Johnston v. Spicer

—The controversy in this case arises among the heirs of one George Spicer over the distribution of surplus money accruing from a sale of lands under a mortgage foreclosure, and depends for its settlement mainly upon the effect to be given to a contract made between Spicer and one Ellen Donnagha on June 29, 1847, in contemplation of their marriage.

. The appellants claim as legal heirs of George Spicer, and the respondents, who were also a portion of his heirs, claim the exclusive right to these moneys by virtue of a release ; from the state of the intei’est said to have accrued to it by escheat on the death of Ellen Spicer. The marriage contract was executed by George Spicer as party of the first part, Ellen Donnagha, as party of the second part, and Peter Crawford, of the third part. The party of the second part thereby conveyed certain real and personal property to Crawford, in trust for her own use and benefit, and the contract then provided as follows: “It is hereby further covenanted and agreed that in case of the decease of, the party of the first part without leaving lawful issue by the contemplated marriage, previous to the decease of the party of the second part, that then and in that case all of the real and personal property he may die possessed of shall belong and be the property of the party of the second part, and also in case the party of the second part should die without having lawful issue by the said contemplated marriage, the property, both real and personal, shall belong and be the property of the party of the first part and the trustee shall, by good and sufficient conveyance or conveyances, assign the same to said party of the first part.” The parties subsequently married, but had no children. Spicer died, intestate, on July 1, 1884, seized of the lands out of which the surplus moneys arose, and leaving numerous heirs-at-law. His widow died in January following, intestate, and leaving no lawful heir.

Upon the theory that the marriage settlement established a right in the widow to such real estate which escheated to the state upon her death, the appellants procured the passage of chapter 377 of the Laws of 1885, the escheat bill already mentioned, and, by reason of the interest thereby acquired, assert an exclusive right to the surplus moneys in dispute.

The referee and the special term sustained the claims of the state’s grantees under the statute, but the general term reversed the orders awarding them the surplus moneys, and directed them to be distributed among all of the heirs at law of George Spicer, deceased. The theory upon which that court proceeded was, that the marriage contract, so fay as George Spicer’s property was concerned, was do-

We are inclined to the opinion that the general term erred in some respects in its view of the case, and that upon the death of George Spicer his widow became by force of the marriage settlement the equitable owner of the real estate, and upon her death, without heirs, her interest therein reverted to the state, though not technically by escheat. No express trust was created by the marriage contract, but a trust by implication in the property left by him arose upon the death of George Spicer in favor of his widow. The legal title which was vested in him descended to his heirs at his death by force of the statute of descents, and was held by them at the death of the widow. It did not vest in the widow by virtue of the contract under section 47 of the Statute of Uses and Trusts, as that section is controlled by section 50, which provides that it shall not apply to trusts arising by implication of law. Neither was it affected by section 21, 3 Revised Statutes (7th ed.), 2213, as that relates only to the express trusts authorized by the statutes and does not include such as are created by implication or intendment of law, and the descent of these lands would not therefore seem to be affected thereby.

The property intended to be settled on the wife was such ■only as the settlor should die possessed of, and there would therefore seem to be some difficulty in treating the husband during his lifetime as trustee for his wife since he had an undoubted right of disposition of the property during that time and the equitable right of the wife arose only upon his death.

It would therefore seem that upon the death of George Spicer the legal title to his real estate descended to his heirs, but they held it as a naked trust merely for the equitable owner and subject to her right to become vested with the, title upon demand. Giddings v. Eastman, 5 Paige, 561; Wood v. Mather, 38 Barb., 479 .

