Gilliam v. Guaranty Trust Co.

97 N.Y.S. 758 | N.Y. App. Div. | 1906

Lead Opinion

Clarke, J.:

On April '27, 1853, Eliza Hunt conveyed certain real property to , Andrew Findlay “in trust for the use and benefit of * * * Frances J. Dyett during her natural life and after her decease to her heirs at law ” by deed which empowered said trustee to sell the land so conveyed, and reinvest the money received in other securities ; and provided that “if a sale should be made of said lands, the money or proceeds of said sale shall, until reinvested again be considered as land and held in trust for the benefit of said Frances during her life and after her decease to her heirs at law.” Said Findlay died in 1892, and the defendant Guaranty Trust Company of Yew York was appointed substituted trustee. Frances J. Dyett, the beneficiary under said trust deed, intermarried with Francis H. Thomas. Mr. Thomas died in 1888." Mrs. Thomas died on February 24, 1905. She left her-'surviving no issue and no descendant. Upon her death the trust created by said deed ceased. On December 6,1883, under and in pursuance of the provisions of chapter 830 of the Laws of •1873, Mr. and Mrs. Thomas duly adopted plaintiff, then an infant, as and for their own lawful child, and an order in that regard was duly made at chambers of the County Court of Oneida county, and from and after said-day Mr. and Mrs. Thomas, until their respective deaths, and the plaintiff sustained toward each other the mutually acknowledged relation of parent and child. The defendants James S. Dyett, Thomas H. Dyett and ■ George H. Dyett are surviving brothers of said Frances J. Thomas, deceased. The question in the case is, the trust having ceased by the death of the life beneficiary, did the ¿state upon her death,'under the terms of the d¿ed,-devolve' upon her" legally adopted child, the plaintiff, or upon her three living brothers % At -the time of her death, under the terms of said deed, who were her “ heirs at "law ? ” ’ The plaintiff claims -that the deed should be construed as of the time- when the trust determined, by the death of the life beneficiary; and that as at that time she' was entitled to inherit the estate of her adopted mother, she' was her heir at law. The defendants claim that the deed should be construed as of the time when the" deed was executed and delivered; and that as at that time the law did not authorize the adoption of children they are the sole heirs at law of their sister and entitled to take the whole estate, ' ■

Twenty years after the execution of the deed chapter 830 of the Laws of 1873, entitled “ An act to legalize the adoption of minor children by adult persons ” was passed, providing in s'ectidú 10 thereof that the adopting,parent and the adopted child should sustain toward each other the legal relation' of parent and child and have all-the rights of that relation excepting the right of inheritance, except that as respects the passing and limitations over of real and personal property underand by deeds, conveyances, wills, devises, and trusts, said child adopted shall not be deemed .to sustain the legal relation of child to the person so adopting. Ten years thereafter, December 6, 1883, the plaintiff was lawfully adopted. Section 10 of chapter 830 of the Laws of 1873 was amended by chapter 703 of the Laws of 1887 by. providing that the adopting parent and the adopted child should sustain toward each other the legal relation of parent- and child, and have all the rights of that relation, including the right of inheritance, except that as respects the passing and limitation over of real and personal property, under and by deeds, conveyances, wills, devises and trusts, ..dependent upon the person adopting1 dying without heirs, said adopted child shall not be deemed to sustain the legal relation of child to the person so adopting so as to defeat the rights of remaindermen.

The exception does not apply to the case at bar. The defendants Dyett do not claim as remaindermen under a deed providing for the passing and limitation over of real property, dependent upon the person adopting dying without heirs. They claim under the deed which provides for the passing of the estate to the heirs at law and that they are such heirs. ' Chapter 272 of the Laws of 1896 (the Domestic Delations Law) provides in section 60 that “ ¡Nothing in this article^* in regard to an adopted child inheriting from the foster parent applies to any will, devise or trust made or created before June twenty-fifth, eighteen hundred and seventy-three, or alters,- changes or interferes with such will, devise or trust, and as to any such will, devise or trust, a child adopted before that date is not an heir so as to alter estates or trusts or devises in wills so made or created.”

