Case ID: ny-st-rep_41/html/0527-01.html
Source: Caselaw Access Project
Author: {"author": "Parker, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Morris Steinhardt, Resp’t, v. Edward Cunningham, App'lt.
    
      (Court of Appeals, Second Division,
    
    
      Filed December 8, 1891.)
    
    1. Wills—Trusts—Express trust.
    F. devised Ms estate, in trust to pay legacies to his children, to his wife and one H., who were made executors. After directions as to how the legacies were to be paid, he gave the residuum to his wife, and gave his “trustees, executor and executrix,” full power to sell his real estate and “invest the proceeds, or to let or sell the same as they may deem best for the interest of my family.” H. did not qualify, but the wife did. Held, that a valid express trust was not created by the will so as to vest in the wife and H. the title to testator’s real estate.
    2. Vendor and puchaser—Title—Foreclosure—Parties.
    Defendant’s title was derived through a sale on foreclosure of a mortgage g yen by F. in his life-time on said premises. Held, that H. was not a necessary party to the foreclosure.
    Appeal from an order of the general term of the supreme court, first department, reversing a judgment rendered in favor of the plaintiff at special term.
    
      Theodore W. Dwight, for app’lt; George H. Yeaman, for resp’t.
   Parker, J.

This action was brought to recover money advanced on an executory contract for the purchase of land, and for the expenses of a search subsequently incurred, on the ground that the defendant is not able to give a good title.

The defendant acquired his title through a judgment of foreclosure and sale, and it is contended by the appellant that one of the parties in whom the legal estate of an undivided one-half of the premises was vested at the time of the commencement of the suit was not made a party, and therefore such estate did not pass to the purchaser at the foreclosure sale.

Solomon Freedman died seized of one undivided half of the premises in question, subject to a mortgage. He left a will in which, after directing the payment of his debts and funeral expenses, he in terms devised and bequeathed all his estate “ to my beloved wife Rosa Freedman, and to my good friend Jonas Heller, of New York city, to have and to hold the same to themselves, their heirs and assigns forever, upon the uses and trusts following, "viz.: at the time of my death, should my daughters Fannie and Rachel, or either of them be unmarried, I give and bequeath to such of them as may be unmarried, the sum of $5,000.”

In item 2d, the testator declares: “ I give, devise, and bequeath to each of my sons, Jacob, William and Simon Freedman, the sum of $5,000, lawful money of the United States, as soon as they respectively attain their majority. * * * To my son Benjamin Freedman, I give and bequeath $5, * * * he having already received from me in cash, $5,000. These bequests shall, by my executor and executrix, trustees and guardians hereinafter named, be safely invested upon interest for their and each of their, my said children’s benefit and behoof * * Then follows finis residuary clause: “All the rest and residue of my estate, real, personal and mixed, of which I may die seized and possessed and to which I may be entitled at the time of my death, after providing for the aforesaid bequests and the accumulations thereon, I give, devise and bequeath absolutely and forever to my beloved wife Rosa Freeman, subject solely to her own free will and control and disposal as to her may seem meet and proper in lieu of her dowry.”

Item 3d provides for the disposition of the share bequeathed to either of the children in the event of their death before a division of the estate.

Item 4th authorizes the executors to withhold payment of the bequests to the sons until such time as their conduct or position in life should be deemed satisfactory.

Then follows item 5: “I give to my said trustees, executor and executrix, full power and authority to sell any, or all, of my real estate at public or private sale and invest the proceeds thereof, or to let or sell the same as they may deem best for the interest of my family.”

Item 6 has no bearing on the question before us.

Item 7 is as follows: “I hereby nominate, constitute and appoint my said beloved wife Rosa Freedman and my friend Jonas Heller, of the city, county and state of New York, trustees and guardians of the persons and effects and of the estate of my children during their and each of their minority, and also the executor and executrix of this my last will and testament. And I commend my children to their fostering care and protection.”

Jonas Heller omitted to qualify as executor, but Rosa Freedman did, and letters testamentary were therefore granted to her alone, and she thereafter proceeded to the discharge of the executory duties devolving upon her. In the suit brought for the foreclosure of the mortgage the legatees were defendants and Rosa Freedman was made a party individually and as executrix. But the plaintiff insists that by the terms of the will an express trust was created by which the title to the real estate became vested in the trustees; that while Heller did not qualify as executor, he took no action for the purpose of divesting himself of the estate . devised to him by the testator; and therefore was a necessary party.