Ante-nuptial contracts by which it is attempted to regulate and control the interest which each of the parties to the marriage shall take in the property of the other during coverture or after death, like dower, are favored by the courts and will be enforced in equity according to the intention of the parties whenever the contingency provided

No_ special formality is requisite in such instruments, and in order to effectuate the intentions of the parties, courts of equity will impose a trust upon the property agreed to be conveyed commensurate with the obligations of the contract, or will decree its specific performance, and when such relief is inadequate or impracticable from the situation of the property or the character of the contract, will award damages for its breach. De Barante v. Gott, 6 Barb., 496 ; Beck v. Vandemark, 99 N. Y., 29 ; Pomeroy’s Eq. Jur., §§ 1403, 1297; Schouler’s Domestic Relations, 263 to 266, et seq.; Pierce v. Pierce, 71 N. Y., 156 .

It is entirely immaterial whether a trustee, to carry them into effect, has been appointed in the contracts or not, or whether the property agreed to be conveyed be then owned by the parties or is expected to be subsequently acquired, if the contract is fair and reasonable and such as it is lawful for the parties to make, and the rights of creditors or third persons have not'intervened, it will be enforced in equity m such a manner as to accomplish the object which the parties had in view without reference to the validity of the agreement at law. Blanchard v. Blood, 2 Barb., 352 ; De Barante v. Gott, 6 id., 496 ; Schouler’s Domestic Relations, supra; Atherly on Marriage Settlements (London, 1813), 58.

The rule as stated by Pomeroy in his work on Equity Jurisprudence is-: “Among the ■ agreements which the original common law treated as invalid, irrespective of statutes, but which equity in the application of its conscientious principles regards as binding and enforces by granting its relief of specific performance, are the following: Agreements for the assignment or disposition of a possibility, expectancy or hope of succession; agreements, to assign things in action; executory agreements made between a man and a woman who afterwards marry, which then became absolutely void at common law, but which equity may specifically enforce against either the husband or wife at the suit of the other.” Section 1297. See Stover v. Eycleshimer, 46 Barb., 84 .

It is said in Bright’s Husband and Wife (p. 471, et seq.):

“A jointure which has been agreed by the husband before marriage to be made upon his intended wife will be good in equity although it be not actually so settled, but is permitted to remain in articles, or upon the husband’s covenant; for such a jointress being a purchaser of the provision by the marriage, is entitled in that character to the aid and protection of a court of equity; accordingly such articles or covenants will be specifically performed.” He further says

The principle laid down by Lord Rebesbaee is this: “That where a person acts for a valuable consideration, as upon marriage, he is understood in equity to engage with the person with whom he is dealing to make the instrument as effectual as he is able; and whenever that is the case, there is nothing in any of the authorities to raise a doubt that it shall have effect, so far as the person executing it has the power; and where the nature of the instrument is contrary to what the power prescribes, but demonstrates an intent to charge, it shall have the operation of charging in that form which the power allows.” “It follows, therefore, that however the intent be shown, if it be in writing, the court will, in aid of the intention, supply the defects in the mode of execution in favor of the jointress; so that whether the intent to execute the power be by letter, memorandum, will, articles or covenant, a court of equity will aid the jointress and supply all omissions.”

In case of DeBarante v. Gott (supra) an antenuptial contract had been executed between the plaintiff, who resided in France, and his intended wife, living in New York, whereby it was provided that in case of death of the wife without leaving children, all her personal estate should become vested in her husband, and the real estate of which she should die seized in the United States should be immediately sold and the price thereof remitted to the plaintiff. Upon a bill filed by the husband to recover the real and personal property from the persons in possession, Judge Harris held that if the instrument which created the right of the plaintiff in the property “had also appointed a trustee to carry into effect the object, as in the case of Craig v. Leslie, no one I apprehend would have doubted the authority or duty of such trustee to sell the real estate and remit the proceeds; but it is a rule of equity which is said to admit of no exception that it never wants a trustee.

