Gray v. Corbit

4 Del. Ch. 135

Opinion

The Chancellor :—

The object of this bill is to ascertain the rights of the parties with respect to certain trust property held by the defendants, Messrs. Corbit and Spruance, as trustees under the will of Samuel Thomas deceased ; being that portion of the testator’s estate which he devised in trust for the benefit of his son Richard Thomas, now deceased, during his lifetime, with sundry remainders over upon his decease. The whole trust estate now consists of over $20,000 held in money and securities, together with a considerable body of real estate. The present controversy concerns the whole personal fund and a small part of the real estate, to wit, a lot of twenty-two acres situated in Odessa. I will consider first the questions raised with respect to the personal fund.

This fund was derived originally from three sources,viz:

(1) . A small sum, amounting with interest to $147.38, was received by the trustees in July 1830, as a legacy bequeathed to Richard Thomas by the will of his grand father David Wilson.

(2) . The further sum of $1405,03 was (exclusive of interest) Richard’s share, two-elevenths, of the residuary estate of the testator Samuel Thomas,—which share was bequeathed to the trustees upon certain trusts in the residuary clause set forth. This sum came to their hands in several amounts, at sundry dates between July 21, 1832 and May 20, 1838, in the course of the settlement of the testator’s estate.

(3.) All the balance of the trust funds was derived from a moiety of the clear rents and profits of certain real estate which was devised by the testator to the trustees for the benefit of his daughter Mary Ann and his son Richard, under the trust declared in the will. The accumulated surplus of this moiety over and above the sums expended for Richard’s maintenance constitutes the bulk of the trust fund as now held.

First, then, as to the legacy from Richard’s grandfather.

This legacy was no part of the trust estate, that estate being created under the will of Samuel Thomas, deceased. But this small sum being in the hands of the executors of Samuel Thomas, (who in his lifetime was the grandfather’s executor,) and these executors being also the trustees for Richard under Samuel Thomas’ will, and having as yet received no funds from the trust estate for Richard’s maintenance, they applied this legacy to that object ; and in their first account passed before the Chancellor in July, 1831, this appropriation of the legacy was allowed. Messrs. Corbit and Booth were liable under Samuel Thomas’ will for this legacy as executors only, and not as trustees. They became chargeable in the latter capacity only by voluntarily charging themselves with the legacy in their trustee account, but the same account discharged them by allowing the application of the legacy to Richard’s support. Assuming the allowance to be now open to question it must be considered a proper one, under all the circumstances. There is therefore no ground to charge the trustees as such with respect to this legacy ; nor, indeed, could a claim to it be maintained under Richard in any direction. Not even against Corbit as the surviving executor: for it would be a sufficient answer that Richard had received the full benefit of it in his lifetime in the best mode that his situation admitted of. We may then treat the legacy as long since exhausted and as forming no part of the fund now held by the trustees.

Second, with respect to that part of ■ the trust fund which was derived from Richard’s residuary share of his Father’s estate, $1405 03, with its interest,—we are to inquire how was this disposed of? and does it, or any part of it, still remain ? and if so, to whom does it belong ?

With this residuary share the trustees, who were also the executors of Samuel Thomas’ will, charged themselves in their several trust accounts with Richard, passed before the Chancellor, between the years 1832 and 1838, as follows :—

1832, July 21 ............................$ 200 00

1833, May 16............................. 2co 00

1834, July 10............................. 20000

1835, March 3........................... 200 00

1835, July 7............................. 100 00

1836, Feb. 8.............................. 305 03

1838, May 20...... ....................... 200 00

1405 03

The trustees also charged themselves with interest from the respective dates at which these sums were treated as received from Samuel Thomas’ executors.

With respect to the disposal of Richard’s residuary share it appears from the accounts that the first payment of $200 charged as having been received in July 21,1832, was applied to meet a deficiency of Richard’s moiety of the rents accrued up to that date for the expense of his maintenance, and that the balance of his residuary share, with its interest still remains in the trust fund as now held.

