of
the
income
as
had
not
been
paid
or
applied
under.
clause
4
of
the
settlement,
but
less
so
much
capital
as
had
been
applied
under
clause
3
of
the
settlement.
The
question
to
be
answered
was
had
that
fund
passed
on
the
death
of
the
settlor.
To
answer
that
question
a
comparison
must
be
made
between
the
persons
beneficially
interested
in
that
fund
the
moment
before
the
death.
The
only
persons
beneficially
interested
in
that
fund
immediately
before
the
death
were
the
son
and
the
daughters,
though
their
interests
were
liable
to
be
altered
or
defeated
by
some
act
of
the
settlor,
or
by
the
happening
of
some
event
in
his
lifetime.
His
death
merely
rendered
any
such
act
or
event
an
impossibility.
The
son
and
daughters
remained
beneficially
interested
in
the
same
shares
and
to
the
same
extent
as
before,
but
their
interests
were
no
longer
subject
to
alteration
or
defeat.
They
claimed
under
the
same
title
as
before.
There
was
no
changing
hands.
Therefore
the
fund
in
question
did
not
pass
on
the
death.’’
The
question
under
consideration
there
was
whether
there
was
a
passing
on
the
death
and
that
judgment,
of
course,
is
not
directly
applicable
to
the
instant
case.
The
explanation,
however,
does
establish
that
the
mere
cesser
of
the
possibility
of
the
alteration
or
defeat
of
beneficial
interests
does
not
result
in
a
changing
of
hands,
that
the
parties
beneficially
entitled
remain
beneficially
interested
in
the
same
property
and
to
the
same
extent
as
before;
and
that
they
claim
under
the
same
title
as
before.
It
would
seem
to
follow,
therefore,
that
in
the
instant
case
there
was
no
taking
of
any
beneficial
interest
as
a
result
of
the
failure
to
exercise
the
power.
Counsel
for
the
respondent
submits
that
the
provisions
of
subsection
(4)
should
not
be
interpreted
in
any
technical
or
strictly
legal
manner.
He
suggested
that
while
the
section
may
have
been
poorly
drawn,
the
intention
was
to
create
a
succession
in
every
case
where
there
was
a
general
power
of
appointment
which
had
not
been
exercised.
To
interpret
the
subsection
in
that
way
would
be
to
disregard
entirely
the
clear
words
of
the
subsection
itself
which,
as
I
have
said,
import
a
necessary
condition—the
taking
of
the
interest
in
the
property—a
condition
which
I
find
does
not
here
exist.
The
appeal
must
succeed
on
this
ground
also.
It
may
be
noted
that
subsection
(4)
as
it
existed
at
the
death
of
the
testator
was
repealed
by
Section
2(3)
of
Statutes
of
1952,
ce.
24,
and
a
new
subsection
substituted
therefor.
It
is
unnecessary
to
consider
its
provisions,
the
parties
hereto
being
in
agreement
that
it
has
no
bearing
on
the
instant
case.
For
these
reasons
the
appeal
will
be
allowed,
the
assessment
will
be
set
aside
and
the
matter
referred
back
to
the
respondent
to
reassess
the
duties
in
the
estate
of
the
testator,
omitting
therefrom
all
entries
relating
to
the
residue
of
the
estate
of
Mrs.
Chipman
and
to
her
residuary
legatees
and
fixing
the
aggregate
net
value
of
the
successions
derived
from
the
testator
at
$132,045.16.
The
appellants
are
also
entitled
to
their
costs
after
taxation.
Judgment
accordingly.
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