■ It is the settled doctrine of equity that no trust shall be permitted to fail for the want of a trustee to execute it. Land to which a trust is attached remains chargeable with such trust in the lands of the heir or devisee. A court of equity will always establish and enforce a trust whenever a competent party applies for its aid and presents a case entitling him to relief.” “The general rule as stated by Story (2 Eq. Jur., § 976) is that wherever a trust exists,

In Peck v. Vandemark ( 99 N. Y. 29 ), it was held that an ante-nuptial agreement was established by the letters of the parties to the effect that the intending husband would, in case the plaintiff intermarried with him, make provision by giving her by will one-half of his property and the use of the other half for her life. The parties having intermarried, and the husband failing to make the provision agreed upon, it was held that this was a valid contract binding upon the testator, and the plaintiff could maintain an action against the executor to recover damages for the violation of the contract. The damages were held to be the value of one-half of the estate, both real and personal, absolutely, after paying debts and expenses of administration, and the use of the other half during her life.

It has been the constant practice of the courts of this country, as well as of England, to enforce ante-nuptial agreements according to their terms, whether they relate to existing or after acquired property, and to decree a specific or substituted performance of them, according to the nature of the case. 2 Kent’s Com., 173; 1 Story’s Eq., § 774; Reade v. Livingston, 3 J. Ch., 481 ; Pomeroy’s Eq. Jur., §§ 1297, 1403; Smith v. Osborne, 6 House of Lords Cases, 375; In re Pedder, 10 L. R. Eq., 585; Hammersly v. Baron De Biel, 12 Cl. & Fin., 45; In re Wilson's Ex’rs, 2 Barr., 325.

These cases do not proceed upon the theory of a grant conveying a present interest in the property, but upon that of a contract intended to provide, in case of the death of one of the parties, an adequate provision for the support of the other, and which, as they are founded upon a valuable consideration, and not prohibited by public policy or principles of law, it would be inequitable to defeat or destroy. 2 Kent’s Com., 165; Schouler’s Domestic Relations, 263.

The suggestion that such contracts may be invalid, as being of a testamentary character and as contravening the statutes regulating the execution of wills, is of no force in view of the fact that for many centuries they have been sanctioned and protected by the courts, and their validity in this state has been expressly ratified and approved by statutory provisions. Sec. 4, chap. 200, Laws of 1848; section 3, chap. 375, Laws of 1849.

Here the contract is clear and explicit that in case of

It does not appear in the case at what time the sale of the land under the foreclosure proceedings took place, nor the time when the title of the heirs to the real estate, became divested by its sale and converted from an interest in real property to that of one in personal property. Neither does it seem to us, in the view we take of the case, that this question is material. If the heirs became vested with the legal title on the death of George Spicer, they would retain a similar- interest in the property which had been substituted therefor and which had, without any agency of theirs, been converted from real into personal property. At all events, if this circumstance was material, there is no evidence in the case which enables the court to determine what the fact was, and we must deal with the case upon the facts contained in the record.

The remaining question on this branch of the case has reference to the disposition which the law makes of the widow’s equitable interest in the event of her death before acquiring the legal title.

The respondent states that there is no claim that rights of action would escheat to the people, and such seems to have been the theory entertained by the general term. In the strict sense of the term escheat, perhaps, this may be so, but we assume it to be the law in this state that all rights of property of whatever nature they may be revert to the people when the owner dies intestate, and there is a failure of heirs or next of kin to take such property. We believe it to be the established rule in all civilized countries, that in such cases the property of a resident dying intestate without heirs, reverts to the sovereign or state, to be

While there is an absence of specific statutory authority declaring the rights of the state in such property, it is believed to be the uniform practice for states to assume by force of natural law, the control of such property and to administer it for the benefit of those concerned, and in the absence of any legal heir, to appropriate the proceeds to the uses of the state.

It is said in 4 Kent’s Com., 425, “It is a principle which lies at the foundation of the right of property, that if the ownership become vacant, the right must necessarily subside into the whole community in whom it was originally vested when society first assumed, the elements of order and subordination.” In a note it is stated: “The escheats spoken of in the text relate exclusively to land, movables never escheated in the technical sense; and if the owner died intestate and left no lawful representatives, the Personal estate remained at the disposition of the crown, n this country it must vest in the state, and so the statute law in some of the states has especially provided.

