Court Opinion

ID: 5457879
Source: CourtListenerOpinion
Date Created: 2022-01-09 19:26:09.0129+00
Date Added: 2024-06-11T08:32:44.750772
License: Public Domain

By the Court, Paige, P. J.
The assignment of the bonds and mortgages against E. Hills and H. and S. Waller, by Daniel Stevenson to John McDougall, the father of the plaintiffs Mrs. Gilchrist, Mrs. Hall, and Daniel and William McDougall, and the execution of the instrument in writing executed by John McDougall and his three adult children, and the delivery of the bonds and mortgages to the defendant, under an agreement that they should be so delivered, and that he should collect the moneys due thereon and pay over the same to the persons declared by such instrument to be interested therein, constituted a valid and perfect gift of the bonds and mortgages to the children of John McDougall. / Delivery is essential, both at law and in equity, to the validity of a gift of personal property. The delivery may be directly to the donee, or to a third person for him, or for his benefit. The delivery must be absolute and unconditional. When the gift is perfect it is irrevocable. (2 Kent’s Com. 438, 440. 4 Id. 455. Mickles v. Colvin, 4 Barb. Sup. C. Rep. 304.) To make a perfect delivery, the donor must part not only with the possession but also with the dominion of the property. (2 Kent’s Com. 439.) In the assignments in this case by Daniel Stevenson, of the bonds and mortgages in question to John McDougall, it is stated that they are made in accordance with a certain contract. The contract referred to must have been the one of the date of Oct. 22, 1839; for that was the only contract ever made by the parties in relation to the bonds and mortgages. In one of the assignments it is expressed to be for the benefit of children; meaning undoubtedly the children of John McDougall. The contract of the date of Oct. 22, 1839, was drawn up by the donor Daniel Stevenson, and it expressly declares that the moneys due on the bonds and mortgages are to be divided among the children of John McDougall. And the adult children, and John McDougall in behalf of the minor children, in consideration of the gift *14of the said bonds and mortgages, agree to pay eertain annuities to the North Argyle church. By this contract it is also agreed that the bonds and mortgages shall be left with the defendant, and that he shall collect the moneys due thereon, and pay over the same to the persons entitled thereto. The defendant accepted the trust thus confided to him, and by an instrument in writing signed by himself, he acknowledged the receipt of the mortgages, for the benefit of the children of John McDougall and the North Argyle church, and agreed when the moneys were collected to pay over the same, in accordance with the agreement aforesaid executed by John McDougall and three of his children. The bonds and mortgages, hi pursuance of these agreements, were delivered to and accepted by the defendant. By the assignments to John McDougall,.and by these agreements, j and the delivery of the bonds and mortgages to the defendant, j Daniel Stevenson parted not only with the .possession of, but also with all dominion over the bonds and mortgages; and they became the property of the children of John McDougall, and the defendant became their trustee to collect the moneys due on the ■ mortgages, and to pay the same over to them- and to the North ■. Argyle church. The agreement of the date of the 21st of Oct. ■ 1839, signed by the defendant, created the relation of trustee ( and cestuis que trust between him and the children of John McDougall. Lord Chancellor Thurlow says that it is a maxim which he takes to be universal, “ that wherever persons agree concerning any particular subject, that, in a court of equity, as against the party himself, and any claiming under him voluntarily or with notice, raises a trust.” (Legard v. Hodges, 1 Ves.jun. 477.)
The payment to the North Argyle church was not made a condition precedent to the gift to the children of John McDougall. That payment rested in covenant only. The gift was complete and perfect, and the remedy of the church to enforce payment of the annuities due to it, was by an action on the covenant, or by a suit to compel specific performance of the agreement to give the church further security for the payment of the annuities. No other trust or conditions are shown, except those *15contained in the two agreements of the dates of the 21st and 22d Oct. 1839. The allegations in the answer of the defendant, in relation to other conditions, were neither established by proof nor admitted by the plaintiffs’ reply. The denial in the reply, of any knowledge or information thereof, sufficient to form a belief, put such allegations in issue, and cast on the defendant the burden of establishing them by evidence. That such a denial creates an issue of fact has been decided by this court during the present term. The defendant being a trustee of the children of John McDougall, could not discharge himself of the trust, except by an order of the supreme court, or with the consent of all the cestuis que trust. (11 Paige, 314. 4 John. Ch. Rep. 137. 1 Id. 339.)
