24 Misc. 2d 172 | N.Y. Sur. Ct. | 1960
Frederick B. Taylor died in 1887, a resident of the State of New York, leaving a will which he had executed in 1880 in California where he then resided and which was admitted to probate in this court in the year of his death. In its fourth paragraph he created a trust of $125,000 for his wife with the remainder on her death becoming a part of his residuary estate which he disposed of in paragraph fifth by directing its division into as many shares as he should leave children him surviving, whose number was five, bequeathing one share to each in trust for life with the remainder, subject to the exercise by the beneficiary of a power of testamentary appointment, passing to issue or, in default thereof, to the surviving members of the class to be added to their respective portions.
There has been no accounting in this estate from the date of the will’s admission to probate until the institution of the present proceeding for the settlement of the account of the successor trustee and of the account of the deceased trustee, Joseph F. Taylor, who was also the last of the life beneficiaries to die. The court is asked on this application to settle those accounts and to pass upon the propriety of an agreement of settlement which the parties to the proceeding have negotiated in an effort to resolve a series of problems that have arisen during the course of the administration of the estate. They also seek to overcome the effect of a violation of the rule against perpetuities arising out of the attempt by Joseph F. Taylor to exercise the power in his will by appointing the property in further trust for his widow and children of which group only the widow had been in existence, en ventre sa mere, at the time of the death of the testator in 1887 having been born three months thereafter (Personal Property Law, § 11; Matter of McEwan, 202 App.
As a basis for their proposed agreement the parties attempt to circumvent the application to this will of the New York statutes against perpetuities (Real Property Law, § 42; Personal Property Law, § 11) on the ground that it is governed by the law of California where it was executed by the testator at a time when he was a resident of that State. This argument is without foundation. It has been variously held that the law governing the provisions of a trust is either the law of the domicile of the testator or settlor or that of the situs of the fund, barring a contrary intention upon the part of the creator (Shannon v. Irving Trust Co., 275 N. Y. 95; Chamberlain v. Chamberlain, 43 N. Y. 424; Bishop v. Bishop, 257 N. Y. 40). In the case of testamentary trusts the domicile of the testator at the time of his death is meant rather than his domicile at the time of the execution of the will (Rubin v. Irving Trust Co., 305 N. Y. 288).
‘ ‘ The validity of a trust of movables created by a will is determined by the law of the testator’s domicil at the time of his death.” (Restatement, Conflict of Laws, § 295.)
‘1 Assuming that the law of the domicil governs, as regards the essential validity of a particular provision of a will, it is clear that it is the law of the domicil at the time of the testator’s death, rather than that of his domicil at the time of the execution of the will. (Lowry v. Bradley, 17 S. C. Eq. [Speers] 1; 39 Am. Dec. 142 * * *; Murphy v. Morrisey, 99 N. J. Eq. 238, 132 Atl. 206.” (57 A. L. R. 238, Annotation.)
Applying the rule stated to the present will, since New York is the State of both situs and domicile, it is apparent that the prohibition against perpetuities in this case is governed by the law of New York rather than that of California nor is this result affected in any way by section 24 of the Decedent Estate Law which is confined in its operation to the execution of a foreign will, its admissibility to probate and the interpretation of the testamentary language rather than to the validity of any of its provisions (cf. Irving Trust Co. v. Rubin, supra).
Coming now to a consideration of the proposed agreement of settlement, Joseph P. Taylor died a resident of New Jersey in 1956 leaving a will which, while not effective to exercise the power of appointment under the law of that State (Farnum v. Penn Co., 87 N. J. Eq. 108, affd. 87 N. J. Eq. 652), contained a
The court has jurisdiction to incorporate in its decree an agreement of settlement basically inter vivos in character which will bind the parties to the proceeding and which can be enforced by the Surrogate on their application in the exercise of his power to compel compliance with his directions. In Matter of Bausch (270 App. Div. 418) the parties to a probate contest
“ The single question which seems to be involved herein is whether the compromise agreement is such an inter vivos trust that it, when it became operative, fell outside the surrogate’s jurisdiction. This trust had plenty of, if not all, the earmarks of an inter vivos one.
* # *
1 ‘ Taking the foregoing view of the present situation, the conclusion seems proper that, both by section 40 and subdivision 13 of section 20 of the Surrogate’s Court Act, the surrogate of Onondaga County having once taken jurisdiction of this estate, and, so, having been authorized by the statutory provisions of the Real and Personal Property Laws then in force, now section 19 of the Decedent Estate Law, to approve this compromise agreement, did not lose jurisdiction because the trust created by the agreement has the earmarks of an inter vivos one, but rather, under the express provisions of the Surrogate’s Court Act his jurisdiction continued until the agreement ends, by the final distribution of the estate. ’ ’
The reasoning of the cited case supports the conclusion that the court has jurisdiction to approve a settlement of the sort proposed but whether reason exists for its exercise is another question. The parties insist that such is the case because, of the fact that, if jurisdiction were declined, control over the combined fund, now compromised in major part of two parcels of real property located in this county, would be divided between the successor trustee administering the trust under the will of Frederick B. Taylor under the supervision of this court, the trustee appointed by the court in New Jersey having jurisdiction over the estate of Joseph F. Taylor, and by the latter’s daughters as the owners of that part of the original fund which was the subject' of his invalid appointment. The diversity of control over the property does assume the dimensions of which they profess to be in fear. In the interest, therefore, of the orderly administration of the continuing trust under the will