I am sure that most people that practice in the Estates and Trusts area are familiar with the Rule in Saunders v. Vautier. Even if they do not know the Rule in detail, they normally know enough to avoid its application. That does not mean that the rule is always applied properly. The recent case, Ward v. Roberts, is one in which it seems that the court misapplied the rule. However, it is not my intention in this blog post to speak about misapplication of the rule, but to discuss a fact situation that seems not to have been litigated.
The rule as generally understood permits a beneficiary, who has been given an absolutely vested interest under a trust, to terminate the trust once she reaches the age of majority and is otherwise capable. It is well-known that a provision in the trust instrument that postpones payment until a later date, when there is no gift over for failure to survive that date, will not prevent operation of the rule. The presumption in favour of early vesting ensures that the gift is interpreted as being vested absolutely a morte testoris and not as being vested subject to divestment if the beneficiary dies before the specified age, or as being contingent on the beneficiary attaining the specified age.
Suppose then that a testator, Cassandra, has bequeathed an absolutely vested gift to Jane. The trustee is to pay Jane the annual income and to transfer the capital to her at age 25. Full stop. There is therefore no gift over if Jane fails to reach that age.
Suppose further that: (a) Jane dies under the age of majority; or (b) Jane dies at age 24, not having attempted to terminate the trust. In either case, what happens to the subject matter of the gift? Martin is appointed as Jane’s personal representative on her death.
It might be supposed that in either case the property would be returned to Cassandra’s estate under a resulting trust. But that does not work, for Cassandra has disposed of the property absolutely, or to put it another way she has not retained an equitable interest in it. Consequently Cassandra’s estate cannot possibly reclaim the property.
Therefore in either case the property passes to Jane’s personal representative, Martin, for two reasons:
(1) Cassandra presumably wanted to prevent Jane from enjoying the capital until she reached the age of discretion of 25. That reason or motivation no longer exists. So there is no reason to continue the trust until the time Jane would have reached the age of 25. In fact, it would be highly silly and artificial to do that.
(2) Since the gift was vested absolutely in Jane, that vested gift passes to Martin, unencumbered by the trust. If necessary, Martin can call in aid the Rule in Saunders v. Vautier to terminate the trust and receive the property.
The property will, of course, be subject to the usual estate administration process. Obviously, it will also be subject to any claims by Jane’s creditors.
There would be no difference if the trust were an inter vivos trust. Whether the trust is testamentary or inter vivos, the trustee will have to transfer the property to Martin.
 (1841), 4 Beav. 115, 49 E.R. 282, affirmed (1841), 1 Cr. & Ph. 240, 41 E.R. 482.
 2017 BCSC 1768, 33 E.T.R. (4th) 125.
 For a critical comment on this case see Donovan W.M. Waters, “Ward v. Roberts: A Novel Interpretation of Saunders v. Vautier” (2018), 37 E.T.P.J. 241.
 That was, indeed, the operative fact in the Saunders case.