text:
    WILLIAM J. CALLAHAN, as Executor, etc., of WILLIAM CALLAHAN, Deceased, Respondent, v. JOHN S. BANCROFT, Appellant, Impleaded with PRESTON KENYON.

      The extension of time of payment of a debt, is a valuable consideration for the 1/i'ansfer of an accommodation note.

    One who has loaned his note to another for the latter’s accommodation, and subsequently when his note becomes due receives the note of a third person for a portion and cash for the balance of the amount due on his own note, and thereupon pays his own note, is a holder for value of the note of such third person.
    By receiving such new note he has extended, by the time which it has to run the time for the payment of his debt, and such extension of payment is a valuable consideration for the transfer of such new note to him.
    Appeal from a judgment (recovered by plaintiff’s testator), entered on tbe verdict of a jury; and also from an order made at the circuit denying defendant’s (Bancroft’s) motion for a new trial on the minutes.
    The action was brought by the plaintiff’s testator on a note made by the defendants to the order of Charles Orossley, and indorsed by him to the plaintiff for value, as alleged. The answers denied that the plaintiff was a toncoficle holder for value, and alleged that the note was lent by the defendants to the payee Orossley for his accommodation to take up another note held by the plaintiff, but had been thus obtained by Orossley from them by means of false and fraudulent representations made to defendant Bancroft as to his property and financial condition.
    The plaintiff testified on the trial that the note in suit was given to take up another note of $2,731.46, due about December twenty-sixth. That the latter note was made by himself and given to pay a debt for goods sold to Crossley. When it fell due he paid it by his own check, Crossley paying the difference. He kept the note in suit, and also the note which he took up with the indorsement of Crossley.

      A. R. Dyeit, for the appellant.

      J. R. Dos Dassos, for the respondent.
   Dwight, J.:

Assuming that the defendant’s appeal from the order denying his motion for a new trial on the minutes, brings up for review an alleged misdirection of the judge at the circuit, to, which no exception was taken; and assuming, moreover, that an expression of opinion by the judge, opposed to the ruling actually made for the purposes of the trial and to the positive instruction given to the jury in the final submission of the case, is such a misdirection, if erroneous, as may be thus reviewed, it yet remains to inquire, whether the expression of opinion, complained of in this case, was not entirely correct, and the submission of the case to the jury upon a theory more favorable to the defendant, was not a work of supererogation.

In this case it was admitted that the plaintiff’s testator took the note before due, and without any knowledge of the fraud by which it is alleged it was obtained by Crossley, his transferor; it was only necessary, in addition, to show that he took it for value, to establish his right to recover. The sole question therefore is, was the plaintiff’s testator a holder of the note for value 1

The facts are these: The plaintiff’s testator had previously made his note for something more than $2,700, for the benefit of Crossley, which the latter indorsed and used in the purchase of merchandise from parties not interested in this action. When the note became due, the plaintiff’s testator received from Crossley the note of the defendants in suit for $2,700, .and with'its proceeds and a small balance in cash furnished by Crossley, paid and took up the first mentioned note. He had thus used the note in suit in payment and discharge of an indebtedness of Crossley, and by -that means had extended Crossley’s time of payment .by the time which the new note had to run. That this was a valuable consideration for the transfer of the new note to him, cannot be questioned. (Brown v. Leavitt, 31 N. Y., 113; Grocers' Bank v. Penfield, 69 N. Y., 502.)

We have, then, the plaintiffs testator in the fullest sense a bona fide holder of the note in suit, viz., a holder before due, without notice of any equities of the maker, and for value. Such being the case, it was immaterial that the note was -an accommodation note, unless it had been diverted fiom the purpose for which it was obtained. That it was not so diverted, appears from the .evidence of the defendant himself. He testifies: “Mr. Crossley told me when I gave him the note, that he wanted to give it to Mr. Callahan.' I think he suggested it was to aid Mr. Callahan in taking up some other note.” It was, then, an accommodation note used for the purpose for which the maker understood it was to be used, and fraud in obtaining it from him can be no defense as against a holder in good faith and for value.

It seems, then, that there was no question to submit to the jury, and that the expression of opinion of the learned judge, at the circuit, that the plaintiff was entitled to a verdict, was entirely correct, and that his submission to the jury, for greater caution of the question, whether fraud was used in obtaining the note from the defendant, was not required by the law of the case.

The judgment and order appealed from should be affirmed.

Davis, P. <1., and Brady, J., concurred.

Judgment and order affirmed.


source: Caselaw Access Project

author: Dwight, J.:

license: Public Domain

text:
    FERDINAND MAYER, Plaintiff, v. THE MAYOR, ALDERMEN AND COMMONALTY OF THE CITY OF NEW YORK, Defendants.

      Beduetion of assessment — effect of, upon interest due thereon.

    After an assessment for widening Broadway in the city of New York had been imposed upon the property benefited, the city took proceedings whereby a very large reduction was effected in the total assessment.
    Several years thereafter an action was brought by the above named plaintiff, one of the parties assessed, asking to have his assessment reduced in proportion to the amount in which the entire assessment had been reduced. He further demanded that he should be relieved from interest on his entire assessment up to the time that such reduction was allowed. i '

      Held, that in no event was he entitled to a reduction of interest, in excess of the interest due upon the sum, by the amount of which his assessment had been reduced.
    Cross-appeals from a judgment of tlie Special Term, in favor of the plaintiff, for a portion of the relief demanded in his complaint.
    This action was brought to modify and reform the lien or judgment upon the property benefited by the widening and straightening of Broadway, between Thirty-fourth and Fifty-ninth streets, in the city of New York, and also the unpaid lien or judgment against the property of the plaintiff therefor.
    It appeared that after the assessment list was confirmed, whereby said judgment or lien was created, certain action was taken by the city, one of the parties largely assessed, whereby a saving of many thousand dollars in the bill of costs was effected, thereby reducing the whole judgment or assessment by that sum, and proportionately lessening the unpaid judgment or lien upon the property of the plaintiff.
    The plaintiff now seeks to reform said judgment and to make it conform to the facts by formal decree of this court, through the means of an action in equity.

      G. G. Higgms, for the plaintiff.

      H. J. Dea/n, for the defendants.
   Dwight, J.:

The decision of the Special Term was quite as favorable to the plaintiff as the law of the case permitted, and the principles of natural justice invoked by the plaintiff required no further concession to his demand. He is relieved from his proportionate share of the sum by which the charge of the commissioners was reduced, although that reduction was procured in proceedings to which he was not a party and to which he lent no aid.

His further demand is that he shall be relieved from interest on his entire assessment up to the time of the reduction thus gratuitously awarded to him. This demand is certainly not supported by any principle of law or of natural justice. Interest is awarded as damages for non-payment of the assessment, made and confirmed against the plaintiff, from the date of the confirmation. Those damages had been accruing for a period of eight or ten years when the defendant procured a reduction of the total assessment, which, upon the equitable principle adopted in the decision at Special Term, is made to inure pro rata to the benefit of the plaintiff. But upon no principle can this reduction affect the interest by way of damages, which had accrued upon that portion of the assessment which still continues chargeable against the plaintiff. The most that can be granted him, is to reduce his assessment by his proportionate share of the reduction on the total assessment, and to permit the assessment thus reduced to stand against him as of the date of the original confirmation. And such is the decision of the Special Term.

The plaintiff’s tender was of course of no avail to stop interest, because it did not include interest on the reduced assessment which had accrued.

The judgment appealed from must be affirmed.

Davis, P. J., and Brady, J., concurred.

Judgment affirmed.


author: Beady, J.: Davis, P. J.:

text:
    THE PEOPLE OF THE STATE OF NEW YORK, Respondents, v. EDWARD J. COURTNEY, Appellant.

      Evidence corroborating the testimony of an accomplice, required by section 399 of the ’ Code of Ci'iminal Procedure,

    The corroborating evidence, required hy section 399 of the Code of Criminal Procedure to justify a conviction upon the testimony of an accomplice, must he as to facts independent of the evidence of the accomplice, which taken by themselves lead to the inference not only that a crime has been committed Lut that the prisoner was implicated in it.
    Evidence that the prisoner was frequently in the society of the accomplice under circumstances of a suspicious character is not sufficient.
    Appeal by tbe defendant from a judgment of tbe Court of General Sessions of the city and county of New York, convicting him of tbe crime of forgery in tbe third degree.

      W. F. Howe, for tbe appellant.

      John MeKeon, for tbe respondents.
   Beady, J.:

The defendant was indicted in tbe Court of General Sessions of tbe city and county of New York for tbe crime of forgery in tbe third degree. He was tried and convicted and sentenced to five years’ imprisonment in tbe State prison. Tbe main witness on behalf of tbe people was an accomplice, and it is insisted on behalf of tbe appellant that there was no corroboration of bis evidence, such as is contemplated by section 399 of tbe Code of Criminal Procedure, as amended by chapter 360 of the Laws of 1882, and which is in tbe following language, namely: “A conviction cannot be bad upon tbe testimony of an accomplice, unless be be corroborated by such other evidence as tends to connect tbe defendant with tbe commission of tbe crime.”

It was conceded upon tbe trial that tbe 'check was a forgery, and tbe following is tbe statement made by tbe respondent’s counsel of tbe evidence on tbe part of tbe prosecution given by the accomplice. It was accepted as correct for tbe purpose of discussing tbe question to be considered.

