CHAPTER
114
PERPETUITIES |
ARRANGEMENT OF
SECTIONS |
SECTION |
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Validity dependent upon actual events. |
When the perpetuity period begins to run. |
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Condition relating to death of surviving spouse. |
Ulterior and dependent limitations. |
Presumption and evidence to the age of
procreation. |
Cy-près at conclusion of perpetuity period. |
Administrative powers of trustees. |
Options relating to land. |
Avoidance of contractual and other rights in
cases of remoteness. |
Possibilities of reverter, conditions,
subsequent, exceptions and reservations. |
Non-charitable purpose trusts. |
Application to the court for directions. |
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CHAPTER 114 |
PERPETUITIES |
An Act to
modify the law relating to the avoidance of future interests in property on
grounds of remoteness. | 3 of 1995 |
[Commencement 14th
February, 1995] |
1. This Act may be cited as the Perpetuities Act, 1995. | Short title. |
2. In this Act- | Interpretation. |
"court"
means the Supreme Court; |
"disposition"
includes the conferring of a power of appointment and any other disposition of
an interest in or right over property, and references to the interest disposed
of shall be construed accordingly; |
"power of
appointment" includes any discretionary power to transfer a beneficial interest
in property without the furnishing of valuable consideration; |
"will"
includes a codicil. |
3. (1) Subject to subsections (2) and (3), a
disposition of a non-vested interest in property becomes void if the interest
disposed of fails to vest within the perpetuity period as defined by section 6. | Validity dependent upon actual events. |
(2) Every
disposition of a non-vested interest in property shall be treated, until such
time (if any) as it becomes established that the vesting will not take place
within the perpetuity period, as if such disposition were not subject to the
rule against perpetuities; and its becoming so established shall not affect the
validity of anything previously done in relation to the interest disposed of by
way of advancement; application of intermediate income or otherwise. |
(3) Subsection (1)
shall not apply- |
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(b) to the
trusts of any fund registered under the Superannuation and Other Trust Funds (Validation) Act. |
4. The perpetuity period begins to run- | When the perpetuity period begins to run. |
(a) in the case
of an instrument inter vivos creating interests in property, other than
those created by an instrument described in paragraph (b), at the effective
date of the instrument; |
(b) in the case
of an instrument inter vivos creating interests in property which are
revocable or amendable in the sole discretion of the grantor, at the time at
which such right of revocation or amendment terminates; |
(c) in the case
of interests in property created by will, at the date of the death of the
testator; |
(d) in the case
of an interest created in exercise of a general power of appointment, at the
same date as would be applicable if the instrument exercising the general power
were an instrument creating interests in property in accordance with paragraphs
(a) and (b); |
(e) in the case
of an interest created in the exercise of a special power of appointment, at
the date on which the period began to run in respect of the instrument creating
such special power. |
5. (1) For the purposes of the rule against
perpetuities, a power of appointment shall be treated as a special power
unless- | Powers of appointment. |
(a) in the
instrument creating the power it is expressed to be exercisable by one person
only; and |
(b) it could,
at all times during its currency when that person is of full age and capacity,
be exercised by him so as immediately to transfer to himself the whole of the
interest governed by the power without the consent of any other person or
compliance with any other condition, not being a formal condition relating only
to the mode of the exercise of the power: |
Provided that for
the purpose of determining whether a disposition made under a power of
appointment exercisable by will only is void for remoteness, the power shall be
treated as a general power where it could have fallen to be so treated if
exercisable by deed. |
(2) Where a
disposition consists of the creation of- |
(a) a general
power of appointment, such power becomes void if it does not become exercisable
within the perpetuity period; |
(b) a special
power of appointment, such power becomes void in so far as it is not fully
exercised within the perpetuity period. |
(3) Every
disposition consisting of the creation of- |
(a) a general
power of appointment shall be treated, until such time (if any) as it becomes
established that the power will not become exercisable within the perpetuity
period, as if the disposition were not subject to the rule against
perpetuities; |
(b) a special
power of appointment shall be treated, until such time (if any) as it becomes
established that the power has not been fully exercised within the period, as
if the disposition were not subject to the rule against perpetuities. |
(4) Where an
appointment is made in the exercise of a general or a special power of
appointment, such appointment shall be treated, until such time, (if any) as it
becomes established that the vesting of the interest created by such
appointment will not take place or has not taken place within the perpetuity
period, as if such appointment were not subject to the rule against
