Court Opinion

ID: 5548344
Source: CourtListenerOpinion
Date Created: 2022-01-10 21:23:12.503812+00
Date Added: 2024-06-11T08:34:59.205516
License: Public Domain

The Chancellor.
Had it not been for the recent decision of the court for the correction of errors, I should have had no doubt that the order or direction of Mrs. Ross to her trustee to pay the amount of the bond when it should become due, out of her separate estate in the hands of her trustee, and his written acknowledgment of the receipt of the order, was sufficient to create an equitable appropriation of a part of that fund to the payment of that debt; so as to give the trustee of the infants a right to be heard on the appointment of a new trustee, in order that a responsible person might be appointed in whose hands the trust fund would be safe, so far as they were interested therein. But in the case of Rogers v, Hosack and others, the court of dernier resort decided, at the last December term, that an express covenant to pay a debt out of a particular fund belonging to the covenantor did not give to the persons to whom that covenant was given any legal or equitable right to a preference in payment out of that specific fund. And if such a covenant, founded upon a new and valuable consideration, would not create an equitable preference, a mere order of the wife upon the trustee of her separate estate to pay a debt out of the same, and without any new consideration, would not create a specific lien upon the trust estate; although the order was duly intimated to the trustee. I am therefore bound to declare, contrary to my opinion when the application was made to me in the summer of 1832 to appoint a new trustee, that W. James as trustee of the infant defendants had no interest in the appointment of such new trustee under the marriage settlement of Mrs. Ross, and had no right to be heard on such an application. She may therefore apply to modify the order of July, 1832, if she shall think proper to do so, and to make absolute the appointment of her brother William Lush, as trustee in the place of Treat.
Even if the vice chancellor was right in that part of the decree which declares that it was the duty of W. James, as the trustee for the children, to procure the appointment of a new trustee under the marriage settlement to protect their interests in that fund, he was wrong in supposing that *107the duties of his trust devolved upon the complainants as his personal representatives at his death. That probably might have been the case at common law; as the right to bring a suit upon the bond given to him as trustee was vested in the complainants as executors, and they held the bond as trustees for the children. The testator died, however, after the law in this respect had been changed by the revised statutes. The 68th section of the article of the revised statutes relative to uses and trusts, (1 R. S. 68,) provides that upon the death of the surviving trustee of an express trust, the trust estate shall not descend to his heirs or pass to his personal representatives; but the trust, if then unexecuted, shall vest in the court of chancery with all the powers and duties of the original trustee, and shall be executed by some person appointed for that purpose under the direction of the court. If there was any doubt from this section, taken only in the connection in which it stands, that it was intended to apply to trusts of personal as well as of real estate, it is made applicable to the present case by the second section of the title relative to accumulations of personal estate, &c. (1 R. S. 773.) The money secured by the trust bond being payable at a future day, is a future interest or estate in that money according to the definition of a future estate as given in the statute. (1 R. S. 723, § 10.) The condition of this bond therefore, contains a limitation of a future estate, which is to a certain extent a contingent interest in personal property; and the persons upon whom the legal interest or trust is to devolve, upon the death of the trustee, must be controlled by the provisions of the 68th section above referred to. The trust which W. James held by virtue of this bond, at the time of his death, devolved upon this court and not upon his executors. The bond should therefore be delivered to the register, or to the general guardian of the infants for their use ; so that he may get a new trustee appointed to receive the first payment, which will become due when Elizabeth James would have been 21 if she had lived.
*108For these reasons, the decree of the vice chancellor must be reversed, with costs both in this court and in the court below, to be paid by the complainants out of the estate of the testator in their hands to be administered.