Barton, tbe accomplice, testifies that be knew defendant since January last. That on May sixteenth, or four days before the check in question was given to him by Courtney, he opened an account in the Pacific Bank under the fictitious name of Horton, depositing therein the sum of $200, and that Courtney furnished him the money, suggested the fictitious name, and directed him to open the account about, noon on May sixteenth. He met Courtney by apjjointment at Canal street and the Bowery, Courtney having stated to him that he expected to get a check on that day.

At this meeting Courtney told him he had not yet got the check— for him to return in a half hour. A half hour later he met Courtney on Canal street near the Bowery. They met under an awning; Courtney took the check in question out of his pocket, handed it to him and directed him to give it to a boy (Albert Woodman), who was waiting at Earl’s hotel, and have him get it certified at the 1 Pacific Bank. He gave the check to the boy, and Courtney followed to see that the boy took it to the bank. The boy returned the certified check to him, Courtney following the boy. He and the boy went and deposited the certified check in the Pacific, after which he returned and met Courtney at the corner of Centre and Bowery. By direction of Courtney he afterwards drew by checks $2,170 in all, which he paid over to Courtney.

After making the deposit in Pacific Bank, he met Courtney; they walked down Grand street and met Woodman. Courtney said the boy ought not to see them together, and they immediately separated so as to avoid the boy.

It is conceded also, by the learned counsel for the respondents, that the only evidence of corroboration in the case, is : Eirst. The testimony of Woodman, the boy, who testifies that he had the check ■certified at the request of Barton, the accomplice, at about one p. m., on the sixteenth of May; that he returned it to him and then went to the Pacific Bank with him where they separated, and that he (Woodman) then went through Grand street. And he then further said: “ Coming through Grand street, I seen this man Barton and Courtney together,” and that this was about fifteen minutes ■after the deposit of the check was made in the Pacific Bank; and further, that when .he got near them, Barton turned around and went the other way, and Courtney turned and commenced looking up at the buildings. Second. That William Bohucke, a witness, stated that lie saw Barton and the appellant together. Third. That Louis Oppikofer testified that he saw Barton and the appellant at his place with each other during the afternoon and forenoon of the month of May, every day for a fortnight; and, Fourthly. The testimony of Rogers, who arrested Courtney and Barton whilst in company with each other.

In this statement is presented the entire evidence of corroboration, which was offered as tending to connect the defendant with the commission of the crime charged.

The appellant denied expressly and positively all participation in the crime; and it appears from his evidence that when arrested he demanded an immediate trial. Is this-evidence thus stated-sufficient to justify the conviction under section 399 of the Code, of Criminal Procedure; or, in other words, has the testimony of the accomplice been corroborated by other evidence which tends to connect the defendant with the commission of the crime ?

The section under consideration is new and changes the law of this State with regard to convictions upon the testimony of accomplices, which were sustained, although based on such evidence alone (People v. Costello, 1 Denio, 83), the question of credibility being one for the jury. Similar statutes exist in other States of the Union (see note to sections 1169, 1170, Bish. on Crim. Pro. [3d ed.]), and, amongst others, in the State of Texas. The statute in that State forbids a conviction on the testimony of an accomplice, unless corroborated by other evidence tending to connect the defendant with the offense committed, and is therefore substantially the same as ours.

The Supreme Court held in considering it, in Coleman v. The State (44 Texas, 109), that the rule of law forbidding a conviction on the testimony of an accomplice, unless corroborated by other testimony tending to connect the defendant with the offense committed, was under the statute positive and peremptory, and that however much the jury might be disposed to credit the accomplice, the defendant could not be convicted legally unless the evidence of the accomplice was confirmed in some material matter tending to show the defendant’s guilt. And the learned justice said in that case: “ To allow convictions to stand where the corroboration is only in immaterial matters, * * * would be to violate both the letter and spirit of the statute, and to disregard those precautionary rules which experienced and wise jurists have deemed it necessary to adopt in order to guard against erroneous convictions based on evidence unreliable because coming from a corrupt source.” And in the case of the State v. Thornton (26 Iowa, 80) the court, in considering a statute similar to the one under consideration, said: “Admitting, as we do, that the corroborating evidence to be sufficient must not merely relate to the commission of the offense or the circumstances thereof, but must be evidence of a character that shall tend to connect the defendant with the commission of the alleged criminal act. it is the opinion of the court that evidence of this character was produced by the Stale.” The corroborative evidence must be of some material fact; and this was the rule in reference to the evidence of accomplices in this State, if corroboration were relied'upon, and indeed the general rule. What appears to be required (see Roscoe’s Treatise [6th Am. ed.], 122) is that there should be some fact deposed independently altogether of the evidence of the accomplice, which taken by itself leads to the inference not only that a crime has been committed, but that the prisoner is implicated in it. In the case of the People v. Davis (21 Wend., 309), the charge excepted to was that the accomplices of the prisoner were not to be believed by the jury unless confirmed by other credible witnesses in respect to the facts connecting the prisoner with the possession of the forged bills, or with the manufacture of them; but the court, declared that no error had been committed, because it was not necessary by existing rules that every part of the testimony should be confirmed, the question usually being whether the jury wilbelieve the witness in such parts of his narrative as the confirmal tion extends to, and quoted with approbation the observation of Mr. Justice Alderson in summing up the case of Rex v. Wilkes and Edwards (7 Car. & Payne, 272), namely, that the confirmation he always advised juries to require was a confirmation of the accomplice in some facts .which went to fix the guilt on the particular person charged. The confirmation in The People v. Davis {supra), was the possession by the prisoner of the forged bills, which if not of the essence went to the point of the offense charged, and if believed, the court said, pressed strongly against him, and laid a foundation for giving credit to the narrative of his associates.

The only evidence, however, corroborative in this case, as we have already seen, is that the appellant was observed frequently in the society of the accomplice, and under ■ circumstances of a suspicious character. But there is no other evidence in the case affecting him; no proof that he participated in the money which was received by the check; no proof that he was in any way concerned • with its preparation or presentátion; no proof of bad character; whilst he most positively denies all participation in the criminal act.

The case, therefore, is one in which the accomplice proves all the material facts. The defendant denies them. His character is unassailed and for that reason presumed to be good, and the only circumstance which favors the truthfulness of the statement made by the accomplice is, that he had been seen in the society of the latter, and once at least under circumstances of a suspicious character.

This is not the evidence contemplated under the section referred to. It.is not a confirmation of the. testimony of the accomplice in some material factg tending to show the defendant’s guilt. The fact that another was in the company of a person who committed a larceny, while well calculated to excite suspicion, was held to be no evidence that she knew the person with whom she was thus associating had any design to steal, and the fact of her going with such person even into the place where the theft was committed, was regarded as consistent with entire innocence, and being so was not proof of guilt. (Ormsby v. The People, 53 N. Y. 474.)

The language of the statute, as we have seen, is that the accomplice must be corroborated by such other evidence as tends to connect the defendant with the commission of the crime. The existence of intimate relations is not a circumstance from which participation in the guilty acts of an associate is to be presumed, because it is consistent with innocence. .

The association may be continued, and may be marked by all the circumstances which characterize the association of the accomplice and the appellant herein, and yet be an innocent one. In other words, the appellant might not have been advised in any way of the intended crime by the accomplice. It is not in the language of the section, such other evidence as tends to connect the appellant with the commission of the crime. And this view of such a relation presents itself with peculiar force when the associate upon his trial for an offense charged against him, the proof of which rests chiefly upon the testimony of the accomplice, solemnly denies all participation in the crime charged.

For these reasons it is thought that the statute has been violated in this case and the conviction was improper. The judgment should, therefore, be reversed.

Davis, P. J.:

It is a grave mistake, I think, to assume that the testimony given „ by the defendant in this case can have any legitimate affect upon the question whether there was corroborating evidence tending to connect the defendant with the commission of the crime.

His testimony, and its contradictions of the evidence on the part of the people, could only operate to produce an issue of fact for the consideration of the jury; and his denial of the truth of any evidence which tended to connect' him with the commission of the crime could not have any effect to diminish that tendency, however much it might impair the credibility of the evidence itself. When the question was raised that the evidence did not tend to comply with the requirements of the Code, that question was one of law to be disposed of by the court, untinged by any other evidence which simply conflicted with its truth. We are, therefore, to look at the corroborating evidence alone to see if it tended to connect the prisoner with the commission of the offense. If it did, no matter how slightly, then the requirement of the Criminal Code is satisfied and the question of the credibility of the accomplice and the satisfactory character of this testimony becomes one'for the jury.

In this case there can be no doubt that the accomplice was to some extent corroborated. The prisoner was brought by other testimony than that of the accomplice into connection with him under circumstances of grave suspicion. Under the former rule the court could properly have held that the evidence, if credited by the jury, did corroborate with greater or less force the testimony of the accomplice.

But that fact does not answer the requirements -of the Code.. Under the new rule the testimony must not only corroborate, but . must tend to connect the accused-with the commission of the crime. In this case the crime was shown to have been committed by the uttering of the forged cheek. My brother Brady’s examination satisfies me that the Corroboration was not of the character which the Code demands, because it did not tend to connect the prisoner with the commission of the crime. The testimony of the accomplice did that, but the Code will not be satisfied unless the accomplice is corroborated by evidence which tends to show the participation or immediate contact of the prisoner with the acts which'constitute the crime. I am, therefore, obliged to concur with the conclusion that the judgment should be reversed.

Daniels, J., concurred.

