[1927] 3 W.W.R. 718, 22 Sask. L.R. 142, [1928] 1 D.L.R. 318, 1927
CarswellSask 111
Burke Estate, Re
In re Trustee Act
In re Burke Estate
Saskatchewan King's Bench, Chambers
Taylor, J.
Judgment: November 25, 1927
Counsel: T.H. Jameson, for the applicant.
W. Robinson, for the Official Guardian.
Subject: International; Property
Conflict of Laws --- Property -- Law governing property -- What
constituting movables and immovables.
Conflict of Laws -- Immovables -- Owner's Interest in Land Agreed to
be Sold as -- Owner Dying Domiciled Outside Province -- Administration
of Interest.
Where on the death intestate of an owner of land situate in
Saskatchewan his title is subject to the interest of a purchaser under
an outstanding agreement for sale the interest of the deceased in the
land is immovable, not movable, property and, therefore, devolves
according to the law of Saskatchewan and is to be administered by the
representative of the estate in that province, even though the
deceased died domiciled elsewhere.
Taylor, J.:
1 The petitioner, as administrator of the property of Charles John
Burke, deceased, who at the time of his death had his domicile in the
State of Wa****ngton, in the United States of America, applies for
advice and directions concerning the administration and distribution
of the property of the deceased in Saskatchewan, to which grant of
administration was limited. It is stated that an administrator had
been appointed of property in the State of Wa****ngton, and that the
property there had been duly administered and the administrator
discharged.
2 The deceased left him surviving a widow and three children, two
of whom are infants; and he died intestate.
3 It is argued that from affidavits of attorneys-at-law,
practising in the State of Wa****ngton, it appears that according to
the law of the State of Wa****ngton the widow would be entitled to one-
half of the property of the deceased, and the children to the
remaining one-half share; whilst if the property is to be distributed
according to the law of Saskatchewan the widow will take a third and
the children the remaining two-thirds.
4 The whole of the property of the intestate in Saskatchewan
consisted of an interest in lands, two quarter sections. He held the
title subject to mortgages and agreements to sell made by him with
different purchasers. One of these purchasers has since his death paid
up and the sale has been closed, the other agreement is subsisting. I
take it that the petitioning administrator acquired title to this
quarter section, subject to mortgages thereon and to the interest of
the purchasers under these agreements for sale.
5 Now if the interest of the deceased could be considered as pure
personalty the matter would be a very simple one. A direction could be
made that the administrator in Saskatchewan hand over the proceeds of
the estate realized in due course of administration unto the proper
representative appointed in the State of Wa****ngton to be administered
there, and leaving it to the Courts of that country in which the
parties, including the children, are domiciled, to determine all
questions as to distribution of the estate and maintenance of the
children, and the protection of the children's interest in the estate.
And counsel, including counsel for the Official Guardian, take the
view that the interest of the deceased in this property in
Saskatchewan can be regarded as personal property and so dealt with.
But the question strikes me as one of major im****tance, and, as I was
not satisfied that that conclusion could be drawn from the cases
cited, I reserved the matter and have looked further into the matter.
6 The opinion that I have arrived at is that the interest of the
intestate in the property in Saskatchewan must be taken to be an
interest in immovable, not movable, property, and therefore devolves
according to the law of Saskatchewan, and is to be administered by the
representative of the estate in this province. It is surprising that
no case can be cited, or apparently found, directly to the point. The
decisions to which I have been referred are largely cases on the
construction of wills and have no application, and I am unable to
find, and am not referred to, any statute bearing upon the question.
It is quite clear that the question whether any species of property is
to be considered movable or immovable is to be determined according to
the lex rei sitae; and I think it may be stated generally that it is
only in regard to movables in the true sense of that term that in
English law jurisdiction is surrendered to the foreign tribunal. And
in Story (I quote from the 5th ed., sec. 447, at p. 739) it is stated:
Fourthly: in relation to the subject-matter, or what are to be deemed
immovables. Here, as we have already seen, not only lands and houses,
but servitudes and easements, and other charges, on lands, as
mortgages and rents, and trust estates, are deemed to be, in the sense
of law, immovables, and governed by lex rei sitae. But in addition to
these, which may be deemed universally to partake of the nature of
immovables, or (as the common law phrase is) to savor of the realty,
all other things, though movable in their nature, which by the local
law are deemed immovables, are, in like manner, governed by the local
law. For every nation, having authority to prescribe rules for the
disposition and arrangement of all the property within its own
territory, may impress upon it any character which it shall choose;
and no other nation can impugn or vary that character. So, that the
question, in all these cases, is not so much what are, or ought to be
deemed, ex sua natura, movables, or not; as what are deemed so by the
law of the place, where they are situated. If they are there deemed
part of the land, or annexed (as the common law would say) to the soil
or freehold, they must be so treated in every place, in which any
controversy shall arise respecting their nature and character. In
other words, in order to ascertain what is immovable or real property,
or not we must resort to the lex loci rei.
