In re the Accounting of Luckenbach

278 A.D. 114, 103 N.Y.S.2d 997, 1951 N.Y. App. Div. LEXIS 3752
Appellate Division of the Supreme Court of the State of New York·Decided April 2, 1951·Published·Cited by 4 cases

Opinion

Per Curiam.

This is a motion for reargument of a prior motion to dismiss the appeal; to resettle an order dated March 5, 1951, which dismissed the appeal, and for leave to appeal to the Court of Appeals.

The motion for reargument is granted. Upon reargument the prior determination to dismiss the appeal is adhered to and the motion, in all other respects, is denied, without costs.

In 1906, the will of Lewis Luckenbach, deceased (hereinafter referred to as the grandfather ”), dated June 13, 1905, was probated. Insofar as material, it directed that the residuary be held in trust, with income therefrom to the extent of $15,000 to be paid to the widow, with the balance to the only child of testator, Edgar F. Luckenbach (hereinafter referred to as the “ father ”). On the death of the widow and the father, the grandfather directed that the corpus be divided among the issue of the father, who are a daughter, Andrea, and a son, Edgar F., Jr., both of whom are respondents here, and a son Lewis, an alleged appellant. The widow died in 1929. The father died on April 26, 1943. As of that time, if not earlier, the three shares in the remainder absolutely vested in the three children of the father.

[117]*117Prior to the death of the father, however, and on September 1, 1936, the son Lewis, alleged appellant, had executed a trust agreement whereby in conjunction with an assignment of May 4, 1943, he conveyed to three named trustees all his right, title and interest in the remainder of the estate of the grandfather. The trust agreement provides, inter alia: “10. In the event of a disagreement among the Trustees as to a course of conduct or a policy to be followed, then the will of the majority of the Trustees shall control and be binding upon the third Trustee: It is specifically provided that this agreement shall be controlled by the laws of the State of California, no matter where the property hereunder may be situated or located or where the estate may be administered.”

The decree purported to be appealed from grows out of a consolidated accounting proceeding instituted on behalf of the daughter Andrea against the father, as trustee, for a compulsory accounting on June 21,1938, and a voluntary accounting by the father, as trustee, instituted in January, 1939. The son Lewis, purported appellant, and his three trustees, Barnett, Landres and Wente, appeared by Shearman & Sterling and intervened in that accounting proceeding* in January, 1939. The gist of that accounting controversy was whether the father was required to account only for assets with which he had been charged as trustee in 1908, or a business which he had. allegedly developed out of such assets. There was also presented a question of commingling of assets arising from the fact that the father indiscriminately used the assets of the estate of the grandfather with his own interest in the same steamship business with that of an uncle, which the father purchased in 1925.

On the death of the father, the executor under his will, Boscoe H. Hupper, undertook to account for the father, as trustee, to the date of the death of the father. After extensive litigation, inclusive of appeals, a decree was made December 14, 1950, which was served with notice of entry on December 18, 1950, from which by an original notice dated January 10, 1951, and an amended notice dated January 12, 1951, the son Lewis and two of the three trustees purport to appeal by their attorneys Barnett and Francis McGrath.

The son Edgar F., Jr., then moved to dismiss the appeal upon the ground (a) of the status of the attorney representing the alleged appellants; and (b) of the status of the alleged appellants.

[118]*118Barnett is not an attorney admitted to practice in this State and, in consequence, his name on the notice of appeal is worthless; but McGrath’s appearance is sufficient. It is argued in support of the motion that McGrath cannot prosecute the appeal because he did not file a notice of appearance or authorization in accordance with section 63 of the Surrogate’s Court Act. This is unnecessary. As set forth in Slepin v. Beck (84 Misc. 254) the authority of the attorneys (Shearman & Sterling) who originally represented the trustees ceased with entry of judgment, leaving a successor free to prosecute an appeal and his authority to do so is presumed.

As to (b), the second phase, it is argued that the son Lewis cannot appeal because he has no interest inasmuch as he, concededly, irrevocably assigned his interest to named trustees. It is contended, in opposition, that inasmuch as he was named as a party in the accounting proceeding itself, he is entitled to be named as an appellant from the decree made therein. As it is undisputed that this proceeding does not involve any issue as to the validity of the trust agreements, the son Lewis clearly has no interest and the appeal taken on his behalf must be dismissed. As stated in Matter of Hodgman (11 App. Div. 344, 353, affd. 161 N. Y. 627):

‘ ‘ If our conclusions are correct, neither of the petitioners had an interest in the estate of Fredrick D. Hodgman. The surrogate, therefore, could properly, and probably should, have dismissed the proceeding instituted by the petitioners. (Matter of Pruyn, 76 Hun, 128; 141 N. Y. 544; Matter of Wagner, 52 Hun, 23; 119 N. Y. 28.) * * *
“ Whether or not the surrogate reached a correct conclusion, or in the progress of the trial made erroneous rulings, the appellants, having no interest in the estate, are not concerned. We are,, therefore, not called upon to consider whether the surrogate erred in settling the account of the executors or in his rulings upon the trial.”

There remains for consideration, therefore, the purported appeal by ‘1 Philip Barnett and Herman Landres, as Assignees and Trustees of said Lewis Luckenbach, a remainderman * * This alleged appeal by two of the three trustees fails to include the third trustee, one Wente, who, the appellants state, resigned in February, 1950. The attorney for Edgar F. Jr., points out that no evidence or proof of such resignation has been submitted and that there was no intimation thereof to the parties prior to August, 1950. There is no claim that the account of WTente has been settled and that he has been dis[119]*119charged by court order, or that a successor for Wente has been appointed, or even that the alleged resignation of Wente has been accepted by anyone.

It is well settled both in this State and in California that trustees, whatever their number, must act together and collectively constitute an entity. As stated in Cooper v. Illinois Central R. R. Co. (38 App. Div. 22, 28): “ Trustees, however numerous, constitute in law a single person. As Perry expresses it: ‘ They all form, as it were, one collective trustee.’ (Perry Trusts, § 411.) When a trust or authority is delegated for private purposes, the concurrence of all who are intrusted with the power is necessary to its due execution. (Sinclair v. Jackson, 8 Cow. 583; Wilder v. Ranney, 16 Wkly. Dig. 478; Wilbur v. Almy, 12 How. [U. S.] 180.) One of several trustees, therefore, cannot make a valid contract relating to the trust estate; he cannot lease, incumber, sell or otherwise dispose of the trust property. (Berger v. Duff, 4 Johns. Ch. 368; Hertell v. Bogert, 9 Paige, 52; Anon. v. Gelpcke, 5 Hun, 255; Brennan v.

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In re the Accounting of Luckenbach, 278 A.D. 114, 103 N.Y.S.2d 997, 1951 N.Y. App. Div. LEXIS 3752 (N.Y. Ct. App. 1951).

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