Judgment reversed. ■


author: Daniels, J. :

text:
    THE MUTUAL LIFE INSURANCE COMPANY OF NEW YORK, THOMAS A. DAVIES and REUBEN H. CUDLIPP, Appellants, v. RUSSELL SAGE, Respondent.

      Foreclosure of mortgage — taxes and assessments, who liable for.

    In an action brought to foreclose a second mortgage on real estate in the city of New York to which the owner of the first mortgage was not made a party, a judgment was entered directing the referee who was to conduct the sale to pay out of the moneys arising therefrom, after deducting his fees and expenses and ‘ ‘ any lien or liens upon the said premises so sold at the time of such sale for taxes or • assessments,” the costs of the various parties and the amount due to the plaintiff.
    By an arrangement with the second mortgagee, who purchased at the sale, the whole amount realized at the sale was, without deducting or paying the taxes and assessments upon the premises (no objection to such an arrangement having been taken by any person a party to such action), paid over to him.
    The owner of the first mortgage thereafter foreclosed his mortgage, and under a judgment containing similar provisions for the payment of taxes and assessments the property was sold to it-for $50,750; out of this purchase-money there were paid taxes and assessments, which were then ¡liens upon the property, amounting to $32,000. There was due to the plaintiff upon its mortgage at the time of the entry of the judgment the sum of $49,672.89.
    In this action brought by the first mortgagee against the defendant (the second mortgagee) who had purchased at the previous sale to recover the amount so ■ paid for taxes and assessments:

      Held, that as the owner of the first mortgage was not a party to the action brought to foreclose the second mortgage, he was not entitled to enforce those provisions of the judgment entered in such action which provided for the payment of the taxes and assessments; the execution of such provisions having been waived by all the parties to the former action and the purchaser at the first sale.

      A portion, of the assessments and taxes, so paid by the owner of the first mort» gage upon purchasing the property, were imposed and became liens upon it after it had been purchased and while it was owned by the defendant, the second mortgagee.'
    By statute the tax was a demand which could be personally enforced against the defendant (the owner) by the public authorities, but the provisions of the statute left such action to the discretion of the receiver of taxes.
    The statute under which the assessment was laid provided that the “ owners or occupants shall also, respectively, be liable upon demand to pay the sum at which such houses or lots, respectively, shall be assessed.” In case of default it provided that a warrant to collect the same by distress and sale of the goods of the owner should issue. It further provided that: “If any money so to be assessed be paid by any person, when by agreement or law the same ought to have been borne and paid by some other person, it shall then be lawful for the person paying to sue for and recover the money so paid:”

      Held, that the defendant was under no obligation to the first mortgagee (the purchaser at the second sale) to pay the amount of the tax, and that no action would lie against him by such mortgagee for his failure so to do.
    That he was personally liable for the amount of the assessment, and that the first mortgagee, having paid and discharged it, was entitled under the statute to recover from him the amount so paid.
    Appeal by the plaintiffs from a judgment recovered on a trial at the Special Term. This action was brought by the purchaser at a foreclosure sale of certain mortgaged premises, and by certain parties who had assumed payment of the mortgage foreclosed to recover the amount of certain taxes and assessments from one who had formerly purchased the same premises upon a sale had under foreclosure of a mortgage, which was subordinate in liento that which was owned by the plaintiff, the insurance company, and under the foreclosure of which the premises had been purchased by it.
    To the action in which the sale was had at which the defendant purchased, the plaintiffs in this action were not parties. In that action a judgment was entered directing the referee, who was to conduct the sale, to pay out of the moneys arising therefrom after deducting his fees and expenses, and “any lien or liens upon the said premises so sold at the time of such sale for taxes or assessments,” the costs of the various parties, and the amount due to the plaintiff. By.an arrangement with such plaintiff in the action brought to foreclose the second mortgage, who was the second mortgagee, and who purchased at such sale, the whol amount realized at the sale was without deducting or paying the taxes and assessments upon the premises, and without objection on the part of any person a party to such action, paid over to him. The holder of the first mortgage thereafter foreclosed, his mortgage, and under a judgment containing similar provisions for the payment of taxes and assessments, the property was sold to it for $50,750. Out of this purchase-money there was paid taxes and assessments which were then liens upon the property amounting to $22,000. There was due to the plaintiff, the insurance company, upon ‘ its mortgage, at the time of the entry of this judgment, the sum of $49,672.89. This action was brought by this first mortgagee against the defendant (the second mortgagee), who had purchased at the previous sale to recover the amount so paid for taxes and assessments.
    The tax of 1876, a portion of the tax so paid and sued for in this action, and an assessment for grading, curbing, etc., also paid and sued for in this action, were imposed upon the property while it was owned by this defendant.
    By the terms of the statute under which the tax was imposed, it was' provided that it might be enforced personally against the owner of the property by the receiver of taxes, but the statute left such •action in his discretion.
    The statute under which the assessment was laid is set forth in the following opinion:

      Julien T. Dames, for the appellants.

      A. J. Vanderjjoel, for the respondent.
   Daniels, J. :

The action was brought to recover taxes and assessments imposed upon property in the city of New York, and amounting to about the sum of $22,000. The Mutual Life Insurance Company held a mortgage upon the property to secure the payment of the sum of $44,000, executed on or about the 1st of June, 1870, by the plaintiff, Thomas A. Davies. This property was, in February, 1869, conveyed to the other plaintiff, Cudlipp, who assumed the payment of the mortgage debt. The plaintiff Cudlipp, in July, 1871, conveyed the property to Adriance, who also assumed the payment of the mortgage, but afterwards became insolvent. This grantee also executed two mortgages, one on each half of the property, to secure the stun of $30,500. These mortgages were afterwards assigned to the defendant who procured them to be foreclosed by actions prosecuted for that purpose in this court. By the judgments recovered, the referee appointed to sell the property was directed that he should pay the defendant, who was plaintiff in those actions, the amounts found due to him after deducting “ any lien or liens upon said premises so sold at the time of such sale for taxes and assessments.” The referee did not comply with this direction for the payment of the taxes and assessments, but by an arrangement with the defendant, who purchased the property under the judgments, the amounts for which the sales were made were applied -towards the payment of the amounts found due by virtue of the judgments. This change was made by his authority, and no complaint whatever was made of it by any party to either of the actions under which these, sales were made. After this disposition of the property, the Mutual Life Insurance Company commenced an action for the foreclosure of the mortgage executed to it by the plaintiff Davies. That resulted in a judgment in April, 1877. There was then found due upon this mortgage the sum of $49,672.89, and by its terms the referee appointed to sell the property was in like manner directed to pay- the plaintiff in the action the amount found due to it, after deducting the amount of any lien or liens upon the premises for taxes and assessments. Other directions were given in the judgment for the payment of expenses and the costs of the action which do not require to be specially noticed. By virtue of its authority the property was sold and purchased by the Mutual Life lusur-ance Company for the sum of $50,750, an amount certainly not exceeding that required to be raised for the payment of the sums directed to be paid by the terms of the judgment, excluding the taxes and assessments. Out of this purchase-price the taxes and assessments which were at the time liens upon the property were paid by the attorneys for the plaintiff in that action, and these payments all together amounted to the sum already mentioned of upwards of $22,000. And after deducting such payments from the amount for which the property was purchased, together with the other sums directed to be paid, the residue amounting to the sum of $27,336.45 was paid over to the ¡Dlaintiff, the Mutual Life Insurance Company.

It is because of tbe failure of tbe defendant to pay these taxes and assessments that this action has been brought for their recovery, and as to those which had been imposed upon the property prior to the 25th of October, 1876, which is the date of the delivery of the deeds to the defendant to carry into effect the purchases of this property made by him, the right to maintain the action is wholly dependent upon the terms of the judgments recovered in the two foreclosure actions prosecuted by the defendant himself. But neither the insurance company nor Davies, or Oudlipp, both of whom were charged with the deficiency remaining upon its judgment, was a party to either of such actions prosecuted by the defendant. For that reason it could not have been any part of the design of the judgments recovered by him, or of this clause inserted in each to benefit them or either of them. They were strangers to his proceedings, and the directions given in the judgments were for the exclusive benefit of himself or that of the other parties to the action, or the purchaser of the property, and as they have not complained of the omission to comply with the terms of the direction given for the payment of taxes and. assessments, and neither of the plaintiffs derived any right under them, or either of them, to make such a complaint, the insurance company cannot obtain any advantage either from this direction, or- the failure to comply with it. That necessarily follows from the fact that they were neither of them a party to the proceeding, and consequently their rights could in no manner be affected by it. It was not a contract the terms of which either of the plaintiffs could insist should be performed, and no benefit was reserved by it to either of these persons. For that reason the case is distinguishable from all those which have been relied upon as authorities establishing some legal principle on which the plaintiffs could maintain this action by force of this provision in these judgments.

In People ex rel Day v. Bergen (53 N. Y., 404) the observance of a similar direction was insisted upon by the purchaser of the property, who had the right under the terms of the sale to have the taxes and assessments paid off out of its purchase-price, and that right had in no form been waived or surrendered by him. On account of this circumstance tnis case is entirely different from the one now being considered, for here the defendant as the purchaser relinquished the right created by this direction of the judgment in his favor.

