[1952] 1 All ER 1107

By her will, dated 16 February 1937, a testatrix, who died on 6 June 1941, directed, in exercise of a power of appointment conferred on her by her marriage settlement, that the trustees should pay the income of an equal one-third share of the trust funds to G during her life "... unless some act or event shall have been done or happened during my life whereby if the same income belonged absolutely to her such income or some part thereof would at my death be or become vested in or charged in favour of some [other] person or until some act or event shall be done or happen within twenty-one years after my death whereby if the same income belonged absolutely to her such income or some part thereof would have become so vested or charged ... " On the failure or determination during the life of G of the said trust the trustees were directed to hold the said income on other trusts. At all material times the testatrix and G, being resident in the south of France, were, by virtue of the Trading with the Enemy Order, 1940, "enemies" within the meaning of the Trading with the Enemy Act, 1939 s 2(1).

Held - The term "vested" as used in the will had the significance of the passing of some proprietary interest and related to the life interest given to G; the Act of 1939 (having regard especially to s 7(1) thereof) and the orders made thereunder (in particular the Trading with the Enemy (Custodian) Order, 1939), made a clear distinction between vesting and payment; by art 1(i) and (ii) of the order of 1939 the income which would have been payable to G was payable to the Custodian of Enemy Property, but the proprietary right to the life interest did not vest in the Custodian, whose right to receive the income depended essentially on the circumstance that the proprietary interest was vested in an enemy; and, therefore, the condition for the operation of the forfeiture clause had not arisen.
   Fraenkel v Whitty ([1947] 2 All ER 646), overruled.

1107

Notes
For the Trading with the Enemy Act, 1939, s 7, see Halsbury's Statutes, Second Edn, Vol 26, p 337.

Appeal
Appeal by the third and fourth defendants to an originating summons against an order of Vaisey J dated 1 May 1951.
   Following Fraenkel v Whitty, Vaisey J held that by virtue of the Trading with the Enemy Act, 1939, and the orders made under s 7 thereof, the income of certain trust funds had become vested in a person other than the appointees under the will of Doris Muriel Guerbois, deceased, and, therefore, the defeasance clause in the said will operated to determine the interests of the appointees.

26 March 1952. The following judgments were delivered.

SIR RAYMOND EVERSHED MR. The first point raised in this case is in form an appeal from Vaisey J but in substance it is an appeal from Roxburgh J in Fraenkel v Whitty. The question, put briefly, is whether the effect of the Trading with the Enemy Act, 1939, and the Trading with the Enemy (Custodian) Order, 1939, of 16 September 1939 (SR & O, 1939, No 1198), as amended, operated in the circumstances of the present case to cause a forfeiture of the life interests appointed by the will of Madame Doris Muriel Guerbois (to whom I will refer hereafter as "Doris"), pursuant to the terms of the settlement made on her first marriage (with M Francis Louis Frederic Pozot) in which the proceedings are entitled? If this question is answered affirmatively (as Vaisey J answered it, following the decision of Roxburgh J in Fraenkel v Whitty), a further question arises on the construction of the will of Doris, by which the appointment was made, as to the present effect of that forfeiture.
   The settlement on the first marriage of Doris is dated 2 August 1910, and was made pursuant to an order of Eve J under the Infant Settlements Act, 1855. By the effect of it, so far as relevant, certain funds (specified in the schedule to the settlement and now worty, we are informed, some £12,000) were settled so that the income of the fund was payable to Doris for her life and subject thereto were held on trust for the children or remoter issue of the marriage as Doris should by deed or will appoint and in default of appointment equally for the children of the marriage as therein stated. There was a power to Doris (inter alia) to appoint in favour of an after-taken husband, and this power was exercised to the extent of a one-fourth part of the income of the fund in favour1108 of the second husband of Doris who is the first defendant in the action. It was provided that the settlement of all rights taken thereunder should be determined according to the law of England, and there is no question in the present appeal that the problem that is now presented to the court has to be solved by reference exclusively to English law.
   The plaintiff are the trustees of the settlement. The second, third and fourth defendants are the three children (all daughters) of the first marriage of Doris. Mr Pozot, her first husband, died in July 1927, and in the following year Doris married the first defendant to the action, M Fernand Louis Guerbois. She herself died on 6 June 1941. After her death, the first defendant, her widower, proceeded to go through a form of marriage with the second defendant, one of the three children of Doris and, therefore, one of his own step-daughters. The remaining five defendants (all being infants) are the issue of the first and second defendants. One was, in fact, born during the subsistence of the marriage between the first defendant and Doris, and another was born after the death of Doris, but before the ceremony of marriage between his parents. At all material times Doris and all her three daughters were resident in the south of France, and during the second world war were subject to the government associated with the name of the late Marshal Petain. By a decree promulgated by the marshal or by his authority, the marriage of the first defendant to his step-daughter was declared valid by the law of France, and the decree also legitimated those two of the infant defendants who were born before the marriage of the first and second defendants. After hearing evidence, Vaisey J held that for all the purposes of the settlement and the appointment made thereunder, the five infant defendants must be treated as lawful issue of the second defendant, and there is no appeal against that finding. The other two children of Doris by her first marriage, viz, the third and fourth defendants, have married since the proceedings were started, but there is no issue, as yet, of these children and there was no issue of the marriage of Doris and the first defendant.
   The power of appointment conferred on Doris by the settlement of 1910 was exercised by her by an English will dated 16 February 1937. After making the provision above-mentioned for the first defendant, her second husband, the will provided as follows:

