Chase, J.
A proceeding was commenced in the Surrogate’s Court to prove the will of William E. Trnmble, deceased, upon the petition of the executor named therein. All of his next of kin and heirs at law were made parties to the proceeding and appeared therein, and each put in issue the validity of paragraph four of said will, as provided by section 2624 of the Code of Civil Procedure.
The surrogate directed that the will be admitted to probate, but found that the fourth paragraph of the will is void and that the residue of the testator’s property therein mentioned passes and descends to the heirs at law and next of kin of said testator in the manner provided by the statutes of this state in case of intestacy. He also found that the fifth paragraph of the will in no way affects the statutory rights of any of the heirs at law and next of kin of the testator in the property passing or descending to them by reason of the invalidity of the fourth clause of said will. A decree was entered accordingly.
The executor appealed to the Appellate Division of the Supreme Court from such part of said decree as adjudges the fourth and fifth clauses unlawful, and the sisters of the testator appealed from such parts of said decree as direct that the residue of the testator’s property passes and descends to his heirs at law and next of kin, and that direct that the fifth paragraph of the will in no way affects the statutory rights of the heirs at law and next of kin in said residue.
The Appellate Division modified and, as modified, affirmed
said decree. The decree as modified and affirmed provides as follows:
“
It is ordered, adjudged and decreed: That the first, second and third paragraphs and provisions of said will are valid and that the devises and directions therein contained are sufficient and proper and dispose of the estate of the testator as therein set forth.
“
It is further ordered, adjudged and decreed, that the provisions for the sisters contained in the fourth clause of the will are valid; that an independent trust is created thereby as therein provided for the benefit of each sister; that the provision therein contained for the heir or heirs of any sister therein named is illegal and void and that the property embraced therein remaining after the death of any such sister is not disposed of by said will and passes and should be distributed to the persons entitled thereto as provided by law in cases of intestacy.
“ It is further ordered, adjudged and decreed, that the fifth clause and provision of said last will and testament in no way affects the statutory lights of any of the heirs at law and next of kin of said testator in and to the property not effectually disposed of by said will, and that what remains of the trust funds after the death of the sister beneficiaries should be distributed as unbequeathed assets.
“
It is further ordered, adjudged and decreed, that the sixth and seventh clauses of said last will and testament are valid.”
The executor has not appealed from the order of the Appellate Division, but the sisters of the testator have appealed therefrom to this court, so far as it adjudges that the fourth paragraph of. the will provides independent trusts for each sister, and also so far as it adjudges that the fifth paragraph has no effect on the statutory rights of the heirs at law and next of kin in the residue of the testator’s property. And the nephews and nieces have also appealed from the order of the Appellate Division, so far as it modifies the decree of the Surrogate’s Court.
There are blit two questions open for discussion in this court, viz.:
1. What interest did the sisters of the testator named in the fourth paragraph of the will take as legatees or otherwise in the residue of his estate by virtue of the provisions of such paragraph
1
2. If the residue of the testator’s estate or any part or interest in it is not legally devised and bequeathed by the fourth paragraph of his will, and the same passes or descends to his heirs at law or next of kin, is the distribution thereof among such heirs at law and next of kin restricted to the beneficiaries named in said will by reason of the provisions of the fifth paragraph thereof ?
First.
It has been conceded by all of the parties to this proceeding that a trust is created in the residue of the testator’s estate mentioned in the fourth paragraph of his will. It has been so assumed and treated by the learned surrogate and by the Appellate Division. It seems also to have been conceded that the sisters named in the fourth paragraph of the will take equitable noil-transferable estates only as beneficiaries under the trust. The contention between the parties has been as to whether the assumed trust is single or divided into as many parts as the testator had sisters living at the time of his death and named in the said paragraph, and also as to the legality of the trust or trusts.
It has been adjudged and decreed that the provisions contained in the will for the heir or heirs of any sister therein named are illegal and void, and no appeal has been taken from such part of the decree. All of the parties to the proceeding and their respective counsel have apparently overlooked the fact that the gifts to the sisters create in them severally a legal estate transferable by them at will.
The gifts to them severally are of specific amounts, payable monthly and continuing in each case until the death of the sisters respectively. Such gifts are unqualified and constitute simple, general legacies, with the time of payment postponed, and such gifts to the sisters are vested interests, transferable
by them, as is any gift in the nature of a general legacy.
(Durfee
v. Pomeroy, 154 N. Y. 583;
Snedeker y.
Congdon, 41 App. Div. 433;
Wells
v.
Squires,
117 App. Div. 502; 191 N. Y. 529.)
The fact that the executors as such, or as trustees, may have to hold such residue and deal with the income thereof in order to carry out the provisions of the will, does not create an illegal suspension of the power of alienation so far as the sisters are concerned.
(Gillman
v.
