Merchants Trust Co. v. Russell

260 Mass. 162 | Mass. | 1927

Carroll, J.

Under the residuary clause of the will of Frederick A. Russell, his son Charles F. Russell was given certain real estate, with the fixtures, farming instruments and equipment, “to hold for the term of his natural life, with full power and authority to use the income and principabas he desires, and to sell and convey absolutely and in fee simple any part or all of said principal, including both real estate and personal property, without any purchaser being answerable for the application of the purchase money, but without power to dispose of by will.” The property was charged with a trust to pay the sum of $4,000 to Marion F. Russell, the granddaughter of the testator. The will provided that “if any part of the principal” given to Charles F. “shall remain undisposed of by him during his lifetime,” it was to go to such of the children of Charles F. Russell as are living at the time of his death. On March 27, 1922, Charles F. by deed and bill of sale transferred to his son Albert A., without consideration, all of the land and personal property which came to Charles F. by the will of his father.

Charles F. died September 23, 1922. He was indebted to the plaintiffs. The prayers of the bill are to restrain the defendants from conveying the property, and for the appointment of a receiver with authority to sell the property and to distribute the proceeds among the creditors of Charles F. Russell.

The judge found that the property was conveyed to Albert A. Russell upon an oral trust to mortgage the property for the purpose of paying the debts of Charles F. Russell. The plaintiffs do not contend that they can compel the execution of this oral trust. They now concede that it *164cannot be enforced. They rely upon Clapp v. Ingraham, 126 Mass. 200, which decided that where a person had the power of appointment and executed it, the property appointed was considered in equity part of his assets subject to the demands of his creditors in preference to those of his voluntary appointees or legatees.

By the will of Frederick A. Russell his son Charles F. received a life estate with power “to sell and convey absolutely and in fee simple . . . without any purchaser being answerable for the application of the purchase money,” with a trust to the extent of $4,000 for the benefit of Marion F. Russell, the remainder of the property undisposed of to go to the children of Charles F. Russell living at his death. Charles F. had a life estate with the power of sale. Kelley v. Meins, 135 Mass. 231, 234. Dana v. Dana, 185 Mass. 156. Homans v. Foster, 232 Mass. 4. He had no power to make a gift of the property, or convey it without consideration. He could sell it and dispose of the proceeds as he desired, but the language of the power must be so construed as to carry out the testator’s intentions and regard must be had to the rights of the remaindermen. Lovett v. Farnham, 169 Mass. 1, 6. Charles F. Russell could use and enjoy the property as he saw fit, but he could not dispose of it except by sale. The testator provided that the purchaser should not be answerable for the application of the purchase money; and according to the terms of the instrument Charles F. could not dispose of the property by will. The beneficiary had rights in the property of which she could not be deprived, and the remaindermen also had rights which could not be taken away from them except in accordance with the terms of the will. Alexander v. McPeck, 189 Mass. 34, 43. The conveyance to Albert A. was without consideration; as the judge found, it “operated as an absolute gift.” It was not, therefore, a sale within the meaning of the will, which gave to Charles F. Russell no authority to dispose of the estate by gift; he was limited to the terms of the will, and the gift was not authorized by it. Stocker v. Foster, 178 Mass. 591, 599. Clapp v. Ingraham, supra, has no application to the case at bar; the power given in that case was executed in *165accordance with the terms of the will, whereas Charles F. Russell, in conveying the property, exceeded his right. He had no power to make a gift. He acted, not under the authority given him, but contrary to the provisions of the will.

The decree directed Albert A. Russell to execute and deliver to Anna M. Russell, the executrix of the will of Charles F. Russell, a proper deed of transfer of all the real and personal estate conveyed to Albert A. by Charles F., to be administered, first to satisfy the trust for the benefit of the testator’s granddaughter, Marion F. Russell (Stone), and thereafter as assets of the estate of said Charles F. Russell. The decree was wrong. The property transferred by gift from Charles F. to Albert A. did not belong to the estate of Charles F., and was not assets belonging to his estate. The decree must be reversed, and the bill dismissed.

Ordered accordingly.

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