Court Opinion

ID: 3614208
Source: CourtListenerOpinion
Date Created: 2016-07-05 23:57:42.851247+00
Date Added: 2024-06-11T14:24:29.289499
License: Public Domain

David Dows, Sr., died in the year 1890, leaving a last will and testament, which has been duly proved and admitted to probate by the surrogate of the county of New York. Under the provisions of the will, after making certain specific bequests, he gives and devises all the rest, residue and remainder of his estate to his executors in trust, authorizing them to sell, convey and invest, to collect and reinvest such estate and to receive the rents, income and profits therefrom. He then divides the trust estate into eight separate individual trusts, and from such rents, profits and income he directs his trustees to pay over to his daughter, Linda Dows, afterwards Linda Dows Cooksey, the income from one-eighth part of such trust estate during her life, and then after her decease he provides that all of such remainder shall vest in the children of such Mary Dows Cooksey or the issue of such children as she by her "last will and testament shall designate and appoint and in such manner and upon such terms as he or she may legally impose; but in case such person dies intestate then said one-eighth part of my said residuary estate which had been held in trust as aforesaid for and during the lifetime of such person shall thereupon vest absolutely and at once in his or her children him or her surviving, share and share alike, and the issue of his or her deceased children (such issue to take, share and share alike, the portion which would have been received by their parent by the terms hereof if living), to be paid to them in the proportions following, to wit, as each attains the age of twenty-one years there shall be paid to him or her a sum not to exceed fifty thousand dollars; as each attains the age of twenty-five years a further sum not to exceed one hundred thousand dollars; as each attains the age of thirty years the remainder, if any, of the share of said one-eighth part of my residuary estate with all accumulations of interest, income and profits to which he or she may be entitled, excepting, however, that said children and said issue of deceased children shall each of them receive from his or her respective share of said one-eighth part of my said residuary estate which is *Page 96 
herein provided shall vest in said child or said issue of a deceased child the entire income from and after he or she shall have attained the age of twenty-one years and during the minority such sum or sums not to exceed five thousand dollars in any one year, as in the judgment and discretion of his or her guardian may seem right and proper for the maintenance, education and support of such child or said issue of a deceased child."
Linda Dows Cooksey died in the city of New York on the 7th day of March, 1903, leaving a last will and testament which has been duly proved and admitted to probate, in which she exercised the power of appointment provided for by the will of her father, by giving and devising the one-eighth share of the residuary estate of her father held in trust for her benefit during life to her then living children and the issue of any such child as should be deceased, share and share alike, the issue of a deceased child to take their parents' portion, substantially following the provision made in the will of her father for the vesting of such estate in her children in case she should die intestate and without exercising the power of appointment; but as to the time payments should be made to them she provides that upon each child attaining the age of twenty-one years there shall be paid to him or her the sum of fifty thousand dollars, and upon arriving at the age of twenty-five years the further sum of one hundred thousand dollars, and upon attaining the age of thirty years the remainder, if any; thus depriving the trustees of the right to exercise any discretionary power as to the amount of such payments; and by another provision relating to the determination of the amount that shall be used for the support and maintenance of her children during their minority she gives the same to the trustees under her will instead of to the guardian of the children, who was the person authorized to exercise such discretion under the will of her father.
Under the Real Property Law a power "is an authority to do an act in relation to real property, or to the creation or *Page 97 
revocation of an estate therein, or a charge thereon, which the owner, granting or reserving the power, might himself lawfully perform." (Laws of 1896, ch. 547, § 111.) This provision applies also to powers concerning personal property. (Matter ofMoehring, 154 N.Y. 423.) Under the will of David Dows, Sr., the power of appointment given to his daughter, Mrs. Cooksey, was limited to her children and the issue of any of her deceased children, so that it became a special power in trust under section 115 of the Real Property Law.
Section 220, subdivision 5, of the Tax Law (Ch. 908 of the Laws of 1896, as amended by ch. 284 of the Laws of 1897) provides as follows: "Whenever any person or corporation shall exercise a power of appointment derived from any disposition of property made either before or after the passage of this act, such appointment when made shall be deemed a transfer taxable under the provisions of this act in the same manner as though the property to which such appointment relates belonged absolutely to the donee of such power and had been bequeathed or devised by such donee by will."
So that, under the provisions of this statute, when Mrs. Cooksey exercised the power of appointment under the will of her father we must, for the purposes of the transfer tax, deem the property transferred under the power, to which the appointment relates, as having belonged absolutely to her and bequeathed or devised by her under her will. Under the will of David Dows, Sr., the residuary estate, as we have seen, was vested in his executors, as trustees, and so remained vested until the death of the life tenant, at which time he provided that the same should at once vest absolutely in such of the children or the issue of such children of the life tenant as he or she, by his or her last will and testament, should designate and appoint. It was only in case of the failure of a life tenant to appoint, by dying intestate, that he vested the remainder in the children of such life tenant. The specifically vesting of the estate in the *Page 98 
executors during the continuance of the trust, and then upon the death of the life tenant vesting it in such children as the life tenant appoints, and then in the absence of the exercise of the power of appointment the vesting of the estate in the children surviving we think indicates a purpose on the part of the testator to include all of such children, whether in being at the time of his death or after born. Under the provisions of this will the children can become vested with the remainder only in case of the death of Mrs. Cooksey intestate, without exercising the power of appointment. In other words, if she did exercise the power of appointment in her last will and testament they must take under the provisions of that will and cannot take under the will of their grandfather, and in proving their title to such estate they would have to produce and put in evidence the will of their mother showing the exercise by her of the power.
Again, as we have seen, under the will of Mrs. Cooksey, in exercising the power of appointment she made material changes with reference to paying over the remainder to her children from that incorporated in the will of her father. While each of her children may ultimately receive the same amount, yet she, by her will, fixes definitely the amounts that shall be paid to each of her children upon their arriving at the ages of twenty-one and twenty-five years, leaving no discretion in the trustees as to the amounts that shall be paid over to them, and then vests in the trustees the discretionary power to determine how much shall be used for the support and education of the children during their minority. It appears to us, therefore, that there was a necessity for exercising the power, that it cannot be treated as a nullity, and that, therefore, the transfer tax under the statute was properly assessed.
In Matter of Dows (167 N.Y. 227) we had under consideration the same provisions of the will of David Dows, Sr., that we have in this case. In that case David Dows, Jr., had died leaving a last will and testament, by which he had exercised a power of appointment given him by the will of *Page 99 
his father, in favor of his three sons. To each of his sons he gave the income of three undivided forty-eighths until his son Robert attained the age of twenty-one years or sooner died; of four forty-eights until Robert attained twenty-five years or sooner died, and nine forty-eights until Robert attained the age of thirty years or sooner died; thus each son was given the income of sixteen forty-eighths or one-third of the property. Upon Robert arriving at the age of thirty years or in case of his sooner death, the life estates terminated and the principal was given to the sons in such manner that each received one-third of the property absolutely. In that case the power of appointment differed from that of the provision made by the will of David Dows, Sr., as to the manner of payment only; each of the grandchildren received an equal amount and yet we held that the power was properly exercised and that the transfer tax was correctly assessed.
The order should be affirmed, with costs.
CULLEN, Ch. J., O'BRIEN, BARTLETT, VANN and WERNER, JJ., concur; GRAY, J., absent.
Order affirmed.