The accounts show the following to have been the course of the administration of the trusts. The testator died March 5, 1829. The first fund of Richard realized for his support was the small legacy of $147.38 under his grandfather’s will, received April 26, 1830. The next fund received and so applicable was Richard’s moiety of the clear rents profits as ascertained by the joint account of the trustees Richard and Mary Ann passed July 13, 1831, Richard’s moiety being $277.07^. No part of the residuary share had as yet been received. Meanwhile, during the interval between Samuel Thomas’ death and the passing of the first account of rents and profits, something over two years, Richard was maintained by the trustees at an expense, including interest and commissions, of $1053.36. Against these expenses the Chancellor allowed the trustees, in their separate account with Richard, passed the same day, July 13, 1831, to credit him with the legacy from his grandfather and also his moiety of the clear rents and profits as shewn by the joint account of that date a the two credits amounting to $425.28^, and leaving still'a balance overpaid by the trustees for Richard’s maintenance to that date of $628.07^. Between the date of these first accounts and of those next passed, the second accounts May 13, 1833, nearly two years elapsed, during which, on the 21st July, 1832, the trustees received the first payment on account of Richard’s residuary share amounting, with some interest, to $209.63; and in addition to this there accrued his moiety of the clear rents and profits of those two years, which moiety as the same was ascertained by the joint account of May 13, 1833, was $961.78. These two funds made $1171.41, applicable to the balance of $628.07^ overpaid by the trustees on the first account and to Richard’s maintenance during these two years. It so turned out that these two funds, viz : the first payment from the residuary share and the moiety of the clear rents for those two years, were just sufficient to sink the balance overpaid by the trustees and to meet Richard’s expenses up to the date of the second accounts, leaving a small balance of twenty-seven cents due to Richard. These appropriations were allowed by the Chancellor ; and thus the first payment from the residuary share clearly and necessarily went to make up the then deficiency of Richard’s moiety of the clear rents and profits to pay his expenses. This use of Richard’s residuary share is author ized by the terms of the will. It is clear that the testator contemplating a probable deficiency of the rents, which at. that time were small intended the residuary share to be an auxiliary fund to be applied as might become necessary, for Richard’s maintenance. It will be observed that the testator does not require Richard’s share of the residue to be kept invested, but directs that it be “applied for his use and benefit, and if not expended or “ disposed of in his lifetime, ” then over. The next accounts, being the third set, were passed January 27, 1836, after an interval of nearly three years. During this interval the trustees received on account of the residuary share sums, amounting, with interest, to $761.78 ; and they held additionally for Richard’s maintenance through this period a moiety of the clear rents amounting, as shewn by the joint account passed at this date, to $1683.-24. Richard’s personal expenses during this interval, with interest and commissions, amounted to $958.06, a sum quite within his moiety of the rents. The next set of accounts, passed January 22, 1840, shew that the trustees during the interval between the accounts of 1836 and 1840, received two more and the last payments on account of Richard’s residuary share amounting, with interest, to $597.49 ; and further that during the same period Richard’s moiety of the clear rents quite exceeded his expenses,—his moiety being $2571.26 1-4; and his expenses with interest and commissions, $2141.08. It appears, therefore that while the first payment of $200 on account of the residuary share was necessarily applied to make up a deficiency of Richard’s moiety of the clear rents to meet his expenses, the subsequent payment, amounting in all, with interest to the dates of the respective accounts to $1359.27, were not so requisite; and considering, as I do, that Richard’s moiety of the clear rents and profits was the primary fund for his maintenance and his share of the residue auxiliary only, I must treat that portion of his residuary share which was not requisite for maintenance as being still intact, forming part of the gross fund now held by the trustees, and as subject to whatever rights may attach to it under the will Under the limitation of the residuary clause touching Richard’s share of it, he having died without issue, and Mary Ann Thomas without a will or appointment, so much of the present trust fund as represents the unexpended portion of Richard’s residuary share (which includes all except the first payment received by the trustees) belongs to the heirs at law of Mary Ann Thomas. The amount will be $1359.-27, with interest on the several payments composing it from the respective dates to which the trustees are charged as having received them. This account will, however, be somewhat reduced before the final disposal of the cause ; for, as will appear in the sequel of this opinion, the residuary share, or what remains of it, is liable to reimburse to the surplus of Richard’s moiety of rents'and profits so much as was applied out of that surplus toward the purchase of one moiety of the twenty-two acre lot. That will be a point for distinct consideration hereafter.

It was strongly insisted on behalf of the heirs of Mrs. Mailley (the Mary Ann Thomas of the will) that one moiety of the price of the twenty-two acre lot (the whole price being $781.56) must be considered as having been paid out of Richard’s residuary share ; and not, as the complainants and some of the defendants contend, out of his moiety of the rents and profits. This point was discussed as being material in determining the rights of the respective parties in the lot.

