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Section 138, chapter 173, United States Laws, 1864, made it the duty of the plaintiff to pay the succession tax to the government out of the proceeds of the sale of the land sold by him as trustee under the will of the testator. It follows that if the defendant was chargeable with the payment, in exoneration of the fund in the hands of the plaintiff, he can recover the amount so paid to its use. The inquiry, therefore, is whether the defendant was so liable.
Benjamin Ogden, by his will, devised the lands in question
to the plaintiff in trust, to take possession of and manage the same, pay taxes, etc., from the rents until sold, and, as soon as the same could be conveniently done, to sell the same in the city of New York either at public or private sale, and execute conveyances therefor, and, after deducting expenses, directed him to apply a certain amount of the proceeds in the manner therein specified, and to pay the residue thereof to the treasurer of the defendant for its use. This gave to the plaintiff the entire legal estate in the land, subject to the right of the defendant to enforce performance of the trust in equity. (1 R.S., 726, § 60; Briggs v. Davis, 21 N.Y., 574.) The defendant having no title to the land, none passed by its quitclaim deed to the heirs of the testator. All that the latter acquired thereby was the equitable right of the defendant to enforce the performance of the trust by the plaintiff, and to receive from him such proceeds of the sale as the defendant was entitled to demand and receive from him pursuant to the trust created by the will. But such part of such proceeds as the plaintiff was required by law to pay in discharge of the tax, the defendant had no right to demand and receive from him. Had there been no transfer by the defendant, the plaintiff would have fully satisfied its claim under the trust by paying to it the balance of the proceeds, after deducting the succession tax paid by him. The defendant had no right to the latter, and consequently transferred none to the grantees in the deed. The duty of the plaintiff still was to proceed and sell the lands, and from the proceeds pay the tax to the government, and pay the balance to the defendant, or — the transfer having been made — to its grantees. This balance was all that he was required to pay to them. It was all they acquired any right to by the deed of the defendant; and if the plaintiff paid to them the proceeds without deducting the tax, he thereby acquired no right of action, for the amount paid for the tax, against the defendant. Whether the tax would have been a lien upon the land, had the plaintiff failed to perform the duty imposed upon him by law of paying it out of the proceeds of the sale, is wholly immaterial. These
proceeds, received by the plaintiff, largely exceeded the amount of the tax paid, and were the primary fund for the payment. They were in the hands of the plaintiff, and the tax was or should have been paid therefrom. If it was not so paid it was not the fault of the defendant but that of the plaintiff. The verdict for the plaintiff was subject to the opinion of the court upon a case. There was no conflicting evidence given or exceptions taken upon the trial, and the court should, instead of ordering a new trial, have given judgment for the defendant. But the plaintiff having appealed from the order, and given the requisite stipulation, the same result will be attained by affirming the order and giving final judgment for the defendant upon the stipulation.
All concur.
Order affirmed and judgment accordingly.