In Ranney v. Peyser (20 Hun, 11) a distinct direction had been given concerning the disposition which should be made of the rents and profits received by the receiver, and that direction continued in full force and effect, and it was on account of that circumstance that the receiver was held liable to obey the direction given to him in the order under which he was appointed. These cases, as well as the others which have been brought to the attention of the court, are entirely different from that which is presented by the facts appearing upon the trial of this action. They, neither of them, go so far,- or support any principle, as to authorize the maintenance of this action simply upon the force and effect of the direction contained in the judgments recovered by the defendant for the payment of the taxes and assessments existing against the property.

After the defendant had received his deeds the taxes of 1876, amounting to the sum of $1,507.17, were imposed upon the property ; so also was an assessment for the expense of regulating and grading, setting curb and gutter stones, and flagging and superstructure of the boulevard or public drive, amounting to the sum of $6,328.56, imposed upon this property. These two sums, with the interest upon them, were in like manner paid by the attorneys representing the insurance company in its foreclosure action, and because they were imposed upon the property while the defendant continued to be its owner under the deeds which had previously been delivered to him, the plaintiffs claim to recover these payments from him. But while the tax itself was a demand which could personally be enforced against the defendant by the public authorities, he was placed under no obligation for its payment for the benefit either of this preceding mortgage or of the persons through whom he had derived his title. The insurance company, by force of its mortgage, had the right to pay off the amount of the tax and add it to its mortgaged debt, and in that manner to preserve the lien for it upon the property, but no authority has gone so far as to sustain an action on its part against the defendant for its recovery personally from him.

But as to the amount of the assessment for the expenses assessed upon this property while the defendant was its owner, for improving the boulevard, the rights and obligations of the parties depend upon different principles. This work is found to have been performed in accordance with section 175, chapter 86 of the Laws of 1813, and the various laws of the State supplemental and amendatory thereto, including of course chapter 565 of the Laws of 1865, by which this avenue was authorized to be opened. And by the terms of the act of 1813, the amount of the assessment was, in express language, made the debt of the owners of the property, for it was declared by it that, “ such owners or occupants shall also, respectively, be liable upon demand to pay the sum at which such houses or lots, respectively, shall be so assessed to such person as the said common council shall appoint to receive the same.” (2 Rev. Laws, 1813, 407, § 175.) And it was further provided, that in case of default of payment of the assessment a warrant should be issued to levy the same by distress and sale of the goods and chattels of the owner or occupant refusing or neglecting to pay the same. By force of these provisions, which in their application to this work do not appear to have been changed by subsequent enactments, a personal obligation rested upon the defendant for the payment of the amount of this assessment; and the fact that after receiving his deeds he determiried to and did abandon his purchase, and in no way occupied the lands or any part of them, or exercised any act of ownership over them, and never promised to pay the amount of this assessment, had no such effect as to discharge him from this statutory liability, for it was not made to rest or depend upon any other fact or circumstance than that of ownership, and that was shown to be complete under the execution and delivery" of the deeds to the defendant. This statute further provided, that “ if any money so to be assessed be paid by any person, when by agreement or by law the same ought to have been borne and paid by some other person, it shall then be lawful for the person paying to sue for and recover the money so paid, with interest and costs, as so much money paid for the use of the person who ought to have paid the same.” (Id., 408.) This provision has been so clearly enacted as to the right to maintain an action for the recovery of money paid for assessments which another person was legally and primarily bound to pay, as to leave no real ground for doubt concerning the liability of the defendant to refund, this money to the insurance company. The demand was his- personal obligation, and it was paid and discharged by the company acting through its attorneys in the foreclosure case, and that is all that has been required to entitle the company to maintain an action for its reimbursement.

The fact that this money was in form taken out of the purchase-price bid for the property by the insurance company will not relieve the defendant from the obligation imposed upon him by these statutory .provisions, for while it is true that the sum paid was deducted out of the purchase-price of the property itself, it is still equally so that it was taken from the moneys which the insurance company, as mortgagee, would otherwise have received upon its mortgage debt. In this transaction it sustained a double relation, that of purchaser and also that of creditor. All that it bid for the purchase of the property, beyond the payment of the expenses of the action and of the sale made pursuant to-the judgment, it -was, as between itself and the defendant, entitled to receive upon its mortgage debt. That difference was the money of the insurance company, and when instead of being paid over to it this money was in part appropriated to the payment of this assessment, it constituted a payment by the company as the first mortgagee and not as a purchaser of this property. These facts appear clearly from the evidence 'in the case, and they have been found by the judge presiding at the trial, notwithstanding the subsequent statement that the amount was paid by the -company as purchaser under its decree. The controlling circumstances show that as a matter of fact this latter was an erroneous view, for the money that was paid was deducted from the amount the company was entitled to receive under its judgment to be applied upon its mortgage debt.

It was, consequently, a payment from that amount made by the company out of its own moneys. So far as it was held by the judgment that the insurance company was not entitled to be reimbursed for the amount paid for the extinguishment of this assessment it was erroneous and the judgment should accordingly be reversed and a new trial ordered, with costs to the appellants to abide the event.

Davis, P. J., and Dwight, J., concurred.

Judgment reversed, new trial ordered, costs to appellant to abide event.


author: Daniels, J.:

text:
    LEWIS H. BAILEY, as Executor, etc., of BENJAMIN BAILEY, Deceased, Appellant, v. JOSEPH H. BAILEY and Others, Respondents.

      Trust of real and personal ps'operty — void if for three lives — its continuance as regards the real estate must depend on lives beneficially interested therein — otherwise as to personal estate — what trust to receive rents of real estate cannot be sustained as a power —proper disposition of an estate as to which void trusts arc created.

    A testator devised his residence to his wife for life. All the rest and residue of his estate, including, on the death of his wife, his aforesaid residence, he gave to his executor in trust to rent the real estate and keep invested the personal property and to divide the income into four parts, and pay over one part to each of four persons named during the. lives of two third persons not in any way interested in such residence or income or entitled thereto.

      Held, that as to his residence the power of alienation was suspended for the period of three lives, and the trust as to it was consequently invalid, and that the same, on the termination of the widow’s life estate, descended to the testator’s heirs-at-law.
    That the fact that the widow’s life estate therein might be, as it was, defeated by her refusal to accept the same in lieu of her dower, did not remove the objection to the devise, as it was possible that she might not so refuse; and that it was only necessary in order to defeat the devise to show that it might unlawfully suspend the power of alienation.
    After the deaths of the widow and of the two persons upon whose lives the trust was limited, the residue of the estate was given to persons named in the will.

      Held, that the devise of the remainder in the residence was invalid, and that upon the termination of the widow’s life estate it descended to the testator’s-heirs-at-law.
    That, as regarded the real estate embraced in the trust, inasmuch as the continuance of the trust for the payment of the income to the four persons named depended upon the lives of two persons in no way beneficially interested therein, it was not within the provisions of the statute authorizing a trust “ to receive the rents and profits of lands and apply them to the use of any person during the life of such person, or foi any shorter term,” and was void.
    That, as regarded the personal property embraced in the trust, the term of the trust did not suspend the absolute ownership of the property for a longer period than that of two lives in being at the death of the testator' the term prescribed in cases of trusts of personal property, and that the trust was valid.
    That the trust intended to be created over the real estate could not be sustained as a power in trust for the reasons:
    That the execution of a trust of this kind requires that the trustee shall be vested with the title to the estate.

      That the statute, providing that in certain cases an express trust may be executed as a power, embraces only express trusts “ created for any purpose not enumerated in the preceding sections,” and that this trust is so enumerated in the preceding sections; the mere fact that it was intended to extend it beyond the period provided for in the statute in no manner changing its purpose or nature.
    That it is only when an act by which the property affected by the power may be disposed of or charged, as distinguished from continued management and control, is included in the purpose of a trust that it may be lawfully.performed as a power in trust; and an express trust to receive and apply the profits of land is distinct as well as distinguishable from all those acts which may be performed under the authority of a power.
    The testator gave, on the expiration of the trusts above named, all his real and personal estate, subject to the life estate of his wife in his residence, to four ■ persons named in his will, and to their heirs and assigns, forever.

      Held, that the estate so-given, other than the residence, was a valid expectant estate, and vested, at the expiration of the lives of the two persons named in the will, in the persons to whom the several fourth parts'thereof were given.
    That during such two lives the portion of the testator’s real estate designed to be included in the trust descended to the testator’s heirs-at-law, who became entitled to the rents and profits thereof.
    Cross-appeals from a judgment, entered on the report of a referee.

      William F. Cogswell, for L. H. Bailey and others.

      George Zahrishie, for Noys and other executors.

      luden B. Chase, for others, respondents.
   Daniels, J.:

The determination of this appeal depends upon the construction and effect to be placed upon and given to the will of Benjamin Bailey, deceased. By its-ter ms he intended to dispose of his entire real and personal estate. He devised his residence, known as No. 344 West Fourteenth street, in the city of New York, to his wife for life. Upon her decease this house and lot was to become a part ■of the residue of his estate, to be disposed of as he thereafter provided by his will. This residue was intended to include all his property, after the payment of his debts and certain legacies mentioned in the will, and the paragraph of the will by which the subsequent disposition of it was made is in the following language: Sixth. “All the rest, residue and remainder of my real and personal estate, I give, devise and bequeath unto my executor hereinafter named in trust, nevertheless to and for the uses and purposes following, that is to say: in trust, to let and rent my real estate, and to invest and keep invested my personal property, and to collect the rents, income and interest from my said real and personal property, and after paying all charges and expenses upon or affecting the same, to divide the said rents, interest and income into four parts, and to pay one of said parts to my brother Ward II. Bailey; one of said parts to my sister Kosilia Banks, the wife of Hugh S. Banks; one of said parts to my brother, Lewis H. Bailey, and the other of said parts to my nephew William B. Hobby and my nieces Anna Leila Hobby and Sarah B. Hobby, during the natural life of Thomas Bailey, son of my brother Joseph H. Bailey, and Webster Mabie, son of Moses T. Mabie, of Buffalo, N. Y.”