There is no doubt upon the face of the account that as a matter of fact the entire price of this lot was paid out of the joint rents and profits before any division of them into moieties, one moiety for Mary Ann’s separate use and the other for Richard’s maintenance. Let us look closely at this point. This twenty-two acre lot was a part of Samuel Thomas’ residuary estate, devised by the will to be sold by the executors, and the proceeds, together with the surplus personal estate, to be divided among the residuary legatees. After his death it was considered desirable for the benefit of the real estate held in trust for V Mary Ann and Richard, that the twenty-Two acre lot should become annexed to it and held subject to the same trusts,—the special object being to annex the lot to the mansion house in Odessa, which was part of the trust estate. In order to effectuate this object and not at all with any view to an investment of the residuary share, the executors conveyed the lot to Tatman and afterwards took to themselves a reconveyance, in which the object of the transaction as just stated, was fully recited and the lot was subjected in express terms to the same trusts under which the real estate devised for Mary Ann and Richard was held. The substance and whole effect of the transaction, was to withdraw the twenty-two acre lot from the residuary estate and annex it to the trust estate. Of course it became necessary that the residuary estate should receive an equivalent in value, which equivalent seems to have been fixed at $781.56.. To effect this no money was passed, but the executors charged themselves in the testamentary accounts with this amount at three several dates, viz: July 6, 1830, May 21, 1832, and July 21, 1832, that is, with $260.52 at each of these dates, as money received from the trustees, they being themselves the trustees. Now, whether the trustees are to be considered as having made these payments out of the one fund or the other, i. e., the whole out of the rents, or Richard’s portion out of his residuary share which is the point of dispute, is conclusively determined by the joint accounts of the real estate passed July 13, 1831 and May 13, 1833. It will be observed that the trustees passed two sets of accounts :—one set of which are those just referred to, shewing these transactions with the trust estate as a whole,' such as the receipt of the gross rents and the payment of taxes, repairs &c., the object being by these accounts to ascertain the net balance for division into two moieties for the benefit of Mary Ann and Richard respectively. At the same time they passed separate accounts with Mary Ann and Richard of their respective moieties and the charges to which these were subject. Now to the joint accounts of 1831 and 1833 it will be found that the trustees are credited as against the gross rents and profits with the entire price of the twenty-two acre lot, before any division of the clear surplus. The allowance of these credits by the Chancellor made them, in fact, a payment for the lot out of the rents and profits before division. Whether this application of the gross rents was erroneous, and if so what consequences result, are questions to arise in another connection. The present inquiry is only how in point of fact Richard’s residuary share has been applied, and what portion of it remains unexpended. The conclusion on this point is that no part of it was applied to the purchase of the twenty-two acre lot,—that except the first payment of $200, which was expended for Richard’s maintenance the whole residuary share yet remains, though subject, as will presently be seen to reimburse to the surplus rents and profits, held for Richard and those in remainder upon his death, so much as was taken from that fund to pay for Richard’s share of the price of the lot.

A Third. We now reach the chief point of controversy, viz : who are entitled to the surplus of that moiety of the rents and profits which was devised in trust for Richard’s maintenance ? Did it vest in Richard so as to be transmissible to his administrator? or if not, was it, upon' his death without issue, carried by the limitation over to Mary Ann and. her heirs ? or, if undisposed of by the trusts of the 4th item, does it pass under the residuary clause or, does it result to the testator’s heirs at law as being -wholly undisposed of by his will ? All these questions are covered in the argument. ■