perpetuities, and its becoming so established shall not affect the validity of
anything previously done in relation to the interest created by the appointment
by way of advancement, application of intermediate income or otherwise. |
6. (1) Subject to subsections (2) and (4), and to
sections 7, 15(3) and 18, the perpetuity period shall be a period measured by
the lives of persons alive at the time when the perpetuity period begins to run
in respect of any instrument creating interests in property (hereinafter called
the "measuring lives") plus twenty-one years. | The perpetuity period. |
(2) Where an
instrument by which any disposition is made so provides, the perpetuity period
applicable to the disposition, instead of being any other period, shall be a
period equal to such number of years, not exceeding eighty, as is specified in
the instrument: |
Provided that this
subsection shall not apply where the disposition is made in exercise of a
special power of appointment, but where a period is specified under this
subsection in the instrument creating such special power, that period shall
apply in relation to any appointment which is made in exercise of the power. |
(3) For the
purposes of subsection (1) and of sections 3, 5(2) and 7 a person en ventre
sa mère but subsequently born alive shall be treated as a person who was
alive at the relevant time. |
(4) Where no lives
are applicable under subsection (1) and no period of years is specified under
subsection (2), the perpetuity period shall be a period of eighty years. |
7. (1) Subject to subsection (3), where the perpetuity
period applicable to a disposition is that laid down in section 6(1), the
measuring lives shall be such of the following persons as are alive and
identifiable at the time when the perpetuity period relevant to the disposition
begins to run- | The measuring lives. |
(a) such
persons as may be expressly selected in the instrument making the disposition
as being the measuring lives for the purposes of the disposition; |
(b) the person
or persons by whom the disposition was made; |
(c) any person
to whom or in whose favour the disposition was made, that is to say- |
(i) in
the case of a disposition to a class of persons, any member or potential member
of the class, |
(ii) in
the case of an individual disposition to a person taking only on certain
conditions being satisfied, any person as to whom some of the conditions are
satisfied and the remainder may in time be satisfied, |
(iii) in
the case of a disposition made in exercise of a special power of appointment- |
(A) the
donee of the power; |
(B) where
such power is exercisable in favour of members or a class, any member or
potential member of the class; and |
(C) where
such power is exercisable in favour of one person only, that person, or, where
the object of the power is ascertainable only on certain conditions being satisfied,
any person as to whom some of the conditions are satisfied and the others may
in time be satisfied; |
(d) a person
having a child or grandchild within paragraph (c) or any of whose children or
grandchildren, if subsequently born, would, by virtue of his or her descent,
fall within that paragraph; |
(e) any person
during whose life or upon whose death, whether as an individual or as the
survivor of a group of persons, or on the failure or determination of where
prior interest the disposition is expressly limited to take effect, and any
parent or grandparent of such person: |
Provided that only
those lives as are within paragraph (a) shall be the measuring lives for the
purposes of a disposition if the settlor or testator so manifests his
intention. |
(2) Where the
question relates to the validity of a general or special power of appointment
or of an option the measuring lives are the person or persons by whom the
disposition was made and the person or persons upon whom such power or option
is conferred. |
(3) Where the
ascertainment of the date of death of the survivor of the measuring lives,
whether because the number is large or for any other reason is not reasonably
practicable, viewed from the date on which the perpetuity period begins to run
in respect of the disposition, the measuring lives applicable to any
disposition shall be reduced, category by category, within subsection (1) by
the exclusion of all the lives in that category which makes such ascertainment
impracticable. |
(4) Where an
application is made to the court under section 19 for a determination of the
measuring lives applicable to a disposition, the onus of establishing that the
lives in any particular category are ascertainable shall be upon the party so
asserting. |
8. (1) Where the vesting of a disposition in favour of
any person or persons is postponed until the attainment by such person or
persons of an age in excess of twenty-one years and it becomes apparent at any
time that- | Reduction of age. |
(a) the
disposition, in respect of any one or more of such persons would, apart from
this section, vest outside the perpetuity period; but |
(b) it would
not so vest if the specified age had been twenty-one years, |
the
disposition shall be treated for all purposes as if, instead of being limited
by reference to the age in fact specified it had been limited, in respect of
the separate interest or share of each such person or persons, by reference to
the age nearest that age which would, if specified instead, have allowed the
disposition to such person to vest within the period. |
(2) Subsection (1)
shall be construed so as to allow the age to be reduced only in respect of any
person whose interest would otherwise vest outside the perpetuity period; and
