Court Opinion

ID: 3666884
Source: CourtListenerOpinion
Date Created: 2016-07-06 06:16:40.42859+00
Date Added: 2024-06-11T14:08:45.348899
License: Public Domain

The Court has felt much perplexity in forming an entirely satisfactory opinion in this case. Upon the best consideration, however, which it has been able to give to the case, it is of opinion that the plaintiffs are entitled to relief upon the second ground taken by them in their bill; and being of that opinion, it forbears from forming any judgment upon the first ground as not necessary for the purposes of justice. Nothing, indeed, short of necessity could induce us to make a judicial decision upon questions involving the construction of the law of New York, where that law has not been settled by the decisions of its domestic tribunals. In undertaking such a duty, with the very imperfect light we have, we could scarcely hope to avoid error. It has been by no means an easy task to fix the meaning of the agreement of 16 February, 1838. The subject-matter of that agreement was money paid into the treasury of New York for the use of the estate of the late Mr. Graham; and if it be regarded as money to all purposes, yet, as the proceeds of property disposed of by his will, it was subject, as far as money could be, to the limitations in that will declared in regard to all his property. According to these limitations, Mrs. Graham was entitled to the use and benefit of it for the term of her life; but who were to be the proprietors of it after her death was then unknown. If her children, Hamilton Graham, Mrs. Daves, and Mrs. Haywood, should *Page 264 
all survive their mother, they are to have it as tenants in common. If one or more of them should die before their mother, and die childless, (320) it was to vest in the survivors or survivor wholly. But if any of them so dying before their mother should leave children, then such children were to take the share which the father or mother would have had, if surviving Mrs. Graham. It is to be remarked, too, that Mrs. Graham had not only the interest in this money during life, under her husband's will, but that she was wholly and solely the executrix of that will. It cannot be supposed, unless the agreement explicitly so declared, that it was the intent of the parties to the agreement to affect thereby the ultimate rights in contingency. And so far from such a declaration, the instrument in the strongest terms disclaims such a purpose. "It being the true agreement of the parties that Mrs. Graham surrenders her interest to said money without prejudice to the rights and interests of all other persons." The agreement contains no words of gift, sale, transfer, or assignment; will be found to use no technical terms; and professes merely to set forth an agreement which has been made in respect to the receipt, custody, and future forthcoming of the money. In the beginning it declares Mrs. Graham to relinquish, and in a subsequent part she is said to surrender, her interest therein. But manifestly these terms cannot be understood to mean a technical surrender; for there can be no surrender of a particular estate, except to those having a vested interest in remainder or reversion. They mean no more than her consent to forego the exercise of her right to the use of this money, and to permit the enjoyment of it by others. The inquiry is, Who are those for whose benefit she has, in this sense, relinquished her interest? and the answer, we think, must be, her children. It was a natural direction for her benevolence to take, from the promptings of maternal affection; it was a proper direction, and one conforming most to the spirit of her husband's will. Although these children had no vested interest in the money, yet they stood in the foremost rank of expectants, and were the persons most likely, according to the course of nature, to become entitled to it. The money was lying in the city treasury inactive; she did not want the use of it, and she was willing that her children might use it during her life. The money, too, was the substitute of and equivalent for real estate; and whether it had or had (321) not the properties of such, it was natural for all concerned and intending to carry out fully the late Mr. Graham's will to make all their arrangements so as to secure the enjoyment of it as it would have been enjoyed if real estate. And this purpose, we think, is substantially admitted by the answer, and may be collected from the instrument, when its different parts are attentively considered. The instrument purports, in the commencement, to be made for carrying into *Page 265 
effect an agreement in relation to the money so paid in for the estate "between the parties interested." It cannot be questioned, we think, but by these words are intended Mrs. Graham on the one part and her children on the other; for though, in the strict sense of the word, they were not interested in the estate, yet they were the persons most likely to be interested therein, and, in common parlance, might have been spoken of as persons actually interested. This agreement, then, is set forth, viz., that she is "to relinquish to the other parties" her interest in the said money so that it may be received by the other parties. The instrument then proceeds to state how it is to be received by the other parties, viz.: H. C. Graham is to receive one-third; W. H. Haywood, Jr., for himself and wife, another third; and J. P. Daves, for himself and wife, another third. If the phrase had been, W. H. Haywood is to receive for his wife one-third, and J. P. Daves is to receive for his wife another third, perhaps the intent of the agreement would have been more clearly manifested that in thus receiving the husbands were but the agents whereby their wives respectively were to receive. Yet the words employed are not unapt for the purpose of declaring that they take in right of their wives. The benefit of this surrender was for the wives; but, as during the coverture the money would be held by the husbands, without accountability for interest, the money might thus be said, without impropriety, to be received for themselves and their wives. The words are plainly inconsistent with the supposition of a gift of Mrs. Graham's right to the husbands. Then follow the covenants of the son and of the husbands of the daughters. The son had received a third of the money for himself, as of the bounty of his mother. The only purpose proper to be secured by his covenant, in relation to this (322) money, was to have it forthcoming to answer the ulterior purposes of his father's will, if, by any casualty, the property thereof, instead of vesting in him, as was anticipated, should vest in some other person or persons; and his covenant is so drawn accordingly, and it is expressed to be for the use of those "who may thereafter become entitled to the said sum by him received." The covenants of the husbands are in different words, and, it must be admitted, are more obscure. J. P. Daves covenants with the other parties — here intending, no doubt, the parties executing the instrument — "for the use of his wife, or any other person who may hereafter become entitled to the money received by him, that upon the happening of any contingency whatsoever that vests a right to receive the money by him received from the estate of Edward Graham, deceased, he will repay the same, or cause it to be done, but without interest, until the contingency happens."