in manner therein provided. The will then proceeded to deal with the other two third shares of the trust funds, under corresponding trusts, substituting for the name of Georgette the name of one of the other two daughters of Doris. 1109There was a final disposition in the appointment expressed to take effect in the event of the "failure" of the trusts of any one-third share, on which provision the second question to which I have earlier alluded turns. As a result of the order made by Vaisey J, the present position is that the income of the entire trust fund is now payable to or for the benefit of the five infant children of the second defendant (who, by the Official Solicitor, are respondents to the appeal), and no part of such income is payable to either of them, the third or fourth defendants (who are the appellants in this court), but the interest of the five infant defendants is liable to be reduced on the birth of further children to the second defendant and also on the coming into existence of children of the third or fourth defendants respectively.
   I have stated that Doris and her three children were at all material times resident in what was known as unoccupied France during the late war and so all of them became "enemies" within the meaning of the trading with the enemy legislation at all material times, including the time of the death of Doris on 6 June 1941. The first question, as I have already indicated, is whether the effect of the Trading with the Enemy Act, 1939, and the orders made thereunder was, on the death of Doris, to cause an immediate forfeiture of the limited interest given to each of her daughters by the appointment made by Doris by her will, on the ground that in each case the income appointed (if belonging absolutely to such daughter) would have become "vested in, or charged in favour of some person"? It is clear that the words "some person" must mean some person other than the named daughter and that the Custodian of Enemy Property appointed pursuant to the trading with the enemy legislation was and is such a person. It is clear also that nothing turns on the alternative words "or charged in favour of". The matter, as the arguments have proceeded, turns on the proper interpretation of the earlier words "vested in".
   One other matter I can dispose of briefly and at once. The relevant appointment consists, as will be remembered, of two parts. The first one-third of income given to Georgette is given to Georgette "unless some act or event shall have ... happened during my life whereby", etc, or, alternatively, is given to her "until some act or event shall be done or happen within twenty-one years after my death whereby", etc. Counsel for the infant defendants had said that, if the facts are such as do not bring the case within the first limb of the provision to which I have alluded, then at any rate a forfeiture is brought about by the second. I cannot agree that the second part has any application in any circumstances in the present case. It seems to me tolerably clear that the Trading with the Enemy (Specified Areas) Order, 1940, which made the Act apply as regards unoccupied France, was an "act or event" which happened during the life of Doris such as would, at Doris's death, cause the rest of this part of the clause to operate if the word "vested" is satisfied by the effect of the trading with the enemy legislation in other respects. If, however, this part of the clause did not take effect because there would have been no "vesting" within the meaning of the will, then, in my opinion, there is no question that the second alternative part of the clause is also ineffective. In my judgment, nothing that happened after Doris's death can in any circumstances be regarded as an "act or event" within the meaning of the words used.
   The whole question, then, turns on the significance of the two words "vested in". In approaching this problem, I agree with counsel for the infant defendants that it is not legitimate to give words in this will a strained construction in order to avoid a particular result on the ground that the particular problem which has arisen was not envisaged by Doris at the time when she made her will. On the other hand, it is nevertheless legitimate to bear in mind that forfeiture clauses are given a strict construction by this court. In the recent case of Re Westby's Settlement, in delivering the leading judgment, I referred ([1950] 1 All ER 483) to the proposition which I have mentioned and used this language, which I hope I1110 shall be forgiven for quoting, in reference to a decision of Farwell J in Re Greenwood:

I think, therefore, as a premise to what follows, that it is necessary to give to this clause not an unnatural or strained construction but a strict one, bearing in mind that the language used is the technical language of lawyers or equity draftsmen who are employed in drawing wills or appointments of this character. Certainly the word "vested" to such persons may be regarded as a term of art, and it has as such, in my judgment, undoubtedly the significance of a passing of some proprietary interest.
   I referred during the argument to the definition in Stroud's Judicial Dictionary, 2nd ed, p 2181, and to the passage cited from Coverdale v Charlton. The relevant passage is:

Then there are reference to its use in the Lands Clauses Consolidation Act, 1845, the Trustee Act, 1850, and the Bankruptcy Act, 1869.
   In Fraenkel v Whitty, which is, substantially, the case now under appeal, Roxburgh J, who had to construe a deed of covenant which contained language directed to a forfeiture substantially identical with the words which are contained in Doris's will, came to the conclusion to which he did because he thought that the effect of the trading with the enemy legislation was to produce a result, if not in strict parlance a vesting as understood by lawyers, at least having a practical result equivalent to a vesting. In my judgment, that was not a legitimate way to construe such a clause as this. The words in this will are "or become vested in", not "or so held as to be in effect vested in" or other words of similar wide and general import.
   I must now, however, turn to the Trading with the Enemy Act and the orders made thereunder, so that I can make clear the reasons for my conclusion. The Act of 1939, by s 7(1), provides:

Paragraph (e) covers the requirement of payment of fees. In sub-s (4) it is provided that

1111

Section 4, to which counsel for the third and fourth defendants attached some importance, relates to negotiable instruments and choses in action belonging to enemies, and provides (briefly) that no assignment of a chose in action given by or on behalf of an enemy shall, except with the sanction of the Treasury, be effective so as to confer on that person any rights or remedies or interest whatever.
   From what I have read, this much, I venture to think, is quite clear-that there is in this Act the clearest distinction between vesting, on the one hand, and payment of money, on the other, and it is to be noted that this Act differs in this respect from the Trading with the Enemy Act, 1914, passed on the occasion of the first world war. Under the latter Act vesting orders were made, and had to be made, by the court. Under this Act it is provided that the Board of Trade may, indifferently, make vesting orders and orders requiring payment. But for present purposes the essential matter is the clear distinction which I think is to be found in the language of Parliament between vesting, on the one hand, and payment, on the other. By "vesting", in such a context, I have no doubt that Parliament was signifying an operation which would pass to the Custodian a proprietary interest in the subject-matter vested, and the significance of s 4 (I do not desire to make too much of it, as, indeed, counsel did not desire to make too much of it) is that it seems to indicate that, notwithstanding that there may have been orders for payment, under the sanction of the Treasury the assignment of a chose in action is contemplated, and there could, of course, be no assignment of anything unless the assignor had in him something to assign. It is, perhaps, merely an emphasis on the distinction which I think is clear in the Act between vesting and payment.
   The Trading with the Enemy (Custodian) Order, 1939, art 1(i), is a general direction in exercise of the Board of Trade's power under s 7 of the Act of 1939:

Paragraph (ii) descends to the particular and expands what para (i) has provided:

There is no doubt that that provision would cover, on the face of it, money arising under the settlement contained in the deed of 1910 and the appointment of 1937. Paragraph (iv) has a significance in the argument, and it provides:

Pausing there, the effect is (as I follow it) that where, under the terms of a trust, the trustees have in hand at any particular point of time money which, by the terms of the trust, becomes then payable by the trustees to the beneficiary, if that beneficiary is an enemy the money has to be paid to the Custodian, not immediately, but within fourteen days after the date which I have mentioned. By art 2 of the order the Board of Trade is given power, in any case where it appears to them to be expedient so to do, to make a vesting order as regards the enemy property therein mentioned. I need not for the present refer to any more of the original order except art 7, which provides (as amended by the1112 Trading with the Enemy (Custodian) (No 2) Order, 1942 (SR & O 1942, No 342)):

   Again, as I think, the clearest distinction is drawn throughout that order between vesting, on the one hand, and payment, on the other. The order is made, as its introductory paragraph states, under s 7 of the Act of 1939, and, following the dichotomy between vesting and payment, it may, I think, be safely asserted that the provisions of art 1(ii), which particularly relates to the question of money, are made under the terms of s 7(1)(a) as being orders requiring payment, whereas the powers contemplated by art 2 of the order, if exercised, would be made under s 7(1)(b) or (c). Furthermore, I think that if and so far as the order requires third parties (in this case, say, Westminster Bank Ltd) to pay over moneys to the Custodian, that obligation is imposed on Westminster Bank Ltd by s 7(1)(d)(iii). The distinction is, I think, further emphasised by another important addition to the original order, viz, that now contained in art 1(vii) as a result of the addition made by the amending order, the Trading with the Enemy (Custodian) (Amendment) Order, 1941 (SR & O, 1941, No 765), which adds to art 1, among other things,