In Perry on Trusts it is said that it was held in Burgess v. Wheate (1 Eden, 117), “ that if the cestui que trust left no heirs, the trust estate did not escheat, but that the trustee thenceforth held the estate discharged of the trust.” “ This is upon the principle that there is no want of a tenant to the land, the trustee being clothed with all the rights of ownership against all the world except the cestui que trust and those claiming under him. But this principle does not apply to chattels where there can be no tenant, nor to leaseholds, nor to an equity of redemption. In the United States, trustees would hold personal property, subject to the right of the state, as uttimus hceres in case the cestui que trust died without heirs or next of kin, and it is conceived they would hold real estate under the same rule.”

Washburn on Real Property (vol. 3, p. 54), says: “While escheat was regarded as an incident of feudal tenure, it did not extend to the equitable estates of cestuis que trust, and by analogy it is generally understood that if a cestui que trust dies intestate, without heirs, the trust fails and the trustee holds an absolute estate in the property free from the claim of anyone. But it is settled by the courts of Maryland, and intimated by Judge Kent in respect to New York, that such would not be the case under the statute in these states, and that if a cestui que trust should die without heirs, his equitable estate would escheat* to the atate.”

A very elaborate discussion of the history and origin of the right of the state to appropriate the property of a per

In a note to section 990 of Pomeroy’s Equity Jurisprudence, the author says: "When the trust is personalty, on the death of the beneficiary intestate and without any next of kin, the crown or the state succeeds to his property upon other grounds than that of common law escheat,” citing many authorities.

If we turn to the legislation of this state we shall find that the subjects of escheat and the administration of estates of persons dying intestate without heirs, have generally been treated together as analogous, and result in the appropriation by the state of all such property both real and personal. The first act we have been able to discover is chapter 35 of the Laws of 1792, entitled ‘6 an act concerning escheats.” That act provides in all cases “ where administration hath been, or hereafter shall be granted to any person or persons, not the widow of or not of kin to the intestate, and no person hath, or shall, within one year after granting the letters of administration, appear to claim the personal estate of such intestate as next of kin, then and in every such case the administrator or administrators shall pay the amount of the personal estate after deducting the debts and funeral charges of the intestate into the treasury of the state.” In case the administrator neglects to obey this requirement, the attorney-general is authorized to bring an action in the name of the state to recover this amount. By the second section it was provided 66 that whenever the attorney-general shall be informed that any person has died seized of any real estate within this state without making any devise thereof and leaving no heir capable of inheriting the same,” he shall take proceedings in the name of the state to recover the same, and upon recovery thereof it shall be sold by the state and the proceeds thereof paid into the treasury of the state.

The provisions of this act were substantially re-enacted under the same title by chapter 73 of the Laws of 1801, and also by chapter 19 of the Revised Laws of 1813. No material change in legislation on this subject was made until the revision of the statutes in 1823, when the subjects were separately treated and a new system was adopted for administration upon the estate of such persons.

Section 1. The, people of this state in their right of sovereignty are deemed to possess the original and ultimate property in and to all lands within the jurisdiction of the state, and all lands, the title to which shall fail from a defect of heirs, shall revert or escheat to the people.

Section 2. All escheated lands, when held by the state or its grantees, shall be subject to the same trusts, incumbrances, charges, rents and services to which they would have been subject had they descended; and the court of chancery shall have power to direct the attorney general to convey such lands to the parties equitably entitled thereto according to their respective rights or to such new trustee as may be appointed by the court.

Section 1977 of the Code of Civil Procedure provides for the enforcement of these provisions.

The subject of administration upon chattels and personal property was regulated by article 2, title 6, chap. 6, part 2, R. S. (3 R. S. [7th ed.], 2319, et seq.), whereby it was provided that “The county treasurer m each of the counties of the state shall by virtue of his office have authority to collect and take charge of the assets of every person dying intestate, when such assets shall amount to one hundred dollars or more, either in his county or out of it, upon which no letters of administration shall have been granted in the following cases :

1. Whenever such person shall die leaving assets in the county of the treasurer, and there' shall be no widow or relative in the county entitled or competent to take letters of administration on such estate.