7 The first part of the above quotation is quoted by the Chief
Justice of Canada in delivering the judgment of the Court in Henderson
v. Bank of Hamilton (1894) 23 S.C.R. 716, and he also quotes from
Wharton's treatise on the Conflict of Laws, 2nd. ed., sec. 291:
It has already been stated that all interests in land, whether
consisting of equitable interests, charges, trusts, or servitudes, all
interests, in other words, that may fall under the term lien in its
most general sense, are controlled by the lex rei sitae even in the
opinion of those who would confine that law within the narrowest
limit.
8 In that case, and in the subsequent case of Purdom v. Pavey &
Co. (1896) 26 S.C.R. 412, the Court declined jurisdiction to settle
questions concerning mortgages on foreign lands, even where the
parties were domiciled within the jurisdiction. These definitions have
therefore the sanction of the Supreme Court of Canada, and I find too
that Story's definition is quoted with approval in the Court of Appeal
in England in In re Hoyles; Row v. Jagg , [1911] 1 Ch. 179, 80 L.J.
Ch. 274, by Farwell, L.J. at p. 186, in which it was also held that a
mortgage on land in England is an immovable.
9 Then there is a later case in England, still closer to the
point, though not actually determining it. In re Berchtold; Berchtold
v. Capron, [1923] 1 Ch. 192, 92 L.J. Ch. 185, Russell, J. A testator
owning English freehold directed it to be sold and the proceeds held
in trust and distributed. A beneficiary domiciled in Hungary died, and
the question was whether this beneficial interest devolved according
to English or Hungarian law. The English cases are reviewed, and the
very point had previously been before the Court in Ireland, in which
the interest was held to be an immovable. Russell, J., so held.
Attention should especially be called to his review of the text-books,
p. 205, and in his judgment he points out that the question to be
determined is whether the interest is an immovable or movable, not
whether it was personal estate, and that the cases on construction of
wills and particular statutes, many of which were referred to me on
this argument, are of no assistance.
10 Possibly I need go no further, but it may be advisable to
examine the argument that this property is to be considered personal
property because in equity under a contract for the sale of an
interest in land the vendor becomes a trustee of the land for the
purchaser and the vendor's interest is a claim to the purchase-money.
It may first be observed that no case has been cited in which this
notional conversion was suggested as a determining factor in deciding
the point now under consideration or as having anything to do with it.
And even if it were to be taken in its full significance the
definitions of immovables as given in Story and Wharton, and those
referred to by Russell, J. (ubi supra) would include it as immovable
property. But, following the course adopted in the judgment of the
Judicial Committee in Miller v. Howard , [1915] A.C. 318, 84 L.J.P.C.
49, 7 W.W.R. 627, 30 W.L.R. 112, from which I quote, at p. 326:
It is material to consider what this interest [a purchaser's interest
under an agreement for sale] really was. It is sometimes said that
under a contract for the sale of an interest in land the vendor
becomes a trustee for the purchaser of the interest contracted to be
sold subject to a lien for the purchase-money; but however useful such
a statement may be as illustrating a general principle of equity, it
is only true if and so far as a Court of Equity would under all the
cir***stances of the case grant specific performance of the contract.
The interest conferred by the agreement in question was an interest
commensurate with the relief which equity would give by way of
specific performance, and if the plaintiff Miller [the purchaser] had
in his application attempted to define the nature of his interest, he
could only so define it.
11 To put it in another way for the purposes of the deduction
which I am about to draw, the vendor holds the complete title and
interest in the lands, subject only to the purchaser's right to have
the contract specifically performed. And the extent to which English
Courts will decree specific perform ance of contracts respecting
foreign land is well settled, and in the judgments in those cases it
is pointed out that the Court proceeds not upon any jurisdiction over
the property or upon any notional conversion into personalty, but over
the person, and limits its jurisdiction to a judgment in personam and
will not give a judgment in rem. Dicey, 3rd ed., p. 227, cites what is
stated in Foote:
Foote states that "the English Courts, acting in personam and not in
rem, will make decrees, upon the ground of a contract or other equity
subsisting between the parties, respecting property situated out of
the jurisdiction"
12 From this statement it would follow that matters not founded on
such grounds would not be adjudicated upon, with the further
conclusion that English Courts would not recognize any authority of
any foreign Court there over or of any foreign power to legislate in
reference thereto. See British South Africa Co. v. Companhia de
Mocambique, [1893] A.C. 602, 63 L.J.Q.B. 70.
