Court Opinion

ID: 5559136
Source: CourtListenerOpinion
Date Created: 2022-01-11 00:46:55.887403+00
Date Added: 2024-06-11T08:35:25.158265
License: Public Domain

Bleckley, Justice.
1. We are in equity, th% fomm chosen by the beneficiaries of the trust. They unite in praying for a common relief. They seek to shake off the mortgage debt from the trust property. They make no tender, but stand on the supposed legal incapacity of the trustee to incumber the trust estate by mortgage, especially as the money borrowed went to the use, not of that estate generally, but of three of the nine beneficiaries. We need not rule that the power to sell and convey, contained in the deed of 1850, included, by implication, a power to mortgage. There is broader and better ground in the facts of the case, upon which to rest our decision. Three of the beneficiaries of the trust got the money, through the trustee, by means of the mortgage. There were eighty-two town lots embraced in the deed of *6241850, and but two of these were put in the mortgage. There is no evidence in the record as to the relative value of these two as compared with the other eighty. Assume them to be average lots, and they would constitute less than one-fortieth part of the trust estate covered by this one deed. The three sons who received and used the money were one-third of the whole number of beneficiaries in being when the bill was filed, and it does not appear that any have been born since. These three were of full age when the money was borrowed, and were therefore competent to consent to the mortgage, so far as their interest in the trust property was concerned. The deed gave the trastee power to sell and convey the whole or any part of the property, whenever it might appear to him to be for the benefit of his wife and children, and so to apply the proceeds of the sale as deemed by him most conducive to their interest. Instead of pursuing the exact terms of the power contained in the deed, the trustee raised money by note and mortgage, and suffered this money to be taken and appropriated by three of the beneficiaries of the trust, who used it partly for their own separate benefit, and partly in an unsuccessful effort to produce a profit for the trust by operating a sawmill belonging to the trust estate. In the absence of evidence to the contrary, it ought to be presumed that the amount was not in excess of their due share of the trust estate, and that the two town lots were not more in value than their equitable share of the property embraced in the deed of 1850. As the trustee, instead of keeping the money and using or investing it, permitted these beneficiaries to take it, he probably deemed this a proper application of it under the trust deed. And that it was an improper application does not appear. The best interest, on the whole, of a man’s wife and children may possibly be subserved by permitting his sons, after they arrive at majority, to receive and manage their proportion of the property which he holds for the family in trust. Certainly, the sons, themselves, who got the money and spent it, could not complain; and *625in order for their co-beneficiaries to complain with effect, there should be affirmative evidence that they were injured. In this instance, all the co-beneficiaries who were parties to the bill have had an opportunity to show injury, and have failed to do it. Eor aught that appears, the three sons may, on an equal division, be entitled to much more of the trust property than the lots in question, or the money which was raised on the mortgage. There is no hint that they are entitled to less. It may be that more beneficiaries have been born since the filing of the bill, or may hereafter be born ; if so, they should not and will not be' bound by the decree, as to the two lots; for the like opportunity of showing injury, as the others have enjoyed, will be due to them, and can be accorded in the future. All the complainants in the bill, having had their day in court, can be and are to be bound absolutely.
2, 3. The deed of 1852, contained an express power to mortgage. The Code did not cut away the power by section 2335, for the simple reason that the power was older than the Code, and the latter was not intended to have any retroactive effect. Possibly other reasons might be adduced, but as they are not needed, they need not be sought for.
4. The borrowed money went to three of the beneficiaries of the trust, with the trustee’s consent. Notice of the trust did not cast upon the lender and mortgagee the duty of seeing to a more strict application of the money to the purposes of the trust. The apparent magnitude of the trust estate, and the fact that the three beneficiaries were of full age, have already been noticed. On an enlarged view of the objects of the trust, it could be held nakedly that the application of the money was within the objects ; but even if it was somewhat aside from them, the money appeared to be going in the right direction when it reached the hands of the adult sons of the trustee, who were working or about to work a saw-mill belonging to the trust estate, and who wanted the money for use in that connection, the trustee not objecting. The jury were warranted in inferring from *626the evidence that the mortgagee was without notice of any intention to divert the money from the objects embraced within the scope of the trust, even on a strict and narrow view of such objects.
5. As we understand the record, the evidence of the two defendants in the bill, which the complainants wanted to dispose of on the principle of setting off one defendant’s evidence against that of the other, was contained in their respective answers responsive to the charges of the bill. The mortgagee had answered favorably to herself, and the trustee had answered favorably to his wife, sons and daughters. The complainants wanted a charge from the bench which would force the jury to give the trustee as much credit as the mortgagee. It is even doubtful whether the trustee’s answer was evidence at all against the mortgagee, as to relief which would affect her without affecting him. The trustee had no direct interest in favor of upholding the mortgage, and it is plain that he had no inclination to uphold it. lie was a defendant in sympathy with the complainants — a Greek in the Trojan camp. But concede that his answer was evidence where it conflicted with hers, why should the jury be bound to treat both as eqnally credible ? There is neither rule nor reason that so requires.
6. We have disposed of all questions of any moment which the case presents. Without going in detail into the more minute points, we may hold, in general terms, that the court committed on the trial no error against the complainants. The jury found correctly, and the order for a new trial on terms was erroneous.
Judgment reversed.