Howard v. Leonard

3 A.D. 277, 38 N.Y.S. 363
Appellate Division of the Supreme Court of the State of New York·Decided July 1, 1896·Published·Cited by 4 cases

Opinion

Hatch, J.:

The defendant Leonard- is a daughter of Jéremiah P. Robinson,, who died leaving a large estate. .By..the terms of his will, so. far as essential to any cpiestion arising in this case, the devise, to his daughter was in trust as follows: “ Her share shall be held and kept invested, for the life of said daughter by my executors, or the survivors or survivor of them, and the net interest and income thereof shall, as it accrues,, be paid to- her,, or applied to' her uSe so-long as she shall live.” The will also devised to his wife, Elizabeth Robinson, certain personal property and one-fourth of his estate.. His Wife has since died, leaving a will which, so far as affects any interests here, makes, the same disposition of her property as was made by the will of her husband.

. Since the death of both husband and wife' the property has been kept together and managed by the executors, who are the testator’s-children, as trustees. The business as it was carried on during the lifetime of Jeremiah P. Robinson, has been substantially conducted by the executors in the same manner, the son Jeremiah having its-active management. The income of the estate from August 31, 1892, to the same date ■ in 1894, was respectively $119,789.30, $117,007.89, $59,694.91, making a total income for that period of' $296,492.10, and the net income $79,319.24. . The average income during this time to which Mrs. Leonard was entitled, is $6,609.93. From September 1, 1894,. to July 1, 1895, the. net income was [279] $13,190.39. The falling off of income since 1892 was due to the appropriation of a part to the completion of certain unfinished buildings and making other improvements, and did not represent any loss or impairment of the estate, but added to its value, and will ultimately increase' its productiveness. Mrs. Leonard’s family consists of herself, her husband, an unmarried daughter-and son. She has two married daughters who live with her and are supported by their husbands, but one daughter defendant has been accustomed to assist to a limited extent. Neither the unmarried son or daughter are self-supporting. Mrs. Leonard’s husband is about forty-five years of age and is in sound bodily health. Since the death of Jeremiah P. Robinson he has engaged in no business, and during this period has been entirely supported, clothed and furnished by his wife from her incomeas a gentleman of. leisure. Mr. and Mrs. Leonard and the unmarried daughter now live in a boarding house in West Fifty-eighth street in the city of New York, for which Mrs. Leonard pays sixty dollars a week. The son receives three dollars a week and is fitting himself for business. During the lifetime of Mrs. Leonard’s father she lived for the greater part of the time at his home and was supported by him, her expenditures being $10,000 or $12,000 a year. For about three years she kept house, the house being furnished by her father, and then she expended from $12,000 -to $15,000 a year. The husband was then in business with the testator and contributed something of this sum, what proportion does not appear. After she abandoned housekeeping she returned to her father’s house before his death, where she lived as before and continued therein until some time after her mother’s death, drawing after the latter event $11,-000 a year. This sum was not entirely devoted to. her individual use, but was expended in keeping up the house, an- expensive establishment.

The plaintiff is a judgment creditor of Mrs. Leonard’s, and the basis for the judgment is the purchase price of clothing furnished for her personal use. The present action is in the nature of a creditor’s bill to reach surplus income. The allegations of the bill are, among other things, that the income received from the trustees by Mrs. Leonard is more than sufficient to provide for her suitable support and maintenance, and that the surplus is properly" applicable in equity to the payment of the judgment. And plaintiff asks in her [280] prayer for'judgment.that the court determine how milch of Mrs.' Leonard’s income is- necessary for her suitable support and maintenance and to direct judgment 'that the surplus of said income be applied to the satisfaction of plaintiff’s judgment: The referee has tried" the case carefully and disposed of it intelligently, and we "might safely rest on the learned opinion with which he" maintains his conclusion; Blit defendant so fiercely assails it that we may contribute somewhat in. answer thereto. The referee has found" that $5,000 "is" an amount which will be sufficient to meet" the expenses of' Mrs." Leonard and of those members-of her "family naturally depend ent upon" her. Reference to his opinion shows that the basis of 'this conclusion is the sum of $2,080 for the board of herself and daughter, $1^000 for tlie -maintenance of her .son, leaving $1,920"' ■ for clothing for herself and daughter, and incidental expenses.. It is,"therefore, readily discerned that in the opinion of the referee the " luxury of supporting and furnishing spending money for an able-bodied" husband in sound health ought to be denied the wife, for the benefit of creditors who have furnished her with clothing.

The conclusion is first, assailed upon the ground that there "has never existed any basis of legal right to maintain this action-. The defendant assigns as reason for" this claim that it was necessary for plaintiff to" show that a surplus income existed. To this we .'agree. Examination of "the* argument of the learned counsel for Mrs. Leonard, however, shows that this is not precisely what he means. And . in the light of further" statement we learn that what, is" "intended to be conveyed is that there must -have been an accumulation of some income, which, with the sum which may' be received, must be beyond the needs of the cestui, que trust-before equity can lay hold of.it; The Revised Statutes provide, “Where a trust is. created to receive the rents and profits of lands, and no- valid direction for accumulation is given, the surplus of such rents and" profits, beyond the sum that may be necessary for the education and support of the person for whose benefit the trust is created, shall' be.liable, in equity, to the claims of the creditors of stich person, in the same "manner ,as other personal property, Which cannot "be readied- by an éxecution at law.” (4 R. S. [8th ed.] 2438, § 57 ; Code Civ. Proc. § 1871.)

■ Tinder this statute, which- is authority for "this action, we"understand that the precise claim which-is urged here" was made and con-. [281] deinned in Williams v. Thorn (70 N. Y. 270). And the court said in answer thereto: I find no authority for this proposition except a single 'Special Term decision (Hann v. Van Voorhis, 15 Abb. Dr. [N. S.] 79), nor any reasonable' ground upon which it can be sustained. It is only where the surplus is sought to be reached, as' property of the debtor, or as a debt due from a third person, by supplementary proceedings, that such doctrine has been held, and as has already been shown by the cases cited, those very cases concede that á different rule would prevail in a suit like the present one.” The court then reviews and condemns the case of Clute v. Bool (8 Paige, 83), relied upon by defendant, reaching the conclusion that the decision was in violation of the express language of the statute, and further showing that the chancellor who wrote therein did not adhere to his own dictum when he came to the decision' of Sillick v. Mason (2 Barb. Ch. 79).

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Howard v. Leonard, 3 A.D. 277, 38 N.Y.S. 363 (N.Y. Ct. App. 1896).

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