Court Opinion

ID: 5482560
Source: CourtListenerOpinion
Date Created: 2022-01-10 01:59:20.745431+00
Date Added: 2024-06-11T08:33:38.278156
License: Public Domain

Desmond, J.
(dissenting). I vote to reverse.
I realize that there is practical convenience to respondent, and perhaps an appearance of fairness, in allowing these creditors of the trust income beneficiary, to garnishee, in New York, the income which is being paid to her by- a New York trust company, one of the trustees, on the securities held by the trust company in New York City. However, the difficulty arising from our affirmance of the garnishee order, is that the New York courts are thereby making directions for payment of income, different from those in the terms of the trust itself, and as to a trust which is presently being administered by a competent court of the District of Columbia. That this trust is still under administration in the United States District Court for the District of Columbia is entirely clear from the language, quoted in Judge Conway’s opinion, wherein that court specifically retained jurisdiction of the trust for necessary further orders and instructions regarding its administration. After the executors had accounted in that court, the trust fund was turned over to the testamentary trustees to be administered according to the provisions of the will, and the trustees have no right to distribute the income otherwise, except on instructions of that court (see Everhart v. Provident Life & Trust Co., 118 Misc. 852, 854, Lehman, J., citing Jenkins v. Lester, 131 Mass. 355). Thus, when they comply with this New York garnishee order, they can be accused of violating the instructions of the District of Columbia court which turned the trust over to them, and which has retained jurisdiction of it. What we are doing, by this affirmance, is subjecting these trustees to two conflicting sets of instructions, by two different courts.
So, it seems to me, it is not of prime importance whether this trust would be considered, for other purposes, as “ located ” in the District of Columbia, or in New York. But, if we are to decide that question, we must remember that ordinarily, as *321to a testamentary trust, it is presumed that the locus is at the place where the will was probated, unless the trust has been turned over to trustees in another State without further control by the court which probated the will. Judge Lehman- pointed out in the Everhart opinion (supra, p. 855), as one reason (there was another not here pertinent) why that trust had to be considered as being “ legally outside of the state ”, that “ the instrument creating the trust was probated in a foreign jurisdiction ”. It is true, here, that one of the trustees, and the one which has physical possession of the res, is in New York, but there is another trustee in Wisconsin, and there is nothing in this record to indicate that the Wisconsin trustee has lost her position as such. There is certainly no showing that the Wisconsin trustee has failed or neglected to take any step, if there be any, required by District of Columbia law, to keep her in her trusteeship. The trust business, to be sure, is being carried on in New York, as to the holding of the securities and the collection and paying out of the income, but trust law requires that the two trustees act jointly, and, presumably the New York trustee communicates with the Wisconsin trustee whose powers are exactly the same as those of the New York bank. The ministerial duties of the trust can be and are carried on bv one trustee, but the trusteeship is still joint.
This is not a problem of finding the locus of a trust to see what law governs it, but rather of a demand, by a trust beneficiary’s creditor, for a direction by a New York court for payment of income contrary to the direction made by the trust itself and by the court which is administering the trust.
Lewis, Dye and Fboessel, JJ., concur with Cobway, J.; Desmobd, J., dissents in opinion in which Fuld, J., concurs.
Order affirmed, etc.