Case ID: ad_110/html/0037-01.html
Source: Caselaw Access Project
Author: {"author": "Jenks, J.:", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Gertrude Stringer, Respondent, v. George A. Barker and Jacob Berry, as Executors and Trustees under the Last Will and Testament of George Bell, Deceased, George A. Barker, Individually, and Mary E. Leavitt, Appellants, Impleaded with Charles B. Barker and Catherine B. Bell, Defendants.
    Second Department,
    December 29, 1905.
    Trust—when future income from trust estate not assignable by beneficiary — remainder assignable.
    A testator created a , trust of his residuary estate and made ’ the following provisions:
    That the trustees pay out of the income so much as, in their opinion, was'necessary to the support of the testator’s insane daughter, not to exceed §15,000 in any one year, and to divide the remainder of the net income equally between nephews and a niece during the life of said daughter;
    That if said daughter should recover, marry and have lawful issue, the trustees pay the whole net income to her support and that of her issue during her life, and at her death leaving issue surviving to pay to each of the nephews and the niece aforesaid §50,000 and the balance of his residuary estate to the daughter’s said issue;
    That if the daughter died without leaving issue her surviving, the principal of the residuary estate be paid as follows: One-third to a nephew, George Barker, absolutely; .one-third to the other nephew absolutely, and one-third in trust for a niece named.
    The said nephew, George Barker, during the life of the said daughter of the testator, assigned to the plaintiff §100,000 of his share as residuary legatee and directed the trustees to pay said sum to the plaintiff when the principal sum became payable to the assignor. He also further assigned to the plaintiff $5,000 annually'from his share of the income of said estate, to be paid by the trustees at such time and times as the same became due and payable to said assignor. Such payments to coiitinue annually ini til the principal sum became due.
    
      Held, that said assignment to the plaintiff was not valid as an absolute assignment of the-income to accrue in the future, the same being forbidden by-statute (Real Prop, Law, § 83); but that the assignment of the share of the remainder was valid.
    Appear by the defendants, George A. Barker and another, as executors and trustees, etc., of George Bell, deceased, and • others, from a judgment of the Supreme Court in favor of the plaintiff, entered in the office of- the clerk of the county of Kings off the 8bh day of February, 190Í.- ,
    George Bell died on July 21, 1879, leaving an estate iof nearly $1,000,000, in value and a last will and testament which was thereafter duly admitted to probate in the Surrogate’s Court .'of the county of New Y ork, the substantial effect of which is as follows : The residue of his estate the testator gives- to his executors in trust to collect the rents and income, and out of the net income to apply to the support of his (insane) daughter so much as in their judgment is necessary, but not to exceed $15,000 -in • any one year, and the remainder of the net income to apply and divide equally to and among his. nephews and niece (children of his- sister, Elizabeth -Barker),' George Barker, Charles Barker and Mary Leavitt, during the life of liis daughter, but if his daughter shall recover, marry and have lawful. issue, the whole net income shall be applied to her support and that of her issue during her -life, and upon her death, leaving lawful issue her surviving, thén he gives-$50,00.0-to each of his said sister’s children then living and the rest of his residuary 'estate to his daughter’s said .issue. And'‘■in the case of the death of his daughter leaving no lawful issue her surviving, then he gives his residuary estate .as follows: One-third to. George Barker absolutely, one-third to Charles Barker absolutely, and one-third in trust for Mary Leavitt. Upon 'the death of his daughter there is an alternative gift of his residuary estate, conditioned upon the contingency of her leaving lawful issue or not. In, the former case each of the Barker' children then living gets $50,000 and saitj- issue the rest. '
    On November 12,1901, testator’s daughter still living, the 'defendant Charles B. Barker, being the same person named in the said will as a nephew of the said George Bell, deceased, made, executed and delivered to Gertrude Stringer, the plaintiff in this action, an instrument in writing conveying to her an interest in the estate of George Bell, deceased, to the extent of $100,000, and authorized and directed the trustees, in case his distributive share of said estate should become due and payable to him pursuant to the provisions of said will, to pay to the plaintiff Stringer therefrom said sum of $100,000, which he assigned and transferred to her. He also in and by said instrument further assigned and transferred to said Stringer from the income of said estate that was then due him or might thereafter become due the annual sum of $5,000, to be paid at such time and times as the same became due and payable under the terms of said will and until the said sum "of $100,000 should be payable.
    The principal sum of $100,000 which Charles B. Barker has undertaken to dispose of is the same in which it is claimed the defendants Mary E. Leavitt and George A. Barker are contingently interested, as above set forth.
    The referee determined that the assignment by said Charles B. Barker to the plaintiff is a valid and effectual assignment of the principal sum of $100,000 of such residuary vested in said Charles B. Barker and of the annual sum of $5,000 income due said Charles B. Barker under the terms of the will of said George Bell, deceased.
    
      James W. Hawes, for the appellants.
    