Reddington,
24 N. Y. 9,
18; Durfee
v.
Pomeroy, supra.)
It is quite immaterial so far as it affects the interests of the sisters whether a trust is created in the executor or not. It is provided by section 15 of the 'Personal Property Law (Cons. Laws, ch. 41) as follows: “ The right of the beneficiary to enforce the performance of a trust to receive the income of personal property, and to apply it to the use of any person, cannot be transferred by assignment or otherwise. But the right and interest of the beneficiary of any other trust in personal property may be transferred.” The sisters are not beneficiaries of a trust to receive the income of personal property and apply it to their benefit.
It is immaterial, therefore, whether the executor holds the residue of the testator’s estate under an executory power, power in trust, or as a trustee.
Free access — add to your briefcase to read the full text and ask questions with AI
Chase, J.
A proceeding was commenced in the Surrogate’s Court to prove the will of William E. Trnmble, deceased, upon the petition of the executor named therein. All of his next of kin and heirs at law were made parties to the proceeding and appeared therein, and each put in issue the validity of paragraph four of said will, as provided by section 2624 of the Code of Civil Procedure.
The surrogate directed that the will be admitted to probate, but found that the fourth paragraph of the will is void and that the residue of the testator’s property therein mentioned passes and descends to the heirs at law and next of kin of said testator in the manner provided by the statutes of this state in case of intestacy. He also found that the fifth paragraph of the will in no way affects the statutory rights of any of the heirs at law and next of kin of the testator in the property passing or descending to them by reason of the invalidity of the fourth clause of said will. A decree was entered accordingly.
The executor appealed to the Appellate Division of the Supreme Court from such part of said decree as adjudges the fourth and fifth clauses unlawful, and the sisters of the testator appealed from such parts of said decree as direct that the residue of the testator’s property passes and descends to his heirs at law and next of kin, and that direct that the fifth paragraph of the will in no way affects the statutory rights of the heirs at law and next of kin in said residue.
The Appellate Division modified and, as modified, affirmed
said decree. The decree as modified and affirmed provides as follows:
“
It is ordered, adjudged and decreed: That the first, second and third paragraphs and provisions of said will are valid and that the devises and directions therein contained are sufficient and proper and dispose of the estate of the testator as therein set forth.
“
It is further ordered, adjudged and decreed, that the provisions for the sisters contained in the fourth clause of the will are valid; that an independent trust is created thereby as therein provided for the benefit of each sister; that the provision therein contained for the heir or heirs of any sister therein named is illegal and void and that the property embraced therein remaining after the death of any such sister is not disposed of by said will and passes and should be distributed to the persons entitled thereto as provided by law in cases of intestacy.
“ It is further ordered, adjudged and decreed, that the fifth clause and provision of said last will and testament in no way affects the statutory lights of any of the heirs at law and next of kin of said testator in and to the property not effectually disposed of by said will, and that what remains of the trust funds after the death of the sister beneficiaries should be distributed as unbequeathed assets.
“
It is further ordered, adjudged and decreed, that the sixth and seventh clauses of said last will and testament are valid.”
The executor has not appealed from the order of the Appellate Division, but the sisters of the testator have appealed therefrom to this court, so far as it adjudges that the fourth paragraph of. the will provides independent trusts for each sister, and also so far as it adjudges that the fifth paragraph has no effect on the statutory rights of the heirs at law and next of kin in the residue of the testator’s property. And the nephews and nieces have also appealed from the order of the Appellate Division, so far as it modifies the decree of the Surrogate’s Court.
There are blit two questions open for discussion in this court, viz.:
1. What interest did the sisters of the testator named in the fourth paragraph of the will take as legatees or otherwise in the residue of his estate by virtue of the provisions of such paragraph
1
2. If the residue of the testator’s estate or any part or interest in it is not legally devised and bequeathed by the fourth paragraph of his will, and the same passes or descends to his heirs at law or next of kin, is the distribution thereof among such heirs at law and next of kin restricted to the beneficiaries named in said will by reason of the provisions of the fifth paragraph thereof ?
First.
It has been conceded by all of the parties to this proceeding that a trust is created in the residue of the testator’s estate mentioned in the fourth paragraph of his will. It has been so assumed and treated by the learned surrogate and by the Appellate Division. It seems also to have been conceded that the sisters named in the fourth paragraph of the will take equitable noil-transferable estates only as beneficiaries under the trust. The contention between the parties has been as to whether the assumed trust is single or divided into as many parts as the testator had sisters living at the time of his death and named in the said paragraph, and also as to the legality of the trust or trusts.
It has been adjudged and decreed that the provisions contained in the will for the heir or heirs of any sister therein named are illegal and void, and no appeal has been taken from such part of the decree. All of the parties to the proceeding and their respective counsel have apparently overlooked the fact that the gifts to the sisters create in them severally a legal estate transferable by them at will.
