EWE KEOK NEOH Vs. NG ANN THYE

JUDGEMENT

(1.) The only question in this appeal is whether the respondent is entitled to an account of the income and expenditure of the estate of one Ng Boo Bee from 24 September 1921 to 23 August 1929. The facts so far as it is necessary to state them here are not in dispute. Ng Boo Bee, who may be referred to for convenience as the testator, died on 24 September 1921 leaving a will dated 6 September of same the year, of which probate was granted to the appellant as sole executrix and trustee. The will provided that (subject to certain pecuniary bequests) the estate should be divided into 88 shares of which 12 were to go to the respondent, the eldest son of the testator, 10 to the appellant his widow, and 36 to other children and grandchildren. The remaining 30 shares were left to the appellant upon trust to accumulate the income for ten years after the testator's death and then to divide the capital and accumulated income amongst the children named in the will as she might consider just and proper.

(2.) In the year 1923 the respondent took certain proceedings in the Supreme Court of the Straits Settlements against the appellant, apparently in connexion with her administration of the testator's estate. These proceedings were compromised by an agreement dated 17 March 1924. The parties to this agreement were (1) the appellant as executrix and trustee of the will and also in her individual capacity, (2) the respondent, and (3) the other beneficiaries, some of whom were then minors. The operative part of the agreement in which the appellant was referred to as "the executrix"and the estate of the testator as "the trust estate"included the following amongst other provisions: By Cl.1, that on approval of the settlement by the Courts, the appellant should transfer to the respondent absolutely a certain rubber estate and other land and (Cl. 4) should pay him the sum $2 000 to be debited against his share of the trust estate. By Cl. 2, that the appellant should raise as soon as possible a sum of $70,000 on the security of the estate and out of the money so raised should pay off two charges created by the respondent over his share; that in the event of any principal or interest due under any charge or mortgage so made by the payment having to be paid out of the estate, owing to the failure of the respondent to pay the same, the amount so paid together with interest thereon at 8 per cent should be debited against the respondent's share of the estate. By Cl. 3, that upon the appellant paying off the sums due under the two charges created by the respondent he should charge in her favour the share of the trust estate to which he was entitled to the extent of the amount so paid by her. such charge not to be repayable for three years from the date of execution. By Cl. 6, that the appellant should cause accounts of her trusteeship to be kept in English in proper and usual manner and have them audited by a qualified accountant at least once every six months and should regularly submit such accounts together with the auditor's report to the beneficiaries. By Cl. 11, that until distribution of the 58 shares the appellant should make the following monthly payments: "To the eldest son the sum of Dollars four hundred ($ 400/-) which shall be credited to him in respect of the twelve shares-in the trust estate bequeathed to him but no part of such monthly sum shall be paid to the eldest son until repayment has been made of the mortgage or charge to be executed by the eldest son referred to in para. 3 hereof. Until such repayment all the said monthly payments of Dollars four hundred ($ 400/-) shall be applied in part payment of the interest payable on the said mortgage or charge to be executed by the eldest son and the remainder of such interest shall be paid by the eldest son out of the revenue of the said 'Swee Thye' rubber estate. Provided and it is hereby agreed that in the event of the revenues of the trust estate being insufficient to meet the monthly payments in this paragraph agreed to be made then such monthly payments shall be reduced proportionately in each case and shall be accepted by all parties concerned in full satisfaction of their respectively monthly payments."

(3.) The terms of this settlement were approved by the Court, and the mortgage provided for by Cl.3 was on 19 August 1925, executed by the respondent who as mortgagor thereby conveyed, assigned and transferred to the appellant "all that his 12 out of 88 shares under the will of the testator."On 1 September 1926 the respondent executed a second mortgage of his 12/88ths share in favour of one Ramasamy Chettiar for $25,000 and interest. The prior mortgage in favour of the appellant was recited and the operative words were similar. On 23 August 1929 the respondent being in default, the second mortgagee exercised his statutory power of sale and conveyed the mortgaged shares (subject to the first mortgage in favour of the appellant) to one of the brothers of the respondent. The validity of this sale is not disputed. On 24 December 1930 the respondent commenced the proceedings out of which the present appeal arises. By his statement of claim (to which the appellant was the only defendant) he claimed administration and accounts of the estate of the testator and the appointment of a new trustee or trustees in her place. The material plea in defence was that having regard to the transactions above referred to the respondent had no interest in the estate, and it is, their Lordships think, upon this question that the decision of the appeal must turn.