      Thomas Watts, for the respondent.
   Jenks, J.:

Barker took either a vested or a contingent estate. (Real Prop. Law, § 30.) The estate was a future estate. (Ibid, § 27.) It was an estate in expectancy. (Ibid, § 25.) My induction, therefore, is that it was descendible, devisable and alienable. (Ibid, §§ 3, 49.) And so arev the authorities. If the estate was vested, the assignment was valid (Lewisohn v. Henry, 179 N. Y. 352, 361); if it was contingent, the assignment was likewise valid (Kenyon v. See, 94 id. 563 ; Hennessy v. Patterson, 85 id. 91, 104), inasmuch as the uncertainty was not as to the person. (Reeves Real Prop. § 608.)

The learned referee decided that Barker took a vested remainder,,, and if the decision of that question were necessary to the judgment that the assignment was valid and effective I should be inclined’ to hold .likewise.' Professor Reeves, in his admirable book on Real Property, considers the oft-quoted language of Woodruff, J.,. in Moore v. Littel (41 N. Y. 66, 76), where, after considering the language of the statute (1 R. S. 722 et seq.) which has been revised in the provisions of the Real Property Law (supra),'the learned judge says: “ I read this language according to its ordinary and natural signification,' and if you can point to a human being and say as to him, ‘ that man or that woman, by virtue of a grant of a remainder, would have an immediate right to the possession Of certain lands if the precedent estate of another therein should now cease,’ then the ■statute says, he or she has a vested remainder.’’ Mr. Reeves cites numerous judgments, many of them in our highest • court, which have referred to the rule, with approval, and says that although the. rule has been sharply questioned (notably a dictlim- in Hennessy v. Patterson, supra, which in turn has been, cited in subsequent judgments), yet the rule" of Moore v. Littel has not been shaken, but rather has been "made" the one practical test of a vested remainder. Examination of some at least of the numerous authorities cited by Mr. Reeves sustains the accuracy" of the statement, and I think justifies his conclusion. (Reeves Real Prop. 734, and note.) A trust limited to lives is no more an obstacle to the present vesting than is a life estate. (Matter of Tompkins, 154 N. Y. 634, 644.)

I think that such assignment was not valid as an absolute assignment of income yet to accrue, because it was forbidden by statute. (Real Prop. Law, § 83; Pers. Prop. Law [Laws, of 1897, chap. 417], § 3.) In. Rothschild v. Roux (78 App. Div. 282), Ingraham, J., for the court, says that section 63 of 1 Revised Statutes, 730, as amended by chapter 452 of the Laws of 1893, is substantially contained in section 83 of the Real Property Law and section 3 of the Personal Property Law. The authorities are clear. (Lent v. Howard, 89 N. Y. 169 ; Tolles v. Wood, 99 id. 616 ; Cochrane v. Schell, 140 id. 516 ; Rothschild v. Roux, supra.) The r,ule applies whether the trust is in real or personal property. (Authorites supra, and also Graff v. Bonnett, 31 N. Y. 9, and especially Cochrane v. Schell, supra, 534.)

The learned counsel for the respondent urges that statutory restraint should not apply-forasmuch as the provision was not a spendthrift trust. In Cochrane v. Schell (supra, 533). the court, per Andrews, Ch. J., say: “ The primary purpose of subdivision 3 of sec. 55,* as stated by the revisers, was to enable the owner of lands to make provision for the maintenance of infants, married women or improvident persons out of the rents and profits of his estate, and of sec. 63, to make the interest of the beneficiary inalienable. (Revisers’ notes' to sections 55 and 63. ) But for obvious reasons the objects of a trust under the 3rd subdivision were not specified, and it permits a trust for the receipt of rents and profits for the benefit of any person whomsoever.” I think that he cannot rely upon. Matter of Tompkins (supra), for the reason that the judgment in that case but applied the rule of the statute (1 R. S. 726, § 40, revised in Real Prop. Law, § 53) that “ rents and profits undisposed of during a valid limitation of an expectant estate shall belong to the persons jiresumptively entitled to the next eventual estate.” In Chemung Canal Bank v. Payne (164 N. Y. 252, 256) the court, per Werner, J., say that the “'general rule is, that if the -good be mixed, with the bad, it shall, nevertheless, stand, provided a separation can be made.” (Citing Curtis v. Leavitt, 15 N. Y. 9, 96.) I cannot see that the subjects of the assignment are so closely knit as to be inseparable. The annual payment is derived from the income of the entire corpus, until the principal sum which is to be derived from the corpus becomes due and payable. When that principal sum is determined and payable, the earnings thereof covered by the assignment cease.

, I think that the judgment must be modified as indicated, and as thus modified affirmed, without costs of this appeal.

Hirschberg, P. J., Bartlett, Rich and Miller, JJ"., concurred.

Judgment modified in accordance with opinion of Tenes, J., and as modified affirmed, without costs of this appeal. Order to be settled before Jenks, J. 
      
      Laws of 1896, chap. 547.— [Rep.
     
      
       These statutes-were respectively amended by. chapter 88 and chapter 87 of the Laws of" 1903,— [Rep,
     
      
      1 R. S. 728, §55, subd. 3, as amd. by Laws of 1830, chap. 320, §10. — [Rep.
     
      
      See Fowler’s Real Prop. Law (2d ed.), p. 1013 et seq.— [Rep.