133 N.Y.S. 257 | N.Y. Sup. Ct. | 1912
This motion presents for determination an issue of law. The action is brought to cancel a deed of trust of personal property alleged to have been revoked under section 23 of the Personal Property Law;
The deed of trust provides in substance that the plaintiff, Henry de Groot Robinson, the creator thereof, shall receive the income therefrom during his life; that, if plaintiff leaves him surviving a wife or a wife and children, or issue of a deceased child or children, the fund shall be divided into equal shares, one for a possible wife if surviving, and one for each of the children or issue of deceased child or children, said shares to be transferred and assigned to them respectively, except that, if the wife be a person in being at the date of the trust deed, then her share to be held in trust for her during her life; that, if plaintiff dies leaving neither .wife nor children, nor issue of deceased children surviving, but is survived by his mother, Hannah Robinson, and his brother, Francis de Groot Robinson, the income of the fund shall be paid, one-half to his mother and one-half to his said brother during the life of his mother, and upon the death of his mother the whole to his said brother; that, if plaintiff dies leaving neither wife nor children, nor issue of deceased children him surviving, but survived by his said mother or brother, .but not by both, the whole of the income shall be
At the present time the plaintiff and his brother are unmarried and without children and the plaintiff’s mother is still living. The defendant Thomas H. Eobinson is a brother of the plaintiff’s deceased father and the defendant Charles L. F. Eobinson is a nephew of plaintiff’s deceased father. These two defendants are conceded -to be the only persons in being who, if the intervening life estates were to cease eo instanti, would answer the description of next of kin of the settlor on his father’s side."
The mother and brother of the settlor have signed a consent in writing to the revocation of the deed of trust. The defendants Thomas H. Eobinson and Charles- L. F. Eobinson were not originally parties to this suit, but upon their own motion they were made parties. These defendants have demurred to the complaint on the ground that it fails to state facts sufficient to constitute a cause of action. The said defendants who now demur to the complaint contend that they are persons “ beneficially interested ” in the trust and that the said trust may not be revoked without their consent. This contention rests upon section 23 of the Personal Property Law, which provides as follows: “ Eevocation of trusts upon consent of all persons interested. TJpon the written consent of all the persons beneficially interested in a trust in personal property or any part thereof heretofore or hereafter created, the creator of such trust may revoke the same as to the whole or such part thereof, and thereupon the estate of the trustee shall cease in the whole or such part thereof.”
This section was added to the law by chapter 247 of the Laws of 1909 and took effect April 23, 1909.
The proposition to be determined upon this demurrer is whether the demurring defendants are “ persons beneficially interested ” within the meaning of those words as used in section 23 of the Personal Property Law.
Formerly a person having a right to the beneficial en
This rule was not inconsistent with a recognition of the right of those representing every estate in the trust, assuming that they were all competent to act, to revoke the trust at their pleasure. Such was the rule in this State prior to the adoption of the Revised 'Statutes in 1830. • The Statute of Uses- and Trusts (4 R. S. [8th ed.] 2438, 2439) in sections 62 to 65 prohibited a beneficiary under the trust, other than a trust for the payment of a sum in gross, from assigning his interest, and declared that every sale, conveyance or other act of the trustees in contravention of the trust shall be absolutely void. This statute was several times interpreted by the courts. Wood v. Wood, 5 Paige, 596; Douglas v. Cruger, 80 N. Y. 19; Lent v. Howard, 89 id. 169. In Cuthbert v. Chauvet, 136 N. Y. 326, these cases were re
The Legislature amended the Revised Statutes by chapter 452 of the Laws of 1893 so as to provide in substance that “ whenever a beneficiary of a trust for the receipt of rents and profits became entitled to the next estate in remainder he might call for a conveyance and put an end to the trust, and this provision was finally incorporated in the Real Property Law, and was thereafter, by section 3 of the old Personal Property Law, explicitly extended to trusts of personalty.” Eowler Pers. Prop. Law, 7. The act of 1893 continued in existence until October 1, 1897, when it was repealed by chapter 87 of the Laws of 1897. This act of 1897 was amended by chapter 87 of the Laws of 1903, which, as again amended by chapter 327 of the Laws of 1911, is in its present form incorporated in section 15 of the Personal Property Law. After reviewing these statutory changes Surrogate Eowler, in his valuable book on the Personal Property Law, says: “ The interests of a beneficiary in a trust to receive and apply the income of personal property have, since the passage of chapter 87 of the Laws of 1903, again become as inalienable as they were held to be under the Revised Statutes. * * * This section is now an explicit restoration of the former law of this State making certain trust interests inalienable, as we have before noticed at length. But this section, it will be observed, applies only to trusts to receive and apply income to the use of beneficiaries specified and not to other trusts ” (p. 89).
