136 Misc. 116 | N.Y. Sur. Ct. | 1930
This is a trustee’s accounting embracing two trusts established by the will of the above-named testator. One of the trusts is of twelve-fifteenths of the residuary estate for the benefit of the widow, Mary L. Marshall, and the other trust is of three-fifteenths of said residuary estate for the benefit of testator’s son, Chauncey Marshall, Jr. The trust for the benefit of testator’s widow is still in force and effect, as she is still living. The trust for the benefit of the testator’s son has terminated by his death, and the accounting is, therefore, intermediate so far as the trust for the benefit of the widow is concerned, and is final as to the trust for the benefit of the son. The total capital of these two trusts, as shown by the accounting, is $1,082,795.19. Part of the trust
I hold that the contention of the special guardian is correct. It is my opinion that the Court of Appeals, in the decisions quoted above, did not intend to establish the absolute rule for every case involving unproductive real property in a trust fund that there must be an apportionment between principal and income when such real property is sold. When the above cases are closely analyzed, it is readily seen that the rule laid down therein was for the purpose cf preventing the life tenants suffering a diminution of income or a total loss of income by reason of the heavy carrying charges on unproductive real property where the latter constitutes the greater portion of the estate. Thus, in Furniss v. Cruikshank (supra) there was productive real property of the value of approximately $490,000 and unproductive real property of the value of $1,400,000, and, it should be noted, that the opinion states that “ where a testator creates a trust largely of unproductive real estate,” there must be an apportionment. In Spencer v. Spencer (supra) the court said that “ the question in the case under consideration, therefore, depends on what was the intention of the testator.” In the case of Lawrence v. Littlefield there was $8,000,000 of unproductive real estate in the trust fund, and the court held that the carrying charges on such a large amount of vacant property would reduce the income payable to the life tenant to such an extent that the latter would be deprived of a fair income, and on the sale of this real estate there should be an apportionment between principal and income. In the case at bar the unproductive real estate constitutes but a very small part of the trust fund, and the carrying charges on the same
I, therefore, hold that on the particular facts of this case — the unproductive real property being only of the value of $45,000 and the trust fund of income-producing property being over $1,000,000 in value — no apportionment should be made. Submit decree accordingly.
