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Meaning of “irrevocable instrument”.
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445.—The following provisions shall have effect in relation to the construction of “irrevocable instrument” in this Chapter:
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(a) an instrument shall not be an irrevocable instrument for the purposes of this Chapter if the trusts thereof provide for all or any one or more of the following matters:
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(i) the payment or application to or for the settlor for his own benefit of any capital or income or accumulations of income in any circumstances whatsoever during the life of a child of the settlor to or for the benefit of whom any income or accumulations of income is or are or may be payable or applicable under the trusts of the instrument;
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(ii) the payment or application during the life of the settlor to or for the wife or husband of the settlor for her or his own benefit of any capital or income or accumulations of income in any circumstances whatsoever during the life of any such child as aforesaid of the settlor;
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(iii) the termination of the trusts of the instrument by the act or on the default of any person;
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(iv) the payment by the settlor of a penalty in the event of his failing to comply with the provisions of the instrument;
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(b) an instrument shall not be prevented from being an irrevocable instrument for the purposes of this Chapter by reason only that the trusts thereof include any one or more of the following provisions:
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(i) a provision whereunder any capital or income or accumulations of income will or may become payable to or applicable for the benefit of the settlor, or the wife or the husband of the settlor, on the bankruptcy of a child of the settlor to or for the benefit of whom any income or accumulations of income is or are or may be payable or applicable under the trusts of the instrument;
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(ii) a provision whereunder any capital or income or accumulations of income will or may become payable to or applicable for the benefit of the settlor, or the wife or the husband of the settlor, in the event of any such child as aforesaid of the settlor making an assignment of or charge on such capital or income or accumulations of income;
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(iii) a provision for the termination of the trusts of the instrument in such circumstances or manner that such termination would not, during the life of any such child as aforesaid of the settlor, benefit any person other than such child or his or her wife, husband, or issue;
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(c) “irrevocable instrument” includes instruments made before, as well as instruments made after, the passing of this Act.
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