Case ID: ad_169/html/0810-01.html
Source: Caselaw Access Project
Author: {"author": "Scott, J.:", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Augusta Doctor and Ludwig Scholem, Respondents, v. Augustus S. Hughes and James Frank, as Trustee in Bankruptcy of Elizabeth L. Hughes, Appellants, Impleaded with Elizabeth L. Hughes and Others, Defendants.
    First Department,
    November 19, 1915.
    Debtor and creditor — suit to impress lien upon contingent interest in trust property — parties — husband of contingent remainderman claiming under conveyance from her —trustee appointed upon bankruptcy of contingent remainderman.
    Where a deed creating a trust of real estate for the benefit of the grantor provided that upon his death the trustee should convey the premises, or pay over the proceeds thereof, to the grantor’s heirs, and a daughter of the grantor having a contingent interest under said deed conveyed the same to her husband, neither the husband, nor a trustee appointed upon the bankruptcy of the wife, has any standing to contest a suit brought by a judgment creditor of the wife to impress a lien upon her contingent interest in the trust property.
    Appeal by the defendants, Augustus S. Hughes and another, from an order of the Supreme Court, made at the New York Special Term and entered in the office of the clerk of the county of New York on the 27th day of July, 1915, denying the motion of the appellant Hughes for judgment on the pleadings.
    
      Burt D. Whedon, for the appellants.
    
      Marte Q. Holstein, for the respondents.
   Scott, J.:

The action is by judgment creditors of Augustus S. Hughes and Elizabeth L. Hughes, his wife, to impress and enforce a lien upon the contingent interest of Elizabeth L. Hughes in a certain parcel of real estate, which interest was attempted to be conveyed by said Elizabeth L. Hughes to her husband on June 12, 1902. The contingent interest is said to arise out of a deed whereby James J. Hanigan (who is still living), the father of Mrs. Hughes, conveyed to a trustee the real estate in question, subject to a certain trust for the benefit of the grantor, which deed of trust contained a clause providing that upon the death of said Hanigan the trustee should convey the premises, or pay over the proceeds if the premises should have been sold, to the heirs at law of Hanigan, of whom Elizabeth L. Hughes would be one if living at her father’s death.

On June 12, 1902, Elizabeth L. Hughes executed a bargain and sale deed to her husband whereby she purported to convey to him the premises in question, although of course she could in any event convey no more than her interest in the property, whatever that might be. That deed has never been recorded.

It is the contention of the plaintiffs that Elizabeth L. Hughes acquired under the trust deed executed by her father a contingent interest in the real estate which, although hable to defeat by her death during her father’s lifetime, was still alienable, and that by her deed to her husband he became vested with this interest subject to the happening of the contingency which may defeat it. .

The appellant Augustus S. Hughes insists that his wife acquired no interest in the property which she could transfer, and hence that he acquired no interest therein by her deed to him.

The court at Special Term has held in accordance with the contentions of the plaintiffs, and certainly strong support is to be found for this view in Moore v. Littel (41 N. Y. 66), National Park Bank v. Billings (144 App. Div. 536; affd. on opinion below, 203 N. Y. 556) and Clowe v. Seavey (208 id. 496). We do not find it necessary, however, to pass upon that question at the present time. If the appellant Hughes has no interest in the property she has no concern with plaintiffs’ attempt to establish a lien upon it. If he has an interest, even if it only be contingent, we see no reason why it should not be applied to the satisfaction of the judgment against him. So, in no aspect of the case has he any standing to move for the dismissal of the complaint. So, also, as to the trustee in bankruptcy of Elizabeth L. Hughes, who was appointed on February 2, 1912, and who appeals but has filed no brief. If the bankrupt ever had an alienable interest in the real estate she had conveyed it away before she became a bankrupt. If she never had such an interest nothing passed to her trustee. It follows that in any aspect of the case the motion for judgment was rightly denied. In so deciding, we do not intend to pass upon the measure of relief to which plaintiffs may be entitled. That will be a subject for consideration when they apply for judgment.

The order appealed from is affirmed, with ten dollars costs and disbursements against the appellant Augustus S. Hughes.

Ingraham, P. J., McLaughlin, Laughlin and Dowling, JJ., concurred.

Order affirmed, with ten dollars costs and disbursements against the appellant Augustus S. Hughes.