Case ID: ny-st-rep_29/html/0162-01.html
Source: Caselaw Access Project
Author: {"author": "Barrett, 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.
    
      (Supreme Court, General Term, First Department,
    
    
      Filed January 24, 1890.)
    
    1. Wills—Tbust—Power of sale.
    A testator devised his estate in trust to pay legacies to his children, to his wife and one H., who were made executors. After giving directions to his executor and executrix in regard to the same, he gave to said "trustees, executor and executrix,” full power to sell any or all the real estate • and invest the proceeds, or to let the same, “ as they may deem "best for the interest of my family.” Held, that it was doubtful if the trust was valid as an express trust to sell, etc., for the benefit of legatees, but if so it was executorial, and its execution devolved on the wife, who alone qualified.
    8. Vendor and purchaser—1Title—Foreclosure.
    Defendant’s title was derived through a sale on foreclosure of said premises. The wife and children were made parties to the action, and consented to the payment of the surplus moneys to the executrix. Held, that the failure to make H. a party, or to name the wife as trustee, did not affect defendant’s title or make it doubtful or unmarketable.
    Appeal by the defendant from a judgment rendered against him after a trial at special term.
    
      Hooper C. Van Vorst, for app’lt; Jacob Steinhardt, for resp’t.
   Barrett, J.

We are unable to see what difficulty there was with the defendant’s title. The questions which were raised by the plaintiff seem, upon the particular facts of the case, to be purely speculative.

Solomon Freedman died seized of one undivided half of the premises in question, subject to a mortgage. Freedman left a will which attempted to create a trust.

His estate, real and personal, was thereby devised and bequeathed to his wife Bosa and to his friend Heller, in trust, to pay legacies to his children. This was followed by a power in these words:

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 private or public sale, and invest the proceeds thereof, or to let or lease the same, as they may deem best for the interest of my family.

His wife and Heller were also appointed executor and executrix and guardian of the persons and estates of the children. The will was proved, but Heller did not qualify. Mrs. Freedman, however, took out letters. This was in 1877. Heller died in 1887, and there was no evidence that he ever accepted the office of trustee or performed any act as trustee or executor. The mortgage already referred to as ante-dating the will, was foreclosed in 1884. Mrs. Freedman was made a party individually and as sole acting executrix. So were all the children of Solomon Freedman and the legatees under his will A decree of foreclosure followed in due course and the defendant’s title is derived from the sale under that decree.

The principal objection made to this title is that Heller was not a party to the foreclosure suit The plaintiff bases this objection upon the theory that a valid trust was created by Solomon Freedman’s will in Mrs. Freedman and Heller, as individuals, apart from the executorial office, and consequently that Heller’s equity of redemption was not cut off. In our judgment, this objection is without merit. It is exceedingly doubtful whether the trust was valid as an express trust to sell, mortgage or lease land for the benefit of legatees. To hold it to be valid by implication from all the language used in the will would require the coupling of the power with the language previously employed to create the trust, and the treatment of the power as imperativa Cooke v. Platt, 98 N. Y., 35. The power, however, stands by itself and does not in terms apply to the trust purposes.

It is also in a measure discretionary. The trustees, executor and executrix ” may sell or lease, not as they may find one course or the other most expedient to effect the payment of the legacies, but “as they may deem best for the interest of my family,” thus covering even the residuary legatee and her interests.

But even if the trust is valid, it is plainly attached to the executorial office and requires the performance of the most ordinary executorial duty. It is true that the devise is nominally to Mrs. Freedman and Heller, as individuals, but all the trust duties are imposed upon them as executor and executrix. Indeed the words trustees, and executor and executrix, are used throughout in the same sense and as equivalent expressions.

These trust duties consist exclusively of the payment of legacies to the testator’s children. Such legacies are to be paid as the children respectively attain their majority, and in the meantime the proper sums are to be safely invested on interest by the “ executor and executrix, trustees and guardians. ” In another connection the phrase is used, “shall by my said executor and executrix be placed at interest” This is still further emphasized by what the testator styles “Item 4,” as follows:

Item 4. In regard to the bequests of $5,000 to each of my said sons, as provided in § 2 of this will, I ordain that if, in the opinion of my said executor and, executrix, the conduct or position in life of my said sons or either of them should not be satisfactory, my said executor and executrix may, in their discretion, withhold the payments of such bequest or any part thereof, until in the opinion of my said executor and executrix, they, my said son or sons, may be worthy of the same, and if such bequests be withheld, then, and in that case, such beneficiaries shall only receive during my said wife Rosa’s lifetime the interest on such bequests.

Then follows “Item 5. ” already quoted, conferring the power to sell or lease upon his “trustees, executor and executrix.” It is thus entirely plain that the trust duty is not only in itself, that is, in its very nature executorial, but is throughout imposed in express terms upon the executor and executrix as such..