Erom this review it becomes evident that, except in the special cases referred to, an active trust was, before the enactment of section 23 of the Personal Property Law, inde
The purpose and the effect of the adoption of section 23 of the Personal Property Law are well set forth in Hoskin v. Long Island Loan & Trust Co., 139 App. Div. 258. In that ease Mr. Justice Burr said; “ The difficulty which has existed in the way of the destruction of an active trust arose from the provisions of the law which prohibit the person entitled to the beneficial interest from assigning or in any manner disposing of the same, or the trustee from doing anything in contravention of the trust. * * * The beneficiary of the trust, the trustee, the owner of the reversion or remainder, ..and in' some cases the creator thereof, represent every possible interest, legal or equitable, in the trust property.' The creator of the trust and the person entitled to the reversion or the remainder, if in other respects competent to act, could always release or convey all or any rights which they might have in the subject-matter of the trust. The effect of this act is to remove from the beneficiary and the trustee the prohibition which has heretofore existed, and make them as free to act in regard thereto as any other person. When, therefore, the necessary conveyances or releases are executed, the trust terminates as matter of law.”
Section 23 of the Personal Property Law neither enlarges nor restricts the class of those who answer the description of persons beneficially interested in a trust estate. Whatever beneficial interest one possessed in a trust estate before the enactment of section 23 still continues in precisely the same nature, quality and degree as before.
By virtue of the statutes of this State the same rules which regulate future estates in land are made applicable to the creation and limitation of future estates in personal property. Per. Prop. Law, § 11; Nat. Park Bank v. Billings, 129 N. Y. Supp. 846. With respect to their time of enjoyment, estates are divided into estates in possession and in expectancy. Estates in expectancy consist of future estates .and estates in reversions.. Real Prop. Law, §§ 35, 36. Remainders "are future estates and are either vested or contingent. Certainly these demurring defendants can claim no
Under this rule of construction the trust fund is ultimately to be distributed to those answering the description of next of kin of the settlor on his father’s side, who shall be in existence at the termination of the trust. There is not necessity for attempting to classify with precision the exact interest which these demurring defendants claim to possess. Any interest in remainder, whether vested or vested subject to'its being divested or contingent, is nevertheless an expectancy. It is provided by statute in this State that “ an expectant estate is descendible, devisable and alienable in the same manner as an estate in possession.” Real Prop. Law, § 59. A person having an expectant estate in a trust fund which is descendible, devisable or alienable is certainly a person beneficially interested. The converse of this proposition seems to be equally plain. One whose interest is not descendible, devisable or alienable cannot be said to be beneficially interested. If the interest which one has in a trust estate possesses none of these attributes it cannot be said to be a beneficial interest.
All expectant estates except those defined in the statute are abolished (Real Property Law, § 36), and those defined in the statute are descendible, devisable and alienable. If, therefore, one possesses an interest which lacks these attributes of descendibility, devisability or alienability it is not such an interest as is recognized by our law and could not have been within the contemplation of the Legislature in
The language of the statute declaring expectant estates to .be descendible, devisable and alienable is comprehensive, but it still leaves open for determination the question as to what are expectant estates and what interests are descendible, devisable and alienable. Upington v. Corrigan, 151 N. Y. 143, 148; Fowler Real Prop. Law, 215.
