Arnold v. Gilbert

W. died before the testator, leaving his widow and children as stated in the bill.

After the demurrers were overruled, no further pleadings were interposed by the defendants. The complainants did not attempt to sustain their allegations against the due execution of the will.

The cause came on to be heard on the bill, the answers, the replications thereto, and certain formal proofs; the great controversy being upon the validity of the trusts of the will.

E. Sandford and S. Stevens, for the complainants, argued upon the following points.

First. The will of the testator devises his real estate to the trustees named therein, upon specific trusts attached to such estate in their hands. Beyond the trusts to sell for the payment of the debts of the testator, the trusts created by the will are invalid.

I. Because the trust estate is not created for any of the legal purposes of an express trust as authorized by law.

1. The trusts to receive and pay over the rents and profits of real estate, to the persons beneficially interested therein, are void. (Coster v. Lorillard, 14 Wend. 265; Opinion of Chief J. Savage, p. 322, 328; of Senator Maison, p. 352; of Senator Young, p. 378; Hawley v. James, 16 Wend. 61; Opinion of Bronson, J. p. 156, 161; 1 Rev. Stat. 722, 2d ed. § 55; p. 721, § 45.)

2. The trusts to make partition of the estate, and to sell the lands and convert them into money, for the purpose of making division among the parties entitled to the fund, is not authorized by law.

3. The authority to lease lots for a term of years, and to sell, purchase or exchange slips or gores or other pieces of ground, to enable his executors to manage and benefit the estate given in the 21st and 23d clauses of the will, are not trusts authorized by law, and cannot sustain the trust estate.

2d. The doctrine of equitable conversion is not applicable to the real estate devised by this will, and cannot be invoked to

Arnold v. Gilbert.

sustain its trusts and provisions, which are otherwise illegal and void.

Where there is a valid devise of real estate, and a peremptory direction to sell it, a court of equity may deem a sale as having actually taken place, for any legal object, in administering the estate, or executing the will; but it would sanction complete frauds upon and evasions of the statute of uses and trusts, to indulge this fictitious assumption for the express purpose of sustaining a devise, which in other respects is against public policy and prohibited by statute.

SECOND. The trust estate created by the will is void, because it suspends the power of alienation for a longer period than is allowed by law; or if the doctrine of equitable conversion be applied, and the estate held in trust, under the will be regarded as personal property, because the trust suspends the absolute ownership of personal property for a longer period, than during the continuance, and until the termination of two lives in being at the death of the testator.

1. In either view of this point, the interest of the respective cestuis que trust, under this will, are inalienable during their several lives. (Gott v. Cook, 7 Paige, 521, 536, 538; De Peyster v. Clendining, 8 Paige, 309; Clute v. Bool, 8 Paige, 85.)

2. The will does not contemplate a sale or disposition of the whole of the real estate, until after the decease of the widow and Ephraim. Four-sevenths of the property devised to Warren Gilbert, George W. Gilbert, Mrs. Fish, and Mrs. Hunt, do not then vest absolutely, but the trust is continued for their several lives with remainders over.

3. The trust is continued, and no final distribution can be made of the estate, until after the determination of six lives in being at the death of the testator; viz, the widow, Ephraim, Mr. Hunt, Mrs. Fish, Warren and George; supposing George and Warren to die without children.

4. If George and Warren die leaving children, the trust appears to be designed to continue as to their portions during the lives of all their children, as in that event interest is directed to be paid to them.

(Under this point, the counsel also cited, 2 Prest. on Abstr. 158,

Arnold v. Gilbert.

159; 2 Crompt. & Jer. 334; Ware v. Polhill, 11 Ves. 257, 283; 2 Sugd. on Powers, 492, 496; Leigh & Dalz. on Eq. Conv. 48, 49, 54; 2 P. Will. 308; 5 Madd. 25; Kane v. Gott, 24 Wend. 641; Van Veghten v. Van Vechten, 8 Paige, 128.)

The trusts created by the will, should be adjudged to be void, and the decree should declare that the real estate of the testator descended to his heirs at law, free and discharged from all conditions, devises, authority and control of the trustees. The decree should direct an account to be taken, as prayed by the bill.

E. H. Owen, for the assignees of Garret Gilbert, supported the propositions contained in the points next stated.

C. O'Conor and George Wood, for the other defendants; argued in support of the following points.

I. The decisions made upon the demurrer in this cause, do not authoritatively determine that any part of the will of William W. Gilbert was void.

