Case ID: ad_61/html/0513-01.html
Source: Caselaw Access Project
Author: {"author": "Jems, J.:", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

In the Matter of the Judicial Settlement of the Account of Charles A. Tatum, as Executor of the Last Will and Testament of Maria E. Hibbler, Deceased. Charles A. Tatum, as Executor, etc., of Maria E. Hibbler, Deceased, and Frederick C. Tatum, an Infant, Respondents; Frederick D. Preston, as Administrator, etc., of Anna H. Preston, Deceased, Appellant.
    
      Will—when an equitable conversion of real estate into personalty does not take place.
    
    The will of a testatrix, whose estate consisted of $15,000 in realty and $70,000 in personalty, and who left her surviving three grandchildren, one of whom, was an infant, gave her residuary estate, both real and personal, to her grandchildren “for their own use and benefit forever, share and share alike. But if any of my grandchildren hereinbefore named shall not be twenty-one years of age at the time of my decease, the share in my estate hereinbefore bequeathed or devised to such grandchild shall be held by the trustee hereinafter named or his successor, in trust to invest the same and keep the same invested until such grandchild shall attain the age of twenty-one years, and then to pay over to such grandchild the said principal sum with the interest - and accumulations thereon; and, in the event that such grandchild shall die before attaining the age of twenty-one years, then to pay the said principal sum and the interest and accumulations thereon to the survivors among the said grandchildren in equal proportions, the share in such fund of such survivor as shall then be of the age of twenty-one years to be paid forthwith; and, if either survivor shall then be under the age of twenty-one years, his share therein to be paid when he shall become of such age.”
    The will further provided: “ I hereby authorize and empower my said executor and trustee to sell, at public or private sale, and at such time or times and in such manner, and for such sum or sums, and upon such terms as to him, in the exercise of his best judgment, may seem most expedient, and to convey all or any part of my real and personal, estate as he may consider it necessary or proper to do for the payment of my said debts and of said legacies and for any other purpose or purposes whatsoever.”
    
      Held, that the will did not effect an equitable conversion of the real estate into personalty.
    An equitable conversion will not result where only a discretionary power to sell is given, and the scheme of the will can be carried out without such conversion.
    Appeal by Frederick D. Preston, as administrator, etc., of Anna H. Preston, deceased, from a decree of the Surrogate’s Court of the county of Kings, entered in said Surrogate’s Court on the 11th day of March, 1901, in so far as it overruled the objections filed by him and settled and adjusted the account of Charles A. Tatum,, as executor, etc., of Maria E. Hibbler, deceased, and confirmed and ratified the payment by said executor to. himself, as father and heir at law of Anna H. Preston, of a portion of the net proceeds of sale and rents of the real estate of which said Maria E. Hibbler, deceased, died seized, and adjudged and decreed that no equitable conversion of the real property of said testatrix was effected by the provisions of her last will and testament and that said real property descended to the residuary legatees and devisees named in said last will and testament as real property, and only became personal property when actually converted by the executor from real into personal property.
    
      John, M. Shedd, for the appellant.
    
      Ghartes U. Oús, for the respondent executor.'.
    
      Thomas H. Troy, guardian ad litem, for infant respondent.
   Jems, J.:

It is necessary to set out only the 11th and 13th paragraphs of the will:

Eleventh. All the rest, residue and remainder of the property and estate, real and personal, of every description and wheresoever situated, of which I may be seized or possessed, or to which I may be entitled, at the time of my decease, I give, devise and bequeath unto my grandchildren, Anna H. Tatum, Albert H. Tatum and Frederick 0. Tatum, children of my deceased daughter, Alice H. Tatum, for their own use and benefit forever, share and share alike. But if any of my grandchildren hereinbefore named shall not be twenty-one years of age at the time of my. decease, the share in my estate hereinbefore bequeathed or devised to such grandchild shall be held by the trustee hereinafter named or his successor, in trust to invest the same and keep the same invested until such grandchild shall attain the age of twenty-one years, and then to pay over to such grandchild the said principal sum with the interest and accumulations thereon ; and in the event that such grandchild shall die before attaining the age of twenty-one years, then to pay the said principal sum and the interest and accumulations'thereon .to the survivors among the said grandchildren in equal proportions, the share in such fund of such survivor as shall then be of the age of twenty-one years to be paid forthwith; and if either survivor shall then be under the age of twenty-one years, his share therein to be paid when he shall become of such age.”

Thirteenth. I constitute and appoint my son-in-law Charles A. Tatum, the executor of this my will, and trustee of the several trust estates hereinbefore created; and I hereby authorize and empower my said executor and trustee to sell, at public or private sale, and at such time or times and in such manner, and for such sum or sums, and upon such terms as to him, in the exercise of his best judgment, may seem most expedient, and to convey all or' any part of my real and personal estate as he may consider it necessary or proper to do for the payment of my said debts and of said legacies, and for any other purpose or purposes whatsover.”

