Summary
In Henderson v. Henderson (113 N.Y. 1) the will contained a direction to the executor to make partition as soon after the testator's death as practicable, but reserving to the executor discretion to delay such partition for a period of five years after such death.
Summary of this case from Kalish v. KalishOpinion
Argued February 8, 1889
Decided March 5, 1889
S.F. Rawson for plaintiff, appellant. Edward S. Rapallo for defendants, appellants. Francis Forbes for John C. Henderson, respondent.
Joseph O. Brown, guardian ad litem, for Harriet Gertrude Outerbridge, respondent. Kelly, Tucker Henderson for H.G. L.O. Henderson, respondents.
The questions, which this appeal brings before us for review, relate to the validity of the disposition which was made by this testator of his residuary estate. The sixth clause of his will provides as follows: "All the rest, residue and remainder of my estate, both real and personal, and wheresoever situated, I hereby authorize, empower and direct my executor to partition, divide and apportion equally among all my children living at the time of making such partition and division, and the child or children of such of my children as may then be dead, leaving issue. * * * And I do hereby give, devise and bequeath to each of my said children the share or portion of my said estate so to be partitioned, divided and apportioned to them respectively, as aforesaid. * * * Provided, nevertheless, that if any of my children shall die without issue before such partition and division shall be made, then I give the portion of such deceased child equally to the brothers and sisters of such deceased child. And provided, further, that, if any of my said children shall die leaving issue, then the child or children (who shall be living at the time of such partition) of such deceased child of mine shall take and have the share or portion which the parent would have taken if living. * * * It is my will that my executor make the partition, division and apportionment aforesaid as soon after my decease as may be practicable, having reference to the condition of my estate; but as he may find it necessary to realize upon the securities and sell and convert into money both real and personal property, and make other changes in my estate in order to make equitable and proper partition, and which he may not be able speedily to make without sacrifice and loss to my estate, he shall not be compelled to make such partition, division and apportionment until after the lapse of five years from the date of probate of this will."
By the ninth clause the testator directs his executor, until the partition of the estate, to pay over to each of the children $2,400 per annum, quarterly, from his decease, and to charge the payment to the child as a part of his or her share of the estate. In the tenth clause, he authorizes his executor to take entire charge, control and management of all the real and personal estate; to lease; to collect the rents, issues and profits and income; to make investments; to insure; to pay taxes and asssessments; to make repairs; to pull down buildings and erect new ones, etc.
The judgment of the Special Term, sustaining the testamentary disposition of the residuary estate, was reversed at the General Term; but while the two learned judges, who sat in review, in that court, agreed in reversing, they differed in their mode of reasoning out that result. Judge BARNARD thought that the will gave to the executor an estate in the lands, until actual partition, and no estate in possession could be given; that if the will is good to vest the executor with the title in trust, which may extend for an absolute term of five years, there was no one in being who could give a title until after that period has passed, or until the executor chose to partition the land. Judge CULLEN, however, accepting the authority of Robert v. Corning ( 89 N.Y., 225), held, that even if the will created a trust in the executor, that fact alone would not create a suspension of the power of alienation; since the executor may, at any time within the five years, convey a good title to the land by sale; or by the partition and division among the devisees. But he thought that there was a distinction between the cases; in that, in the present one, the absolute ownership of personal property might be suspended by the limitations of the will for more than the statutory period. The limitations, to which he refers, are in the second proviso in the sixth clause, by which the issue of a deceased child of testator, who shall be living at the time of the partition, are substituted in the place of the parent. He also thought that there was an illegal disposition of the real estate, in the creation of a contingent remainder upon a term of years, in which the contingency was of such a nature that the remainder could not vest in interest during the continuance of the statutory period of two lives in being.
We do not think that any valid express trust was created by the testator; for, if such was his intention, it would be ineffectual for not being comprehended within the provisions of section 55 of the article on uses and trusts in the Revised Statutes. The main purpose of testator's will was that his children should participate equally in his residuary estate, and that its division among them should be effected by his executor. For the better execution of that purpose, he gave a discretionary power of sale to the executor, and the further power to manage the estate and to receive the rents, profits and income thereof is conferred, until partition and division. There is no express devise of the residuary estate to any one, and, if no valid trust title was created in the executor, it must follow that the legal title to the real estate vested in the children at the testator's death, subject to the power given to the executor to partition and, meanwhile, to manage and sell.