And by force of it this house and lot was in terms rendered subject to the trust specified in this paragraph during the succeeding lives of Joseph H. Bailey and Webster Mabie. If this had been an effectual disposition of the house and lot, then the power of its alienation would be suspended for the period of three lives, which would exceed that prescribed by the statute during which the power of alienating real estate may lawfully be suspended. (2 B. S. [6th ed.], 1101, § 15.)

The fact that the life estate, provided for the testator’s widow, might be defeated, as it afterward was, by her refusal to accept it in lieu of her dower, does not remove the objection to these devises, for it was possible that no such objection would be taken by her; and if it should not be, then, by the terms of the will, life estates were provided for in this property that would extend through the natural lives of three different individuals; and that, as the statute has been construed, cannot lawfully be permitted. To render such a disposition of real estate ineffectual, it is only necessary that the power of alienation may possibly be suspended for a longer period than that of three lives in being at the creation of the estate. (Hone's Ex'rs v. Van Shaick, 20 Wend., 564; Amory v. Lord, 5 Seld., 403, 415; Schettler v. Smith, 41 N. Y., 328.) And that possibility was provided for as to this house and lot.

After the decease of the two persons mentioned in the sixth paragraph of the will, then a disposition of the entire estate, both real and personal, was declai’ed to be made, but was not intended to take effect until the life estate in this property for the testator’s widow should be terminated by her decease, and the trust estate ¡should also be brought to a like conclusion by the decease of the two persons upon whose lives it had been limited. This period, for the reason already assigned, was too remote to render this an ■effectual disposition of the contemplated remainder in this property. And it cannot be relieved from this objection by either of the provisions of the statute relating to the disposition of a remainder when more than two successive estates for life shall be •directed, or when the remainder may be dependent upon the lives of more than two persons named as the persons during whose lives the life estate shall continue; for both these sections of the statute ■contemplate only such life estates as would be legal and valid if it were not for the fact that all of them together would exceed the period allowed for the suspension of the power of alienation of real estate. (2 R. S. [6th ed.], 1102, §§ 17, 19.)

The first two estates, on which the remainder by force of these ¡sections will take effect, are obviously required to be created in ■such a manner that they will be entitled to be legally sustained. They must be such estates as, under the provisions of the statute,may lawfully be possessed and enjoyed by the life tenants; and where that is their character, the remainder is not allowed to be •defeated because still other intervening estates for life may be, in form, created, but which the statute will not allow to take effect in favor of the life tenants. . The effect, as well as the language of, the statute in that class of cases is to terminate the suspension at the ■end of the first two lives, in the same manner as though no succeeding life estates were intended to be created.

In the present case the life estates intended to follow that provided for the widow were not such as were contemplated’ by these ¡sections of the statute. They were neither of them so directed or ■created as to be lawful under its provisions; for neither of them include a case where the life estates themselves are void in their inception, as those were which the testator provided for after the ■death of his widow.

The provisions of the will were ineffective, so far as they related to the final disposition of this house and lot, and it consequently ■descended to the testator’s heirs-at-law.

Under the terms of the trust which the testator endeavored to create by the sixth clause of his will, one-fourth of the rents, interest and income was made payable to his brother, Ward Ii. Bailey. This beneficiary died before the time of the testator’s decease, and as it is agreed by the counsel that the testator consequently died intestate as to this one-fourth, no further or more particular examination of this portion of the case is necessary for its disposition. As to that, it is substantially agreed that the judgment entered upon the refeiee’s report was right. The remaining part of the estate will consequently be alone affected by the further consideration of the case.

By the terms of the trust provided for in' the paragraph of the will previously set forth the trust estate was to be continued through the lives of Joseph H. Bailey and Webster Mabie, who were not to be benefited by its existence. No part of the rents, profits, interest or income was payable to either of these individuals, but it was wholly to be divided between other and different persons. For that reason, the proposed trust was not within the provision made for this purpose by the statute. That allowed such a trust to be created to receive and apply the rents and profits of land during the life of the person or persons entitled to receive them or for any shorter term. (2 R. S. [6th ed.], 1106, § 55, sub. 3.)

This was not a trust so limited, for, as it was provided for by the testator, it was not to pay over and apply the rents and profits during the lives of the persons who were to receive them, but during the lives of Joseph H. Bailey and Webster Mabie, who were , entirely uninterested in the trust itself or its proceeds.' The statute in terms abolished all trusts not authorized by the article framed and enacted on this subject. All others were in effect prohibited. And the trust designed to be created by the testator so far failed, as it included his reál estate on account of this restraint. (Downing v. Marshall, 23 N. Y., 366, 377.)

But as to the personal estate the case is different. This article of the Revised Statutes has been held not to include trusts created in personal property. (Kane v. Gott, 24 Wend., 641, 651; Gilman v. Reddington, 24 N. Y., 9, 12, 13.)

The trust in the personal estate was in no manner made dependent upon that intended to include the real estate, but it was distinct and separate in its character. All the provisions of the will relating to the real estate might be expunged from it, and those remaining would still be sufficient for the creation and execution of the trust in the personal property. And when such a separation can be made, the fact that the provisions relating to the real estate are incapable of being sustained, will not invalidate those relating to the personal estate. (Post v. Hover, 33 N. Y., 593; Manice v. Manice, 43 N. Y., 303.)

The only restriction upon the power of the testator to create such a trust in his personal estate, was that it should not suspend the absolute ownership of the property for a longer period than that of two lives in being at the death of the testator, and that it should not transcend the rules prescribed by the statute for the limitation of future estates in lands. (2 R. S. [6th ed.], 1167, §§ 1, 2.)

This trust in the personalty consequently was not required to be limited to the lives of the beneficiaries themselves, but it might be lawfully extended during the lives of any two other persons in being at the decease of the testator. And such was the provision made upon the subject in this will. The trust as to three-fourths of the personal estate was therefore a lawfül one and required to be sustained, although that, including the real estate, was inoperative and void for the reasons already mentioned.

It has been urged, however, that the trust intended to be created and extended over the real estate may be sustained and legally executed as a power in trust under the authority of another section of the statute. (2 R. S. [6th ed.], 1109, § 71.) By this section it has been declared that “ where an express trust shall be created for any purpose not enumerated in the preceding sections no estate shall vest in the trustees, but the trust, if directing and authorizing the performance of any act which may be lawfully performed under a power, shall be valid as a power in trust, subject to the provisions in relation to such powers contained in the third article of this title.” But where a trust is proposed to be created to receive the rents and profits of lands and apply them to the use of any person, it has been provided that the whole estate shall vest in the trustee, subject only to the execution of the trust. (2 R. S. [6th ed.], 1109, § 73.) And it'has been repeatedly held by the courts that the execution of a trust of this nature, as a matter of fact, requires that the trustee shall be vested with the title to the estate. In no other manner can it be managed or controlled so as tO| effectually promote and carry into effect the purposes of the trust. (Brewster v. Striker, 2 Comst., 19; Leggett v. Perkins, Id., 297; Tobias v. Ketchum, 32 N. Y., 319; Bennett v. Garlock, 79 id., 302.)

This is a distinguishing feature of a trust of this character. The title is essential to its execution, and'it is only when the.express trust may be such that no estate shall necessarily vest in the trustees; that it can, under section 71, be executed as a power. Other trusts mentioned in the preceding section (55) may be of that nature. The trust to sell lands for the benefit of creditors, or-to sell, moitgage or lease lands for the benefit of legatees, or for the purpose of satisfying a charge thereon, may be so construed and therefore be capable of being executed as powers. But a trust requiring such management of the estate as is necessary to obtain its rents and profits is not of' this description, for its effectual execution, that requires the title itself to be vested in the trustee. This provision of the statute includes by its terms only the trusts which may be created for a purpose not enumerated in the preceding 'sections, while a trust to receive the rents and profits and apply them to the use of any person is a trust for one of the purposes mentioned in the preceding fifty-fifth section. The terms made use of in these two sections require to be construed practically in the same manner. By the fifty-fifth section it is enacted that express trusts’ may be created “ for any or either of the following purposes; ” and one of these purposes is to receive the rents and profits, of land and apply them to the use of any person.

This is one of the enumerated purposes for which a trust may- be lawfully created; and it is only when an express trust shall be created for a purpose not enumerated in the preceding sections that it. can be executed under section 71 as a power. The circumstance that it was intended in this instance to extend it beyond the period provided for by the statute, in no manner changes the purpose for which the express trust was designed to be created, which was to receive and apply the rents and profits of the land ; and, whether it be for the time mentioned in the statute or for á greater period of time, the purpose of such trust is still the same. In each instance it is to receive and apply the rents and profits of the land; and when it may be created for that purpose, it is not within, and cannot be executed as a power under the force and effect of, the seventy-first section.

This is further manifested very clearly by the latter branch of the section itself, for it is only when the trust may direct or authorize the performance of an act, that it is made valid as a power in trust. This section of the statute, by its language, contemplates a class of cases where an act, as distinguished from continued management and control, is all that may be required to satisfy and execute the trust. Where that may be its nature, and the act itself can be lawfully performed under a power in trust, it may be carrifed into effect in that manner. But where more than a mere act shall be required, as must be the case in express trusts of this nature, there the trust is not within the terms of this section, and cannot be executed as a power.