In the first place, I am of opinion that Richard Thomas took no interest in the rents and profits transmissible to his representatives. The trust vests in him no estate nor any disposable or transmissible interest, either in the land or in the rents : but it is only a provision for his “ comfor- “ table and respectable maintenance and support out of its “rents, subject to the .discretion of the trustees as to the manner and place of his support.” Observe, first, the terms of the trust. It is not a trust to hold the rents for Richard’s use,—nor even to apply and dispose of them for his general benefit:—but it is “to pay, apply and dis“pose of the other moiety from time to time as received, to “ the comfortable and respectable maintenance and sup- “ port of my son Richard Thomas, during his natural life, “ at such place and in such manner as my said trustee, or “ the survivor, or his assignee, in their or his discretion “ may think proper.” Certainly these words ex vi termini impart no estate or interest in Richard, with respect to either land or money. Such must be their construction even if read without any view to the circumstances under which the provision was made ; but when read in the light of the fact, admitted in the agreement filed, that Richard was of imbecile mind and wholly incompetent for the care of property, they clearly disclose the testator’s purpose to exclude all possible control by Richard over the fund, either directly or consequently,—such control as a vested interest would carry. It need hardly be stated that, in the construction of wills, it is the admitted rule to read a provision in the light of all facts and circumstances surrounding the testator and bearing upon the subject matter. 2 Phillips on. Bv. 293, at large and cases cited. It would be very hard, though, of course, not impossible to raise against the direct effect of this, the operative provision of the will on this point, a gift of the rents to Richard from the collateral provisions of the trust. The effort to do so has been made with much ingenuity. But after a careful consideration the argument from implication seems rather to support than to weaken the effect of the direct terms of the trust as a provision for maintenance only, exclusive of any disposal or transmissible interest in the fund. Let us see. In the first place, the bare fact now admitted and which is plainly recognized in the frame of this provision, that Richard was imbecile and totally unfit to manage his affairs affords the most powerful implication the case admits of against the gift of any disposable interest in the fund, for the vesting of such an interest would subject to Richard’s debts and engagement the very fund which the testator was so sedulously endeavoring to guard for his support. It must be borne in mind that any interest in the fund transmissible to representatives must be also assignable, devisable and subject to debts. To the same general effect, viz : the exclusion of Richard from all possible control, not only over the management but also over the distribution of the estate after his death, is- the withholding by the testator of any power of appointment by Richard of the estate among his issue, should he leave any,—a power quite usual under trusts created to guard the corpus or capital for children but leaving to the parents an interest for life in its income or profits. Some stress was laid upon the fact that the testator, in providing for the contingency of Richard’s marriage and having issue, contemplated his possession or, as was argued, probable improvement in mental capacity. Limitations of this nature, looking to the possibility of issue of one taking a benefit for life under a trust, are so much a matter of course in wills and are so generally introduced at the mere instance of the draftsman,as hardly to warrant the inference of any such definite expectations on the part of the testator as to have induced him to give Richard an estate such as he could control or dispose of, and that too without the condition of such restoration ever in fact taking place. Certainly it is a ground altogether too slender to support a construction to that effect of the provision made for Richard, going, as it does, so far beyond its plain import. Then, again, with respect to that clause in the bequest of two-elevenths of the residue to the trustees of Richard which expressly limits it over, on his death without issue, to his sister, this clause really seems, though the very contrary was argued, to support that construction respecting the trust of the rents which gives to Richard a maintenance by means of them and not a transmissible estate in them. For, so much care evinced in this limitation of Richard’s residuary share to secure so small a sum as it proved to be, against his control or the consequences of his acts, would not be reconcilable with the purpose to leave a surplus of the profits of the real estate unprotected, could the testator be supposed to have contemplated thát any such surplus would accrue. The obvious explanation of the fact that there is a limitation over of the residuary share, upon Richard’s dying without issue, and none of the rents, is found in the expectation of the testator that Richard’s maintenance would absorb a moiety of the clear rents and profits, but might not require all of the auxiliary fund provided for his support out of the residue. That such was his expectation is clearly apparent from his providing a fund auxiliary to „ the rents and it was well warranted by what the accounts shew to have been the productiveness of the property in the testator’s lifetime,—its great improvement since his death having resulted from the subsequent management of the acting trustee Mr. Corbit. Indeed, this expectation of the testator that the rents appropriated for Richard’s maintenance would be exhausted, satisfactorily explains several grounds mainly relied on for implying a transmissible interest in Richard in a moiety of the rents. It accounts for the appropriation in terms of the whole moiety to Richard’s maintenance,—• also for the omission, in the limitation over to the sister, of any gift of a surplus of the rents, or for the omission of any other disposal of such surplus; while it answers, as we have seen the argument drawn from the maxim expres sio unites, exclusio alterius as applied to there being an express limitation over of the residuary share on Richard’s death without issue, while there is no like limitation over of any surplus of rents :—a maxim, by the way, which raises but a very inconclusive presumption of intent on the part of a testator such as is always open to be explained by collateral circumstances or to be rebutted by counter presumptions arising upon the will.

Let us now turn to the authorities cited upon provisions of this nature. It is to be regretted that none are found in which the question was raised, as here, on behalf of the legal representatives of a deceased party who was in his lifetime the object of the trust. In all the cases cited the claim was between the trustees of the beneficiary while living, and his assignees in bankruptcy under-the English law. They involve the same question here presented, viz ; whether the beneficiary under such trusts takes a transmissible interest in the fund, but with this very observable difference, that in cases under the bankrupt laws the policy of preventing frauds upon the law by the continuance of trusts which give to a party the substantial benefits of the ownership of property, without its being subject to his debts, has led the courts in those cases to carry the presumption, in favor of an interest transmissible to the assignees in bankruptcy, beyond what might be deemed necessary or even warrant-able in cases between parties claiming the fund after the death of a person who was the subject of the trust, in which cases np public policy is involved. Yet even the cases under the bankrupt laws proceed upon a principle which will be found not to sustain the claim of Richard’s administrator. The principle of those cases is this : that a trust for the general benefit of a person who is sui juris, a trust which is not in terms limited to the purpose of mere maintenance, and which, therefore, may~be so used as to afford the substantial advantage of ownership and at the same time be a cover against liability for debts, shall be held to vest an interest assignable under the bankrupt law. The express exclusion of creditors found in some of this class of cases only renders them more directly obnoxious to -the policy of the law : nor does the latitude of discretion sometimes given to trustees, to withhold the fund, save such a case; for the material question, under the statute, is not whether the trustees may use the fund only for maintenance, but whether they are at liberty to go beyond maintenance. If the latter, then as the trust may be used as a cover against creditors it is within the policy which treat these trusts as vesting an interest assignable in bankruptcy. The only mode of saving from the effect of bankruptcy a trust for the general benefit of the party, is by limiting it to continue only until bankruptcy or insolvency and to determine absolutely in such an event. Lewin on Trusts, Ch. VI. Sec. 2, at large.