A remainder is said to be contingent while the person to • whom, or the event on which, it is limited to take effect remains uncertain. Real Prop. Law, § 40; Hennessey v. Patterson, 85 N. Y. 100. Under the early common law such remainders were assignable to strangers, whether by way of fines or common recoveries only on the principle of estoppel. Cruise Dig. tit. XVI, chap. VIII, §§ 20, 21.
“ For a long time,” says Hr. Washburn, “ a contingent remainder was not supposed to be the subject of alienation, because it was rather a possibility than an estate, like the possibility of an heir at law, for instance, having the estate when his ancestor shall have died. But it is now settled that where the contingency upon which the remainder is to -vest is not in respect to the person, but the event, where the person is. ascertained who is to take if the event happens, the remainder may be granted or devised, and the grantee or devisee will- 'come into the place of the grantor or devisor, with his 'chance of having the estate. But if the contingency is 'in the. person who is to take, as where the remainder is limited, to the heirs of one now alive, there is no one who can make an effectual grant or devise of the remainder.” 2 Wash. Real Prop. (6th ed.), § 1557, p. 527. See also Kenyon v. See, 94 N. Y. 563.
■ Commenting upon the statutory provision which declares expectant estates' to be descendible, devisable and alienable, Professor Reeves says: “ But these statutes must -always be understood-, as meaning simply that such interests .may he
In a note upon the Hew York statute declaring expectant estates alienable he says: “ This must be understood with the qualification explained—-the owner must be in being' and ascertained, and he who acquires the remainder takes it subject to the contingency.” Mr. Fearne, in his work on Contingent Remainders, enumerates four classes of contingent remainders, and the fourth class named exists “ where the person to whom the remainder is limited is not yet ascertained^’ not yet in being.” 4th Am. ed., 4. Mr. Cruise, in adopting Mr. Fearne’s classification, says: “The fourth sort of contingent remainders is where it is limited to a person not ascertained or not in being at the time when such limitation is made. Thus, if a lease be made to one for life, remainder to the right heirs of J. S.; now, there can be no such persons as the right heirs of J. S. till his death, for nemo est haeres viventis; and J. S. may not die till after the determination of the particular estate; therefore such remainder is contingent.” 2 Cruise Dig. (Huntington ed.), tit. XVI, chap. 1,'§§ 19, 20. Mr. Washburn says:- “ The fourth class of contingent remainders is where the contingency depends upon the uncertainty of the person who is to take the remainder because he is either not in being or not ascertained at the time the limitation is made. An example of this kind wcmld be that of an estate limited to one for life, remainder to the oldest son of J. -S., who has none at the time of the limitation made, or remainder to the heirs of J. S., who is living at the time.- So a grant to A. and B. for life, remainder to the survivor, would be of this class. In all these cases there is no means of knowing when the limitation is made, who, if any one, will be entitled to the remainder when the particular estate shall determine.” 2 Wash. Real Prop. (6th ed.), § 1562, p. 531. In Broom’s Legal Maxims (4th ed., p. 394) it is said: “When property is' settled in trust in remainder .for the persons who should be ¡ the next of kin of the tenant for life at her death, the pre-■
Under the deed of trust the trust fund is ultimately' to go, after the termination of the preceding life estates, to the next of kin of the settlor on his father’s side. This gift being to a class and coupled with words of survivorship refers not to the time when the deed of trust was made or to the present time, but to the time of-the distribution. If there is now no one in existence and ascertainable answering to the class to which the deed of trust provides that the fund shall ultimately go, then there is no one of whom it may be said that he has a beneficial interest in the trust fund. The deed of trust provides that the trust fund shall ultimately go to the next of kin of the settlor on his. father’s side. The settlor is still alive and there can be no next of kin of a living person. The words “ next of kin on his father’s side ” mean those who shall, at the date of distribution, be next of kin of the settlor on his father’s side, according to the Statute of Distribution. Slosson v. Lynch, 28 How. Pr. 417-419; Heath v. Hewitt, 127 N. Y. 171.