1. The only operative part of Vice-Chancellor Hoffman's decretal order, is the disallowance of the demurrer. It was so held in both the appellate courts.

2. The disallowance of the demurrer was founded, (among others,) upon the ground assumed to be sufficient of itself, that for aught that appeared, there might be an intestacy as to part of the property, by reason of George and Warren Gilbert, or the last survivor of them, dying without children.

3. The demurrer was not well taken, because it was merely a demurrer to an argument advanced in the bill, and not to the whole case stated in the bill, or any substantive part thereof.

II. If this is not so, still the order overruling the demurrer will be sufficiently respected, if this court, in its final decree, declare an intestacy as to any part of the estate however small. The opinion pronounced by Vice-Chancellor Hoffman that an intestacy existed as to a certain proportion, is not binding on the court. (Methodist Episcopal Church v. Jacques, 17 Johns. 559.)

III. There is an equitable conversion of the whole estate; and

Arnold v. Gilbert.

the validity of the several limitations contained in the will, must consequently be tested by the rules relating to the creation of estates or interests in personal property. (Wright v. Methodist Church, 1 Hoff. R. 202; Kane v. Gott, 24 Wend. 641; Bulkley v. De Peyster, 26 Wend. 21; Bunce v. Vandergraft, 8 Paige, 37; Laus v. Bennett, 1 Coxe's Cases, 167.)

IV. Trusts of personal estate, do not like trusts of real estate under the third subdivision of the 55th sec. (Vol. 1, p. 728 of Revised Statutes,) suspend the power of alienation, because,

1. Such trusts are alienable at common law, and are not rendered inalienable by these statutes.

2. The statutory provision is confined in express terms to real

estate.

3. Statutory regulations confined expressly to real estate, should not be extended by a forced analogy to personal estate, which is altogether different in its character, properties and uses.

4. The legislature for wise reasons, refrained from fettering with inalienability, trusts of personal estate. (Kane v. Gott, 24 Wend. 661, 6.)

V. The rents and profits to be received by the trustees are limited to them in a lawful way, and ought to be sustained, because,

1. They should be deemed personal estate, because merely incidental to the conversion of the real estate into personalty, and going along with it into the same common fund.

2. Supposing they are to be deemed real estate in equity, still they are merely incidental to the express trust to sell, and are not limited under the third, but under the second subdivision of the 55th section.

3. The trustees under the third subdivision, do apply the rents and profits to the use of the cestui que trust, by appropriating a portion of them to the purposes of the estate, and paying over the balance to the cestui que trusts.

4. That was the common law mode of applying profits to the use of the party entitled to the equitable beneficial interest; and the statutes should be construed as nearly as may be, to the rule and reason of the common law.

5. If applying to the use of the cestui que trust should be

Arnold v. Gilbert.

construed to mean the management and application of the funds when converted into personalty, to the support and to the domestic comfort and enjoyment of the cestui que trusts; that would be an exercise of guardianship, and not a trust.

6. The design of the act was not to create a guardianship over the person and personal estates arising from rents and profits, but to establish an exclusively active trust, as understood. in equity law. (Gott v. Cook, 7 Paige, 521, 536.)

VI. All the estates and interests given by the will are alienable, except the contingent remainders expectant upon the termination of the lives of George W. Gilbert and Warren Gilbert.

VII. The share given to Catharine Hunt, out of the third allotted to the widow, with all its ulterior subdivision and limitations, is lawful and ought to be sustained, because,

1. As a trust of personal estate, for the reasons above given, it is not inalienable.

2. As to the shares therein of Warren and George, their alienability is not suspended during the lives of the widow and of Catharine Hunt.

3. The respective life estates of Warren and George, (if allowable,) do not suspend alienation, inasmuch as they are alienable, being personal estate.

4. The remainder to the respective children of Warren and George, suspends alienation during one life only, viz. the life of Warren and of George, respectively, upon the termination of which the children to take their shares respectively, will be ascertained, and in a condition to alienate.

VIII. The absolute ownership or absolute power of alienation, is consequently not suspended as to any part of the estate, for a longer period than during the continuance of the two specified lives of George W. and Warren Gilbert; and at their termination, such suspense must inevitably cease.

IX. If the 17th section of the title concerning estates in land, has no application to a case where the ultimate remainder may still be contingent at the expiration of the second successive life estate, then there is no objection to any number of successive life estates, provided the ultimate remainder be so limited that it