A brief notice of the cases relied on will be sufficient to shew the principle stated. In Snowden vs. Dales, 6 Sim. 524 (9 Eng. Ch. Repts.) the party was sui juris, the trustees were authorized in their discretion to pay the interest to him, though they were also authorized to withold it and apply it only to procuring diet and other necessaries, and the trust was framed for the avowed purpose that no creditor of his should have any claim thereon nor should the same be subject to his debts, disposition or engagements. . In Piery vs. Roberts, 1 Myl. & K. 4, (6 Eng. Chy. Repts.) the party was sui juris and the fund made payable to him, both principal and interest, the trustees having a discretion only as to the times of payment and amount,—with a limitation over on his death as to any sums then remaining unpaid. Upon his bankruptcy he was held to be substantially entitled to the whole legacy, which therefore passed to his assignees. In Groves vs. Dolphin, 1 Sim. 66, (2 Eng. Chy. Repts.) the party was sui juris, and an annuity given to be paid into his proper hands, for his personal maintenance and support, but not to be liable for his debts. The case chiefly relied upon was Green vs. Spicer, 1 Russ. & Myl. 395 (5 Eng. Chy. Repts.) That was a trust for a son who was sui juris, the rents and profits to be received and applied, not for maintenance and support only, but generally, for the “benefit ” of the son, the trustees having a discretion as to the time and manner of application, and there being a restriction against the son’s selling, mortgaging or anticipating the rents. It was held to carry a vested interest to the son, upon the extensiveness of the words, the fund being for his “ benefit” generally, and not restricted to maintenance.

The result of these decisions is that a trust for the general benefit of a person sui iuris which, not being restricted to maintenance only, may be so used as to confer the substantial advantages of ownership, shall be deemed to vest a transmissible interest so as to protect the policy of the bankrupt laws. But that policy has not been extended by any decision, even under the bankrupt laws, to a provission restricted to the maintenance and support of an imbecile person, incapable of managing his affairs to such an extent as to contract liabilities which ought to be protected. On the contrary in a case of that nature decided subsequently to all those before cited, Twopenny vs. Peyton, 10 Simon 487, (16 Eng. Chy. Repts.) it was held that no transmissible interest vested, such as would pass to assignees in bankruptcy. There the testatrix, having by will bequeathed the residue of her estate to a nephew for life, and the nephew becoming bankrupt and insane, after-wards by codicil revoked the estate for life and directed the trustees to apply during his life “the whole or such “ part of the interest, at such times, in such proportions “and in such manner, for the maintenance and support of “ her nephew, and for no other purpose whatsoever, as “they in their discretion should think most expedient.” It was held that this trust vested no interest passing to the legatee’s assignees in bankruptcy; and the controlling feature of the case (though some others were alluded to) as put by the V. C. Sir L. Shadwell, was that “it “ would be impossible for the executors to apply the in- “ come of the trust fund for the benefit of the nephew “ generally, or for any purpose beneficial to him which is “ not comprehended under the terms maintenance and ’support.” Now, it is to this precise object, viz: the maintenance and support of an imbecile legatee that the fund, in the present case, is restricted;—I say restricted because, although not so in express terms, as in Two-penny vs. Peyton, it is by clear implication true, that the whole fund is here in terms appropriated to maintenance but it is équally true that no part is appropriated or could 1 be applied to any other object, not even to Richard’s benefit in any other mode. Nor, do our trustees have really any the less discretion than in the case last cited as to the amount to be applied to maintenance, whether I part or the whole, for the direction that Richard should jbe maintained comfortably and respectably “in such manner ” as the trustees might think proper carries the |unquestionable discretion to judge as to the amount [necessary to be applied and is quite equivalent to a discretion to apply the whole or such part as in their judgIment might be required.

It seems clear then that even under the policy of the nankrupt laws a trust like the present one, for the maintenance and support only of an imbecile person, would not le held to vest a transmissible interest. A fortiori such a trust should not be so construed as between the representatives of the deceased legatee and parties claiming Tinder the limitation of the will, as between whom the question is one of simple intention on the part of the tes[ator unincumbered by any considerations of policy. As a Question of intent on the part of Samuel Thomas, the tes|ator, I cannot entertain a doubt, upon the consideration before fully stated, that Richard Thomas was to take no interest under the trust beyond his “comfortable and respectable maintenance and support during his lifetime,” leaving at his death nothing to pass to his representativés,