In Gundry v. Pinniger, 7 Eng. Law & Eq. 148, 151; 14 Beav. 94; 51 Eng. Rep., full reprint, 222, the remainder was “ to O. D. if living; but if dead to his next of kin ex parte materna.” Sir John Romilly, the Master of the Rolls, said: “ The rule has very properly been admitted to be that in ordinary cases of a gift to the next of kin of a person, such a class is to be ascertained at the death of the person himself, unless there be sqme special words to show that such a construction cannot properly apply. I never accurately understood how the ‘ next of kin ’ of a person could properly be ascertained by any other period than at the death of such
Inasmuch as the estate in remainder is to go to the settlor’s next of kin on his father’s side, how can it now be averred that these demurring defendants are such next of kin ?
The settlor is still alive, and, while living, he can have no next of kin. Here the remainder is not to these demurring defendants by name. The settlor gave nothing to them. His gift was ultimately to go to a class. Whether these demurring defendants will be within that class at the death of the settlor or at the time of distribution is entirely speculative. Any interest which' these demurring defendants may have would be divested by their death prior to the death of the life beneficiary, the settlor’s brother. If the settlor shall leave him surviving any child or descendant of such child, the demurring defendants will be excluded from the class of next of kin. If the settlor dies without issue and the brother of the settlor, who is a life beneficiary, shall have issue, such issue would answer the description of next of kin to the settlor on his father’s side to the exclusion of these demurring defendants. The uncertainty which has been pointed out is not only as to event, but relates to the person or persons to whom the trust’ estate will ultimately go. The gift of the ultimate estate is to a class the members of which at present have no existence, and cannot, in the nature of things, have any existence until the death of the settlor.
I regard the case of Gilliam v. Guaranty Trust Co., 111 App. Div. 656, as furnishing strong support for the views herein expressed. In that case the deed of trust provided that after the death of the beneficiary the corpus of the estate shall go “ to her heirs at law.” It was held that although the brothers of the cestui que trust may be her heirs at the time-of her death, their rights are subject to be divested if at the death of said cestui qui trust she leaves other heirs entitled to take in preference to said brothers under the Statute of Descent as so existing at her death, and that the cestui que trust having adopted a child, such adopted child was entitled to inherit by statute to the exclusion of the brothers. In that case Hr. Justice Clarke, writing for the majority of the Appellate Division, said: “ If we assume, what does not appear, that at the time of the execution of this deed' these three defendants (the brothers) would have been the heirs of-the cestui que trust if 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. Consequently their whole estate — whatever it was —■ was liable to be divested by the death of all three before Frances Dyett’s death (the cestui qui trust). That such an estate is not devisable, descendible or alienable is settled:”' After quoting with approval, the opinion of Hr. Justice Rumsey in Paget v. Melcher, 26 App. Div. 17, approved in 156 N. Y. 404, Hr. Justice Clarke says: “So that whatever this right of these defendants may be called,
Within the meaning of these authorities I think it clear that the person or persons who will answer the description of next of kin to the settlor on his father’s side are at present uncertain and must continue to he uncertain until the time of distribution, and until that time it can never he known to whom the remainder of this trust estate will go. Heath
It follows that these demurring defendants have no interest which is descendible, devisable or alienable, and, therefore, are not “ persons beneficially interested ” in the deed of trust and that such deed was revoked and cancelled by the written consent of the settlor and the only other persons who were “ beneficially interested ” in it within the meaning of those words as used in section 23-of the Personal Property Law.
The demurrers should be overruled with costs, and, as it does not appear that leave to plead over would be of any avail to the demurring defendants, judgment is awarded in favor of the plaintiff.
Judgment for plaintiff.