It seems sufficient to say that neither a will nor a devise is here under consideration. Doris a trust. The trust has run its appointed course unaffected and untouched. That it has ceased and determined is the very reason for this litigation. Further, this child was not adopted before June 25, 1873.

Chapter 408 of the Laws of 1897, amending section 64 of the Domestic Delations Law, provides that “ The foster parent or parents and the minor sustain toward ■ each other the legal relation of parent and child, and have all the rights and are subject to all the duties of that relation, including the right of inheritance from each other, * * * and such right of inheritance extends to the heirs and next of kin of the minor, and such heirs and next of kin shall be the same as if he were the legitimate child of the person adopting, but as respects the passing and limitation over of real or personal property dependent under the provisions of any instrument on the foster parent dying without heirs, the minor is not deemed the child of the foster parent so as to defeat the rights of the remaindermen.” Section 60 of the Domestic Delations Law (Laws of 1896, chap. 272) also provides that “ Proof of the lawful adoption of a minor heretofore made may be received, in evidence, and any such adoption shall not be abrogated by the enactment of this chapter and shall have the effect of an adoption hereunder.”

The defendants concede that under these various provisions the plaintiff would be entitled to take by inheritance or succession the estate of her foster motherthat so far as there may be accumulation of income from the trust estate, that she is entitled to. They insist, however, that this estate is not the estate of Mrs. Thomas, devolving by inheritance, but the estate of Eliza Hunt, transmitted by - deed which is to. be interpreted as of the time of execution. Their contention is stated as follows: “ By the terms of the deed of Eliza Hunt * * * the then heirs at law of the cestui que trust took a vested remainder in the said trust estate, and her father being dead, her three brothers,'the defendants Dyett, were then such heirs at law, liable, however, to be divested by the birth of a child.” » There is nothing in this record to show that at the time of the making of the deed the father of the cestui que trust was dead, or that the defendants were then her heirs at law. The Statute of Descent (1 R. S. 751, § 1; R. S. pt. 2, chap. 2, § 1) at that time provided that “ the- real estate of every person who shall die without devising the same, shall descend in manner following: 1. To his lineal descendants: 2. To his father: - 3. To his mother: and 4. To his collateral relatives: Subject in all cases to the rules and regulations hereinafter prescribed.” And then follow many rulés governing various contingencies and varying degrees of consanguinity. The cestui que trust was at that time an unmarried girl. Her heirs could only be ' known at the time of her death, which as m'atter of fact occurred fifty-two years thereafter. If we look at the nature of the instrument and the situation of the' parties, if we look at the intention, . can it be doubted, in view of all the possible contingencies -that might arise, that the grantor, when she used the words “ after her decease to her heirs at law,” had in mind the obvious, natural meaning, viz., those persons who at the time of her death should be declared by the .law. then existing to be’ her ’heirs at law ? There can be -no heirs of a living person.. “ The legal and well understood meaning of the word heir, is, the one upon whom is cast an estate of inheritance upon the death of the owner, and it follows that this person is uncertain until death occurs, for until that event, it can never he known to whom the estate will fall.” (Heath v. Hewitt, 127 N. Y. 171.) If we-assume, what does not appear, that at the time "of the execution of this deed these three defendants would have been the heirs of the cestui que trust it her death had presently occurred, their right to take upon that event was undoubtedly subject to be divested by her marriage and the birth of a child. ■ The share' of each one was liable to be divested by his death before the cestui que trust. Consecpiently their whole estate — whatever it was — was liable to be divested by the death of all three before Frances Dyett’s death. That such an estate is not devisable, descendible or alienable is settled. In Dougherty v. Thompson (167 N. Y. 487) Judge Landon said: “ Moore v. Littel (41 N. Y. 66) is a leading authority, although it has -been criticised upon common-law lines. It is to the effect that a remainder limited to the heirs of A upon the determination of a life estate in A is vested in his lifetime in his living children, although — and this is the point of the criticism — A’s heirs cannot be ascertained until his death. But the case also holds that the death of any child in his father’s lifetime defeats his interest and divests the remainder, the' effect of the statute being to abolish the common-law condition precedent to the vesting of the remainder, namely, the child’s survivorship of his father, and to substitute for it a condition subsequent, which may divest and defeat the remainder after it is vested, namely, the child’s death in his father’s lifetime.

