Bunn v. Vaughan — 5 Abb. Pr. 269

Majority

p. 269

BUNN against VAUGHAN.

Court of Appeals,

January Term, 1867.

Headnote

Trusts.—Wnat Trusts vest in tiie Court on the Death oe Trustee.—Parties.—Admissibility oe Accounts.

A mortgage upon real property, executed to the mortgagee in trust to collect and apply the principal and interest, is a trust in personal property; and if the trust is-perfectly defined, so as not to rest in the discretion of the trustee, his executor may maintain an action for the foreclosure of the mortgage.

In such an action a pass-book kept by the deceased trustee, containing entries of payments of interest, may be admitted in evidence.

Appeal from a judgment.

This action was brought to foreclose a mortgage given by the defendant to one Oakley Bunn, the plaintiff’s testator, to secure the payment of $2000, with annual interest, during the natural life of one Lavinia Yaughan the wife of the defendant, for her separate maintenance. The cause came on for trial in October, 1864, before a referee, and judgment was rendered for the plaintiff.

From the facts disclosed at the trial, it appears that the defendant and his wife lived unhappily together for many years ; and, desiring to live apart, on the 6th day

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of December, 1851, entered into a tripartite jgreement with the said Bunn, as mutual trustee, whereby a separation was brought about, and provision made for the wife’s support.

By the terms of the agreement it was provided that the defendant should execute the above mentioned mortgage to the said Bunn, as trustee, conditioned for the payment of the annual interest of $2000; that the interest of such sum should be expended by the trustee in the support of the defendant’s wife ; and that, whenever in his judgment the interest should not prove sufficient for that purpose, such portion of the principal as might be deemed necessary should be collected by him and applied toward the wife’s maintenance. On default of payment for thirty days, the whole principal was to become due and payable. The annual interest was paid to December 6,. 1860. On the 6th of December, 1861, the interest became due, and $30 was paid thereon, leaving the sum of $110 due and unpaid. No further payment was made.

In July, 1862, Bunn, the trustee, died, leaving a will making the plaintiff sole executrix, legatee and devisee. The will was proved and letters granted to the plaintiff. In December following the death of the trustee, the plaintiff, as his executrix, commenced the foreclosure in question, claiming the right to execute the trust created by said agreement.

Upon the trial a pass-book, kept by the trustee, which contained the payments of interest received from the defendant, and the payments made to the defendant’s wife, was admitted in evidence under the objection of tile defendant (the latter having' previously introduced parol evidence of its contents) that the private memoranda of the plaintiff’s testator were not evidence against the defendant, and that such evidence was improper and immaterial.

The judgment of the referee was affirmed by the supreme court at general term; and the defendant appealed to the court of appeals.

p. 271

J. McGuire, for the defendant, appellant.

Dana, Beers & Howard, for the plaintiff, respondent.

—No discretionary power was conferred upon the plaintiff’s testator by the tripartite agreement or the mortgage executed to him therewith.

The amount which he was authorized to apply to the . support and maintenance of the cestui que trust was not left to his discretion, but was such only as should be actually necessary for that purpose.

The power- was thus perfectly defined, and could be duly executed, as well by another as by the trustee named in the instrument. The trust was in personal property, and, on the death of the trustee, devolved, with the property, upon his representative.

While it is conceded that this is the rule at common law, it is claimed that it is abrogated by our statute of uses and trusts, and that the trust, upon the death of the trustee, vests in the supreme court, and is to be executed under its direction, by some person appointed for that purpose. This would be so if the trust were in real estate ; but it is not, and the section of the statute of uses and trusts which-vests the trust in the supreme court upon the death of the trustee, does not apply to trusts in personal property. This is clearly shown in the opinion of Mr. Justice Cowen, in Kane v. Gott ( 24 Wend., 641 ), by an examination of the statute so thorough, and arguments so convincing, as to preclude further profitable discussion of the subject; and the point in this case may properly be answered in the very words of Judge Com-stock in delivering the opinion of this court in Savage v. Burnham ( 17 N. Y, 561 ): “This is a trust in personal property with which the statute of ‘ uses and trusts’ in ■lands has nothing to do.

At the trial several exceptions were taken to the rulings of the referee as to the admissibility of evidence; but the only one referred to by the appellant, in the points submitted on this appeal, is to the admission of a

p. 272

written memorandum or account kept by the trustee, showing payments made to him by the defendant. The defendant had subpoenaed the plaintiff to produce this, and before its production had given parol evidence of its contents. It 'contained no charge against the defendant, but was an admission of payments made by him.

Under these circumstances it was properly admissible in evidence, and, if its admission by the referee had been error, the defendant could not have been prejudiced by it, as the evidence was in his favor, and did not prevent his proving payments larger than, or' additional to, those mentioned in the memorandum.

The judgment should be affirmed.

All the judges concurred except Bockes, J., who expressed no opinion.

Judgment affirmed.