Discretionary trusts do not confer vested interests to deceased beneficiaries, enabling surviving beneficiaries to demand equitable distribution.

Introduction

[1] This is an application by the plaintiffs for an order of this Court to terminate the trust created under the will of Ratnavale, the testator, dated 10 February 1971 (here in after referred to as "the said Will") and subsequently for all the said properties pleaded therein to be distributed to the surviving six (6) beneficiaries mentioned in the said Will.

[2] The properties are GM 845, Lot 290, Mukim Kulim, Daerah Kulim, Kedah and GM 621, Lot 461,Mukim Kulim, Daerah Kulim, Kedah.

Background Facts

[3] The testator was the father of the six plaintiffs and the brother of the first and second defendants.

[4] By virtue of the said Will, the testator had appointed the first and second defendants as executors and trustees to his estate( here in after referred to as "the said Trust").

[5] The said Will, at para 3 provides as follows:

"I hereby be queathand devise all my movable and immovable property of what so ever nature or description and where so ever situate subject to the payment of my debt, funeral, testament and administration expenses to my legally married wife ANNAIAKSHMI, my mother Madam RATNAMAL and all my six (6) children in whatever proportion my said trustees at their discretion shall choose to distribute."

[6] It was never disputed that all six children mentioned in the said Will were the six plaintiffs in the present case.

[7] However, the other two specifically named beneficiaries, namely Annalakshmi and Ratnamal had both died. Ahnalakshmi died on 26 October 2010 and Ratnamal died on 29 December 1994. The testator died on 9 April 1973.

[8]It was never disputed, as a matter of fact that, up until now, the defendants as executors and trustees appointed under the said Will had not acted or carried out any form of distribution as required of them under the said Will up on the testator's death.

First Issue: Whether The Said Will Created A Discretionary Trust

[9] Para 3 of the said Will provides that-

"I hereby bequeath and devise all my movable and immovable property of what so ever nature or description and where so ever situate subject to the payment of my debt, funeral ,testament and administration expenses to my legally married wife ANNALAKSHMI, my mother Madam RATNAMAL and all my six (6) children in whatever proportion my said trustees at their discretion shall choose to distribute,

(emphasis added)

[10] The plaintiffs in the present case submitted that para 3 of the said Will as quoted above had created a discretionary trust whereby a wide discretion was given to the defendants as executors and trustees of the said Trust to determine the proportion of the testator's properties that each beneficiaries (which were already specified in the said Will) were to receive upon the testator's death.

[11] The plaintiffs in the present case relied heavily on the finding of the High Court in the case of Panchanath Ratnavale v. Sandra Segara Mahalingam & 3 Ors, where by Harmindar Singh Daliwal JC held that-

"l think it is also important to recall that Dl and D2 were operating what is termed as a discretionary trust. This was because Dl and D2 as Executors and Trustees were given the power and discretion to distribute the assets of Ratnavale after payment of debts and expenses "in whatever proportion my said trustees at their discretion shall chose to distribute". In the Law of Trust by JG Riddall, 6th Edition, discretionary trust is defined as follows (at 283):

"A discretionary trust is one under which discretion is conferred by the settlor on the trustees to decide which member or members of a class of beneficiaries should be