The gifts to them severally are of specific amounts, payable monthly and continuing in each case until the death of the sisters respectively. Such gifts are unqualified and constitute simple, general legacies, with the time of payment postponed, and such gifts to the sisters are vested interests, transferable
by them, as is any gift in the nature of a general legacy.
(Durfee
v. Pomeroy, 154 N. Y. 583;
Snedeker y.
Congdon, 41 App. Div. 433;
Wells
v.
Squires,
117 App. Div. 502; 191 N. Y. 529.)
The fact that the executors as such, or as trustees, may have to hold such residue and deal with the income thereof in order to carry out the provisions of the will, does not create an illegal suspension of the power of alienation so far as the sisters are concerned.
(Gillman
v.
Reddington,
24 N. Y. 9,
18; Durfee
v.
Pomeroy, supra.)
It is quite immaterial so far as it affects the interests of the sisters whether a trust is created in the executor or not. It is provided by section 15 of the 'Personal Property Law (Cons. Laws, ch. 41) as follows: “ The right of the beneficiary to enforce the performance of a trust to receive the income of personal property, and to apply it to the use of any person, cannot be transferred by assignment or otherwise. But the right and interest of the beneficiary of any other trust in personal property may be transferred.” The sisters are not beneficiaries of a trust to receive the income of personal property and apply it to their benefit.
It is immaterial, therefore, whether the executor holds the residue of the testator’s estate under an executory power, power in trust, or as a trustee.
The gifts to them severally are absolute and payable out of principal and any added income received while the principal is held by the executor or trustee and they do not violate any statute. The case of
Wells
v.
Squires (supra)
is controlling authority to sustain the gifts to the sisters under the fourth paragraph of the will as legal vested estates in them severally.
In that case the residue of a testator’s estate was given to a person named in trust to pay over to his wife during her life $2,100 annually in monthly payments of $175 each; to a cousin during her life $360 annually in monthly payments of $30. each ; and to another cousin during her life $240 annually in monthly payments of $20 each. The court say: “ The plaintiff asserts that the article and codicil are invalid
and void because they unlawfully suspend the absolute ownership of personal property, of which alone the estate consists. It is observable that the direction for the payment of the annuities is not limited to their payment out of the income. Indeed, the words ‘income’ or ‘rents and profits’ are not to be found in either article except where the wife’s annuity is made a first charge upon the principal and income. A gross sumí is given to the trustee, and out of that sum, not alone out of its income, are the annuities to be paid. In other words, if necessary, the principal is to be used, and it appears that it will be necessary to use it.” (p. 503.)
The court further say: “ The prohibition against the assignment by a beneficiary of the right to enforce the performance of a trust of personal property is limited to cases where the trust is one to receive the income and apply it to the use of any person. The statute expressly provides that ‘ the right and interest of the beneficiary of any other trust in personal property may be transferred.’ * * * The trust in the present case is distinctly not a trust to receive the income and apply it to the use of any person, and cannot be construed as such by any known rule of construction. Consequently the interests of the beneficiaries are alienable and do not suspend the absolute ownership of the fund. * "" * The annuitants, acting in conjunction with the trustee, could convey the estate to the remainderman, or they, with the remainderman, could convey to a third person. And if the annuitants and the remainderman united in an assignment, the trustee would be obliged to convey to the assignee.” (p. 504.)
An appeal was taken from the judgment of the Appellate Division in that case to this court, where the judgment was affirmed on the opinion below.
(Wells
v. Squires, 191 N. Y. 529.)
Second. “
It is a settled principle of law that the legal rights of the heir or distributee to the property of deceased persons, cannot be defeated except by a valid devise of such property to other persons. * * * It was not sufficient to
deprive an heir at law or distributee of what comes to him by operation of law, as property not effectually disposed of by will, that the testator should have signified his intention by his will that his heir or distributee should not inherit any part of his estate.”
(Pomroy v. Hincks,
180 N. Y. 73, 75;
Gallagher
v.
Crooks,
132 N. Y. 338.) In a distribution of any part of the residue of the testator’s estate among his next of kin it should not be restricted to the beneficiaries named in the will.
The judgment of the Appellate Division should be modified by providing that the sisters named in the fourth paragraph of the will each take as legal vested legacies the sum of forty dollars, payable each and every month during the lifetime of such sisters severally, and that subject to such legacies the residue of. the testator’s estate mentioned in the fourth paragraph of his will passes to the next of kin of the testator, as provided by the Decedent Estate Law (Cons. Laws, ch.' 13) and as so'modified it should be affirmed, without costs in this court.
Cullen, Ch. J., Haight, Vann, Werner and Willard Bartlett, JJ., concur; Hisoooic, J., not sitting.
Judgment accordingly.