That relates, therefore, to moneys which the order states are payable to the Custodian, and it was thought proper-indeed necessary-to confer specially on the Custodian a statutory power to sue for and recover such money. If and so far as there had been a vesting in the Custodian of the subject-matter out of which the payments arose, no special statutory power to sue would, I conceive, have been necessary.
   I hope that, having regard to the importance of the matter, I shall not be thought to be taking too much time on this problem, but in the course of the discussion before Roxburgh J much of the argument (according to the judgment) was directed, first, to the proper effect of the interpretation to be given to the formula "money which would be payable to a person who is an enemy", and, secondly, to the precise effect of this fourteen days' interval which is given between the day when the trustees have, under the terms of their trust, money in hand and payable to a beneficiary, and the time when they become liable to be sued by the Custodian. As regards the first matter, I have no doubt, for myself (and I do not think learned counsel disagreed about it) that the use of the present tense in the phrase "a person" who is an "enemy" in art 1(i) and art 1 (ii), is a reference to the point of time when, to take the case of a trust, the money has become, in the hands of the trustees, payable to that (enemy) beneficiary. It appears, then, in the case of money, with which we are concerned here, the phrase has this result, that when any money which, under the terms of the settlement and the appointment, would be payable to a person who was, at the date when, under the terms of the trust, it became so payable, an enemy, then a period of fourteen days is, nevertheless, allowed under this order (for obvious administrative reasons) which the payer, the trustee, has before he becomes under the final obligation liable to be sued accordingly to pay over to the Custodian.
   A question was raised of what would happen if, after the date when, under the terms of a trust, a sum of money representing a particular piece of income became payable to the beneficiary (being then an enemy), but before the expiration of the fourteen days, or, at any rate, before the time when the money had in fact been handed over, the beneficiary eluded the occupying forces of the enemy and arrived in England, being an Englishman, or not an enemy national, 1113and claimed to have payment made to himself or herself. It seems to me that the answer to that problem, under the terms of this order, is (and what I am now stating agrees with the conclusion of Roxburgh J) that once the money has become, according to the terms of the trust, payable to a person who is at that point of time an enemy, then it is payable to the Custodian, and the return to these shores of the beneficiary before actual payment would not have the effect of depriving the Custodian of his right to recover that particular item of money. I think that is reinforced by the circumstance that under the terms of art 3(iv) of this order it is also provided that the Custodian is entitled to give a good discharge for any sums paid to him pursuant to the order. On the other hand, if the operation were one of vesting during such period as the beneficiary was an enemy, so far as I can see the arrival in this country, before actual payment, of the beneficiary, thereby disembarrassing himself or herself from his or her enemy quality, would cause an immediate re-vesting and would then put an end to the right of the Custodian. However, it is, perhaps, at this stage significant to note that, according to the evidence, a material fact in this case is that none of the moneys in question has been handed over to the Custodian, but the Westminster Bank Ltd now has certain sums of money in its possession, and has never been, in fact, called on to pay over those moneys to the Custodian. It seems to me that it would be very difficult to say that in the hands of the Westminster Bank any such moneys were "vested" in law in the Custodian. The Custodian may or may not have the right to call on the bank to pay over some or all of the money in the bank's hands. If he has, it is, to my mind, a right dependent on a particular statutory right given to him and not on a proprietary title. I should also add that in point of fact no fees have been charged in respect of this income by the Custodian, so that no question arises of the effect (whatever it might be) of the liability of the income for the provision of such fees.
   We were referred to Re MŸnster and Re Gourju's Will Trusts, cases which came before Russell J and Simonds J respectively, the first being under the Trading with the Enemy Amendment Act, 1914, and the second under the existing Act. The effect of those cases, undoubtedly, is that moneys actually in the hands of the Custodian are treated as held on "statutory suspense": no beneficial interest in them can be asserted by anybody. Certainly, the Custodian cannot be regarded as holding such moneys as trustee or agent for the original enemy beneficiary. That is true, and in that respect I conceive that there is no distinction between the two Acts. It is, no doubt, true also that any money which has in fact been paid to the Custodian and is in his hands may properly be said, according to the ordinary use of language, to be then "vested" in the Custodian-and not vested in him on behalf, as I have said, of the original beneficiary. But the ability so to assert does not, I think, advance the case of the infant defendants.
   In considering the construction of the will here in suit the essential formula "income or some part thereof would be or become vested in" must relate in the context to the life interests given, and, therefore, mean that "the right to receive the income would be or become vested", etc, at the death of Doris. At the moment of Doris's death the income in question was not an existing entity in the same sense as a fund of a corpus to which the formula also applies. It is, therefore, this life interest, this right to receive the income of which, if counsel for the infant defendants is right, it must be shown that it vested, or would have been apart from the forfeiture provision, vested in the Custodian as a result of the trading with the enemy legislation to which I have made reference. By the effect of that legislation the Custodian, as I have said, had the right to demand payment to him of that income as it fell due, but he surely had that right, not because some proprietary interest under the settlement from which the income sprang was vested in him, but, on the contrary, because the proprietary interest, the life estate, was vested, not in him, but in an enemy under the legislation, viz, Georgette.

