247 Pa. 508 | Pa. | 1915
Opinion by
This is an appeal from the confirmation of the report of an auditor, making distribution of funds in the hands of the accountant as trustee. From the history of the case as given by counsel for appellant we take the recital of the facts. On December 1, 1906, Orlando M. Harper executed and delivered to the Commonwealth Trust Company of Pittsburgh a deed of trust, in which his wife, Kathleen T. Harper, joined. The subject matter of the trust was an undivided onedhird interest in a certain lot of ground, having erected thereon an eight-story building, situated at the corner of Liberty avenue, and what is now Ellesmere street, in the City of Pittsburgh. The trustee was given full control over the property, with power of sale during the lifetime of Kathleen T. Harper, and for three years after her death. The net income from the trust estate was to be paid to Mrs. Harper during her lifetime and after her death to her testamentary appointees, or in default of such appointment then to her heirs under the intestate laws of Pennsylvania. In case of a sale of the property, the trustee, after the payment of all liens and proper charges in connection with the sale was directed to' use the proceeds in paying any mortgage or mortgages held by the trustees of Columbia College in the City of New York and by H. Van Rensselaer Kennedy, or either of them, or their assigns, and in payment of any other encumbrances existing on the first day of December, 1906, or becoming a lien within- one year thereafter, against the property known as No. 41
An auditor was appointed to distribute the fund in the hands of the Commonwealth Trust Company, trustee. At the hearings before him Mrs. Copeland appeared by counsel, and claimed that out of the trust fund, she should be allowed the entire amount of her second mortgage upon the New York property, and a further sum of $1,361.25, which she paid out for interest upon the first mortgage upon that property. This claim was based upon a theory, that if the holder of the Kennedy mortgage had not been paid, he would have been entitled to payment out of the trust fund. And that under the circumstances, Mrs. Copeland was entitled to be subrogated to all the rights of Kennedy as mortgagee of the New York property. The auditor reached the conclusion that the deed for the New York
It will be noticed in the first place that the real estate in the City of Pittsburgh, which was the subject of the trust, was the property of Orlando M. Harper. His sole purpose in creating the trust was to benefit and protect his wife, Kathleen T. Harper. So long as the property was held by the trustee, it was to pay to Mrs. Harper the net income therefrom, during her lifetime, and eventually the proceeds of the property was to go to her testamentary appointees, or to her heirs. In case of a sale of the premises, the trustee was directed to use the proceeds in paying certain mortgages which he designated, and other encumbrances then existing against the New York property, or which might become a lien thereon prior to December 1, 1907. The New York property belonged to Mrs. Harper, and the manifest purpose of the direction was to clear it of encumbrances and preserve it for her benefit. The entire direction for the payment of mortgages and encumbrances upon the property was conditioned upon the fact that at the time of payment, the property was to be in the ownership of Mrs. Harper, or in that of a trustee named by her. It is evident that in making this provision for the benefit of his wife Mr. Harper did not take into consideration the holders of the mortgages, for they were not in any
The fifth, sixth, seventh, eighth, ninth, tenth, eleventh, twelfth, thirteenth and fifteenth assignments of error are sustained, and in so far as anything is allowed upon the claim of Annie E. Copeland, the decree of the court below is reversed; the costs of this appeal to be borne by the appellee.