2. Whenever assets of any person so dying intestate shall after his death come into the county of such treasurer and there shall be no person entitled or competent to take administration of such estate.”

The act, after providing for the manner in which he shall discharge his duties and convert the estate into money, Eroceeds (section 71) : “The balance of any money in his ands shall be paid into the treasury of the state for the benefit of such persons as shall be entitled to receive the same.”

The statutes also provide for the appointment of a public administrator in the city of New York, who has the exclusive right to administer in the cases referred to, and Who is directed to pay into the city treasury all moneys arising from such estates except such as may be paid out and expended in the process of administration.

In the constitution of 1846, the matter of escheats was made the subject of express provision, and it was enacted

From this review of the law, it would seem that there Is no substantial difference between real and personal property in respect to the rights acquired by the state upon the death of its owner Intestate without heirs or next of Mn. A clear deduction from the authorities seems to lead to the conclusion that the doctrine of escheat applies only to legal estates, and does not in a strict sense affect either equitable estates or personal property. It seems also to follow from the authorities cited, that upon the death of Ellen Spicer the state took not the land but succeeded to the equitable right which she had to a conveyance thereof. This right may possibly be subject to the claims of creditors or other equities which would have to be adjusted in an action by the equitable owners to recover the possession of the land.

The omission, in the provisions of the Revised Statutes, of the words “died seized of,” as contained in the Revised Laws of 1813, relating to escheats, is not supposed to have effected any change in the law, as the revisors say in their note to this section that it is “new in terms but implied in R. L., 380, § 2.” A new rule, however, was intended to be introduced by section 2 of the Revised Statutes, which provides that all escheated lands shall be held by the state or its grantees, subject to the same trusts, etc., to which they would have been subject had they descended. This enactment was intended to obviate the severe rule of the common law by which such lands, when escheated, were held to belong to the king free from the trust. Revisors’ Notes, 5 N. Y. Statutes at Large (Edm. ed.), 297.

With reference to the personal estate of persons dying intestate, without next of kin, it appears to have been the uniform practice of the state since its organization to take such property and hold it either for the benefit of the community at large or some division of the state, or to be returned to such persons as may, from considerations of natural justice and equity, seem to the legislature to be entitled thereto.

We think, therefore, that the property left by Mrs. Spicer reverted to the state upon her death, and that it was competent for the legislature to grant the rights thereby acquired and the right to administer thereon to such person or persons as in their discretion they judged equitably entitled thereto. Englishbe v. Helmuth, 3 N. Y., 294 .

The only remaining question relates to the validity of the act by which the legislature assumed to dispose of the property in favor of the appellants.

It is claimed, by the respondents, that it is void for the

It is argued that the act embraces more than one subject, and that no subject whatever is properly or correctly described in its title. The title reads as follows: “An act to release the interest of the people of the state of New York in certain real estate to Henry Spicer, Catharine Valentine, Georgiana Farrington, Sarah F. Chapman and Charles Spicer, and for other purposes.” The act is clearly both private and local since it relates to a specified piece of real estate, described as lying and being in the city of New York; and it purports to convey such land to five persons for their individual use and benefit. Matter of New York Elevated R. R. Co., 70 N. Y., 350 .