any such reduction in respect of a disposition in favour of one such person
shall not, by reason only of such reduction, effect the reduction of the age of
vesting in respect of any other such person. |
(3) Where in the
case of any disposition different ages exceeding twenty-one years are specified
in relation to different persons- |
(a) the
reference in paragraph (b) of subsection (1) to the specified age shall be
construed as a reference to all the specified ages; and |
(b) that
subsection shall operate to reduce each such age so far as is necessary, but
not below the age of twenty-one years, to allow the disposition to vest within
the period. |
9. Where, subject to section 8, in the case of a gift to
a class, the interest of one or more members of the class vests duringthe perpetuity
period, but either- | Gift to a class. |
(a) it becomes
established that the interests or another or other members will not vest within
the perpetuity period; or |
(b) the
interests of such other member or members do not vest within such period, |
the person
or persons described in paragraphs (a) and (b) shall be deemed for all the
purposes of the disposition to be excluded from the class. |
10. Where a disposition is limited by reference to the
time of death of the survivor of a person in being at the commencement of the
perpetuity period and any spouse of that person, and that time has not arrived
at the end of the perpetuity period, the disposition shall be treated for all
purposes as if it had instead been limited by reference to the time immediately
before the end of that period. | Condition relating to death of surviving spouse. |
11. (1) Any rule of the common law to the effect that
an interest is invalid by reason only of the fact that it is ulterior to and
dependent upon a prior interest which is void for perpetuity is hereby
abolished. | Ulterior and dependent limitations. |
(2) The vesting of
such ulterior interest shall not be prevented from being accelerated on the
failure of the prior interest by reason only that the prior interest fails to
vest within the perpetuity period. |
12. (1) Where any question arises- | Presumption and evidence to the age of procreation. |
(a) respecting
the rule against perpetuities; |
(b) in relation
to the closing of a class; |
(c) as to the
time at which payments may be made from a trust; |
(d) in relation
to the termination of a trust or a period of accumulation; or |
(e) for any
other like reason, |
as to the
ability of a person to have a child at some future time, then subject to
subsection (2), it shall conclusively be presumed that a male is capable of
procreating a child at the age of fourteen years or over, but not under that
age, not after death, and that a female can conceive, and subsequently bear a
child at the age of twelve years but not under that age or over the age of
fifty-five years. |
(2) In the case of
a living person evidence may be given to show that such person, although within
the ages laid down in subsection (1) is incapable of procreating or conceiving
a child at the time in question. |
(3) Where any such
question is decided by treating a person as unable to reproduce at a particular
time and he or she does so, the court may make such order as it thinks fit for
placing the persons interested in the property which is the subject of such
decision, so far as may be just, in the position such persons would have held
if the question had not been so decided. |
(4) The foregoing
provisions of this section (except subsection (2) shall apply in relation to
the possibility that a person will become the parent of a child by adoption,
legitimation or other means as they apply to his or her ability at that time to
procreate or conceive a child. |
13. (1) Where it has become apparent that, apart from
the provisions of this section, any disposition would be void solely on the
ground that it infringes the rule against perpetuities, and where the general
intention originally governing the disposition can be ascertained in accordance
with the normal principles of interpretation of instruments and the rules of
evidence, the disposition may, on application to the court by an interested
person, be varied so as to give effect as far as possible to the general
intention of the settlor or testator within the limits of the rule against
perpetuities. | Cy-près at conclusion of perpetuity period. |
(2) Subsection (1)
shall not apply where the disposition of the property has been the subject of a
valid compromise. |
14. The rule against perpetuities shall not operate to
invalidate a power conferred on trustees or other persons to sell, lease,
exchange or otherwise dispose of any property for full consideration, or to do
any other act in the administration (as opposed to the distribution) of any
property, and shall not prevent the payment to trustees or other persons of
reasonable remuneration for their services. | Administrative powers of trustees. |
15. (1) The rule against perpetuities shall not apply
to a disposition consisting of the conferring of an option to acquire for
valuable consideration an interest reversionary (whether directly or
indirectly) on the term of a lease if- | Options relating to land. |
(a) the option
is exercisable only by the lessee or his successors in title; and |
(b) it causes
to be exercisable at or before the expiration of one year following the
determination of the lease. |
(2) Subsection (1)
shall apply in relation to an agreement for a lease as it applies in relation
to a lease, and "lessee" shall be construed accordingly. |