The re-assignment of the mortgages by John McDougall to Daniel Stevenson, and the delivery of them to the latter by the defendant, were breaches of trust both in the defendant and in John McDougall. Daniel Stevenson had no right to demand a re-assignment. He had parted with his whole title to, and all dominion over the mortgages. He had made an absolute gift uof them to the children of John McDougall; and the gift was irrevocable. The defendant had full notice of the interest of the children of John McDougall in the mortgages. He was a witness to the agreement which declared the nature and extent of that interest, and he had agreed to receive such mortgages as agent and trustee, and to collect the moneys due thereon, and pay the same over to such children and to the North Argyle church. After full knowledge that the children of John Mc-Dougall were the equitable owners of the mortgages he delivered them up to Daniel Stevenson. This was a breach of trust in the defendant. Daniel Stevenson taking a re-assignment of the mortgages, and accepting a re-delivery of them with full knowledge of the equitable title thereto of the children of John Mc-Dougall, also became a trustee, subject to the same obligations as were John McDougall and the defendant. And he was obligated to pay over to such children their full share of the moneys received by him on such mortgages. (2 Story's Eq. Juris, sec. 1257. Murray v. Ballou, 1 John. Ch. Rep. 565. Id. 339. *164 Id. 137.) But the plaintiffs are not compelled to resort to the estate of Daniel Stevenson for satisfaction. They may proceed against the defendant personally, and hold him responsible for the whole amount due on the two mortgages when he received them. He, by his breach of his trust, has made himself personally liable to the plaintiffs.
The plaintiffs can proceed against him alone, without uniting with him as a defendant John McDougall. Where there are several trustees who unite in a breach of trust, they are equally liable to the cestuis que trust. And the latter, in seeking relief against the breach of trust, may proceed against all or either of the trustees. (Bailey v. Inglee, 2 Paige, 279. 4 Id. 23. Wilson v. Moore, 1 Mylne Keen, 126. 3 Swans. 74.) The bonds and mortgages in question did not pass under the will of Daniel Stevenson. He had no interest in them, to bequeath. And the defendant, as his residuary legatee and executor, can claim no title to them. Trust property, although it has been sold or assigned by the trustee, so long as it can be traced and distinguished from other property, may be claimed by the cestuis que trust, whenever the purchaser purchases with notice of the trust. (1 John. Ch. Rep. 118. Kip v. Bank of N. York. 10 John. 63. 1 John. Ch. Rep. 63. 4 Id. 137.)
The plaintiffs are not estopped from claiming their shares of the bonds and mortgages by accepting the legacies given to them in the will of Daniel Stevenson. Daniel Stevenson did not stand in loco parentis to the children of John McDougall; and the doctrine of satisfaction or ademption has therefore no application in this suit. It is only where a parent, or other person in loco parentis, bequeaths a legacy to a child or grandchild, and after, in his lifetime, gives a portion to or makes a provision for the same child or grandchild, that under certain circumstances such portion or provision will be deemed a satisfaction, or an ademption, of the legacy. (2 Story’s Eq. Juris. §§1111, 1116, 1117, 1118.)
The defendants must account to the plaintiffs for their shares of all the moneys paid on the bonds and mortgages since the 22d of Oct. 1839, the date of the agreement executed by John *17McDougall and three of his children, with interest from the time of such payments. And the plaintiffs are entitled to a judgment directing the defendants to collect the sums remaining unpaid on such bonds and mortgages, and to account for and pay over to the plaintiffs respectively their proportion thereof. The judgment of nonsuit must be set aside and a new trial «ordered.