Case ID: ad_93/html/0198-01.html
Source: Caselaw Access Project
Author: {"author": "Van Brunt, P. J.:", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Jacob L. Hill, as Trustee in Bankruptcy of Sarah Warsawski, Appellant, v. Sarah Warsawski and Lena Davis, Respondents.
    
      Action to establish that a eked executed by a bankrupt while solvent was in trust for his benefit — there .must be a written declaration of the trust —failure of the grantee to allege that there was no written declaration thereof.
    
    A trustee in bankruptcy cannot maintain an action to compel the conveyance to him of certain land which the bankrupt, four years before the adjudication in bankruptcy, while entirely solvent, conveyed to her daughter upon an alleged oral agreement that the beneficial interest in the lands conveyed should remain , in the bankrupt, and that she should be entitled to a reconveyance thereof upon demand, unless he is able to produce the written declaration of the trust required by section 307 of the Real Property Law (Laws of 1896, chap. 547).
    Where the grantee denies the existence of the alleged trust, it is incumbent upon the trustee to establish the existence of the trust in the manner provided by statute, namely,, by a written declaration of trust; the fact that the grantee did not expressly plead that no written declaration of the trust had been executed does not entitle the trustee in bankruptcy to maintain the action upon making proof of the parol agreement.
    Appeal by the plaintiff, Jacob L. Hill, as trustee in bankruptcy of Sarah Warsawski, from a judgment of the Supreme Court- in favor of the defendants, entered in the office of the clerk of the county of New York on the 18th day of November, 1903, upon the decision of the court, rendered after a trial at the New York Special Term, dismissing the complaint upon the merits.
    
      Albert H. Gleason, for the appellant.
    
      Nathan D. Stern, for the respondents.
   Van Brunt, P. J.:

This action was brought by the plaintiff as trustee in bankruptcy of one Sarah Warsawski to compel the conveyance to him of certain lands situate in the borough of Manhattan which the trustee contended were conveyed without consideration by Sarah Warsaw-ski to her daughter Etta upon the explicit agreement that the beneficial interest in the lands remained in -the ■ grantor and that she should be entitled to a reconveyance upon demand. Thesis lands were conveyed by Etta to one Lena Davis, another daughter of the bankrupt; and it was claimed by the plaintiff that the conveyance. was subject to the same terms and that both conveyances were without consideration. The first conveyance above mentioned was made on the 6th of January, 1898, and the second on the 10th of March, 1898, and the defendant Sarah Warsawski was declared a bankrupt' on the 21st of May, 190.2. The plaintiff claims relief solely upon, the ground that the defendant Lena Davis held .the property in question in trust for the defendant Sarah Warsawski. Upon the opening of the case the counsel for the plaintiff stated that he expected to prove a declaration of trust by parol and that there was no writing of any kind signed by the party declaring the trust. There was no claim or allegation that at the time of this conveyance the defendant Sarah Warsawski was not entirely solvent. Objection being taken to this course of proof, the court dismissed the complaint, .to which counsel for the plaintiff took exception, and from the judgment thereupon entered this appeal is taken.

Section 207 of the Real Property Law (Laws of 1896, chap. 547) provides that “ any trust or power over or concerning real property * * * cannot be created, granted, assigned, surrendered or declared unless * * * by a deed or conveyance in writing subscribed by the person creating, granting, assigning, surrendering or declaring the same or by his lawful agent thereunto authorized by writing.” This provision of the statute clearly prescribes that every conveyance of an interest in real property in trust must be by deed in writing. There is an exception in the section, however, which provides that the section shall not prevent any declaration of trust from being proved by a writing' subscribed by the person declaring the same. And it has been held that such a trust may be established! by any writing from which its terms can be spelled out, and which. ■ is subscribed by the party who, it is claimed, has declared the trust.

How in the case at bar there was no attempt to prove a declaration of trust by any writing whatever. In fact, it was stated by the counsel that it was to be proved by parol; and he claimed to do this under the pleadings, because the' statute was not set up in favor of the defendant Lena Davis. There was á general denial, and there was an allegation that the defendant Sarah Warsawski "had never made any such declaration in writing; but there was none in respect to the defendant Lena Davis.

But we think that the decisions in reference to the necessity of a defendant pleading the Statute of Frauds in order to avail himself of its benefits have no application to the case at bar. In the Statute, of Frauds the provision is that in the cases specified every agreement shall be void unless such agreement or some note or memorandum thereof be in writing and be subscribed by the party to he charged therewith. But in the case at bar the language of the provision is entirely different. It provides that no trust or power over or concerning real property can be created unless by deed or, conveyance in writing. And then comes in the exception that a party holding property may make a declaration of trust by any. writing subscribed by such party. Therefore, in order to show, that this trust has been created, it is necessary to prove the deed, as there is no other way in. which such an estate can he created under the statute ; and where a conveyance is made with an agreement that the. property shall be held in trust, that declaration of trust may be proved by á writing subscribed by the party declaring the same. There can be no trust estate whatever created without a writing and, consequently, where there is a denial of the trust, it is necessary to establish it in, the way provided by the statute.

The judgment should be affirmed, with costs.

Patterson, O’Brien, Ingraham and McLaughlin, J J., concurred.

Judgment affirmed, with costs.