(3) Subject to
subsection (4), in the case of a disposition consisting of the conferring of an
option to acquire for valuable consideration any interest in land, the
perpetuity period under the rule against perpetuities shall be twenty-one
years, and section 6 of this Act shall not apply. |
(4) Subsection (3)
shall not apply to a right of pre-emption conferred on a public body in respect
of land used or to be used for religious purposes where the right becomes
exercisable only if the land ceases to be used for such purposes. |
16. Where a disposition inter vivos would fall
to be treated as void for remoteness if the rights and duties thereunder were
capable of transmission to persons other than the original parties and had been
so transmitted, it shall be treated as void as between the person by whom it
was made and the person to whom or in whose favour it was made or any successor
of his, and no remedy shall lie in contract or otherwise for giving effect to
it on making restitution for its lack of effect. | Avoidance of contractual and other rights in cases of
remoteness. |
17. (1) In the case of- | Possibilities of reverter, conditions, subsequent,
exceptions and reservations. |
(a) a
possibility of reverter on the determination of a determinable fee simple; or |
(b) a
possibility of a resulting trust on the determination of any other determinable
interest in property, |
the rule
against perpetuities shall apply in relation to the provision causing the
interest to be determinable as it would apply if that provision were expressed
in the form of a condition subsequent giving rise, on breach thereof, to a
right of re-entry or an equivalent right in the case of property other than
land, and where the provision falls to be treated as void for remoteness the
determinable interest shall become an absolute interest. |
(2) Where a
disposition is subject to any such provision, or to any such condition
subsequent, or to any exception or reservation, the disposition shall be
treated for the purposes of this Act as including a separate disposition of any
rights arising by virtue of the provision, condition subsequent, exception or
reservation. |
18. (1) Nothing in this Act shall affect the operation
of any rule of law rendering void, for reasons other than failure to comply
with the rule against perpetuities, certain dispositions under which property
is to be applied for purposes which are not charitable or for the benefit of
corporations which are not charities. | Non-charitable purpose trusts. |
(2) Any such
trust, if valid under the general law apart from the rule against perpetuities,
shall be valid for a period of eighty years only. |
(3) Any such trust
which is in existence at the date of the commencement of this Act shall
continue for either the period for which it would continue if this Act had not
been passed, or for a period of eighty years from the date of the commencement
of this Act, whichever period is the shorter. |
19. An executor or a trustee of any property or any
person interested therein, or in the validity or invalidity of an interest in
that property may apply to the court for the opinion, advice or direction of
the court with respect to the following matters- | Application to the court for directions. |
(a) the
construction of the will or trust instrument; |
(b) a
determination of the persons who are measuring lives for the purposes of the
disposition; |
(c) whether a
person who is a measuring life shall be presumed dead; |
(d) whether,
prior to the determination of the perpetuity period governing the disposition,
any interest shall be treated as incapable of vesting during that period; |
(e) at the
conclusion of the perpetuity period, for the variation of the terms of the will
or trust instrument in accordance with section 13; |
(f) any other
matter on which such application could properly be made to the court according
to current practice as if this Act had not been passed. |
20. (1) Subject to subsection (2), the provisions of
this Act shall apply in relation to instruments in respect of which, in
accordance with section 4, the perpetuity period begins to run after the
commencement of this Act, and in the case of an instrument made in the exercise
of a special power of appointment shall apply, in accordance with section 4(e),
only where the instrument creating the power takes effect after such
commencement. | Application of Act. |
(2) (a) Section 5(1)
shall apply to instruments coming into effect both before and after the
commencement of this Act to determine, for the purpose of the application of
the rule against perpetuities, the distinction between general and special
powers of appointment; |
(b) section 14
shall apply for the purpose of enabling a power to be exercised at any time
after the commencement of this Act notwithstanding that the power is conferred
by an instrument which took effect before that commencement; |
(c) section
12(1)(b), (c), (d) and (e) shall apply to instruments coming into effect both
before and after the commencement of this Act, but shall not apply so as to
affect any questions which have been determined, by litigation or compromise or
otherwise, before the commencement of this Act; |
(d) section 18
shall apply so as to terminate, after a period of eighty years, non-charitable
purpose trusts, whether created before or after the commencement of this Act. |
(3) This Act shall
apply in relation to a disposition made otherwise than by an instrument as if
the disposition had been contained in an instrument taking effect when the
disposition was made. |
(4) This Act binds
the Crown. |