We now take up the next question touching the destination of the surplus rents,—which is, whether at Richard’s death without issue this surplus followed the limitations over to Mary Ann of that moiety of the real estate from which it accrued, or whether it has resulted to the heirs at law of the testator. We may lay out of consideration any claim which could be made to the surplus by the residuary devisees, because the residuary clause is so framed as to exclude any interest accruing from the previously devised real estate. This clause begins by directing the executors to convert into money all the testator’s “real and “personal estate not hereinbefore devised or bequeathed,” and then directs the distribution among his children in certain shares, of the residue (to remain after certain deductions) of the proceeds of such sales, together with what moneys should arise from“ the collection of debts or “otherwise.” Itis very evident that this clause was intended to comprehend only the proceeds of undevised lands and chattels and such assets as should come to the hands of| the executors as such, and not such sums as might accrue from the real estate devised in trust, coming to the hands not of the executors but of the devisees in trust. Clearly then the right to the surplus rents' must lie between the devisees over of the moiety of the estate held for] Richard’s maintenance during his lifetime and the testa tor’s heirs at law. Which of these parties is entitled ij The rule of law which controls the question is a clea: one:—the difficulty lies in its application. The rule i this; that all interests in land or springing out of or ac cruihg from land, which are not disposed of by the wil, result to the heir at law. A devise of the fee to trustee does not prevent this effect for in that case the heir take by way of resulting trust. The rule is wholly independent of the testator’s intent in this particular. As it is expressed by Lord Chancellor Talbot, in a case to be presently noticed, “ the law throws it upon the heir ; and “ whenever the testator has not disposed, be his intent that “the heir should take or not take, yet still he shall take; “ for somebody must take ; and none being appointed by “ the testator the law throws it npon the heir.” Cas. temp. Talbot, 52. The decisive question then is, has this surplus been so disposed, of by the will as upon Richard’s death without issue to pass under the limitation to Mary Ann Thomas and her children ? for unless it be taken under that limitation is is not disposed of at all.

Mr. Rodney’s view of this point was, that as a general rule of law rents and profits of real estate accumulated under a trust and not otherwise disposed of pass with the land to the party taking in remainder, or taking under any sort of future limitation of the land. But this position seems not sustained by authority, on the contrary the right of the heir at law to undisposed of interests in real estate has been held to include rents and profits accumulated during a period prior to the taking effect in possession of future limitations, to the exclusion of the person ultimately taking the land. So it was ruled in the case just referred to before Lord Chancellor Talbot, Hopkins vs. Hopkins, Cas. Temp. Talbot 44, a case treated as a .great authority. There it was held that rents accrued prior to the taking effect of an executory devise and not otherwise disposed of by the testator should descend to the heir. So in Bulloch vs. Stone, 2 Ves. Sr. 521, there was an executory devise to the son of A. first to be begotten at twenty-one years of age, with a direction for his maintenance out of the rents during minority. At the testator’s death there was no son born of A. and no provision in the will for the intermediate rents and profits between the testator’s death and the birth of such a son. Lord Hardwicke held that these rents and profits went to the heir. He says, “where there is an executory devise, “ whether of the legal estate or a trust estate in this Court “ the rents and profits go to the heir at law ; because the “legal estate in one case, or trust in the other, descends in the meantime to the heir at law.” To these cases may well be added the great authority of Mr. Fearne, who cited them to the rule as just stated Fearne, Cont. Rem. (434). So also Jarman, 1 Vol. 594, lays down the rule. The same rule is also recognized as a settled one by Lord Brougham in a modern case, Genery vs. Fitzgerald, 1 Jacob 468, (4 Eng. Ch. R.) where he held that an executory devise of a residue, blending real and personal estate, would carry intermediate profits, treating this as an exception to the rule, which he thus states ; “ where personal “estate is given to A. at twenty-one, that will carry the “intermediate interest. If a testator gives his estate Black- “ acre at a future period, that will not carry the intermediate “ rents and profits.. But where he mixes up real and per- “ sonal estate in the same clause the question must be “whether he does not shew an intention that the “ same rule shall operate on both.” It need hardly be said that there can be no difference in principle whether the future limitation of the land from which the intermediate rents and profits accrue be an executory devise, as j in the cases cited, or a remainder, as in the present case. The rule" is otherwise with respect to income accruing from personal estate prior to a limitation over, which does I follow the fund as an accretion to it. Mr. Fearne expressly I distinguishes between real and personal estate in this] respect, and the case of Atkinson vs. Turner, cited by Mr. Rodney from Fearne, was a case of personal estate. To| the rule which carries undisposed of intermediate profits! of real estate to the heir there seems to have been only one! exception ; and that is where the land is given over toi charitable uses, in which case the right of the. heir isl -subordinated to the favor shewn to charities. But this| exception which obtained in early times, has been since disapproved of by the greatest equity judges. Both Lord Hardwicke in A. G. vs. Johnson, Ambler 190 and Lord Eldon in A. G. vs. Bristol, 2 Jac. and Walk. 307, the case cited by Mr. Rodney, said that at the early period when this rule as to charities was adopted in Thelford's case, 8 Co. 150, “the doctrine of resulting trusts was not under- “ stood or the right of the heir at law would never in all “probability have been got over.” Upon all these authorities we must conclude that the surplus rents in this case are not carried, under any general rule, with the land to those taking under the limitation over on Richard’s death, but the surplus rents must be taken by the devisees over, if at all, under the testator’s gift of them, express or implied.