By separate provisions it first purports to release the interest which the state acquired by escheat in certain real estate described; and secondly, it assumes to release all the interest which the state had to the personal property and effects of which Ellen Spicer died possessed or was entitled to. As the act reads there is no apparent connection between the real property described in the first section and the personal property referred to in the second section, and from all of the information furnished by the act, we are led to conclude that the legislature intended to deal separately, not only with real and personal property but also property derived from different sources. It is quite obvious that the title does not describe the interest intended to be conveyed by the latter section, for it is not only not referred to therein but it is excluded by implication through the reference to an interest in real estate alone; and it is equally clear that the first section describes no interest possessed by the state, for we have seen that it had an equitable interest only. That the act embraced in fact more than one subject can hardly be denied, inasmuch as the title itself specifies that it relates to a transfer of real estate and “for other purposes.” Even if we were able to overcome this objection, we are of opinion that the lack of any intelligible reference in the title to the real object of the act and its palpable misdescription thereof is fatal to its validity. The true object of the enactment was obviously to convey to some one of the heirs of George Spicer the rights of property acquired by the state through escheat or forfeiture in the real and personal property of Ellen Spicer. No reference is made in the title to the former ownership of either George or Ellen Spicer, or to the fact that the state acquired its interest by escheat or reversion; no indication that the

The manifest intention of the constitutional provision was to require sufficient notice of the subject of proposed legislation of a private or local character to be so expressed in the title as to put not only interested parties, but also all persons concerned in the proposed legislation, upon their guard and to inform all persons reading it of the general purpose and scope of the act. While this is not required to be done by pursuing any particular formula or with much detail of specification, and great liberality of construction should be indulged in by the courts to uphold the constitutionality of legislation, yet a due regard to constitutional requirements demands that when its plain and obvious purposes are disregarded or evaded, the judgment of the court should give effect to its provisions. Purdy v. People, 4 Hill, 418 ; People v. Hills, 35 N. Y., 452 .

It was said by Judge Davis in the case last cited: “It is not a sufficient compliance with this provision that a subject is expressed in the title of the act; the true and actual subject or object must be there expressed, or the evil and mischief which the framers of the constitution sought to avert and prevent will not have been effectually guarded against.” Judge Gardiner says, that: “The purpose of the 16th section was that neither the members of the legislature nor the public should be misled by the title.” Sun Mutual Ins. Co. v. City of New York, 8 N. Y., 253 .

An examination of the statutes relating to escheated estates for several years past, shows that from twenty to thirty are usually passed in each year and that the titles of such acts, though varying widely in the phraseology employed, usually contain a reference to the locality of the property effected, or the name of the person through whose decease it is claimed to have been forfeited, or some other circumstance affording information as to the scope and purpose of the act. While many of them are clearer and more ■concise than others, yet in every one of the twenty-two passed at the session of 1885, except chap. 377, we find some reference to the circumstances calculated to direct the attention of interested parties to the object of the proposed legislation.

There would seem to be no excuse, in the desire to secure brevity and conciseness of statement, for a title which was so well calculated to elude the vigilance of interested parties as the one under consideration. It seems to us that the

As we have heretofore seen, the legal title to the property in question was in the heirs at law of George Spicer, and at the time of the passage of the act, they were, for that reason, presumably in possession of the property and the legal owners thereof. This title and possession they had a right to maintain against all persons except Ellen Spicer or those who had lawfully succeeded to her rights; and had such a standing in court as authorized them to raise the objection that the act did not vest the rights of Ellen Spicer in the grantees from the state.

The conclusion reached by us, is that the state not having parted with its interest in the property in question by chap. 375, Laws of 1885, is equitably entitled to the surplus-moneys arising on the foreclosure sale, and that consequently neither of the persons filing claims thereto has shown any superior right over that of other claimants and is not entitled to an order giving him or them exclusive rights therein.

Under the circumstances of this case we are of the opinion that there should be a re-hearing of the matter before-the special term, of which the attorney general in view of our opinion as to the constitutionality of chap. 377, should have notice and he afforded an opportunity to be heard.

■ This conclusion renders it fiecessary to affirm the order of the general term so far as it reverses the order of the special term directing distribution to the grantees of the-state; and to reverse that part of its order directing a distribution of the surplus among all of the heirs of George Spicer. An order to this effect should be entered without costs to either party, and the case should be remanded to the court below for further consideration.

All concur.