In re Merritt

By deed dated the 24th day of March, 1915, Marietta Fleming conveyed all her property, real and personal, to the petitioner, William C. Merritt, upon the following trust and powers in trust:

“First. To apply the net rents, issues, income and profits of all the said property to the use of the said party of the first part for and during her life, but free from the control of any husband, her separate receipt therefor to be a full discharge to the said trustee on account of the same.

“Second. Upon the death pf the said party of the first part, upon further trust to convey, transfer and pay over all and singular the property then held in trust, both real and personal, to such persons or person and in such manner and way and upon such trusts and limitations as the said party of the first part shall by her last will and testament, or by any instrument in the nature of a last will and testament, duly made and executed by her in the manner in which wills of real estate are or may be required to be executed, direct and appoint.

“Third. But if the said party of the first part shall die without leaving any last will or|d testament or any such instrument in the nature thereof as aforesaid, or without exercising her said power or privilege of appointment and direction, then and in that case upon further trust to convey, transfer, and pay over all and singular the property, both real and personal, then held in trust as aforesaid to such person or persons as by the laws of the state of New York then in force relating to the descent and distribution of the real and personal estate of intestate decedents would be entitled to receive the said property if this instrument had not been executed and the said party of the first part had died seized and possessed of and being the lawful owner of the said property so invested.”

The trustee accepted and entered upon the execution of his duties as such trustee. Now, owing to some disagreement with the creator of the trust, the trustee desires to account, to be permitted to resign* and that a successor, as trustee, be appointed, to whom he may turn over such-funds as are in his hands and convey the real estate. The creator of the trust malees no objection to the account, but says there

These cases differ in two important particulars from the case at liar. In both of those cases the trustee’s duties ceased with the death of the beneficiary, and the trustee in one case was then required to pay to appointees under a will, if any, and in the other to pay to the executor or administrator of the creator of the trust. It was held in those cases that by reason of the wording of the trust there was no person in being who, upon the death of the creator, would take any interest in the trust estate by virtue of the trust deed. Such is not the case here. Under the trust in this case, if the creator makes no appointment by will, then the property is distributed by the trustee among the heirs at law and next of kin of the deceased, who do- not take title as such, but as purchasers under the deed of trust. In both of the cases cited the case of Genet v. Hunt, 113 N. Y. 158 , 21 N. E. 91 , is distinguished. The trust in the Genet Case is similar to the trust in this case. It was held in that case that the creator had created rights which she was powerless to destroy. This trust embraces real as well as personal property. The statute and cases cited in support of the claim that this trust has been revoked relate to personal property only.

Whittemore v. Equitable Trust Co., 162 App. Div. 607 , 147 N. Y. Supp. 1058 , is still a stronger case in favor of the right to revoke, as the trust in that case more closely resembles the trust involved here. That case, however, related only to personal property. The statute makes every conveyance or other act of a trustee in contravention of the trust absolutely void. Real Property Law, § 105. The trust deed provides only for a power of appointment by will. What was said in Genet v. Hunt, 113 N. Y. 158 , 170, 21 N. E. 91 , 93, is in point here:

“It is a doctrine of the common law that an unrestricted power to appoint a fee in lands by deed or will is equivalent to ownership, because the donee of the power may at any time, by exercising the power, acquire an absolute estate, and for this reason the question of perpetuity arising upon limitations made by the donee of such a power is determined with reference to the date of the execution of the power and not of the instrument creating it. 1 Sugden, Powers, 469 et seq. But the general rule is expressed by Chancellor Kent in Ms Commentaries (volume 4, p. 337): ‘An estate created by the execution oí a power takes effect in the same manner as if it had been created by the deed which raised the power.’ The power of disposition reserved by Mrs. Riggs in the trust deed was not an absolute power equivalent to absolute ownership. It was restricted to a disposition by will. The statute of powers (section 85) defines an absolute power to be one by which the grantee is enabled in his lifetime to dispose of the entire fee for his own benefit. The power in this case, under the definition in our statute, was general, but not absolute. Cutting v. Cutting, 86 N. Y. 535 .”

Motion granted.