13 The cases to which I have been referred are based on the rule
which is stated in Williams on Executors, 11th ed., p. 504:
It is ... an established doctrine in Courts of Equity, that things
shall be considered as actually done, which ought to have been done;
and it is with reference to this principle, that land is under some
cir***stances regarded as money, and money as land.
14 At p. 505:
Again ... where there is a valid contract for sale of real estate, the
vendor is regarded in equity as a trustee for the purchaser of the
estate sold. ... Hence, the death of the vendor or vendee before the
conveyance, or surrender, or even before the time agreed upon for
completing the contract is in equity immaterial, and if the vendor die
before the payment of the purchase-money, it will go to his executors
and form part of his assets;
which, I take it, means that it will not go to the heir as land but be
distributed amongst the next-of-kin under the Statute of
Distributions. But of this rule there is a reference in Story on
Equity, 2nd ed., p. 47, to the qualification expressed in the language
of Lindley, L.J., in In re Anstis; Chetwynd v. Morgan (1886) 31 Ch. D.
596, at p. 605, 54 L.T. 742:
Equity, no doubt, looks on that as done which ought to be done; but
this rule, although usually expressed in general terms, is by no means
universally true. Where the obligation to do what ought to be done is
not an absolute duty, but only an obligation arising from contract,
that which ought to be done is only treated as done in favour of some
person entitled to enforce the contract as against the person liable
to perform it.
15 Consideration can supply to my mind no reason for extending
this domestic doctrine into the tests in private international law for
the determination of what is to be held immovable or movable property.
The reasons for the distinction, as they are given in Story in secs.
377, et seq., between movable and immovable property would indicate
that the equitable doctrine of national conversion would defeat the
practical reasons given for the rule of private international law, the
practical difficulty in enforcing process abroad. In none of the text-
books is there a suggestion that it is to be taken into consideration,
and I think it may be taken that it never has been. I feel therefore
on surer ground in accepting the approved definitions which I have
quoted without an addendum attaching this peculiarly equitable
doctrine thereto. It would be a strange anomaly if, applying these
equitable doctrines, it were held that the interest of the deceased in
these lands was movable property to be governed by the law of his
domicil, and in the law of the domicil no such doctrines were
recognized; and it seems to beg the question to invoke this time-
honoured doctrine in equity -- especially pointed to ameliorate a
hard****p peculiar to English law in distribution of estates, a
hard****p now superseded by statutory changes -- as a rule having such
force as law in Saskatchewan that it excludes the operation of that
very statute itself, which in its terms is made applicable to any
estate, right, or interest in messuages, lands, rents and
hereditaments, cor****eal or incor****eal, other than a chattel
interest. (The Devolution of Estates Act, R.S.S., 1920, ch. 73, sec.
2, subsec. [3].)
16 In addition to the cases cited, I think I can say that my
conclusion is in accord with such decisions as appear on other phases
more or less near the point here for determination. See Ostrander v.
Houston (1915) 8 Sask. L.R. 132, 8 W.W.R. 367, 30 W.L.R. 890 (C.A.);
Dom. Bridge Co. v. Br. Amer. Nickel Corpn. (1925) 56 O.L.R. 288;
Browns v. Browns, 15 Alta. L.R. 77, [1919] 2 W.W.R. 754; Rex v.
Lovitt, [1912] A.C. 212, at p. 221, 81 L.J.P.C. 140, and Tucker v.
Jones (1916) 53 S.C.R. 431, 10 W.W.R. 1117, Anglin, J., at p. 1127,
especially.
17 And the conclusion that I arrive at, therefore, is that the
interest of the deceased in this landed property in Saskatchewan was
at the time of his death, notwithstanding the outstanding covenants to
sell and convey, an immovable governed by and devolving on his death
according to the law of Saskatchewan and to be distributed by the
administration appointed in this province. In due course of
administration the administrator will pay to the widow a one-third
share; to the adult beneficiary a one-sixth share; and I will direct
that upon the appointment of a guardian or guardians by the proper
Court in the State of Wa****ngton for the infants that the share of the
two infant children, each being entitled to a one-sixth share, be paid
to such guardian or guardians, and declare the receipt of such
guardian a sufficient release and discharge to the administrator.
18 All parties will have their costs out of the estate.
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