“ It was held in subsequent cases founded upon the same title that the deed of a child who predeceased his father conveyed no part of the remainder. (Jackson v. Littell, 56 N. Y. 108; House v. McCormick, 57 ib. 310; House v. Jackson, 50 ib. 161.) Thus a remainder vests subject to be divested, if such is its tenure, and the condition subsequently occurring upon which the divesting depends, the remainder is thereby divested.”

Said Mr. Justice Rumsey in Paget v. Melcher (26 App. Div. 17), said opinion being approved by the Court of Appeals (156 N. Y. 404), “ The deed, then, is to be construed in accordance with the rule that where final distribution is to be made among a class, the benefits must be confined to those persons who constitute the class at the time when the division is directed to be made. * * * It is not necessary to consider the precise nature of the interest taken by the members of the class before the time for division arises. Whether the remainder be contingent, or a vested remainder in those persons who shall constitute the class at any given time, subject to be divested by the death of any one of those persons before the time for distribution arises, is a matter of no particular importance. It is sufficient for the purposes of this case to say that the general rule is well established that the property when divided" is to go to those persons who shall compose the class at the time when the division is to be made.” So that whatever this right of these defendants may be called, vested, subject to be divested', or contingent, it was liable to be defeated if at the death of the cestui que trust they were not then her heirs. Their rights depended upon the Statute of Descent. Under certain contingencies they would be the heirs at law. That right was subject tó be- destroyed by the birth of lineal descendants who under the same statute would then oust them. That statute was subject to amendment. It must be assumed that the grantor knew the law; and that when she said “ after her decease to her heirs at law,” she said it knowing that the Legislature had the power to declare who the heirs at law were. The statute was amended by providing that adopted children should inheritand as this was an amendment, in effect, of the same statute under which defendants claim (Dodin v. Dodin, 16 App. Div. 42 Kemp v. N. Y. Produce Exchange, 34 id. 175), it seems to me their right was destroyed or divested by the adoption of a child as it would have been by £he birth of a child. In the Kemp Case (supra) Mr. Justice Cullen said: “ On the death of the testator or the delivery of the deed, the rights of the remaindermen would vest, and those rights could not be divested by subsequent legislation. Though even in such case, if the will or deed showed an intent that the distribution should be governed by the laws that might exist at some future time provided ¿for the distribution of the fund, effect would unquestionably be given to it.” ,

In Kohler's Estate (199 Penn. St. 455) it appeared that by will dated October 11,1853, testator gave part of his estate in trust for his son for life, with remainder to “ such person* or persons as would be entitled thereto if my said son John F. Kohler had survived his wife and died intestate, and possessed thereof and in such shares and proportions as such person or persons would in such case be entitled by law.” And the court said: “The learned Judge below very forcibly said: ‘ The will of John Kohler, father of the cestui que trust, was written thirty-six'years before the decree of adoption, and that event therefore was not reasonably within the contemplation of the testator. But as he gave- the estate to those persons to whom the law would give it in the case of intestacy, he cannot be said to have had any particular class of heirs or next of kin in view, and he committed the question of determining who should take to the’ law itself.’ And it is only necessary to add that a testator who commits the distribution of his estate to the law, upon the happening of an event necessarily future, must reasonably be presumed to have contemplated the possibility of a change in the law in the meantime.”