In its features this case resembles Cooke v. Platt ( 98 N.Y. 36), where there was an express devise to the executors, which was held ineffectual as constituting a valid trust, because it was not upon one of the express trusts authorized by statute. The declared purpose in that case was to divide the estate among the children through the executor, and a discretionary power to sell was conferred. It was there held that the trust could not be sustained as one to receive the rents and profits of the land, under the third subdivision of section 55, because there was no direction to apply them to the use of any person for any period. And it was said that "the statute does not authorize the creation of a trust for the partition of lands. But a power may be created for that purpose, and a devise to the executors, though void as a trust, may be valid as a power to distribute and divide." It was held in the same case that it was essential to the constitution of a valid trust, if the purpose be to sell lands for the benefit of creditors and legatees, that the power of sale should be absolute and imperative, without discretion, except as to the time and manner of performing the duty imposed. "The sale or other disposition mentioned in the statute must be the direct and express purpose of the trust."
However convenient to the executor the possession of the legal title to the estate might be, in order to carry out the testator's purpose, a trust estate should not be implied, when to do so would make the will conflict with the statute and when the duties imposed upon the executor could be executed under a trust power. ( Post v. Hover, 33 N.Y. 601; Heermans v. Robertson, 64 N.Y. 332.) The direction to the executor to partition, divide and apportion the residuary estate, though ineffectual to create a valid trust, may be upheld as a power in trust.
There is nothing in the will, which makes it absolutely necessary to imply a trust; because everything, which the executor is called upon to do, may be performed, either in that capacity, or as the donee of a power in trust. He is not required to distribute from the income, but to advance from the capital to the children, and his duties of management of the estate, of realizing upon the same by sale for the purpose of partitioning and apportioning, may be lawfully performed by him under a power in trust. The power of sale was in no wise suspended by the provision in the sixth clause directing that the executor should not be compelled to make partition, division and apportionment until after the lapse of five years from the date of probate of the will. The reason furnished by the will for this direction is that, owing to the condition of his estate and the possible necessity of having to convert into money the realty and personalty composing it, the executor might not be able to do it speedily without entailing sacrifice and loss. The decision of this court in Robert v. Corning ( 89 N.Y. 225) is in point. Under the will in that case the executors were directed to sell the residuary estate and from the proceeds were to distribute it in certain parts among the children; but they were empowered to delay a sale for not exceeding three years. It is there said in the opinion that "the mere fact that it might be the duty of the executors, in the exercise of their discretion, to postpone the sale to await a more favorable market does not, we think, constitute such a restraint as suspends the power of alienation within the statute." There was no unlawful perpetuity created by authorizing the executor to delay partitioning the estate, because the power of sale was not suspended. He could sell and convey an absolute fee in possession at any time after testator's death. He was a person in being, who could at any time sell the real estate, or give title by partition among the testator's children, without contravening the powers in trust which were conferred upon him.
At testator's death all of his children survived him and were of full age, and, if necessary, they could have united with the executor in a conveyance of the real estate; and, if an immediate conveyance and payment were to be made, they could take at once from the executor. The powers of partition and of sale being valid, however, the children of testator took their interests at his death subject to their exercise, and, hence, one or more of them could not maintain any compulsory partition proceedings, pending the existence of the right in the executor to exercise his powers. Although there is no present express devise to the children of the residuary estate, but only the direction to the executor to divide and apportion it among them, if they were alive at the time of distribution, we think their interests must be considered as having vested at the testator's death. Such would be the result from the fact that no valid trust estate has been created in the executors, and such would be fairly inferable as an intention of the testator from his language in the sixth clause, where he says: "I do hereby give, etc., to each of my said children the share or portion of my estate so to be partitioned, etc., as aforesaid." The time of conveyance of the realty to and of the distribution of the personalty among the children is postponed, only, but that is not inconsistent with the vesting of the undivided shares. We regard that language as disposing of the suggestion that time was of the substance of the gift.
Nor is any insuperable difficulty created, in this case, in the existence of any ulterior, contingent limitation in the sixth clause. The language referred to is, "and provided, further, that if any of my said children shall die leaving issue, then the child or children (who shall be living at the time of such partition) of such deceased child of mine shall take and have the share or portion which the parent would have taken, if living." The primary intention of testator was to give to his immediate children the absolute title to their shares; subject to a limitation over to their issue, in case of their death before the period of actual partition of the estate. That was the limitation of a future, contingent estate, but it was one which would not prevent the ultimate vesting of the share beyond the life of his child. The interest in the lands of testator vested in the children upon testator's death, subject to the power in the executor to partition them, and subject to being divested by a sale under the power. There was no equitable conversion worked of the realty into personalty, for the power of sale was not absolute. If the real estate was converted into money by a sale, under the power, the proceeds would still partake of the nature of realty. So much of the estate as was personalty remained in the executor's possession, to be held and managed by him, until the period arrived when he should exercise the power of partitioning and dividing the whole estate. The interest in the realty, which vested in the testator's children upon his death, was liable to be divested, under the provisions of the will, by death before partition completed; as the ownership in the personalty was contingent upon the child's surviving that event. Though the testator contemplates the gift of the shares to take effect in his immediate children, he provided for the contingency of death before the period of partition, by a limitation over to their issue in such event. The provision we have last above quoted from the will, restricting the limitation over to such of the issue of a deceased child as " shall be living at the time of such partition," introduces the difficulty in the case, because it is claimed that its effect might be to prevent the absolute vesting of the share in the issue of a deceased child at the time of the parent's death.