We are first to inquire, then, whether by the terms of the will a valid express trust was created which vested in Mrs. Freedman .and Jonas Heller the title to testator’s real estate. If not, we need not examine the other questions discussed by the appellant, because this proposition lies at the very foundation of his contention.

It may be doubted whether the testator intended to create an •express trust, notwithstanding the devise was in terms to the executors as individuals, in view of the other provisions of the will. True, after the direction to the executors to pay debts and funeral expenses, he in terms devised all his estate to Eosa Freedman and Jonas Heller, their heirs and assigns forever, upon the uses and trusts following. But this devise is not immediately' followed by the direction to the trustees to sell or mortgage the estate, or to receive rents, profits and income thereof, and make disposition of them in a manner provided. On the contrary, the next sentence is as follows: “ At the time of my death, should my daughters, Fannie and Eachel, or either of them, be unmarried, I give and bequeath to such of them as may be unmarried the sum of $5,000.” Item 2d follows with a bequest of a like amount to each of the testator’s sons, and it concludes with a residuary clause in which the testator gives and devises all the residue of his estate, real, personal and mixed, to his wife, Eosa Freedman. And after “items 3 and 4” he confers by “item 5,” upon the persons named as executors, authority to sell any or all ■of his real estate and invest the proceeds, or to let or lease the .same, as they may deem best for the interests of the family.

The executors were not required to sell, but they were authorized to sell if necessary to discharge the executorial duties conferred upon them. It seems to be clear that the testator had in mind that should his personal estate prove sufficiently large to discharge the legacies given by the will, then there would be no •occasion to sell the real estate, for he devised in terms the residue of his real estate to his wife, and by the power of sale, which •stands alone, he empowers a sale of any or all of his real estate or permits it to be leased. But assuming that the testator intended to pass the title of his estate to the individuals named, it is not •contended that a valid express trust was created, unless it may be said to be within the protection of subd. 2 of § 55, which provides for a trust to sell lands for the benefit of legatees or to satisfy a charge thereon.

This provision is qualified by § 56, which declares that: “ A devise of land to executors or other trustees to be sold or mortgaged, where the trustees are not also empowered to receive the rents and profits, shall vest no estate in the trustees, but the trust shall be valid as a power, and the land shall descend to the heirs or pass to the devisees of the testator, subject to the execution of the power.

Where leases are to be made, tenants put into possession and dispossessed, the possession of the legal estate in the trustees is-convenient and reasonably necessary, and for that purpose the statute permits a grant or devise of title to those charged with the execution of such duties. And it is true that no particular words are necessary to create a trust, and one may be implied where from the whole will it is apparent that the testator intended that, the trustees should be empowered to receive the rents and profits, and for that purpose and to accomplish the other objects of the will it appears to be convenient and advantageous that they should be vested with the legal estate Robert v. Corning, 89 N. Y., 237. But in all other cases of a grant or devise of land to-executors or trustees to be sold or mortgaged, the title of the land descends to the heirs or passes to the devisees subject to the execution of the power. The scheme of the statute is, therefore, in the direction of such a construction as will vest the title in the heirs or devisees rather than the executors, and permits the working out of the wishes of the testator when legal under.a trust, power. And we are unable to discover in this will any barrier in the way of the accomplishment of the purposes of the testator through a trust power; therefore no reason exists for straining after a construction that will declare a trust.

The power of sale is not coupled with the language intended to create a trust; does not in terms refer to it, or apply to the trust pui'pose; nor is it imperative. It does not direct a sale of all his lands, leaving the time of sale merely in the discretion of the executors, but authorizes a sale of “ any or all ” of testator’s real estate, or permits it to be let or leased as may be deemed for the best interest of the family. And this discretionary power is consonant with the residuary clause in the will which, after the payment of bequests, gives and devises to his wife all the rest and residue of his estate, real, personal and mixed.

It has been held by this court in Cooke v. Platt, 98 N. Y., 35, that it is essential to the constitution of a valid trust for either of the purposes referred to in § 55 “ that the power of sale conferred upon the trustees must be absolute and imperative, without discretion except as to the time and manner of performing the duty. imposed, and that it is not sufficient to invest the trustees with a merely discretionary power of sale which may or may not be exercised at their option, and which does not operate as a conversion.” As a valid trust was not created, the legal estate was not vested in the trustees.

It follows that Heller was not a necessary party to the foreclosure.

The judgment should be affirmed.

All concur, except Haight, J., absent 
      
       Affirming 29 St. Rep., 162.