In Randall v. Kreiger (23 Wall. 137), in speaking of dower, the United States Supreme Court said: “ It is wholly given by law, and the power that gave it may increase, diminish, or otherwise alter it, or wholly take it away. It is upon the same footing with the expectancy of heirs, apparent or presumptive, before the death of the ancestor. . Until that event occurs the law of descent and’ distribution may be moulded according to the will of the Legislature.” In McGillis v. McGillis (11 App. Div. 359; 154 N. Y. 532) testator left a life estate to his daughter, and “ from and after the decease of * "x" * my "said- daughter * * * to the lawful issue of my said daughter then living in such relative proportions * * * as they would by the laws of the State of Hew York have then inherited * * * in case she * had then died intestate.” At the time of the death of her father Mrs. McGillis had four children who were aliens. After the,death of testator she had four more children who were entitled to take. She died leaving six children, three born before the death of testator and three afterwards and one grandchild. Legislation subsequent to the death of testator permitted the aliens to take. In the Appellate Division Mr. Justice Landón said : “ The argument against the power of the Legislature to qualify the four first-born children of Mrs. McGillis to take the devise of the testator rests upon the assumption that title to the ultimate possession of the remainder absolutely vested either in the heirs of the testator or in the after-born children of Mrs. McGillis. But this argument wholly fails when we see that such vesting was not of the absolute right to the ultimate possession of the remainder, but- of a contingent right to it, the contingencies inhering in' the right as created by the testator, and only absolutely to be put at rest' by the death of Mrs. McGillis. Then those who<were within the class designated by the testator became vested of the remainder in possession and until then all .the issue of Mrs. McGillis were eligible to enter the class — the after-born by birth within it, the prior-born by the enabling qualification of the statute.” In the Court of Appeals Judge Haiq-ht said: “ The pivotal question in the case arises upon the construction which should be given tó the provisions of the will and is as to whether the remainder after the death of the testator was' vested or contingent. * * * All the children of Mrs. MeGillis in being at the time of the death of the testator were aliens; they consequently could not take under the will, and there could be no vesting of the remainder in them. If there was any vesting of the remainder, it necessarily .must havé been in the heirs at law. * * * He not only gives'to the-issue then living, but he leaves the proportion or sharé which eaqh.is1 to take to be determined by the laws of the State which shall be in forcé at the death of his daughter and her husband, providing for its distribution under such laws in the proportion in'which it would descend, upon the assumption that his daughter was' at that time the owner of the, property in feé simple. It was. not. known at the time of the testa-; -tor’s decease which would survive the. other, the daughter or her husband. It was not known and could not then have beén ascertained what person or persons would be then living, if any, of .the lawful issue. It consequently follows that the person to'Whom, or the event upon which the estate was limited to take effect, was uncertain, and, therefore, the remainder was contingent. If the remainder were contingent the heirs at law took no interest in the. estate upon the death of the testator. It could not, then, be determined who the heirs at law would be or what provisions of the statute would in-the meantime be adopted. * * *” Upon the* death of Mrs. MeGillis “the persons who are entitled to take the estate in possession became fixed and. certain. In the meantime our statutes had been changed. * * ■ It in effect amends the-provision Of the Bevised Statutes making void a devise to a.person who at the time of .the death of -the testator shall be an alien,, so that the provisions of that statute no longer apply to the1 foreign-born children of married women born in this country. Under the statute existing at the time of the- death of Mrs. MeGillis the estate, if it had been hers and she had died intestate, would have descended to her children.” '. ' ■

In the recent case of Richards v. Hartshorne (110 App. Div. 650) a life estate in trust was devised with remainder over to the Bah way library Association upon failure of issue of the cestuis que trustent. At the time of the death of testatrix,"the library'association, being a foreign corporation, was unable to take by devise under our laws. Prior to the death of the life tenant an act was passed by the Legislature permitting such corporation to take and hold for five years. The claim was made that on the death of testatrix her heirs became vested with the remainder, subject to be divested by birth of issue of the life tenants, and that such vested remainder could not be affected by subsequent legislation conferring upon the library the power to take. This court, by the .presiding justice, O’Brien, said: “ The real issue to be determined, therefore, is whether the remainder was vested or contingent. The court at Special Term held that it was the former, but we do not agree with this conclusion,” and gave judgment for the libráry.