Upon these words it is not clear but that it was the sole purpose of the covenant to secure the forthcoming of the money at the death of *Page 266 
Mrs. Graham, either to his wife or to any other person or persons who might then, according to the provisions of the will, be entitled to the ownership of it. And some weight seems to be given to this construction by the phrase, "any contingency which vests a right to receive it." We rather think, however, without examining the instrument further, that the covenant ought to be interpreted in a broader sense. It is reasonable to intend it to have been designed to cover the performance of all the duties imposed by and resulting from the arrangement testified by the instrument. The money received by him under it was received for his wife, to whom the use thereof had been relinquished by Mrs. Graham. It became his duty to preserve the fund inviolate, as well for her benefit as for the benefit of all who might be interested therein. His agency as husband would terminate with the marriage. If at the termination of the marriage by his death Mrs. Graham should be alive, then, under the arrangement, his wife was entitled to the use of the money, and therefore entitled to receive it, and, in case she should ultimately (323) survive her mother, would become entitled to keep it as owner; but if Mrs. Graham should survive her, then the right to the property would go over, under the special limitations of the will, to her children or to her brother and sister. If the marriage should not terminate during Mrs. Graham's life, then both the temporary interest and the final property in the money would be Mrs. Daves', and of course, by the operation of the law, become absolutely his; and if it terminated during Mrs. Graham's life, by the death of Mrs. Daves, he, as husband, was to succeed to her right therein, as so much money, under her mother's relinquishment, or by way of analogy to the law of curtesy, in respect of real property. The covenant, therefore, if it means anything, must be interpreted to have been designed as a security for rights that were to be called into active existence by the contingency of his dying before his wife and during the life of Mrs. Graham; and it is fair to hold, upon the strong and general terms used, that all rights, whether of his wife or others thus depending thereon, were to be protected by that covenant. Nor is there much force in the inference drawn from the technical import of the words "vest a right." Throughout the instrument technical terms are scarcely to be found at all. And in the immediately preceding covenant of Hamilton Graham, where the phrase, "vest a right," in its technical sense, would have been peculiarly appropriate (for, upon the contingency there contemplated, the right to the money would vest under the will of Mr. Graham), the technical phrase is not used, but instead thereof are found the inartificial expressions "whereby the same shall become due and payable." But whatever interpretation we might put upon these covenants, per se, without further explanation, we think a sufficient explanation for the purpose of the present inquiry is *Page 267 
afforded in a subsequent part of the instrument. It is declared that "these covenants shall be construed to operate for the benefit of Mrs. Daves and Mrs. Haywood, although they are severally the wives of J. P. Daves and William H. Haywood, unless they choose to execute a release in due form of law to discharge their right under this deed." Now, no right was or could have been derived to them under this deed but what passed thereby from Mrs. Graham; that is to say, a right to the money during her life. It is expressly provided that (324) the covenants shall operate for their benefit unless they release this right. The covenants, therefore, must be construed to operate for the protection of this right, and to stipulate against the only injury which this right could sustain, by providing that the money should be forthcoming to the wife if the husband should die before her, and during the continuance of this her temporary interest. In Benbury v. Benbury, ante, 235, the principle was clearly recognized that beneficial interests of this description, secured by the covenant of a testator or intestate, are in the administration of his assets to be regarded as of the same dignity with the claims of specialty creditors, and that where the executor or administrator is the person in whose name the legal right on the covenants must be asserted, it is his duty to retain assets for their satisfaction, as against creditors of equal dignity.
It is the opinion of the Court, therefore, and will be so declared, that the defendant do pay into this Court, the sum of $3,548.75, and that the same shall be secured under a scheme, to be approved of by the Court, according to the rights of the plaintiff Elizabeth therein, under the agreement aforesaid, of 16 February, 1838, and the rights of the infant plaintiffs, and of any others who may hereafter claim under the limitations in the will of the late Mr. Graham. And the cause is reserved for that purpose, and for further directions.
PER CURIAM.                                Decree accordingly.
(325)