In re Hoyt's Estate

11 N.Y.S. 901, 32 N.Y. St. Rep. 787, 1890 N.Y. Misc. LEXIS 2419

• Court: New York Surrogate's Court
• Decided: May 8, 1890
• Status: Published

Opinion

Coleman, S.

The direction to lease and accumulate the net rents became inoperative by reason of the sale of the farm by the executors under the power of sale, and instead thereof the executors hold the balance of the proceeds of the sale, in relation to which the only provision of the will is that it “be deposited as aforesaid, or upon good securities elsewhere; and, at the decease of my daughter Hattie L., to be equally divided between each of my grandchildren her surviving.” The purpose of the direction “to be deposited as aforesaid” could not have been intended to be the same as that for which the rents were to be deposited, i. e., to pay off the indebtedness against the farm, for the reason that in case of a sale the executors were to pay .off this indebtedness from the proceeds of the sale, and this has been done. Ho other disposition is made by the testator of the income which must'hccrue upon the fund “deposited” or “put into good securities” until the death of the testator’s daughter Hattie, and only then by inference, for the direction is, “and, at the decease of my daughter Hattie L., to be equally divided,” without saying what it is that is to be equally divided, whether the principal of the fund or the principal and the interest. If the testator intended the interest to be accumulated and divided with the principal at the death of his daughter Hattie, then it is a direction to accumulate not permitted by the statute, since it might cover a period beyond the minority of some or all of his grandchildren, or to be for persons not in being at the creation of the estate, the time of the testator’s death. From a careful reading of the whole will, I am convinced that the testator never contemplated a separate gift of the income to be derived from the investment of the proceeds of the sale of this farm from the gift of the principal itself, and only had in view the making of a gift of a lump sum which should exist at the death of Hattie, made up of the principal and the accumulations of interest. For reasons of his own, he evidently intended to give the net income derived from the house and lot to his daughter Hattie during her life, and to accumulate the income from the farm, or from the proceeds of the sale of it, during that period, and, at her death, to divide the proceeds of both places, with the accumulated income from the farm, between the children of both his daughters who should survive Hattie, intending that his daughter Annie herself should receive nothing from his estate. Must the testator’s purpose necessarily fail because he combined these two elements in one gift, or are they separable? If so, then the gift of the income may be rejected, and it will then pass under the statute, as it accrues, to the grandchildren in existence, they being the persons presumptively entitled to the next eventual estate. The limitation of the expectant estate in the principal, if uninvolved by the direction as to the income, would be valid. And, if it can be sustained, then the disposition of the income made by the statute will so nearly accomplish the intention of the testator in regard to both principal and income that practically his will is sustained; otherwise, he died intestate as to the proceeds of the sale of the farm, and the same should now be paid over to his two daughters, which he did not at all intend. The eases of Kilpatrick v. Johnson, 15 N. Y. 322, and Barbour v. De Forest, 95 N. Y. 13, are cases in which a void disposition of an income was rejected without disturbing the disposition made of the principal; and, although there are in each of these cases separate provisions in regard to the income, there is also a gift of a fund made up of principal and income to be accumulated. In the first case, the fund the income of which was the subject of the controversy was given to the executors in trust, to be invested for the testator’s daughter during the term of her natural life, and to pay out of interest or principal to the daughter, during her life, such sums as the executors might consider necessary for her support, in case of the death of her husband, or his inability to support her, and, at her death, to divide all the principal and interest not received by the daughter among her children. The limitation of the principal after the death of the daughter to her children was held to be good, but that the direction to accumulate was had. In the latter case, the fund was to be invested, and as much of the income as might be needed for the support of the testator’s great-granddaughter during her minority was to be used for that purpose. The balance of the income was to be accumulated during that period, and added to the principal of the fund, the income from the aggregated fund applied to her support during her life, and at her death the fund was to be divided among her children. In this case, it was held that the direction to accumulate the surplus income was void, and that the whole income belonged to the great-granddaughter, but that the gift of the principal was valid. It may be that these cases do not squarely decide the question in this case, but I think they may be regarded as controlling authority for deciding that a legacy made up in part of principal and in part of income is separable, and may be maintained as to the principal, although void as to the income. The decree in this case will therefore provide that the executors retain the fund now held by them and invest the same during the life of the testator’s daughter Hattie, and pay the income, as it shall accrue, to the testator’s grandchildren then living, and, at her death, divide the principal among the grandchildren who shall survive her.