There is no difference in principle. The courts have always had in mind the intention of the-testator or grantor. The defendants here were not remaindermen by name in the deed. They have none of the attributes of personal selection as ultimate beneficiaries. i Grantor looked not to individuals, but to a class “ after her decease to her heirs at law.”

It is conceded, as it must be under the' authority of Dodin v. Dodin (16 App. Div. 42; affd., 162 N. Y. 635); Kemp v. N. Y. Produce Exchange (34 App. Div. 175), and Theobald v. Smith (103 id. 200),'that as to Mrs. Thomas’ own estate the plaintiff has. the right to inherit. Possession of the right to inherit by law constitutes the possessor of such right the heir at law. As it appears from the foregoing discussion that the words, “ after her decease to her heirs at law ” •—■ not the heirs at law of the grantor, but of the cestui que trust —■ must be taken to mean the heirs so constituted by law at the decease of the cestui que trust, it follows that the plaintiff is such heir at law. The defendants’ rights were contingent tin their being the heirs at said time. That contingency having failed, the complaint states facts sufficient to constitute a cause of action, the demurrer was improperly sustained and the judgment should be reversed, with costs in this court and in the court below, with leave to the defendants to withdraw the demurrer and plead over within twenty days upon payment of such, costs.

O’Brien, P. J., and Ingraham, J., concurred; Patterson and Laughlín, JJ.,- dissented.

* Dom. Rel. Law, art. 6.— [Rep.

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Dissenting Opinion

Patterson, J.

(dissenting):

Accepting the .statement of facts as narrated in the prevailing opinion in this cause, I am unable to concur in the conclusion at. which the majority of my brethren have arrived that the' interlocutory judgment should be reversed.

■ I think there are vested remainders in the surviving brothers of Mrs. Frances J..Thomas (Dyett), but as that seems to be debatable ' I prefer to place my dissent upon- the ground that the statutes relating to adopted children do not apply to 'the trust deed made and delivered by Eliza Hunt, the grantor, or creator of the trust, in -1853. The terms of that trust are specifically for the use and ' benefit of" Frances J. Thomas (Dyett) during her natural life, and after her decease the trust property to pass to her heirs at law. When the instrument was made and delivered,-adoption of children with consequent rights of inheritance in them was unknown to the law of Hew York. (Matter of Thorne, 155 N. Y. 140; Smith v. Allen, 161 id. 482.). The first statute relating to adoption was' passed in this State in 1873 (Laws of 1873, chap. 830), twenty years, after the deed in question was made. Its sole purpose was to establish a mu tual relation of parent and child between the person adopting and the one adopted, but rights of inheritance were specifically excluded.' Subsequent statutes in pari materia-will be hereinafter referred to. This plaintiff was adopted "in 1883. It seems to me that in construing the trust deed we must have regard to the intention of the testator at the time it was executed and the-trust created. The words “ heirs at law ” at that time had a definite legal meaning. They then meant kindred by blood and no others. They did not relate to a stranger to the blood, family and kindred, made an heir byz a legal proceeding which the creator of the trust could never have imagined nor anticipated. .“The Word £heir,’ in legal understanding, signifies him to whom lands, tenements, or hereditaments, by act of God and right of blood, descend, of some estate of inheritance.” (Broom Leg. Max. [6th Am. ed.] 381; 3 Washb. Real Prop. [5th ed.] 6.) “The word ‘heirs’ is a legal term.having a definite meaning, and expresses the relation of persons to a deceased ancestor and not to a living.” (Cushman v. Horton, 59 N. Y. 151.) ,“The primary meaning in the law of the Word ‘heirs’ is the persons related to one’ by blood, who would take his real estate if he died intestate, and the word' embraces no one not thus related.” (Tillman v. Davis, 95 N. Y. 24.) Such was the meaning of the words in this trust deed when the trust was created, and a testator (and so of a grantor) is always presumed to use the words in which he expresses himself according to their strict and primary acceptation, unless, from the context of the. instrument, it appears that he has used them in a different sense. (Luce v. Dunham, 69 N. Y. 39; Tillman v. Davis, 95 id. 24; Murdock v. Ward, 67 id. 389; Keteltas v. Keteltas, 72 id. 312; Cushman v. Horton, 59 id. 149.)

