CHAP. VIII. DETERMINATION OF AN ANNUITY BY EFFLUXION OF TIME. CHAPTER VIII. OF THE DETERMINATION OF THE ANNUITY. IT must now be considered how an annuity may be terminated, and it will be found, that, according to the nature of the transaction, many ways will lead to such a result. They may be thus enumerated: 1. Effluxion of Time. 2. Determination of the Fund charged. 3. Consolidation. 4. Release or Surrender. 5. Redemption. 6. Bankruptcy and Insolvency. 7. Revocation. 8. Breach or Performance of Conditions. mined By effluxion of Of these in their order, and first, of the Effluxion of Time. Annuity deterWhere an annuity has been granted for a definite period of time, it ceases on the expiration of that period. If it have time. been granted to one in fee, and there be a failure of heirs to the grantee, it may be presumed, that, in default of any disposition of it by the last holder, it would cease. How far a grantee can bequeath an annuity which is granted in fee, so as to confer a right thereto which shall continue after a failure of the grantee's heirs, may be a question of doubt, when it comes to be examined in a court of law. Where an annuity is granted in any particular course of descent, it ceases on failure of the heirs in that line, as was shown in Turner v. Turner. (a) There one N. T. devised an annuity of 3007. to his wife for life, then to accumulate to make portions for his daughters one after another, then to remain to his eldest son, and, on his decease, to the (a) 1 B. C. C.316; Amb. 776. See Hack v. Tuck, 3 Swa. 270. U DETERMINA TION OF OF TIME. ters. CHAP. VIII. heirs male of his body, and in default of issue male, to remain to his next eldest son, and gave the rest of his estate among all his children. He had five sons and five daughThe latter all married in the lifetime of the widow, and the three eldest sons and the youngest died without issue before her. On her death the fourth son claimed the annuity as remaining to him. The devisees of the eldest son claimed it as part of his estate; and the executors of the original testator claimed it as part of the residue of his estate. The lords commissioners held that it was not personal estate which vested absolutely in the eldest son, being analagous to an estate tail in land, neither did it vest as an executory devise in the fourth son who survived, but that it was an annuity, which, being exhausted by the events, could not be taken by any one as such, and therefore it sunk into the residuary estate of the original testator. Rent does not escheat on In regard to a rent, as that is a species of realty, it might failure of heirs. have been thought that on failure of heirs it would escheat, but that is not the case. Brooke, in his Abridgment, tit. Extinguishment, (a) lays it down from 27 Hen. VIII. 10, that if a rent be granted to one and his heirs, or to a corporation, the rent will be extinguished if the grantee die without heir, or the corporation be dissolved, and shall not escheat to the crown. A rent cannot escheat to the lord for want of heirs, because it is not holden of the lord. Grantee cannot enlarge his estate in the rent. So also where a corporation is chargeable with a personal annuity, it ceases if the corporation be dissolved, but a real annuity would still remain a charge upon the lands of the corporation. It seems that a charge on a parsonage is not a mere personal charge, the parson being only liable in respect of the land. (b) It is to be observed that the grantee cannot enlarge his estate in the rent beyond the terms of the grant; and therefore a grantee in tail of a rent cannot, by suffering a recovery, convert it into a fee, so as to carry it to his heirs (a) And also in Corodie, 5, Escheat, 9. Com. Dig. Escheat, (A. 1). A. G. v. Sands, Hard. 496. (b) Bishop of Rochester's case, Owen, 732; And. 106. DETERMINA- AN ANNUITY general on failure of the limitation. (a) He will only gain CHAP. VIII. a base fee, determinable on failure of the issue inheritable under the estate tail. But if remainders over be limited after and expectant on the estate tail, they will be barred, and the recovery will confer an ownership coextensive with these estates. (b) BY EFFLUXION on lives there is When an annuity is granted during the continuance of As to annuities a life or lives, it determines when the annuitant dies. But no apportionas an annuity is the grant of a sum of money payable at ment. certain appointed times, although the annuitant generally dies in the interval between the times of payment, yet the law does not make any apportionment between the part of the period elapsed and that which is unexpired, but limits the payment to the last period completed before the death of the annuitant. (c) This proceeds upon the interpretation of the contract by which the grantor binds himself to pay a certain sum at fixed days during the life of the annuitant; when the latter dies, such day not having arrived, the former is discharged from his obligation, and such has been the construction of this rule of law, that, where an annuity was payable at Michaelmas and Lady Day, or within thirty days after each feast, and the grantee died within the thirty