Hyperlawhypertext legal database Carter v. Board of Education of Presbyterian Church of United States 23 N.Y.S. 95

← Cases

Carter v. Board of Education of Presbyterian Church of United States

23 N.Y.S. 95 Court N.Y. Gen. Term Decision date 1893-04-14 English

Decision Majority — O’BRIEhT, J. · Concurring — VAN BBTJNT, P. J.

Contents

Majority

p. 95
CARTER v. BOARD OF EDUCATION OF PRESBYTERIAN CHURCH OF UNITED STATES et al.
(Supreme Court, General Term, First Department.
April 14, 1893.)

Headnote

1. Executors—Payment of Void Legacy—Recovery.
The rule that an executor who pays any legacy must bear the loss when it subsequently appeal's "that the assets are not sufficient to justify payment, and that he cannot compel the legatee to refund, does not apply
p. 96
to payment of legacies which are subsequently declared void by the courts, and in such a case the legatees will tie compelled to refund, and they will not be relieved from this duty by the fact that the executor would be protected from personal liability for such payment.
3. Charities—Time oe Making Bequest to.'
Act Pa. April 26, 1855, § 11, (2 Brightly’s Dig. p. 1712, § 22,) which renders void all deeds or wills conveying or devising property for religious or charitable uses made within one month of the death of the, grantor or testator, restricts, not only the power of Pennsylvania citizens to devise and bequeath their property to charitable corporations, but also the power of Pennsylvania corporations to take devises and bequests; and hence a bequest of personal property made by a citizen of New York to a religious or charitable corporation of Pennsylvania is invalid if made within the time limited by the above statute. Kerr v. Dougherty, 79 N. Y. 327 , and Hollis v. Seminary, 95 N. Y. 166 , followed.
3. Wills—Residuary Legatees—Right to Void Legacies.
After a direction to executors to convert testator’s property into money, and “to pay and dispose of the proceeds thereof as herein directed,” the testator gave four "specific legacies of $3,000 each; and then gave “whatever moneys may remain in the hands of my executors after the payment of the foregoing bequests” to three named legatees. Held that, since there were no words in the will unequivocally showing testator’s intent to restrict the operation of the residuary clause, and since the presumption was against intestacy, the residuary legatees, and not testator’s next of kin, were entitled to the specific legacies which had been declared void by the courts.
Appeal from special term, New York county.
"Action by Walter Carter, as executor,- etc., of John Spaulding, against the Board of Education of the Presbyterian Church of the United States of America and others; legatees, and Abel Spaulding and others, next of kin, for the construction of the will of plaintiff’s testator. From a judgment holding certain legacies void, some of the defendants, legatees under the will, appeal. Modified.
Argued before VAN BRUNT, P. J., and O’BRIEN and FOLLETT, JJ.
Parsons, Shepard & Ogden, (John E. Parsons, of counsel,) for appellants.
Vanderpoel, Cuming & Goodwin, (Delos McCurdy, of counsel i for respondent Walter Carter.
Hascall, Clarke & Vanderpoel, (John P. Clarke, of counsel,) for respondents Spaulding and others.
The Board of Education of the Presbyterian Ohurch is a. Pennsylvania corporation created by special act of the legislature of Pennsylvania, approved May 12, 1871. The eleventh section of the act of April 26, 1855, of Pennsylvania (now 2 Brightly’s Dig. p. 1712, § 22, and also page 252, and proved in evidence in this action,) provides: “No estate, real or personal, shall hereafter be bequeathed, devised, or conveyed to any body politic, or to any person, in trust for religious or charitable uses, except the same be done by deed or will attested by two credible, and at the same time disinterested, witnesses, at least one calendar month before the decease of the testator or alienor; and all dispositions of property contrary hereto shall be void, and go to the residuary legatee or devisee, next of kin, or heirs, according to law.” Section 15 of the same act (now 1 Brightly’s, Dig. p. 252, § 28,) provides that “all dispositions of property hereafter made to religious, charitable, literary, or scientific uses, and all incorporations or associations formed for such objects, shall be taken to have been made and performed under and in subordination to all the duties and requirements of this act as rules of property and laws for their.
p. 97
government.” ' The will at bar was executed on the 21st day of March, 1889. The testator died on the 30th day of March, 1889, and therefore within one calendar month after said execution. The testator was a resident of, and died within, this state, and his property, at the time of his decease, was here situate. The disposition of this case appears to be entirely controlled by Kerr v. Dougherty, 79 N. Y. 327 , where, in construing a bequest to the Trustees of the General Assembly of the Presbyterian Church in the United States of America, for the, use of the Fund for Disabled Ministers, a Pennsylvania corporation, the court, after citing the two sections above set forth, proceeds to say: “It virtually declares that no estate shall pass, and that all dispositions of property for the purposes of the act, without regard to the domicile of the giver, shall be ineffectual, unless made in conformity with its provisions. The policy of the law of Pennsylvania evidently was to make all such gifts invalid, and it will be a forced and strained construction to hold that such policy could be avoided and set at naught, and the very intent and language of the act frustrated, because the testator resided, and the will was executed, outside of the territorial limits of that state.” Again: “The question is not as to the construction of the terms of the devise, but as to the right to make it at all in contravention of the statute of Pennsylvania. To maintain that the statute of Pennsylvania has no force in New York would render the statute ineffective and of no avail in many cases in violation of the express prohibition which constitutes its very essence. It is also insisted that, the defendant having been chartered by special act, before the passage of the act of 1855, its power to take and hold real and personal estate, given by its charter, cannot be taken away, restricted, or limited by a subsequent act; and its power in this respect is not subject to the act of 1855. A complete answer to this position is that Hie defendant derived no more right to take and hold property than was possessed by individuals, which, is always subject to the general laws of the state existing, or laws to be thereafter passed, in regard to the acquisition and disposition of property. It follows that the bequest, being in contravention of the act of 1855, was void in Pennsylvania, where the legatee has a domicile, and consequently void in New York, w’here the testator resided.” Kerr v. Dougherty wgs cited with approval upon this principle in Hollis v. Seminary, 95 N. Y. 166 ; Judge Earl, who had written a dissenting opinion in Kerr v. Dougherty, writing the opinion. He sums up in this language: “I conclude, therefore, that the two-months limitation contained in the act of 1848 applies exclusively in terms to corporations formed under that act, and that there is no public policy established, either by statute law or judicial decisions or general consent, which authorizes us to enforce that limitation against domestic corporations which are not expressly subject to it by statute, and hence that it cannot be enforced against foreign corporations which are authorized by their charters to take property by devise or bequest, free from a similar limitation in the state of their creation.” And, again, referring to Kerr v. Dougherty: “There, too, there was under consideration a bequest to a Pennsylvania corporation, and, if that bequest had been void as against the public policy of this state, there would have been no occasion to resort to the law of Pennsylvania, and to hold, as we did, that the bequest was void because of an act of that state which prohibited such bequests by a will executed within a month before the death of the testator.” It is clear, therefore, that the attempted bequest under consideration was invalid, and of no effect.