1114

   I think, therefore, that there was no such proprietary interest under the trust fund or its income which, by the terms of this legislation, vested in the Custodian. Counsel for the infant defendants argued that where a third party (in this case the Custodian) has a right to receive some part of the income as it accrues under a settlement and to receive and hold it not merely as a trustee or agent for the beneficiary under the settlement, then there is a vesting. That, I think, with all respect to counsel, is an over-simplification of the matter and disregards the fundamental distinction that I have tried to state by the language I have used, that the Custodian's right to receive the income depends essentially on the circumstances that a proprietary interest in the investments is not vested in him but in "an enemy" within the meaning of the legislation. The difference and distinction, I doubt not, is a somewhat narrow one, but I think or hope, at any rate, that it is clear and sensible to a lawyer.
   During the case I have drawn attention, by way of illustrating the distinction, to the point arising from what I call the fourteen days' interval in art 1(iv)(c) of the main order, and I have also drawn attention to the addition to the order of the right to the Custodian to sue, given in the case where the order requires payment to him of particular moneys, and not, of course, and properly not, directed to the case where the proprietary interest from which the money springs is vested in the Custodian. In the course of our discussions Jenkins LJ further illustrated the distinction thus. Suppose, in reference to one of the investments held by the trustees of the settlement, there was a bonus issue of shares distributable, according to the terms of the settlement, to the tenant for life. It is, I suggest, manifest that, under the terms of this as it stands, the Custodian would have no claim whatever to those shares, for they are not "money" and they are not covered by the direction for payment. If, on the other hand, there had been a vesting in the Custodian of the proprietary interest from which such a bonus issue sprang, then, of course, the Custodian would be entitled to the shares as the fruit of the subject-matter vested in him. Recent legislation has after all made us familiar with the distinction, which might have been obscure to our ancestors, between the position of those who are given statutory rights, having no proprietary interest, and those who have proprietary interests conferring privileges which are for practical purposes no different from the statutory rights. I quoted during the course of the argument the instance of the Minister who requisitions property. He has, in respect of the property so requisitioned, for all practical purposes all the advantages and privileges of a tenant-the right to possess and the right to exclude others from possession-but he has no estate or interest in the property whatever and cannot, therefore, confer any estate or interest on any other person. The same may be said to be the situation of the phenomenon of this age commonly known as the statutory tenant.
   I turn, therefore, finally to the judgment of Roxburgh J in Fraenkel v Whitty. That was a case in which the forfeiture clause arose under a deed of covenant, but, as I have said, the language was not in any material respect dissimilar from the present. In particular, though it comprehended the two alternatives "vested in or charged in favour of", it did not, as the present case does not, include the other words, so frequently seen in covenants of this kind, "or payable to"; but, as I have already said, the learned judge came to the conclusion that a forfeiture was incurred because, under the terms of the order I have read, if the particular annual sums had belonged absolutely to the recipient they would have vested in the Custodian in the sense that they would have been held so as to be payable to him in a sense which made it in all respects the same thing as though they were vested. I do not think that in so stating I am doing injustice to the judgment. Roxburgh J said ([1947] 2 All ER 648):

With all respect to the learned judge, I am unable to accept that reasoning. I do not think it true that the event which happened would have vested in the Custodian, within the meaning of the deed in question, the right to sue for it. It would have had that effect only in the sense that under the terms of the order the Custodian had a statutory right to sue if not paid, but I do not think that there is such a vesting as is comprehended by the proper use of that word, and, although I do not at all dissent from the view that for practical purposes the Custodian may have been in as good a position as if there had been a vesting, that does not seem to me to involve the conclusion that there was a vesting.
   The learned judge then says (ibid):

There is then a long paragraph in which he proceeds to deal with what he states to have been the argument of Mr Danckwerts for the view now put forward by counsel for the third and fourth defendants. I confess that I have felt considerable difficulty in comprehending this paragraph. To Mr Danckwerts is attributed an argument, as a premise to his whole case, which required the construction of the simpler words "would be payable" in s 7(1)(a) of the Act of 1939 as meaning

so as to produce the result (contrary to what, I think, is the true result) that if, before actual payment under the terms of art 1 of the order of 1939, an enemy beneficiary returned to this country disembarrassed of his or her enemy character, the right of the Custodian to require payment would come to an end. I do not think that is a right conclusion, and if and so far as Mr Danckwerts made it the basis of the argument against that which commended itself to Roxburgh J, I agree with Roxburgh J in his rejection of it. I cannot, indeed, avoid altogether the suspicion that, if such was the argument put forward, the learned judge may well have been influenced strongly towards the conclusion that he reached by the fallacy in the argument that he described as the alternative. My difficulties are increased by the circumstances that the law reporters, in stating what Mr Danckwerts' argument, in fact, was, do not attribute to him the unfortunate and (as I think) erroneous premise which, in the judgment it appears Roxburgh J thought had been the foundation of his case.
   Whatever may be the solution of the particular problem, however, I have, for the reasons which I have attempted to state, felt compelled to differ in this matter from Roxburgh J and I am bound to say that I think his conclusion in Fraenkel v Whitty was incorrect. The result in the present case is that the foundation of Vaisey J's conclusion is gone, and I think that the appeal1116 on this first question should succeed. In other words, I think that the question answered affirmatively by Vaisey J should have been answered negatively, and the result is that the other question raised in the appeal no longer arises. We have considered whether, in the circumstances, we ought to express our view on it, but, as it appears to turn almost entirely on the construction of this particular document, it does not seem to us necessary to pursue that matter, and, therefore, I do not propose to say anything about it. In my judgment, on the first point the appeal succeeds and the order made below should be reversed accordingly.