days, it was held that the payment due at the feast before her death was discharged. (d) Hence, in most grants of annuities, it is now customary to insert a covenant expressly to secure to the grantee a rateable portion of the annuity, according to the period which may elapse between the last day of payment and the death of the annuitant. To this rule, however, there is an exception where the Except it be granted for annuity is granted for the maintenance of the grantee, maintenance. which, as Mr. Swanston observes, (e) is supported by the necessity of the case, and the consequent presumption of (a) Chaplin v. Chaplin, 3 P. W. 230. (b) 3 Pres. Abs. 137, Co. L. 298 a, Butl. n. Weeks v. Peach, 2 Lutw. 1224. (c) 3 Atk. 261. Franks v. Noble, 12 Ves. 484. (d) Price v. Williams, Cro. E. 380. (e) In note to Ex parte Smyth, 1 Swa. 339. DETERMINA TION OF AN ANNUITY BY EFFLUXION OF TIME. CHAP. VIII. intention. It is thought equitable, that, to meet the expenses of maintenance in the full extent to which they have been incurred, the current annuity should be apportioned. Upon this principle the Court of Common Pleas acted in a case of Howell v. Hanforth, (a) where they held the defendant under terms; for as an annuity had been granted for the maintenance of a married woman separated from her husband, the court compelled the latter to pay a sum proportionate to the time elapsed before her death. The practice in the courts of equity was there referred to, and may be found in several authorities, especially in Hay v. Palmer, (b) where the grantee was an infant, to whom maintenance was payable till eighteen or marriage, half-yearly at Lady-day and Michaelmas. She reached her eighteenth year on the 16th of August, and was decreed to have her maintenance rateably from the last Lady-day. This exception does not hold where no main tenance is re. quired. It need not be expressly stated that the annuity is for maintenance; if that must be reasonably understood from the grant, the annuity will be apportioned. (c) It may be well to refer to the observation of Lord Chief Justice De Grey in Howell v. Hanforth, where he says, "It appears that the quarterly payments were not originally forward payments, by way of maintenance for the ensuing quarter, which might make a difference, but payable at the end of each quarter, in order to discharge the expenses incurred in the three preceding months." For where there is no apparent necessity for the continuance of the maintenance, there will be no apportionment, as was held by Lord Redesdale in Anderson v. Dwyer, (d) where an annuity was bequeathed to a married woman for her sole use," It differed," he observed," from the case of a separate maintenance for a wife or children;" and accordingly he refused an apportionment. There is also a case, (e) where an annuity charged on a real estate in aid of the personalty, had been ordered to be (a) 2 W. Bl. 1016. (c) Reynish v. Martin, 3 Atk. 331. (e) Webb v. Lord Shaftesbury, 11 Ves. 361. (b) 2 P. W. 501. (d) 1 Sch. & L. 301. DETERMINA TION OF paid out of a fund in Court, half-yearly, at Midsummer and CHAP. VIII. Christmas. The annuitant having died between Lady-day and Midsummer, the Lord Chancellor, after some consideration, made an order for her representative to have payment of the quarter to Lady-day. Here it was a regulation of the Court which had fixed the intervals of payment, and did not emanate from the grantor himself. OF TIME. not alter the It must not be supposed from this case that the Court The Court will will alter the mode of payment, when any such is appointed mode of payby the grantor, because the contrary has been expressly ment. ruled in a case (a) where an annuity of 1007. per annum was bequeathed by will, and on an application to the Lord Chancellor to order it to be paid quarterly, he refused, saying, he would not alter the payment, as it was in the will. annuitant dies on the day of payment. It may happen, and indeed has, that the annuitant should Where the die on the day of payment; in such a case it seems that the annuity would still be payable. It is true that rent is not due till midnight, though demandable at sunset, and as between the tenant for life and the remainder-man, if the former die before midnight, the latter, at common law, was entitled to the rent which falls due on that day. Here, however, the rent of the period is not lost, but is payable to some person or other, the discussion is, to whom? whereas the annuity would be wholly lost if the death on the day of payment were held to affect it. This is also the construction of a grant or covenant, in which it is to be determined whether the sum is to be paid at the beginning or at the end of the specified day; and the rule of law, which construes the words of a covenantor most strongly against him, is fairly applicable here. Accordingly, in Southern v. Bellasis, (b) an annuity appears to have been payable yearly on Michaelmas-day, and the grantee, who was also the annuitant, died at nine o'clock in the evening of that day; it was held, that as she lived beyond sunset, when the rent on which it was secured (a) Hawley v. Cutts, 2 Freem. 24. (b) 1 P. W. 179, a. |