Toronto General Trust Co. v. Chicago, Burlington & Quincy Railroad

Headnote

1. Trusts—Appointment op Trustee—Validity—Demurrer.

Where one suing to recover property belonging to a decedent’s estate.avers that he has been duly appointed trustee of such estate as successor of the trustee named in decedent’s will, and that he has succeeded to all the rights and powers as trustee under said will, and become entitled to receive the property sued for, for the purposes of the trust, an objection that the plaintiff was not duly appointed trustee, and therefore has no capacity to sue, is not apparent on the face of the complaint and cannot be successfully taken by demurrer.

2. Same—Capacity op Trustee to Sue.

One appointed by a foreign court as the successor of a deceased trustee of a trust created by a foreign will cannot maintain an action in this state to recover property alleged to constitute a part of the trust until such will has been probated here, and he has been appointed trustee by the courts of this state.

Appeal from special term, Hew York county.

Action by the Toronto General Trust Company against the Chicago, Burlington & Quincy Railroad Company and the Hational Bank of Commerce to compel defendants to issue to plaintiff, as trustee of the estate of a decedent, certificates for certain shares of stock. The complaint was dismissed, and plaintiff appeals.

Patterson, J., rendered the following decision at special term:

“I am of opinion that the plaintiff cannot maintain this action. It sues as a trustee appointed by a court in the dominion of Canada, and in place and as the successor of a deceased trustee of a trust created by will of a resident of Canada, which will has not been admitted to probate in this state, and no reappointment made here of the plaintiff as trustee. It is well settled in Hew York that a foreign executor, administrator, or guardian cannot sue in the courts of this state until the will is proven here, and the foreign appointment repeated. The reasons of this rule are stated by Denio, C. J., in Petersen v. Bank, 32 H. Y. 21. There is no distinction in principle on the question involved between executors, administrators, guardians, and substituted testa

menlary trustees appointed by foreign tribunals, and deriving tlieir authority solely from the foreign court, and the provisions of foreign statutes. The same reasons apply for excluding a trustee so appointed as operate to disable the executor or guardian, and this has been very clearly pointed out by Judge Snmi'AN in his opinion in Curtis v. Smith, 6 Blatchf. 537 . That is the only case I have been able to find in which the point as affecting a trustee not named in the will, but succeeding to the trust only by judicial appointment, has been distinctly raised and decided. In the case referred to the learned judge, after stating that if the legal title of the trustee came directly from the testator, and through the will alone, it would be respected everywhere, even when incumbered with a trust, proceeds to say (page 550:) ‘ But, if the title is not derived from the jus disponendi of the owner, but solely from some act of the law, the effect of that act is confined to the territorial jurisdiction over which the law extends. This is the principle which has governed the eases of executors, administrators, and guardians, and I see no reason why it should not prevail in regard to trustees appointed by local law As the trustee, in such a case, derives his title, not from the jms disponendi of the owner, but from the law of the state under which he is appointed, this title, as well as the right to enforce it by legal remedies, must cease to operate when he enters a foreign jurisdiction. Whenever he seeks to exercise his powers in another sítate than that under whose laws he was appointed, he must first have his appointment repeated by the local tribunal having jurisdiction over the appointment of trustees.’ It is undoubtedly true that foreign corporations and foreign receivers, and even foreign assignees or trustees, in proceedings in invitum in bankruptcy are permitted under certain circumstances to maintain actions in our courts upon a liberal application of the doctrine of interstate or international comity, as is illustrated in Re Waite, 99 R. V. 433, 2 R. E. Rep. 440, but no court has yet gone to the extent of applying the principle of comity to overruling that class of cases arising under wills and in testamentary matters in which distinct rules have been pronounced and adhered to for years, both in this country and in England. The inconsistency of admitting one set of appointees to sue and excluding another has been frequently remarked and commented upon, but the differing rules exist, and must be followed until the courts of final authority see fit to adopt some uniformity of decision, if that be desirable or expedient. It is said that there are reasons connected with administration to justify the maintenance of the doctrine that persons suing en autre droit by authority derived from foreign probate courts and under foreign laws should be reappointed by, and become amenable to, the courts of the jurisdiction in which they seek to enforce obligations, and that,.where trustees are concerned, it is usual that the trust begins where administration ends, and therefore the reasons referred to do not apply, for there are no creditors as such of the trust to be ^protected. But the exclusion of the substituted trustee is merely because his authority is given by a foreign court to execute a trust proven only in the foreign jurisdiction, which has conferred but a limited authority. If the case were one in which direct relations had been established between the plaintiff and the defendants, a different question might arise, such as was presented in Lawrence v. Lawrence, 3 Barb. Oh. 71. But here the plaintiff was an entire stranger to all the matters of substance involved in the controversy and whatever right or title it has acquired is altogether derivative from the Canadian court. It is unnecessary, in this view of the case, to consider the other important and interesting questions discussed on the hearing. There must be judgment for the defendants, which is based solely on the ground hereinbefore indicated, and the findings will be settled accordingly. ”