John Spaulding, the testator, executed Ms will March 21, 1889. He died March 30, 1889. He left surviving him no issue or widow, father, or mother, tint did leave certain next of Mn and heirs at law, brothers and sisters, nephews and nieces, all parties to this action. At the time of his death he was seised and possessed of real and personal property situate within this state to the value of $45,000. By his wül he directed Ms executors to convert his estate into money as soon as convenient, and to pay and dispose of the proceeds as directed: Board of Home Missions,

p. 98
$3,000. There is no controversy as to this. Board of. Foreign Missions, $3,000. There is no controversy as to this. Board of Education, $3,000. Declared to be invalid. Board of Relief for Disabled Ministers, etc., $3,000. Declared to be invalid. The will ■then proceeded:
“And whatsoever moneys may remain in the hands of my said executors after the payment of the foregoing bequests I hereby direct my said executors to divide into three equal parts, and to pay one third thereof to the American Seaman’s Friend Society, one third thereof to the Board of Church Erection Fund, and one third thereof to the Board of Aid for Colleges.”

This clause was held by the court below to be a specific residuary clause, and therefore the amount of the invalid legacies passed to the next of kin as undisposed of by the will. The different appeals bring up these three points: (1) That it was error to allow the plaintiff to recover back the amounts he had paid on account of the legacies now found to be void; brought up by the appeals of the Board of Relief and the Board of Education. (2) That it was error to adjudge void the legacy to the Board of Education; brought up by the appeal of that board. (3) That it was error to hold that the void legacies, if any, did not fall into the residuum, and pass to the residuary legatees; brought up by the appeals of the Board of Church Erection and Board of Aid for Colleges..