We, then, take up the question whether there is any bequest over of the surplus rents. It was not contended that there is any gift over by direct words of the surplus rents remaining upon Richard’s death, to his issue, should there be such, or to his sister or her children, in the event, which has happened, of Richard’s leaving no issue. To Richard’s issue, should there be such, the limitation over is of a moiety of the land only ; to Mary Ann, in the event of Richard’s death leaving no issue, the gift over is of the moiety of the clear rents and profits during her lifetime, and at her death a moiety of the land is devised to her children. The devise to her for life of what is termed, “the last said moiety of the said clear rents and “ profits as the same shall from time to time be received,” manifestly applies only to that moiety of the dear rents to accrue after Richard's death, having no reference to any surplus accumulated in his lifetime. Then we are thrown back upon the single question, whether there is upon the face of this will a sufficient ground for raising a gift over of the surplus by implication f

The doctrine of testamentary gifts by implication without direct words, is certainly well established. It is a necessary concession to the circumstances under which wills are for the most part made, being by testator generally inops consilii and often in extremis. But this doctrine is subject to some limitations, quite well defined and rigorously applied, such as are necessary in order to guard against its tendency to introduce a distressing uncertainty into the construction of wills. In the first place, the evidence of the testator’s intent to be accepted in lieu of express words must arise from the face of'the will and not from facts or circumstances, or even from direct proof of interest, dehors the will. Further, the implication from the will must be of a conclusive nature, such, according to Lord Eldon’s test of certainty, that “ an intention to the contrary cannot be supposed.” Wilkenson vs. Adamson, 1 V. & B. 466; 2 Jarman on Wills 745, 5th Rule of Construction. Again, and it is this requisite which concerns the present case, a gift by implication pre-supposes that the testator had the subject-matter of the gift before his mind and intended the disposal of it in question, but through inadvertence or unskillfulness has failed to make the devise or bequest in direct terms. All conjecture is excluded as’ to what the testator would have done in an event not actually contemplated had it been brought to his attention. On this point there are some forcible observations by Lord Mansfield in what, perhaps, is the fullest exposition of the subject yet given. Jones vs. Morgan, 7 Bro. P. C. 130; Fearne on Cont. Rem. App. 584. After denying that necessary implication should be held to mean a natural necessity, he thus defines it: “A necessary implication is that implica- “ tian arising from the words the testator has made use of “ which clearly satisfies the Court what was his meaning, “ It is put in opposition to conjecture.” “Conjecture,” he adds, “ is when you suppose what would have been the “ testator’s meaning if he had had thewhole case before him, “ and what if he had thought of such an event he would have “ said upon it. That is conjecture.” Again he says,— “ necessary implication therefore, is that which leaves “ no room to doubt. It is not an implication upon conjecture ; yqu are not to conjecture what he would have “ done in an event he never thought of, &c.”

Lord Mansfield’s distinction,—and it is one which cannot be questioned, is decisive of our case. For it is apparent upon this will that the accumulation in Richard’s lifetime of any surplus of the moiety of rents and profits appropriated to his maintenance was a contingency wholly unthought of by the testator and for which no provision was attempted or intended to be made. It is clearly a casus omissus. We cannot say of this surplus, here is something which the testator appears from the face of the will to have in contemplation and to have intended to limit over, but through inadvertence, ignorance or unskillfulness has failed in a direct expression, oí his purpose. We can at least only infer from the frame of the will as it is what disposal he would have made of such surplus had the contingency of its accumulation been before his mind. There is certainly ground for a very strong inference that had it been suggested to the" testator that possibly Richard’s maintenance might not absorb the whole moiety of the rents he would have limited over the surplus as he did the unexpended portion of Richard’s residuary share. For, as it was argued with much force by Mr. Bayard, the testator having provided otherwise for all his other children and having given over to his daughter Mary Ann and her children, in the event of Richard’s leaving no issue, all of what he did contemplate would remain upon Richard’s death of this entire trust estate, the inference is almost irresistible that he would have continued in the same course of succession any surplus rents which might accrue from the trust estate had he contemplated such a contingency, and that this should be construed as a devise in trust of the entire trust estate to Mary Ann and her family subject to a provision for Richard’s maintenance. I have viewed the case in this aspect (the strongest it will bear for the Mailley family) often and anxiously, with an inclination not to separate the surplus from the limitation over. But after all, the argument cannot carry us beyond a conjecture, a very reasonable and strong one, but still only a conjecture, as to what the the testator would have done with the surplus had he considered. and providedfor the contingency of its accruing. It is precisely that sort of conjecture which Lord Mansfield so emphatically distinguishes from what is termed a ‘’necessary implication.”

The conclusion is that there is no disposal by the will of the surplu's rents and profits and consequently, that they result to the heirs at law of the testator.

Fourth'. The last question raised in the cause may be disposed of briefly. ' It arises out of the claim that one-half of the twenty-two acre lot having been paid for out of that moiety of surplus rents and profits which was appropriated for Richard Thomas’ support should at his death take the same destination with the surplus of that moiety into which the purchase money would have fallen but for the purchase of the lot. This claim was made on behalf of Richard’s representatives, both personal and real, by Mr. Higgins for the administrator, treating this moiety of the land as personalty, and by Mr. Bradford for the heirs at law of Richard, treating it as realty. The claim is, however, to be now considered as on behalf of the heirs at law of Samuel Thomas, the testator, to whom the surplus rents are considered as having resulted.