JENKINS LJ. I agree, but as we are differing from Roxburgh J and from Vaisey J who followed Roxburgh J on a point of some difficulty and importance, I may perhaps, be excused for adding a few observations of my own. The question in the case is whether the complex of events comprising the outbreak of war between this country and Germany, the passing of the Trading with the Enemy Act, 1939, the making of the Trading with the Enemy (Custodian) Order, 1939, the invasion of France by the German forces and the consequent making of the Trading with the Enemy (Specified Areas) Order, 1940, on 10 July 1940, the making of the Trading with the Enemy (Custodian) (Amendment) Order, 1941, on 30 May 1941 (all or which events happened in the lifetime of the settlor), coupled with the residence of the three income beneficiaries in France, amounted, within the meaning of the appointment, to an act or event done or happening during the life of the settlor whereby, if the income had belonged absolutely to the income beneficiaries, such income would, at the settlor's death, be or become vested in or charged in favour of "some (scilicet, other) person". That, I think, is the question, for I agree with my Lord that if the events here under consideration cannot be shown to have brought about a determination of the life interest under the first branch of the provision for determination contained in the appointment, it is reasonably plain that no forfeiture can have been brought about by any act or event done or happening within the scope of the second branch.
   The question raises, in effect, two points: first, what is the true construction of the provision for determination contained in the appointment, and, secondly, was the effect of the Trading with the Enemy Act, 1939, and of the orders made thereunder on the property in this country of technical enemies, as, for example, the income beneficiaries under this settlement, such as to bring about a forfeiture, having regard to the true construction of the forfeiture provision?
   I propose to address myself first to the question of construction. The words are

Clauses of this general description have a fairly long history, and any conveyancer will have seen them in many settlements in a large variety of forms. What may, perhaps, be termed the rudimentary form is a gift to the income beneficiary "until he shall assign or charge or attempt to assign or charge the income or any part thereof". A clause in that form, from the point of view of complete protection, is obviously imperfect, for it would not apply to events in which the income beneficiary played a purely passive role (as, for instance, the event of bankruptcy), and an improvement or enlargement of the clause, as regards the circumstances bringing about the events sought to be guarded against, is sometimes met with in the form of a trust to pay the income to the beneficiary "until any act or event shall be done or suffered by" the beneficiary whereby the result to be prevented would be brought about. That includes the case where the beneficiary plays a passive role. A yet wider form may be framed (as in this case) so as to1117 depend merely on the doing or happening of some act or event without any qualifying words to indicate who the actor is to be or to suggest at all events permission on the part of the beneficiary. That considerably enlarges the scope of the clause. As to the events which are to occasion forfeiture, as distinct from the circumstances bringing them about, the clause may be framed so as to create a gift over, as already instanced, in the case of an assigning or charging, or attempted assigning or charging. That may not cover all events. I mentioned the possible circumstances of bankruptcy, where, although there is a vesting in the trustee, there may have been nothing amounting to an assignment in his favour. Such events as that are covered, or may be covered, by the use of the word "vested", sometimes in addition to, and sometimes in substitution for, the reference to an assignment or charge. For instance, a common variant is the form used here:

Lest that should not suffice to cover all events, recourse is sometimes had to a wider form, the form "be or become vested in or charged in favour of or payable to some other person". Lastly, I would refer to, perhaps, the widest form of all, the compendious form used in the Trustee Act, 1925, s 33, where the interest of the principal beneficiary is made to endure until any event happens whereby if the income belonged absolutely to him he would be deprived of the right to receive the same or any part thereof.
   Each of these forms has its own scope, and when the question arises whether a forfeiture has occurred under a particular settlement it is necessary to look critically at the language of the particular clause and see whether, having regard to the language of that clause and the nature of the event relied on as bringing about a forfeiture, a forfeiture has been incurred. The words here, as I have said, are "be or become vested or charged in favour of some (scilicet, other) person". It has not been contended before us, nor do I think it could be contended with any reasonable prospect of success, that there has been any charge in this case. The argument is centred on the question whether there has been a vesting of the income or some part thereof in some other person. Now, "vesting" is to some extent, I think, a term of art, and to my mind, and I should say, to the minds of most lawyers, it would connote a vesting in point of interest-a transfer of the property, or the passing of a proprietary interest of some sort, to the person in whose favour the vesting is said to take effect. Thus, in my view, the event here contemplated by the words "become vested in some person" is an event amounting to a transfer of the ownership of, or of a proprietary interest in, the income or in some part thereof to some other person. It follows, in my judgment, that no forfeiture was here incurred unless the Trading with the Enemy Act, 1939, and the orders made thereunder, fairly considered, and with their legal consequences properly taken into account, would, apart from the forfeiture provision, have brought about something amounting to a vesting in the Custodian of the income or some part thereof, in the sense of a transfer to the Custodian of a proprietary interest therein.
   The argument of counsel for the infant defendants took this form. He said the income beneficiary was entitled to the income of a share of the fund during her life. What did that mean? It meant simply that she had the right to receive the income of the share during her life. The effect of the Trading with the Enemy Act, 1939, and the relevant orders, apart from the forfeiture provision, would have been to give the Custodian the right to receive that income as and when it accrued, so long as the beneficiary continued to be a technical enemy. Therefore, said counsel, the right to receive the income during that period would have become vested in the Custodian. Therefore, the income would have become vested in the Custodian within the meaning of the forfeiture provision in the1118 appointment. With all respect to counsel, that is, to my mind, an over-simplification. Each of these income beneficiaries had a life interest in a share of the fund. That means, no doubt, a right to the income of that share of the fund during her life. That is an interest well known in equity, and I would describe each of them as the beneficial owner for life of one-third of the fund, and, consequently, a beneficial owner for life of the income accruing and to accrue from the fund. That is the nature of their interest. No doubt, as an owner of such equitable interest each of the income beneficiaries had the right to receive her share ofincome, and, no doubt, the right to receive the share of income is the most important incident of ownership, but while the owner of an interest in income has a right to receive the income it does not follow that anyone else who, by whatever means and for whatever purpose, is given a right to receive that same income, becomes the owner. The person who is given the right to receive the income may or may not become the owner, but it does not follow that he is the owner because he has the right to receive the income.
   My view being, therefore, that "vested in some person" means "vested in point of proprietary interest in some person," it remains to consider the provisions of the Trading with the Enemy Act and orders to see whether (apart from the forfeiture clause) the operation of those provisions was such as to give the Custodian in this case a proprietary interest in the income of these three beneficiaries under the settlement or in some part thereof. I will not traverse again at length the ground already covered by my Lord. The Trading with the Enemy Act, 1939, provides by s 4(1):