To sustain the contention that it was error to allow the plaintiff to recover back the amounts he had paid on account of the void legacies, it is insisted that there was no evidence to support the finding that the executor made these payments under a mistake of fact; and that, even though there had been, nevertheless it was error to conclude as a matter of law that these boards must refundió the executor the amounts already paid by him on account of their legacies. Appellants invoke the well-settled rule that, to warrant a court of equity to relieve against mistake of fact, it must be the mutual mistake of both parties, or there must be the mistake of one and the fraud of the other in taking advantage of . it; and another rule, equally well settled, that where the executor .volunteers to pay the whole or any portion of a legacy, and it subsequently appears that the assets are not sufficient to justify a payment to that extent, the loss must fall upon the executor, and he cannot compel the legatee to refund. This last rule we.do not think can apply to a case such as this, where the payment is not made voluntarily, and upon an assumption that there are assets sufficient, which assumption subsequently turns out to be erroneous. Here the executor, under the terms of the will, was directed and required to pay these legacies," and, having no reason to believe that the legacies themselves were void, it was "in the discharge of his duty as executor that the payments were made. The legacies themselves, however, having, by the judgment, been declared void, we can think of no principle that would protect the legatees from being obliged to refund the amounts thus paid to them. The right to require such a payment is in no way affected by the fact that the executor would be protected from personal liability for such payments made by him. In other words, the exemption from lia

p. 99
Mlity with which the law might clothe the executor for payments made in good faith could not be extended so as to preclude him from recovering back from the parties to whom the money was paid without right, or invest such parties with the title to such moneys. The analogy sought to be drawn between a payment made by an executor of a legacy held to be void and a payment made by an assignee under the terms of an assignment held to be void is illusory, as the distinction between the two makes clearly evident. In the case of an assignment subsequently held to be void, a payment by the assignee to a preferred or general bona fide creditor before action brought to attack the assignment would not make the assignee responsible for such payment. But is there any doubt as to the right of the assignee to recover back moneys paid to a supposed creditor, whether general or preferred, who, after such payment, is shown never to have had any valid or legal claim against the assigned estate? Undoubtedly the assignee, who made the payment in good faith before action brought to determine the validity of such a claim, would be protected, as he would in the case of a payment made to a preferred creditor, although the assignment should be subsequently set aside and adjudged to be fraudulent and void. With respect to a valid claim, the ground upon which it could be urged that the assignee could not recover back a payment made to a bona fide creditor could be sustained, as it has been, by the view that the creditor received but his due out of the debtor’s property; but with respect to an invalid claim, just as here, in the case of a void legacy, the determination being that the party never had any claim against the estate, the right to compel a repayment seems, in the absence of any authority to the contrary, reasonably free from doubt.

The point that it was error to adjudge void the legacy to the Board of Education we regard as equally untenable. Upon this question we agree with the conclusion of the learned trial judge in holding that the cases of Kerr v. Dougherty, 79 N. Y. 327 , and Hollis v. Seminary, 95 N. Y. 166 , are direct authorities, and controlling.

The remaining question is whether the void legacies .passed to the residuary legatees, or are to be regarded as so much of the estate of the testator remaining undisposed of, and which descends to his next of Mn. In passing upon this question it becomes necessary to examine the language of the will in order to determine whether the residuary clause is general or specific and restricted. After a direction to his executors to convert his property into money, and “to' páy and dispose rof the proceeds thereof as herein directed,” the testator gives four legacies of $3,000 each, and then directs as follows:

“And whatever moneys may remain in the hands of my executors after the payment of the foregoing bequests I hereby direct my executors to divide into three equal parts.”

Then follows the designation of the three legatees, each of whom was to receive one third. The question is, did the testator by this