We do not think that the main testamentary purpose of the testator should be allowed to be frustrated because of its existence. The will, in that respect, was carelessly or inartistically drawn. The testator had previously directed the partition and apportionment of his estate among all his children "living at the time of making such partition and division, and the child or children of such of my children as may then be dead, leaving issue." Under such a provision, upon the death of a child of testator before partition, leaving issue, the share would have vested absolutely in that issue; the time of payment, merely, being postponed, or, failing issue, it would have gone to the brothers and sisters. The subsequent clause, to which we have referred as creating the difficulty in the validity of the residuary disposition, was an inconsistent provision and one quite unnecessary, so far as relating to the perfection of a testamentary scheme for disposing of the residuary estate. We do not think it should be allowed to prevail over the preceding direction in the same clause, when, by cutting it off and disregarding it, as a void direction interpolated in the instrument, the will of the testator can be effectuated according to a plain and just intent. In doing so, we would thwart no purpose of the deceased, nor make any new testamentary disposition for him. We simply reinstate the purpose, in its integrity, which had just been definitely stated. Under the statute every future estate, which may not vest within the period of two lives in being at the time of its creation, is void, as is any limitation or condition, by which the absolute ownership of personal property may be suspended beyond the specified period of time. When such a void disposition of property has been made by the testator in his will, if it is separable from his principal dispositions, it may be cut off.
In Harrison v. Harrison ( 36 N.Y. 543), it was said that "the principle is now well settled that the courts lean in favor of the preservation of all such valid parts of a will as can be separated from those that are invalid, without defeating the general intent of the testator" (citing many authorities.) In Tiers v. Tiers ( 98 N.Y. 568), it was said: "It is quite evident that the ulterior contingent limitation is quite separable from the primary trust, and merely incidental; its only purpose being to provide for a contingency which may never arise, and the failure of that provision would not affect the general scheme of testatrix. In such cases the rule is quite well settled that an ulterior limitation, though invalid, will not be allowed to invalidate the primary disposition of the will, but will be cut off in the case of a trust, which is not an entirety, as well as in the case of a limitation of a legal estate."
Courts should endeavor, by every reasonable intendment and by a liberal construction, to sustain a testamentary disposition of property when, in so doing, they can give actual and just effect to the testator's purpose and validate at least the main, if not the true part of a testamentary scheme, which contemplates distinct and severable acts. If the principal disposition can be upheld, we should disregard ulterior, contingent limitations, which threaten violation of statutory rules respecting the ownership of property. Thus, in this will, it is perfectly clear that what the testator desired to accomplish was an equal partition of his estate, within a certain period of time, through the exercise of his executor's judgment, among his children then living, and the issue of any child dying before the actual division and apportionment, per stirpes and not per capita. So much he has said in the opening paragraph of the sixth or residuary clause; and, if it is argued that the subsequent limitation imposed upon the gift, by which, upon the decease of one of his children, the parent's share shall not vest in his or her issue at once, but shall be held and paid over only to those living at the time of partition, is to be taken as a serious purpose of the testator, and constitutes a void ulterior, contingent limitation, it may be severed from the will without affecting the main purpose of the testator. Thus cut off, the attainment of his principal objects would be secured, and the absolute ownership of the personalty and the ultimate vesting in interest of the remainder created in the realty, could not be postponed beyond the life of the parent, testator's child.
For the reasons we have given, the order of the General Term should be reversed, and the judgment of the Special Term should be affirmed, with costs to all parties who have appeared in the action, to be paid out of the estate.
The respondent moved for a dismissal of the appeal, on the ground that the order of the General Term, which reversed the judgment at Special Term and granted a new trial, is not appealable. Judgment would have been more appropriately ordered under the decision of the General Term, in a case on the equity side of the court involving the construction of a will. But jurisdiction was given to this court to entertain the appeal from the order, by the assent given by appellant in the notice of appeal that judgment absolute should be rendered against him if the order was affirmed. The awarding of judgment absolute can work no prejudice in this case. It fixes and determines the rights and interests of all the parties, and is the authority and guide for the executor in the performance of his duties under the will.
The motion should be denied.
All concur.
Order reversed and judgment affirmed.
Motion denied.