If my understanding of the intention of the creator of the - trust is correct, then it is evident that she had in contemplation that kindred in blood of the beneficiary — those who would be such at the death of the beneficiary — were to take the interest in remainder after the expiration of the trustee’s estate. Upon an examination of the statutes passed after 1873, relating to the subject of the adoption of children, I am of the opinion that the intention of the creator of the trust is not to be thwarted or defeated. It must be conceded that so far as succession to the property, real and personal, of the adopting parent is concerned, the adopted child sustains the relation of heir, and that such relation, with its incidents, is established as of the time of the death of the parent, and not in accordance with the law as it existed at the time of the adoption, so that if at the time of the adoption the statute did not confer the right of inheritance, but did at the time of the death of 'the parent, the adopted child would take. (Theobald v. Smith, 103 App. Div. 200; Dodin v. Dodin, 16 id. 45; affd., 162 N. Y. 635.)

We have seen that by the statute of 1873 the right of inheritance was not given to the adopted child. In 1887, by chapter 703 of the laws of that year, the act,of 1873 was amended and the relation of parent and child was constituted, including the right of inheritance, except that as respects the passin'g and limitation over of real or personal property dependent under the provisions of any instrument on the foster parent dying without heirs, the adopted child was not deemed the child of the foster parent so as to defeat the rights of remaindermen. It is a fair construction of this statute that its intent was to give the adopted child rights in property passing under deeds, wills, devises and trusts, except in the particular instance where the passing or limitation over of the property was dependent upon the-person adopting dying without heirs. Butin 1896 a change was again made in the law. (Laws of 1896, chap. 272, §60.) By that section it is provided as follows: “Nothing in this article^* in regard to- aff adopted child inheriting from the .foster parent applies to any will,' devise or'trust made or created before Juné twenty-fifth, eighteen hundred and seventy-three, or alters, changes or interferes with such will, devise or trust, and- as. to any such will, devise or trust, a child adopted before that date is not an heir so as to alter estates or trusts or devises in wills so made or created.” The effect-of section 60 is, so far as it relates to-trusts of property created .before June 25, 1873, to put an adopted child back in the same position it would have occupied under the act of 1873, namely, to deny to it the right of inheritance as to such property. I cannot assent to the proposition that section 60 is inapplicable -here'because the trust ceased at the death of the-beneficiary. When the? trust chased whoever was entitled to the remainder would take under the trust deed and would. not take from the beneficiary. Sharman v. Jackson (98 App. Div. 187) is authority only for the proposition that -the trust ceased on the death of Mrs. Thomas (Dyett). I think one of the purposes of section 60 was -to prevent an adopted child as heir of the adopting parent from taking property “ so as .to alter estates or trusts or devises ” made or created prior to June 25,1873. " It seems to me that allowing the plaintiff to take realty, as' an heir at- law of the beneficiary of the trust, would radically change the provisions of the trust deed if I am right in "the interpretation given to the words “ heirs at law ” in that trust deed as evincing the intern " tion of the grantor at the time the-trust was created.' I think the .statutes of adoption should not be construed so- as. to defeat the intention of the creator of a trust and divert his property from that line of suc- ' cession in which he declared it should go and bestow it upon absolute strangers whom he never intended to be the recipients of his bounty.

The judgment should be affirmed, with costs.

Laughlib,'J., "concurred.

. Judgment reversed, with costs, and demurrer sustained, with hosts,with leave" to defendants to withdraw demurrer and to answer on payment of costs in this court and in the court below.

* Dom. Rel. Law, art. 6.— [Rep.