I cite that provision as a provision to be borne in mind in considering the Trading with the Enemy Orders as showing that, so far as the Act is concerned, it does appear to recognise something in the nature of a proprietary interest remaining in an enemy and capable of being assigned by an enemy, for it is only on that footing that it was necessary to enact by s 4(1) that an assignment should not be valid except with the sanction of the Treasury. The only other section of the Act to which I need refer is s 7, to which my Lord has already made reference. Its provisions are enabling in character, and the relevant operative provisions, in substance, are to be found in the orders made under those enabling provisions. Turning to the Trading with the Enemy (Custodian) Order, 1939, one finds there, as in the Act itself, a clear distinction between two possible courses. The orders contemplated by s 7 may, on the one hand, require the payment to the prescribed Custodian of money which would, but for the existence of the state of war, be payable to or for the benefit of (to put it shortly) an enemy, as one possible course, or may, on the other hand, vest in the prescribed Custodian such enemy property as may be prescribed. Those are two alternative courses, and I think the fact that they are expressed in that way indicates that the legislature contemplated that an order might require payment of money to the Custodian without thereby vesting any proprietary interest in the money in the Custodian, and that where it was necessary or expedient that the Custodian should be invested with proprietary rights, then that could be done by means of a vesting order.
   That distinction is preserved in the Trading with the Enemy (Custodian) Order, 1939. The first observation I would make about that order is that so far as money is concerned it does not use the expressions one would expect to find1119 in an order transferring a proprietary interest in given sums of money to the Custodian. Article 1(i) deals with

and it does not provide that such money is to belong to or vest in the Custodian. It enacts that such money "shall be paid to the Custodian". So far, then, what seems to me to be done is that the Custodian is given no proprietary interest, but where there is money due and payable to a person who, at the time when the money is due and payable, is an enemy, then the person from whom the money is due is placed under a statutory obligation to pay the money to the Custodian. That state of affairs seems to me to be perfectly consistent with the absence of any proprietary interest in the Custodian. Article 1(ii) goes on to detail the sources from which the money in question may come and includes "payment arising under any trust, will or settlement". The effect is that (apart from the forfeiture provision) the Westminster Bank, as trustee of the settlement, whenever it became possessed of any income arising from the trust fund in the form of money, fell under a statutory obligation to pay that money to the Custodian, provided that at the date when it came to hand and was thus immediately divisible among the income beneficiaries, each of the income beneficiaries was still technically an enemy. Again, I think there is nothing in that which postulates any proprietary interest in the Custodian: it is a statutory obligation on the trustees when they have money in hand owing to an enemy beneficiary to pay that money to the Custodian and not to the beneficiary-not because it is money of the Custodian, but because it is money of the beneficiary. It is recognised that the title remains in the beneficiary, and it is because the title is in the beneficiary and the beneficiary is an enemy that the statutory obligation to pay the Custodian is imposed.
   When any money has been paid to the Custodian it is true that he has to hold it, under art 3 of the order, in suspense. He has to hold it, along with any property vested in him under the provisions of any vesting order,