The question presented by this appeal is whether the testatrix intended that there should be a conversion of the realty. She left a house, lot and stable and $70,000 in personal property. Three grandchildren, two of age and one an infant twelve years old, survived her. When the testatrix died, one of the elder grandchildren was married to Mr. Preston. Mrs. Preston died intestate - without issue, leaving her husband and, as her only heir at law, her father. The husband took out letters of administration upon his wife’s estate. Shortly after the death of the testatrix the realty was sold for $15,000. The father of the said deceased grandchild claims a share of the proceeds as heir at law of his daughter, and her husband claims such share on the theory that the will of the testatrix effected conversion of said realty at the time of her death, and that, therefore, the proceeds pass to him as personalty. Before a conversion can be justified there must appear a positive direction. There is none expressed in this will, for the power of sale is clearly discretionary. And such a direction can only be implied “ when the design and purpose of the testator is unequivocal, and the implication so strong as to leave no substantial doubt.” For where only a discretionary power to sell is given and the scheme of the will can be carried out without a conversion the land will remain land. (Scholle v. Scholle, 113 N. Y. 261; Clift v. Moses, 116 id. 144.) The 11th paragraph provides that the residuary estate, real and personal, is given, devised and bequeathed to the three grandchildren named, for their own use and benefit forever, share and share alike. The single limitation applies only because of the infancy of the third grandchild. But subject to the adult grandchildren’s right to a partition, the real property as realty could have been held for him until his majority, then to vest in him. The learned counsel for the appellants argues that the words “invest,” “pay,” *£ principal sum, with the interest and accumulations,” “in equal proportions,” “share in such fund” and “paid,” all indicate that the testatrix contemplated a sale of the real estate. But it must not be. forgotten that these words are used in the clause of the will whereby disposition is made of all the rest, residue and remainder of the property and estate, real and personal, which consisted, for the most part, of personal property. The word “invest” may be limited as applicable to the personalty, as may be the words “ principal sum, with the interest and accumulations.” “ In equal proportions ” does not necessarily require a sale of the realty. The word “ fund ” in its broader meaning may include property of every kind (And. Diet. L.; Miller v. Bradish, 69 Iowa, 278, 280), while the word “ pay,” while affording strong implication, is not enough to establish the rule. (Chamberlain v. Taylor, 105 N. Y. 185, 191.) The learned counsel asks if it was the intention of the testatrix that, the real estate should be held unsold for ten years, why did the executor sell it almost immediately ? It may be answered that the exercise of a discretionary power by the executor is no proof of the intention of his- testator. The fact that the executor applied the proceeds of the sale as directed by the will does not show, as is contended, that he was compelled to sell in order to carry out the scheme of the testator. There is more force in the point that the full share of the adult surviving grandchild, as provided for in the 11th clause of the will, in case of the death of any grandchild before its maturity, could not be “ paid forthwith ” so far as the realty is concerned, but the argument, after all, depends upon the use of the inapt term <£ pay,” which, as I have said, is far from sufficient to establish the intention for conversion. (Chamberlain v. Taylor, supra.) The learned counsel for the appellants mainly relies upon Salisbury v. Slade (160 N. Y. 278) and Kinnier v. Rogers (42 id. 531). In the first case, Baetlett, J., quotes : “ ‘ Precedents are not very valuable where the decision must be based on the peculiar phraseology of the entire will.’ (107 N. Y. 540.)” The scheme before his court was a devise of a life estate to the widow in an estate consisting largely of realty, which, upon her death, was directed to be divided into seven shares, three of which were to be paid over to the sons at once, and four of which were to pass into four separate trusts for life, and a restriction that the executors and trustees must not sell or divide up the real estate during the life estate or the widowhood of the holder thereof. The court held that the provisions for the children raised of necessity an implied trust to sell, and that the restriction as to selling and dividing up during the life or widowhood of the widow meant that it should be sold and divided up after the period named, as the rest of the estate had been, otherwise the will could not be carried out. (Pp.. 289, 290.) The case is not an authority because the scheme of this will is essentially different. .For, in the case at bar, there is an absolute devise, effective upon the death of the testatrix, save that an undivided third share is held by trustees during the minority of the devisees thereof,. and the power of sale of the entire estate is but in discretion. The decision in Kinnier v. Rogers (supra) held that a discretionary power of sale following an absolute devise was valid, but it did not apply the doctrine of conversion. And the quotation from the opinion of Lott, J., therein, made by the learned counsel, is pertinent to the case at bar without making for the appellant, inasmuch as it but states the reasons that may well have induced the testator to give a discretionary power of sale to his executors. Row, that power is given in this case, and similar reasons may well have moved the testatrix. Many other cases are cited by the learned counsel which are instances of the application of the rule of equitable conversion. There is no dispute about the rule; this contest turns upon the application of it. I think that the cases cited are not precedents because provisions of the wills or the express directions of the testators, essentially different to the provisions and directions of this will, required' or justified the application of the rule. A precedent in such a case as this must show provisions similar, a scheme identical or- language equipollent. I am of opinion that the intention of the testatrix can be fully carried out without the application of the rule invoked by the appellant. Story, in his Equity Jurisprudence (Yol. 2 [13th ed.], 552), says:’“In general Courts of Equity do not incline to interfere to change the quality of the property as the testator or intestate has left it, unless there is some clear act or intention by which he has unequivocally fixed upon it throughout a definite, character either as money dr as land. For (it has been said) there is not a spark of equity between the next of kin and the heir as to the right of property in such cases, and, therefore, the general principle adopted is that the heir shall take all the property which has attached to it the quality of real estate, if there is not some other definite and specific purpose to which it is entirely devoted.”

The decree must be affirmed, with costs.

All concurred.

Decree of the Surrogate’s Court of Kings county affirmed, with costs.