The provisions of the article relating to powers are consistent with no other construction of this section, for, as they have authorized powers to be created, the power itself is'restricted and limited, in terms, to some act required in the .disposition or charge of the property. The broad definition given in the outset is, that it “ is an authority to do some act in relation to lands, or the creation of estates therein, or of charges thereon, which the owner granting or reserving such power might himself lawfully perform.” (2 R. S. [6th ed.], 1113, § 95.)

And the succeeding provisions are consistent with no other understanding or. construction of the statute. By these provisions, a special power has been defined to include the disposition of lands to designated persons, or a class of persons, or where it authorizes the alienation by means of a conveyance, will or charge of an estate, or interest less than a fee. This power is beneficial when no person other than the grantee has an interest in its execution; while a power is general which authorizes an alienation in fee by means of a conveyance, will or charge to any alienee whatever. By the succeeding sections, the power allowed to be created is designated as one to dispose of lands, as a power of disposition, or a power to make leases, all contemplating and requiring only for their proper execution the performance of some act by the grantee of the power. (2 R. S. [6th ed.], 1114, §§ 98-108.)

The provisions made declaring the cases when a power shall be in trust, have in no manner enlarged the signification of these terms. For a general power in trust has been defined to be one where a person or class of persons, other than the grantee of the power, shall be entitled to the proceeds, or any part of the proceeds, or other benefits to result from the alienation of the land, according to the power. While a special power in trust restricts and limits the benefits of the disposition authorized to be made to a person, or class of persons, other than the grantee of the power, or entitled to the benefit of some charge authorized by the power. (Id., §§ 115, 116, p. 1115.)

The provisions declaring and defining the manner in which powers may be executed, maintain the same view of the purpose and object of the statute. By these provisions it has been declared that a power can only be executed by an instrument in writing sufficient in law to pass the estate or interest of the person executing it, were he the actual owner, and where a power to dispose of lands is confined to a disposition by devise or will, it must be executed in that form.

Where it may be by grant, a proper grant is essential to the execution of the power. In each instance the statute has been framed in such a form as to contemplate the execution of a will, or of some other instrument, as the act by which the power is to be fully carried into effect.

It is a power to dispose of or make a charge upon property requiring one act or successive acts, and whatever the power may be the statute contemplates its complete execution by a will or some other instrument designated for that purpose. (2 R. S., [6th ed.], 1117, §§ 134-140.)

All these provisions are apposite to and consistent with that made by section seventy-one of the article providing for uses and trusts. For they all contemplate the performance of some act by which the property affected by the power may be disposed of or charged. And it is only when such an act has been included in the purpose of a trust, that it may be lawfully performed as a power in trust. An express trust to receive and apply the profits of land is distinct as well as distinguishable from all these acts which may be performed under the authority of a power. For that required more than an act or succession of acts. It can be carried into effect in no other manner than by continued and C( nstant management and control.

In Lang v. Ropke (5 Sand., 363), and Downing v. Marshall (23 N. Y., 366), a broader and more enlarged view was taken, of the effect of this section (71) of the article defining uses and trusts. It was incidentally stated that all express trusts which could not be executed under the provisions of the statute defining them, may still be maintained and carried into effect as powers in trust. But what was said in these cases upon this subject was not essential to their decision. This appears from the nature of the controversies considered in the cases, and from the views otherwise expressed. Both these cases were such as to involve in their final disposition no more than the performance of an act which could be well performed under the provisions of the statute defining and providing for the execution of powers. In the second case, Denio, J., stated his views of this feature of it, in the following manner: “ According to the earlier part of the opinion of the chief judge (in which I concur), it is shown that there is no devise of the land to anyone. There is only a power. Although we concede that so much of the power as relates to the rents and profits is void, there still remains a distinct authority to sell the land and pay over the proceeds.” And that, in his view, could be well executed under the provisions of the statute relating to powers. (Id., 391, 392.) Crittenden v. Fairchild (41 N. Y., 289), was certainly no more extended in its effect, for that was simply a power in trust to sell land. In the opinion of Mason, J., it was stated: “ Iiere is no attempt to vest a title in the trustees, but to confer a power of sale upon these executors and distribute the avails to the residuary legatees. It has never been doubted that such a power of sale — conferred upon the executors for the purpose of carrying out the provisions of the will, and where the exercise of the power becomes'necessary to carry out the intentions of the testator — is good.” (Id.-, 292.) The case of Tucker v. Tucker (1 Seld., 408) may be very properly disposed of under the same suggestions. For there was clearly nothing in that case, nor in Robert v. Corning (23 Hun. 299), or in either of the other authorities which have been brought to the attention of the court, indicating it to be- the purpose to extend this section of the statute so far as to authorize sueli a trust as this, to be executed as a power. "While in Wood v. Wood (5 Paige, 596), and Garvey v. McDevitt (72 N. Y.), 556, 562), a different view of the effect of the provisions of the statute was taken by the courts. But if neither of thes i authorities can be properly regarded as controlling over this subject, inasmuch as no authoritative determination has been made the other way, the terms in which the provisions made by the statute have been expressed require the seventy-first section, so often referred to, to be so construed as to exclude an express trust of the nature of that mentioned in the sixth paragraph of the testator’s will. That has been authorized only as an express trust, and when the limitation imposed upon its creation is transcended it must be held to be void and incapable of being executed as a power.

The effect of this conclusion is that, the portion of the testator’s real estate designed to be appropriated by him for the purpose of this trust was not disposed of by his will, aiid it consequently descended under the statute to his heirsrat-law, and by virtue of their title so acquired, the rents and profits of it belong to them. They consequently are not subject to the section of the statute declaratory of the class of cases where the rents and profits are made to belong to the persons presumptively entitled to the next eventual estate. (2 R. S. [6th ed.], 1104, § 40.) That applies only when there shall be a suspense of the power of alienation or of the ownership, during the continuance of which the rents and profits shall be undisposed of and no valid direction given for their accumulation. There was no such suspense of the power of alienation as to this interest in the testator’s real estate. The heirs to whom it descended became its absolute owners and entitled to take and receive the rents and profits for their own use and benefit.

After the expiration of the two lives upon which the trust was intended to be limited, all the property, both real and personal, was devised to the persons named in the seventh paragraph of the testator’s will. This paragraph is in the following form:

Seventh. Upon the death of "said Thomas Bailey and Webster Mabie, I give, devise and bequeath the whole of my real and personal property,. together with the house and lot No. 344 West Fourteenth'street, after the death of my said wife, as follows, viz.: One-fourth part thereof to my brother Ward H. Bailey, and to his beirs and assigns, forever;' one-fourtb part thereof to my sister Rosilia Banks, and to her heirs and assigns, forever; one-fourth part thereof to my brother Lewis H. Bailey, and to his heirs and assigns, forever, and one-fourth part thereof to my nephew William B. Hobby and my nieces Anna Leila Hobby and Sarah B. Hobby, and to their heirs and assigns, forever.

And it was designed to give the persons named in it the remainder of the testator’s estate. As the law stood before the revision of the statutes in 1830, this direction would have constituted a good executory devise, for as that has been defined it did not require any particular estate to precede and support it, but it might be limited to commence in the future without reference to any precedent estate. It was defined to be: “A devise of the future interest in lands or chattels, not to take effect at the testatoi-,s death, but limited to arise upon some future contingency.” '(Paterson v. Ellis, 11 Wend., 260, 278; 4 Rent [7th ed.], 278.) And it. would apparently still be •valid as an expectant estate within the definition of such an interest by the statute (2 R. S. [6th ed.], 1101, § 10), for by this section an estate of that nature may be limited to commence at a future day without the intervention of a . precedent estate, and that is the condition of the final interest in terms disposed of by this will, as the trust estate must fail. By its failure it will in effect be eliminated from the will, which will then direct the final estate to vest in the persons named in it at the 'decease of Thomas Bailey and Webster Mabie. And that would not extend the time for its final vesting beyond the lives of those two persons, which the statute expressly permits. It is an expectant estate commencing at a future period and it should not fail because the life estates are incapable of being maintained. For the statute has further provided, that, “no expectant estate can be-•defeated or barred by any alienation or other act of the owner of the intermediate or precedent estate, nor by any destruction of such precedent estate, by disseisin, forfeiture, surrender, merger or otherwise.” (2 R. S. [6th ed.], 1103, § 32.)

These are the only points required to be considered in the determination of the appeal, and for the reasons already assigned, and those ■mentioned in the very lucid and able opinion of the referee, it follows that the judgment from which the appeal has been taken should be affirmed.

Davis, P. J., and Bkady, J., concurred.

Judgment affirmed.


author: Davis, P. J.: Beady, J.:

text:
    JEANIE DE F. K. BARBOUR, an Infant, etc., Appellant and Respondent, v. ROBERT W. DE FOREST and LOUISE W. KNOX, as Executors, etc., of BURR WAKEMAN, Deceased, and LOUISE W. KNOX, Individually, Appellants and Respondents.

      Accumulation during minority — adding such accumulaton to the principal to be held in trust for the life of the beneflciwry — a disposition over of the same, on the termination of the life estate, is valid — construction of the provisions as to accumulation.'