It would be quite absurd therefore to imply an intention upon the testator’s part to vest the fee in Mrs. Freedman and Mr. Heller as individuals. He could not have intended to so vest the fee upon trusts to be performed, not by the individual devisees, but by the executor and executrix and with a power of sale granted to them as executor and executrix as well as trustees. That would not only be absurd, but fatal to the plaintiff’s contention of a valid express trust. If then the trust power was attached to the executorial office, its execution devolved upon Mrs. Freedman, who alone qualified and acted. Ogden v. Smith, 2 Paige, 195; In re Stevenson, 3 id., 420; Meakings v. Cromwell, 2 Sand., 512; Dominick v. Michael, 4 id., 375; Conover v. Hoffman, 1 Bosw., 214. In Dominick v. Michael, Judge Duer said that, “when a power to sell lands, whether coupled with an estate, or a. naked power, is given to several persons as executors, it may-doubtless be executed under the Revised Statutes by those who-take upon themselves the execution of the will, without the concurrence of those who neglect or refuse.” See 2 R. S., 70, §§ 15, 16; 2 id., 109, § 55; Code Civ. Pro., § 2642; Laws 1883, chap 401; Roseboom v. Mosher, 2 Denio, 61; Sharp v. Pratt, 15 Wend., 610.

It follows, as a logical sequence, that Heller was not a necessary party to the foreclosure suit, and that the appearance therein, as a defendant, of Mrs. Freedman as sole executrix, was sufficient to render the proceedings regular and the decree valid. Indeed, a finding that Heller had actually refused to accept the position of executor or trustee would have been justified by his failure to take out letters and his complete non-action for some seven years after Mrs. Freedman had duly qualified.

But even if the trust was valid and the fee vested in Mrs. Freedman and Mr. Heller as individuals, we still think that the defendant’s title is not impaired or affected by the failure to make Heller a party defendant in the foreclosure suit. For there is no one who could possibly claim an equity of redemption in the premises or enforce the trust to sell for the benefit of the legatees. Still less is there anyone who, in case the trust be deemed invalid, could compel the execution of the trust power. Heller died before the contract between the plaintiff and the defendant was entered into. Thus Mrs. Freedman became sole surviving trustee. She certainly could not as such trustee question the validity of the foreclosure decree nor attempt a sale of the premises in hostility thereto. Her equity of redemption and all her rights, whether as an individual or as executrix, were cut off by the decree. So too were any possible rights as trustee, for she was fully apprised by the papers served upon her of the nature and object of the suit. And the case is thus brought within the distinction suggested in Landon v. Townshend, 112 N. Y., 99; 20 N. Y. State Rep., 223.

The children and legatees were in like manner cut off. They were necessary and proper parties, 2 Barb. Ch., 174; McGown v. Yerks, 6 Johns. Ch., 450; and see Woods v. Williams, 4 Mad., 186; Lowe v. Morgan, 1 Bro. Ch., 368, and thus they have had their day in court. Heither the children as heirs, nor the children as legatees and cestuis que trust, nor the widow as individually vested with the remainder, nor the widow as sole executrix, made any objection to the proceedings or decree in the foreclosure suit.

Hay more, there was an express recognition by all these parties, and as we have seen they were all of full age, of Mrs. Freedman’s right as executrix to the share of the surplus moneys coming to the estate of the testator, Solomon Freedman. For it appears that upon the consent of these very children, legatees and cestuis que trust, such surplus moneys were paid to her as such executrix. How these moneys in her hands at once became applicable to the paymeut of the legacies, and it is to be presumed that they were so applied in accordance with the provisions of the will

It is entirely clear that, after such affirmative acts, the children and legatees could not be permitted to question the validity of the foreclosure proceedings, nor could they require the execution of the trust or of the power of sale. They elected to accept the fruits of a judgment which purported to cut off all equities of redemption, and all right, title and interest which they and all persons claiming under them had in the mortgaged premises. Having done so, they cannot now compel the surviving trustee to execute a trust or power to sell the same premises for their sole benefit, nor could such surviving trustee convey any valid title in execution of such trust or power. Neither could the trustee or the cestuis que trust redeem.

It follows that the failure to make Heller a party defendant or to name Mrs. Freedman as a trustee (in addition to naming her individually and as executrix) in the foreclosure proceedings did not upon the facts before us affect the defendant’s title or render it doubtful or unmarketable.

■ There is nothing in the point that the referee in the foreclosure suit sold more property than was required to pay the plaintiff. The plaintiff here cannot now question the sale for that reason or because of that fact.

As was said in McBride v. Lewisohn, 17 Hun, 527: “ the owner of the equity of redemption was the only person having any right whatever to question it, and by omitting to take any action with regard to the alleged improper sale, and by permitting the proceedings to go on in reference to the surplus occasioned by the sale, she has waived all right to any consideration on that subject, and is estopped.”

To the same effect is Andrews v. O'Mahoney, 112 N. Y., 571; 21 N. Y. State Rep., 583, and see cases there cited. Wolcott v. Schenck, 23 How. P. R., 385; McBride v. Lewisohn, supra; De Forest v. Farley, 62 N. Y., 628. The other objections to the foreclosure proceedings are trivial. The report of sale was duly confirmed, and all parties to the action were thereafter fully bound. Bechstein v. Schultz, 45 Hun, 191; 9 N. Y. State Rep., 815; Fverson v. Johnson, 22 Hun, 115.

It follows that the judgment appealed from should be reversed and a new trial ordered, with costs to the appellant to abide the event.

Van Brunt, P. J., and Daniels, J., concur.