106 N.Y.S. 133 | N.Y. App. Div. | 1907
This action is by the surviving trustee under the ‘will. of Hew- • berry Halste.d, deceased, to pass his accounts and incidentally to determine the ownership of certain lands involved. The accounts were passed without objection, and the sole question litigated and brought up to us relates to the said lands as to which two of the defendants present conflicting claims.
The will of the testator, who died in 1862, gave the remainder of his estate, real and personal, to his executors in trust for the benefit of his widow during her life, and upon her death directed the trustees to' convey a part of the realty to Halsted. In 1867 Halsted’s firm of Putnam & Halsted made an assignment for the benefit of its creditors to Smith, who was subsequently removed and gave way to Stevens. Stevens died in 1888 and the State Trust Company, became the trustee in his place. In 1891 the said company sold the estate of Halsted under 'the said will of Newberry Halsted to Parker. The widow of Newberry Halsted was then in enjoyment of her life estate. She lived until 1904. The plaintiff complained that as to such share devised to Halsted, demands had been made' by Halsted and by Parker that any action on the part of the plaintiff as trustee necessary to be taken to place either in possession should be taken, “ thus endeavoring to put this plaintiff * * * in a position where he shall determine to which of the two parties so demanding the same now rightfully belongs,” and that by reason of their adverse claims and the question whether any conveyance should.be made by plaintiff the plaintiff could not settle his accounts, it further appearing that he had in his hands $2,753.60 in the nature of the real estate.'. The plaintiff prayed for an adjudication as to these questions. Halsted answering asserted that he was entitled to the said fund, alleged that the sale of his estate by the State Trust Company was illegal, fraudulent and collusive, that any interest which passed under the said assignment by his firm had reverted to him and demanded judgment accordingly. Parker answering asserted . that he was entitled to the fund by virtue of his title to the realty, which lie had acquired from the State Trust Company at public sale, and demanded that he be decreed the owner of the fund and of the realty. Thus the contest was between these two defendants of whom each had thus affirmatively submitted his claim and his rights
I think that the judgment should be affirmed. There was evidence on the trial, not contradicted, that the realty was worth about $132,000 in 1891, the'time of the sale, andfrom $175,000 to $200,000' at the present time. The property was sold to Parker for $2,525. 0f course it is to be remembered that the sale was only the remainder interest of Halsted. Parker admits that he then knew the property was “ very valuable.” The sale was attacked by Halsted o.n the theory that it was' the successful consummation of a conspiracy by Parker and the Cowdreys to buy in the property for a song ; that Parker, the' purchaser, was disqualified because lie was a director of the State Trust Company and also the executor of the j3teveils, estate, quite the largest creditor of the'firm of Putnam & Halsted, and that the Cowdreys were the attorneys for "the State Trust Company and one of them was the auctioneer at the sale. I do not propose to discuss either the evidence in detail or the various questions arising thereupon as to the effect of the several fiduciary "relations. For" I think that the affirmance may rest upon the facts that the trust company obtained the order for this sale through the MessrSi Cowdrey as its attorneys; that the auction sale was thereupon conducted by the Cowdreys, of whom one was the actual auctioneer;' that the- estate was thereby sold to Parker ; that prior to the-sale there-was an agreement between Parker and the Cowdreys that if Parker secured the property the" profits of -the transaction would be divided between him and the Cowdreys on a certain basis and that the Cowdreys were in fact the purchasers with Parker, And it nowhere appears that the trust company or Halsted' knew at that time of any such arrangement. It was the duty
Under the assignment, as I have shown, the assignor was entitled to any surplus, and under chapter 545 of the Laws of 1875 there was a reverter to him. I think, therefore, that he was entitled to assert this claim. In Zimmerman v. Kinkle (108 N. Y. at 287) the court-say : “ The principle which justifies this conclusion was applied in the recent case of Wetmore v. Porter (92 N. Y. 76), where it was held tha^ whoever receives property knowing it to be the subject of a trust and to have been transferred by the trustee in violation of his duty or power, takes it subject to the right, not only of the cestui que trust, but also of the trustee to reclaim" possession or recover for’its conversion.” (See, too, First Nat. Bank v. Nat. Broadway Bank, 156 N. Y. 459, 468; Moss v. Cohen, 158 id. 240, 251.) There is no need to ' consider whether the Statute of Limitations is in the case and was not waived, inasmuch as the cause of action of Halsted, i. e., the right to the remainder under the will, did not accrue until the' death of the life beneficiary in
. The judgment is affirmed,--with costs.
Hírschberg, P, J., Woodward, Hooker and Miller, JJ., concurred. .-
Judgment, in ..so far as appealed from, affirmed, with costs..