    A will directed an accumulation of any surplus income received during the minority of an infant, from a trust fund in which such infant had a life estate, and that, on her coming of age, such accumulation he added to the principal and held in trust for her benefit during her life; and that on the termination of such life estate the same he distributed among certain persons.

      Held, that the provisions of the will as to the disposition over were valid. (Brady, J , dissenting.)
    The direction for accumulation was held not to require that each annual surplus, if any occurred that year, should then pass absolutely into the corpus of the estate, hut that all accumulations should remain, during the entire minority, within the control of the executors, so that the excess of one year might he used to meet the greater expenses of any other year.
    Appeals by both, plaintiff and defendants from a judgment of the Special Term construing the will and codicil of Burr Wakeman, deceased.

      Andrew & Man, for the plaintiff, appellant and respondent.

      Henry W. He Forest, for the defendants, appellants and respondents.
   Davis, P. J.:

The testator, Burr Wakeman, by his will, gave and devised “ all the rest, residue and remainder ” of his estate, both real and personal, to bis executors, in trust, and directed his said executors to divide the same into three equal parts, two of which to be designated and set apart for the use of his granddaughter, Louise "Wake-man Knox, and the other one to the use of his great granddaughter, Jeauie De Forest Knox Barbour. In respect of the latter part, he directed that his executors shall receive and apply the income to the use of his said great granddaughter during her life, and upon her death that the principal shall be paid over and transferred to her child or children surviving her, in equal shares; and in case she should die.without issue her surviving, and leaving his granddaughter Louise her surviving, then her share to be added to the other shares of Louise and held by the executors on the same trust; and in case Louise should not survive, but leave issue, such issue to take absolutely.

Afterwards by a codicil to his will the testator in respect of the share of the plaintiff directed as follows: That so- much of the income of the share set apart for my great granddaughter Jeanie De F. Knox Barbour as shall not be needed, in the judgment of my executors for her support shall be retained and invested by them during her minority, and any accumulation of income shall be treated and dealt with as part and parcel of the principal of such share.

The question arising in the case upon these provisions of the will and codicil is whether they direct such an accumulation as is forbidden by the Revised Statutes.

The learned judge at Special Term was of opinion that the direction of the codicil was unlawful to the extent that required the accumulation (if any), to fall into the corpus of the gift and ultimately to go to the issue of the plaintiff, or to Louise Wakeman Knox, or her issue. He therefore adjudged that so much of the codicil as directs that any accumulation of income shall be treated and dealt with as part and parcel of the principal of such share” is void; but he was of opinion that that phrase could be dropped from the codicil, and the direction to accumulate be retained and enforced during the minority of the infant, and the fund so accumulated be paid to her as her absolute property on attaining her majority. If the question were a new one I should be of opinion that the provisions of the will and codicil do not direct an accumulation in violation of the statutes. So far as the statutes which are applicable to this case relate to the accumulation of. rents and profits of real estate,'it is provided that such accumulation must be made for the benefit of one or more minors, then in being, and terminate at the expiration of their minority. (1 R. S., 726, § 37.) And substantially the same direction is given in respect of accumulation of income and profit arising from personal property. (1 R. S., 773,' 774, § 3.) In both cases it is declared that all directions for accumulations, other than such as are allowed by those statutes shall be void, except that when the accumulation shall be for a*longer time than during minority it shall be void only for the period after minority. (1 R. S., 726, §38; Id., 774, § 4.) In this case, the direction for the accumulation, if it be one, is confined to the minority of a minor and -terminates ex vi termini at her majority.

It is also undoubtedly for the benefit of a minor, because if the direction produces such accumulation it will enhance a fund in which she is given a life estate, and the income of which she is to receive for her life.

The statute does not declare that an accumulation which is in fact limited to the minority of an infant, and is made for his or her benefit during life, shall be void if the instrument creating it directs a distribution of the fund at the termination of the life estate. Such a case, in my opinion, is not within the mischief that the statute was intended to prevent, and is -no more obnoxious to the section that declares illegal accumulations void than it would be if no testamentary disposition was made of the fund after the death of the first beneficiary. If that were the case, the accumulation would accrue' necessarily to the benefit of the persons entitled by law to the estate after the death of the minor. Hence some benefit from the accumulation woulfi flow to others than the . minor; and the result would be that it must be held that the statute forbids all accumulations during the minority of minors which create or increase estates or funds in which the minor has a life estate merely. Such results are not, in my opinion, within the mischiefs intended to be prevented, and are not covered by the restraint of the statutes. In Meserole v. Meserole this view seems to have been taken by the General Term of this department. (1 Hun, 66.) In that case, Daiíiels, Justice, in pronouncing the opinion of the court, says: The accumulation of rents, income and profits of the shares given in severalty to the testator’s grandchildren was limited by the expiration of the minority of the respective minors for whose benefit it was directed ; and the direction in that respect was not unlawful, because the fund accumulated during the period provided for, was to be added' to the principal of the minor’s interest in the equitable estate. The statute nowhere prohibits such a disposition of the accumulated fund. It simply requires that it shall be for the benefit of the minor, and terminate at the expiration of his or her minority; and that purpose is as clearly and literally observed where the amount accumulated is to be added to the principal of the minor’s interest as it would be in case it were required to be paid over to him upon his obtaining his majority.”

The case of Meserole v. Meserole was precisely similar in its facts-to that before us; and the same question seems to have been involved, but not considered by the court, in Moore v. Hegeman (72 N. Y., 376). In that case a part of the property was left in trust to apply the income to the use of one of the testator’s children during life, using a part of the income for his support and education during minority, and accumulating the balance to increase the principal which was given to others on the termination of the life estate.

"Without passing directly on the effect of the direction to accumulate, the whole of the testamentary dispositions were sustained, and it may properly be argued that the court did not'consider the accumulation provided for, as affected by the former decisions of similar but not analogous questions.

In this case the accumulation, if any, is only of a possible surplus of income. Primarily the income is directed to be applied to the support, etc., of the minor in the discretion of the executors and trustees, but if a surplus arises it is ultimately if it continue to exist to become part of the fund in which the minor is given a life estate. The intention of the testator was not that each annual surplus, if any occurred, should pass beyond the control of the executors and into the corpus of the estate absolutely, but the whole minority income was intended to remain within the control of the executors and to be used from time to time as exigencies may demand, so that the excess of one or more years might be used to meet the greater expenses of other years, but ultimately any accumulation. of such excess remaining on the minor’s attaining • her majority, or on her prior decease, is directed to go into the fund as part of the life estate, out of which income is afterwards to be paid or applied.

In this view it was not an accumulation within the meaning or prohibition of the statute,” but a mere disposition of the surplus of a growing fund after providing thereout for the proper education and support of the minor, or in other words, the life estate is given in trust to the executors for the benefit of the minor with directions to apply so much of its income during her minority as they shall deem necessary for her support, maintenance and education, and on her attaining her majority to add any surplus of income to the principal of the fund as a part of the life estate, out of which the further-income is to be paid during life. The fact that such an arrangement may result in some greater or less benefit to the persons who will be entitled to the principal after the death of the first beneficiary, ought not to defeat it under our statutes prohibiting unlawful accumulations. Those statutes are aimed against schemes purposely adopted to create accumulations ” that shall extend beyond forbidden periods, or are made for forbidden purposes, and were not intended to apply to cases where accumulations are not a primary object of the scheme, but are at most a mere possible accidental result. The object of the codicil in this case was only to direct and secure reasonable prudence in the use of a fund wholly devoted to the care, education and maintenance of the infant, and to provide for the contingency of the fund being larger than such requirements. To bring such a provision under the category of unlawful accumulations of estates is straining the statute beyond the intent of the legislature.

"We have not overlooked the cases cited by the plaintiff’s counsel, which hold more or less directly that the accumulation, to be lawful, must be “ for the sole benefit of the minor,” but we think they were not intended to apply to such a case as the one before us.

Here was no intent to effect an illegal postponement of the distribution of an estate, or to withhold such a distribution for the purpose of enlarging it by accumulations, as seems to have been tbe case inthe leading authority of Hawley v. James (5 Paige, 318 ; Id., 16 Wend., 61), which has been followed in Manice v. Manice (48 N. Y., 303); Boynton v. Hoyt (1 Denio, 53); Harris v. Clark (3 Seld., 242), and other cases; for in this case there is no real attempt to “ accumulate,” but simply to effect a disposition of contingent surpluses, which may or may not arise during the infancy of a minor, by adding them to the body of her life estate if not exhausted by her support and education before attaining her majority.

■ We do not therefore, concur with the views of the court below, but are of opinion that the judgment should be modified, so far as to declare that the provisions of both the will and codicil are valid; and that the surplus of the income of the estate not exhausted by the suitable support, education and maintenance of the plaintiff during her minority, will fall, under the provisions of the codicil, into the body of the life estate given to her. It should also be said that the executors are not entitled, in providing for the support of the plaintiff, to take into consideration her income from other sources; but she is entitled to be supported, educated and maintained, according to her rank in life, out of the income of the life ■estates given her by the testator in this case.

We think the disposition made by the court below of the question of costs v as correct, and should be affirmed, and that the costs of both parties of these appeals should also be paid out of the fund.

Dwight, J., concurred.