p. 100
language intend to make a general residuary disposition of ¿¿is property? If he did, then the law is well settled that in a will of personal property the general residuary clause carries whatever is not -otherwise legally disposed of; or, otherwise stated, a general residuary clause includes not only what is not specifically given, but also what is ill given, or whatever fails by lapse, indefiniteness, or invalidity. The canons of construction to determine whether a residuary clause is general or not are thus stated in Lamb v. Lamb, 131 N. Y. 227 , 30 N. E. Rep. 133 :
“The construction oí residuary clauses in wills has been frequently before the courts. The intention of the testator is to be followed if the actual intention is discoverable from the language employed. There is no rule of law which prevents a testator from restricting the operation of a residuary clause to a particular or specific residue. He may make the residuary clause general and comprehensive, so that it shall carry any residue, whether of personalty or realty, or both; or he may confine its operation to property of a particular class or to a particular interest. But, where the language of a residuary clause is ambiguous, the leaning, of course, is in favor of a broad, rather than a, restricted; construction. It prevents'intestacy, which it is reasonable to suppose testators do not contemplate. And, if the mind is left in doubt upon the whole will as an actual testamentary intention, a broad, rather than a strict, construction -seems more likely to meet the testamentary purposes, because such a clause is usually inserted to provide for contingencies or lapses, and to cover whatever is left after specifying specific and special purposes of the testator manifested in other clauses of bis will. The court, in Floyd v. Carow, 88 N. Y. 560 , in construing the construction of a residuary clause -in a will, said: ‘The intention of the testator to restrict the operation of the residuary clause cannot be deduced from the mere absence of words in the will directing that - a particular interest or estate, upon which the residuary clause is claimed to operate, was in the contemplation of the testator when the will was made, or from the fact that the reversion was a mere expectancy, dependent upon the failure of issue, or other improbable contingency. A general residuary devise carries every real interest, whether known or unknown, im- * mediate or remote, unless it is manifestly excluded. The intention to- include is presumed, and an intention to exclude must appear from other parts of the will, or the residuary devisee will take.’ And in Riker v. Cornwell, 113 N. Y. 115 , 20 N. E. Rep. 602 , Gray, J., said: T think the doctrine is firmly established, by reports of cases and text-books, that, where the residuary bequest is not circumscribed by clear expressions in the instrument, and the title of the residuary is not narrowed by words of special and of unmistakable import, he will taire whatever may fall into the residue by lapse, invalid disposition, or other accident.’ ”

In the case last above cited (Biker v. Cornwell) it is further said:

“In ascertaining the intention of the will maker, we should not seek it in particular words and phrases, nor confine it by technical objections. We should find that intention by construing the provisions of the will with the aid of the context, and by considering what to be the entire scheme of the will.”

It is clear, construing the language of this will, that, if the testa- ■ tor had omitted the words “after the payment of the foregoing bequests,” no doubt could arise but that a general residuary clause would have been created; and, while there is much force in the suggestion that these words give the clause a restrictive meaning, ■ still, when we consider the language of the entire will, we think it consistent with the view that the testator did not intend to limit his résiduáry legatees' to what would remain after deducting the amounts provided to be paid by the former bequests. - As stated,

Concurrence

p. 101
there was a direction to his executors to convert all his property into money, “and to pay and dispose of the proceeds thereof as hereinafter directed.” Here is an expressed intention that all his property was to be disposed of by his will; and, after providing for certain bequests which he undoubtedly assumed to be valid, he left the entire remainder to the residuary legatees. This view of the testator that all the bequests were valid would explain the presence in the will of the expression “remaining after the payment of the foregoing bequests,” which it is insisted gives to the clause a restrictive meaning. As said in Re Estate of Bonnet, 113 N. Y. 522 , 21 N. E. Rep. 139 :
“We hold that, unless a contrary intent unequivocally appears elsewhere in the will, a lapsed or void legacy will be carried by a general gift of the residuum of the testator’s estate. If the title of a residuary legatee is not narrowed by special words of unmistakable import, the gift will carry with it all that falls into the residue, whether by lapse, invalid disposition, or other accident.”

We fail to find in this will the intent “unequivocally expressed,” or “by special words of unmistakable import,” that the title of the residuary legatees is limited to a particular fund or to a certain residuum; and, though some authorities and expressions of opinion may be found to the contrary, (notably in Re Benson, 96 N. Y. 499 ,) the trend of the more recent decisions, and particularly that of Lamb v. Lamb, supra, is, as stated, that—

“Where the language of a residuary clause is ambiguous, the leaning, of course, is in favor of a broad, rather than a restricted, construction. It prevents intestacy, which it is reasonable to suppose testators do not contemplate. And, if the mind is left in doubt upon the whole will as an actual testamentary intention, a broad, rather than a strict, construction seems more likely to meet the testamentary purposes.”

We do not think that the intention is so clearly expressed as not to raise a doubt. Still, upon a consideration of the entire will, we have reached the conclusion that it was the intention of the testator, not to confine or circumscribe the residuary legatees to a particular fund or residuum, but that he intended by that clause in his will to create a general residuum, under which the legatees would take all his property except such as was. specifically bequeathed. And upon this view it would follow that the void lega-' cies fall into the residuum, and should be divided among the residuary legatees. The judgment should therefore be affirmed in all respects, except as to the disposition made of the void legacies, which should pass into the residuary estate, to be disposed of as therein directed, without costs to either party upon this appeal.

I concur. The case of Kerr v. Dougherty seems to have been repeatedly overruled in respect to the rule governing the disposition of void or lapsed legacies.

FOLLETT, J., concurs.

Cases cited