He holds the money he receives, and he holds it in suspense in accordance with that provision. But I do not think it follows from the fact that he so holds any money representing income of a trust fund as and when he receives it from the trustees of a settlement, that there has been any vesting in him of the proprietary interest in the income of the trust fund of a beneficiary under the settlement who is an enemy. Furthermore, as my Lord has pointed out, in this case there was never, in fact, any payment at all to the Custodian of any of the income. It was, through inadvertence, as it was put in the affidavit in support of the summons, simply held by the bank and, I think, invested. Considering the matter as if the life interests had been given free of any provision for forfeiture, I think the result follows that the income in question, never having in fact been paid to the Custodian, never became subject to the provisions of art 3 of the order. It may be that the bank committed a statutory offence in failing to pay this income over, and it may be that the Custodian could have sued the bank and demanded the money, but unless and until the money was in fact paid over to the Custodian, so far as I can see it remained throughout nothing more nor less than income due to beneficiaries who were enemies during the material period and, as such, income which the bank was under a statutory obligation (which it did not perform) to pay over to the Custodian.
   I can find no warrant in the order for holding that the Custodian had any proprietary interest in this income. Accordingly, in my view, after giving the best consideration I can to the provisions of the Trading with the Enemy Act, 1939, and the orders made thereunder, and applying what I conceive to be the1120 true construction of the forfeiture clause, I cannot find that the relevant event has happened on the happening of which the forfeiture was to take effect. I have not overlooked the fact that, by the amending order of 1941, the Custodian was given power to sue for and recover any moneys payable to him under the order. Nor have I overlooked the fact that under art 3(iv) of the order of 1939 the receipt of the Custodian for any money paid to him under the order was to be a good discharge. Notwithstanding these two provisions and notwithstanding the statutory obligation to pay money to the Custodian in the circumstances I have mentioned, it does not seem to me that the Custodian's powers, rights and duties, important as they were, and though, taken together, they might put him in a position approximating to that of an owner, were such as to confer on him any proprietary right. I think his position fell short of that of a person in whom the income under this settlement or some part thereof would, apart from the forfeiture provision, have been "vested" within the meaning of the appointment.
   The decision to which, in my view, we should come is, I should emphasise, a decision which turns on the true construction of this particular forfeiture clause. There may well be clauses so worded that the effect of the Trading with the Enemy Act, 1939, and the orders made thereunder was to bring about a forfeiture. Examples of that are to be found in the books. There is a case to which my Lord has referred, Re Gourju's Will Trusts. In that case the settlement adopted the protective trusts defined by the Trustee Act, 1925, s 33, so that forfeiture was to ensue when any event happened whereby, if the said income were payable during the trust period to the principal beneficiary absolutely, during that period he would be deprived of the right to receive the same or any part thereof. In the face of that language, Simonds J held that the effect of the Trading with the Enemy Act and orders was to bring about a forfeiture because the effect of them was quite plainly to deprive the principal beneficiary of the right to receive the income. But there are no such words in this appointment.
   Again, Uthwatt J in Re Hall had to consider the case of an annuity bequeathed to an annuitant with a provision for forfeiture if she should alienate or charge the annuity or do or suffer any act whereby it might become vested in or payable to any other person. The learned judge held, and I find difficulty in seeing how he could have held otherwise, that, having regard to the fact that the annuitant was living in France, the effect of the provisions of the Trading with the Enemy Act, 1939, was that the annuity, if not forfeited, would become payable to the Custodian of Enemy Property; and prima facie that meant, I think, that as the annuity would have become payable to the Custodian of Enemy Property but for the forfeiture clause, the forfeiture clause, containing as it did the words "vested in or payable to", would have operated. But the learned judge in that case found himself able to escape that conclusion on the strength of the words "do or suffer any act" and he held that the unfortunate events whereby the annuitant had become a technical enemy were neither acts done by her nor acts suffered by her, placing, in the context, on the word "suffer" the meaning "permit". But in this case the words "or payable" are not present. The words are "vested in", and for the reasons I have given I do not think that the Trading with the Enemy Act and orders would have brought about a "vesting" within the meaning of this forfeiture provision.
   I may, perhaps, be excused for referring to Re Sartoris's Estate. I refer to it because it provides an illustration of a case in which income may become payable to some person other than the income beneficiary, or some person other than the beneficiary may acquire the right to receive the income, although the income is not vested in that other person. The headnote to the case is:

Chitty J said ([1892] Ch 13):

   Apart from the circumstances that in the present case the Custodian of Enemy Property was given an express right to sue for money which had become payable to him under the provisions of the Trading with the Enemy Orders, it seems to me that those observations provide a reasonably close analogy to the present case. The receiver was under a duty to execute his office and to receive whatever property the debtor might have. Nevertheless, the property did not vest in the receiver. The receiver's duty was to take possession for the purpose of protecting the property and seeing that it reached its ultimate destination, whatever that might be. So, too, it might here be said that the Custodian was under a duty to receive money due to enemies and that persons holding money due to enemies were under a statutory obligation to pay that money to him, and the Custodian was then to hold it in suspense and see that it reached its ultimate destination, whatever that might be, under whatever directions might ultimately, at the conclusion of hostilities, be given by the Board of Trade.
   Re Sartoris's Estate is, I think, also instructive in another respect. It will be remembered that the words of forfeiture in that case were "payable to or vested in some other person", and that, for the reasons to which I have referred, Chitty J held that there was no vesting in the receiver. But he drew a sharp distinction between the words "payable to" and "vested in" and held that the income had become payable to the receiver although it had not become vested in him. That, I think, bears out my observations earlier in this judgment as to the difference in effect of different forms of forfeiture clauses. If, here, the words "or payable to" had been present, or if, here, the event of forfeiture had been defined as deprivation of the right to receive the income or some part thereof, the result would, I venture to think, inevitably have been different. But the words we here have to construe are "vested in"; and for the reasons1122 given by my Lord and those which I have added (I am afraid at undue length) I am of opinion that there was here no vesting in the Custodian within the meaning of the appointment.

MORRIS LJ. I am in full agreement with the judgments which my Lords have delivered.

Solicitors: Michael Kramer (for the third and fourth defendants); Official Solicitor (for the infant defendants); Caprons & Crosse (for the trustees).