Beady, J.:

The plaintiff is an infant about nine years old, and is the great granddaughter and a devisee under the will of the late Burr Wakeman. The defendant Louise W. Knox is also a granddaughter of Burr Wakeman, and a devisee under his will, and an executrix of and trustee under the will, and was of full age at the time of the death of the testator. The defendant Robert W. De Forest is an executor of and trustee under the will. The parties to this action constitute all the persons now interested in any way under the will, and the plaintiff and the defendant Louise W. Knox are the only heirs and next of kin of the testator. Louise W. Knox has no children. The guardian ad litem is the father and general guardian of the plaintiff, and this action was brought to obtain a construction of the will and codicils of Burr Walternan,, so far as they affect- the rights and interests of the plaintiff.

The question presented arises upon a provision in the second codicil of the testator, in connection with the will. By the will the testator devised and bequeathed to the defendants, as trustees, one-third of all his residuary estate, in trust, to receive and apply the income to the use of the plaintiff for life, and directed that upon her death the principal of said part, one-third, should go to her child or children, or in default of children, to the defendants, for the use of the defendant Louise W. Knox, if then surviving, or to her issue if she be then dead, or, as the learned justice presiding in the court below states it, he directed his trustees to set apart one-third of such income of the rest, residue and remainder of his estate for the use of his great granddaughter Jeanie De Forest Knox Barbour, and they were directed to apply such equal third part of the income, to the use of such great granddaughter during her life, and upon her death, the principal, out of which such one-third part of the income of his estate arose, was given to her child or children surviving her; and in case of her death without issue her surviving, there was a gift over of the principal of the trust estate to others.

By a codicil to his will, thereáfter made and executed, the testator directed “that so much of the income of that share of his residuary estate set apart for his great granddaughter Jeanie De Forest Knox Barbour, as should not be needed in the judgment of his executors for her support, should be retained and invested by them during her minority, and any accumulations of interest should be treated and dealt with as part and parcel of the principal of such share.”

The learned justice, in constructing these provisions of the will and codicil, declared that so much of the clause of the codicil as ordered an accumulation, was during the minority of the infant valid; but that portion thereof which directed that “ any accumulation of income shall be treated and dealt with as part and parcel of the principal of such share ” was invalid, and therefore null and void, and he determined and adjudged that it was the duty of the trustees to accumulate, but that the accumulation to be made should be for the benefit of the plaintiff during her minority, and should at all times belong to her, and should be paid to her when she became twenty-one years of age.

The defendant appeals from the entire judgment, and the plaintiff from so much of it as adjudges that that portion of the codicil directing an accumulation is valid, i. e., during the minority of the infant, and as authorizes the defendants to retain and invest any part of the income during such minority.

The construction adopted by the learned justice in the court below is regarded as erroneous. It is not sustained by the case of Meserole v. Meserole (3 T. & C., 192), nor by that of Moore v. Hegeman (72 N. Y., 376). In the former case the residue of the income of the share of each grandchild was to be accumulated during the period of the minority of the grandchild, from whose fourteenth the same should be derived, and as each should attain his or her majority, then from that period the entire rents, profits and income of his or her fourteenth, and of the accumulations added thereto under the preceding direction, were to be paid over to each respectively for his or her support and maintenance during the residue of his or her respective life. The accumulation therefore was expressly and only for the infant to whom the share was given. Such is not the case here, as we have seen, and as conceded by the learned justice in the court below, because, upon the death of the minor, the share, with its accumulations, may go to an adult, and she therefore derives the benefit of them in the case of the failure of issue of the plaintiff.

In the case of Moore v. Hegeman (supra), although the will contained a provision similar to the case in hand as to accumulations, the question of its validity was not considered, nor was there any mention of or reference made to it anywhere either in the briefs or in the opinion of the court. It is true that the- court held that the entire disposition of the estate was valid, but the language which involved the accumulation clause of the will directed that certain sums should be applied to the education and support of the children during the period named, and after that period provided that the whole of the income should be paid over to them. It was insisted that the trust was not within the provision of the statute, and that the provision to pay was valid only when used as an equivalent to “ apply,” and when used in any other sense was void; and that as these words were used in opposition to each other the trust could not be upheld. Judge Millee, in delivering the opinion of the court, said:

“ I am unable to discover that there is any want of harmony or any antagonism in the words referred to. They are substantially equivalent to each other, and whether the sums mentioned are applied ’ or paid over 1 for the benefit of ’ the children can make but little difference as the object is the same — the benefit of the children. They are to receive the avails and to reap all advantages from the income under all circumstances.”

The question therefore, as already suggested, was not considered. In the cases of Manice v. Manice (43 N. Y., 303-381); Hawley v. James (5 Paige, 318, 481); Hawley v. James (16 Wend., 61, 210); Harris v. Clark (3 Seld., 242, 258), it has been determined that accumulations which are not for the benefit of minors exclusively are obnoxious under the statute in relation to the accumulation of the rents and profits of real estate. (1 R. S., 726, §§ 37, 38.) See, also, reviser’s notes (3 R. S, [2d ed.], 578) in which the revisers say:

The English statutes for restraining trusts and directions for the accumulation of profits, to which we have before referred,” * * * prohibit accumulation for any longer time than ” * * *

3. “ During the minority of any person or persons who, under the deed or will directing the accumulation, would, if then of full age, be entitled to such rents and profits.

“ It is to the period last indicated that the revisers propose to confine the power of accumulation, conceiving that this restriction furnishes the most effectual means of guarding against the abuses-to which directions of this nature are admitted to be liable, and believing that it embraces the only case in which the purpose of the accumulation is such as ought to be sanctioned, namely, for the benefit of infants entitled to the next eventual estate.”

Section 38, to which reference has been made, declares that all directions for the accumulation of the rents and profits of real estate, except such as are therein allowed, shall be void. It is the direction to accumulate which the statute prohibits unless made in conformity to its mandates; and it is from the judgment of the learned justice in apparent antagonism to this provision of the statute that the plaintiff appeals, and which determines that the direction for the accumulation is valid pro tempore, i. e., during the minority of the infant, although it is conceded by him that it is not a direction to accumulate for the benefit of the minor exclusively. It is conceded by the judgment which declares the direction' to be void to the effect that any accumulation of income shall be treated and dealt with as part and parcel of the principle of such share. And this view was adopted and enforced by the learned justice in the court below, upon the proposition that the invalid portion of the direction to accumulate might be dropped without disturbing the residue of the trust, or the remaining testamentary directions, in that regard. He said:

“ The codicil modifies the original provisions of the will, which directed the whole income of the one-third part of the residuary estate to be applied to the use of the testator’s great granddaughter during her life by directing that so much thereof as shall not, in the judgment of the executors, be needed for her- support should be retained and invested by them during her minority.”
“ The codicil to that extent has no invalidity; the statute is violated by the subsequent disposition of these investments of income' which are allowed to accumulate.”
“ Under the will itself any surplus of income over and above what .was needed from time to time for the support of the infant would, without doubt and that lawfully, have been held and allowed to 'accumulate for the infant during her minority, although no express directions as to such accumulations are given, and by dropping the words “ and any accumulation of income shall be treated and dealt with as part and parcel of the principal of such shares,” which is the only direction which is invalid, the will itself is left intact and provision is made for accumulation of surplus income for the benefit of the plaintiff during her minority, and in the event of her, death before attaining her majority the accumulations of income would go to her next of kin, but should she reach her majority the accumulations would belong to her and not to those entitled to the next eventual estate.”
“ This is not making, as is suggested by the learned counsel for the plaintiff, a new will for the testator, it is, in fact, in entire harmony with the will as first made.”
“ It eliminates from the codicil what is conceded to be illegal, and leaves so much thereof as does not conflict with the original gift of the income, but rather supplements it, and suggests what would doubtless have been done by the trustees with the surplus income during the minority of the plaintiff.”
“ It still remains, however, with the trustees, according to their judgment, to determine how much of the income shall be applied for the purpose of the support of the infant, and the residue shall be invested and'held by them.”
This was clearly the intention of the testator, but they are to hold for the use 'and benefit of the plaintiff during her minority.”

This view is erroneous because the clause in question does not create two independent trusts capable of being separated, or of being separately exercised, where one may be saved and the other declared to be illegal. The clause in reference to the accumulation is, as we have seen, contained in the codicil and relates exclusively to the share of the plaintiff. Although, of course, connected with the will, it stands by itself as a separate and independent disposition of his property in the respect mentioned. It is an attempt to engraft upon a disposition of a part of his estate by the will, a direction'which in itself is obnoxious, because it is in conflict with the statute by whieh it is expressly prohibited. As said by the counsel for the plaintiff:

“ There is no such thing as an independent trust to accumulate separate and apart from the object of the accumulation. The statute forbids it. The only trust to accumulate permitted is where a specific object is sought, and then the object characterizes and legalizes the trust. Take away the direction to pay over the result and all that is left is a naked trust to accumulate for no purpose and for no one’s, benefit, a trust void under both statutes; it is neither a permitted express trust nor a permitted direction to accumulate.”
What authority has a court to legalize a trust for accumulation by changing the destination of the fund by taking the ultimate ownership of the fund from one person and giving it to another.”
“ The statute admits of no such perversion. It says plainly that if the accumulation be directed for any other object than that specified there shall be no accumulation at all.”

The judgment appealed from should therefore be affirmed, except that portion of it appealed from by the plaintiff, which should be modified so as to adjudge the direction to accumulate to be void.

We think that the learned justice in the court below in charging the costs and allowances named upon the entire fund was quite justified, because it is very clear that the codicil in question is one which, in the event of certain contingencies, would affect the entire estate.

Judgment modified as directed in the opinion of Davis, P. J., and affirmed as modified, with costs of appeal of both parties to be paid out of the fund.