Take poor old Peter Krstic, who died in 2007. He was always tight with his money and wanted his sons to be of a “mature age” before they got their inheritance. His two sons were aged 24 and 20 when he died.

The relevant part of the will stated “the residuary estate to such of Mark and Nicholas as survive me and attain the age of 40 years and 36 years respectively with a gift over to my grandchildren as survive me and attain 35 years”. The deceased was survived by his two sons and neither of them had any children.

Under the rule in Saunders v Vautier, if all the persons who have a present interest in the estate are ascertained, have capacity and consent to an early release, they may put an end to the trust by directing the trustee to transfer the interest in the estate to themselves, notwithstanding any direction to the contrary in the will.

His two sons argued that, as they had survived the deceased and there were no grandchildren who survived the deceased, they did not have to wait until they attained the ages of 40 and 36 years respectively to receive the residuary estate of the deceased. They argued that as the deceased was not survived by any grandchildren, the gift over provision to the deceased’s grandchildren could never take effect.

The legal representatives of Mark and Nicholas submitted that the rule in Saunders v Vautier applied and that Mark and Nicholas could at any time require the transfer of the residuary estate to themselves.

On the other hand, counsel for the estate submitted that the interests of Mark and Nicholas in the residuary estate were not vested and absolute interests but were contingent interests until they met their age qualifications. Counsel for the estate submitted that the phrase ‘as survive me and attain’ the respective ages in the will was a pre-condition or a quality that Mark and Nicholas must possess before they could attain a vested interest in the residuary estate.

The Court held that the intentions of the deceased, as disclosed by the words of his will, were that he intended that the sons should receive their interests in the residuary estate when they attained the specified ages.

As no grandchildren of the deceased survived the deceased, the gift over provision to the deceased’s grandchildren could never take effect. The only persons who could take an interest in the deceased’s residuary estate were Mark and Nicholas. In addition, Mark and Nicholas had capacity and consented to the early termination of the trust. Therefore, they could require the transfer of the residuary estate and any accumulations to themselves by reason of the application of the rule in Saunders v Vautier. This conclusion meant that the intentions of the deceased were overridden.