| New York Court of Chancery | Jan 31, 1845
The deed from Joseph to Graham, appears to have vested the latter with an absolute and unqualified estate in fee, on the 12th of October, 1836.
The declarations of a trust in the lands conveyed, executed by Graham in April following, could not have the effect to divest the absolute estate acquired by the deed.
By those instruments, he declared that he was a trustee of the lands which had been thus conveyed to him. He covenanted to hold them in trust, and to exercise certain powers in trust in the disposition of the lands and their proceeds.
The validity and effects of those powers, are not called in question by any of the parties ; and the defendants concede, nay assume, on their part, that on the conveyance by Graham to Ogden and Clason, the latter took the property subject to the execution of those powers.
The questions are, whether Ogden and Clason could rightfully
The powers to be exercised were; to sell the premises, or such portion thereof as the majority of shares should specify, at such times, at public or private sale, and on such notice and terms, as the majority of shares should direct. Out of the proceeds to pay all proper expenses, and apportion and divide the residue to and among the holders of the shares. And if so directed by a majority of the shares, to allot, divide and set apart, the unsold premises, to and among the shareholders.
The instrument contains no reservation or provision of a power of appointment or substitution by Graham, of any person or persons, to do these acts in his stead. Upon such an instrument, delivered to each shareholder, each appears to have paid the price or consideration for his share. Each shareholder thus acquired a right and interest in the covenants and powers contained in the declaration of trust.
The powers were to be executed by Graham personally. The manner of their execution, was important to the parties in interest. His skill and success in effecting a sale; his economical conduct of the trust; and his judgment and impartiality in making a partition, if that should become necessary; were elements of the contract which the parties entered into by this trust deed, and which the court upon the construction, of the trust, must infer were a part of the inducement for the purchase of the shares.
It seems to me perfectly clear, that such powers cannot be delegated, without an express provision in the deed creating the powers, or the consent of all the parties.
The conveyance from Graham to Ogden and Qlason therefore, while it may have transmitted the legal title, did not clothe them with the powers in trust which are contained in the declarations executed to the shareholders.
They could not proceed to sell at auction or otherwise, under the direction of the majority of the shareholders; and the proceeding instituted for that purpose, as stated in the bill, was nugatory.
This conclusion renders it unnecessary to look into the mere
A sale under the direction of the court, is doubtless the proper mode of winding up this trust. But all the necessary parties for that purpose, are not before the court.
The three outstanding shares, and Mr. Graham should be brought in. If the owners of the three shares cannot be ascertained, it may suffice to bring in as defendants, the persons in whose names the declarations of trust for those shares were issued.
In the meantime, an order may be entered directing the cause to stand over for the purpose of adding those parties, and reserving all further questions and directions.
The complainant made further parties, and on the cause being brought to a hearing at a subsequent term, a decree was made directing a sale of the premises, and a distribution of the proceeds among the holders of the certificates. The sale and deed to Pumpelly were set aside.