The claim, is in effect, that the trusts upon which the land was settled by the deed, so far as concerns the .moiety limited to Richard's benefit and in remainder upon his death, shall be displaced, and the lot as to that moiety converted to the use of those entitled to the surplus of the rents out of which the lot was paid for. It is insisted that there is a resulting trust of that moiety of the lot to the parties interested in the fund out of which the purchase money was paid, viz ; that moiety of the rents held in trust for Richard’s maintenance.

It is true, as we have seen, that the lot was paid for out of the gross rents and profits of the real estate before any division of them for the trusts of the will, the effect of which was to take one-half the purchase money out of the moiety of rents appropriated for Richard’s maintenance and so to reduce pro tanto the surplus of that moiety of the rents. Nevertheless, those now entitled to the surplus have not, on that account, a sufficient equity to follow the lot; and this for two reasons.

(i.) Even supposing that there was originally such a resulting trust, it was one of those latent equities which cannot now be set up against the interests in the lot which have since intervened under the partition in chancery. Under the partition and the deed upon which the decree for partition was based, the descendants of Mary Ann Thomas hold this lot as part of the allotment made to the trustees in trust for Richard’s benefit and for those in remainder. If this moiety of the lot be now taken from them they have no remedy for contribution. The result would be to unsettle a partition made under a decree of the Court of Chancery,—it being the decree of a competent jurisdiction and well founded upon the title as it then stood on the face of the deed. Now, a resulting trust in lands arising out of payment of the purchase money is an equity which like all latent equities set up against a title by deed cannot follow the land to the prejudice of rights acquired in good faith under the title arising from the face of the deed. This is a doctrine very well understood: Hence it is that a bona fide purchaser, for a valuable consideration, of the legal title, is protected against all latent equities of which he had not notice. Such a purchaser, having himself an equal equity, is permitted to retain his legal advantage, The interests acquired bona fide under a decree for partition, based upon the title as it then stands on the face of the title papers, should certainly receive the like protection with an ordinary purchase for value without notice. In fact, a party taking under such a partition is a purchaser for value of the allotment made to him ; since in consideration of a title in severalty to his allotment he parts with his undivided interest in the allotments made to his co-tenants. In addition to this consideration there is another of hardly less force. A sound public policy requires that partitions made under decrees in Chancery and well based upon the legal title as it then stands, shall be effectual,, and shall protect all interests acquired under such decrees,—i. e., observe, as against prior latent equities,—not of course, against any outstanding title by deed in third persons who were not parties to the proceeding.

(2.) The other objection to the claim to follow the lot is, that looking to the original transaction the true equity of the parties entitled to the surplus rents, is not to have the trusts of the lot unsettled and the lot, as to a moiety, converted to uses other than those for which it was purchased, but rather their equity is, to have the fund they are interested in, viz :—the surplus rents, reimbursed the amount, paid out of it for that share of the lot which was settled upon Richard and the remainder-men. The doctrine of a resulting trust in land, to him who having in fact paid for it has not taken the legal title, and the right of such a party to follow the land instead of having the money refunded, proceeds, upon the ground either of contract or fraud. The present is a case of neither ; but simply of a mistake in the application of one of two trust funds held by the same trustees to a purchase made for the benefit of one branch of the trust estate, the whole transaction having been in good faith and sanctioned by the Court having cognizance of it. It seems that the purchase money for that moiety of the lot which was settled upon Richard and the remainder-men was not taken out of the residuary share, which was the fund held to precisely the same uses as was the purchased moiety of the lot, and which therefore was the fund to be properly applied to the purchase ; but through mistake the purchase money of that moiety of the lot was taken out of the rents appropriated for Richard’s maintenance, which, as is now adjudged, did not stand under the will to the same uses as the purchased moiety. Now, had this moiety of the purchase money been taken out of the residuary share, it is admitted, that all would have been right, and no claim could have arisen to the lot contrary to the trusts of the deed. Then, most clearly all the equities of the case will be satisfied by now restoring to the fund which represents the surplus rents the amount improperly applied out of the rents toward this purchase, that amount to be now taken out of the unexpended balance of the residuary share. Then the case will stand precisely as if the proper fund had been originally applied to the purchase, exact justice will be done to the parties entitled to the surplus, and at the same time the interests in the lot which have intervened under the partition in Chancery will remain undisturbed. The enhancement in the value of the lot since these transactions does not at all enter into this question. The equities of the parties are to be considered as they arose out of the original transaction except only so far as other rights may have since intervened. They cannot be altered by subsequent contingent changes or fluctuations of value in the property, either by its advancing or depreciating. This must be self evident.

Note. At the next term this case received further consideration upon other questions raised and argued, and which are reported, post.