Majority
p. 333In the Matter of the Accounting of Abraham B. Valentine, Trustee. (Supreme Court, General Term, Second Department, Filed February 9, 1891.)
Headnote
1. Will—Construction—Direction to sell.Testator devised certain real estate to his executors to receive the rents and profits thereof during two designated lives, but not exceeding 16 years, subject to the right of his daughter in-law to occupy one of them for life or,while she remained the widow of his son, and at the end of that period or the earlier termination of the trust by the death of those named, to sell the real estate and divide the proceeds between certain legatees. Held, that the property occupied by the said daughter-in-law was not excepted, from the direction to sell, but the scheme required the sale of the remainder in that parcel as well as the rest at the end of the 16 year period.
2. Same.
By a subsequent clause testator devised half of the remaining land to his executors to be held and sold in the same manner and the proceeds to be divided between the grandchildren named, “ and the issue of such of them as may then be dead leaving such issue or descendants then surviving” in the same proportion as directed in the previous clause. Held, that the words “ then be dead” and “then surviving” referred to the end of the 16 year period if not shortened by the death of both lives before that time.
3. Same.
Bach grandson took a vested interest, or would if he survived the period, and in either case had an interest which was alienable and would pass under an assignment made before that period expired.
4. Same—Record.
The direction in the will constituted an equitable conversion, and hence the recording acts would not apply to an assignment of the beneficiary’s interest.
Appeal from decree of the surrogate of Westchester county.
The decedent executed his last will and testament, dated in July, 1853. By it he gave and devised in fee simple to his ex-cutors certain stores, buildings and lots in the city of New York ; “also my house and lot, now known as number 98, in Bast Nineteenth street, now occupied by Jane Valentine, the widow of Abraham G. Valentine, which last mentioned house and lot I will and order my executors to permit my daughter-in-law, Jane Valentine, to possess and enjoy and have the free use, occupation, rents and profits thereof, so long as she shall live and remain the widow .of my said son.”
Out of the rents and profits of the other real estate, which they were directed to let out and rent during sixteen years from date of will, they were directed to pay to Jane Valentine an annuity of $2,000, so long as she lived- and remained his widow, to pay the taxes, insurance, repairs, etc., on all the property, and to divide the surplus income equally among the nine children of said Jane Valentine, for their support, etc. At the end of the sixteen years, which was in July, 1869, he ordered and directed his executors to sell at public auction “all the said houses, stores and lots herein-before devised ” to them, and to divide the proceeds among the said nine children, etc., among whom were John H. Valentine and George F. Valentine.
At or about the expiration of the sixteen years (1869) all of the
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real- estate was sold except tlie Nineteenth street house, and in the year following an accounting was duly had before the then surrogate, all parties in interest having been duly cited, which resulted in a decree of distribution, etc., bearing date May 23, 1870, and disposing of about $180,000 belonging to the nine children. By that decree, among other things, it was- directed that the trustee retain in his hands the sum of $50,511, and keep invested, “in ■order to pay the annunity of $2,000, yearly or oftener to the said Jane Valentine, the widow of the said Abraham G. Valentine, until her marriage or death, and to pay the taxes, insurance and repairs during the same period of said house and lot No. 138 (formerly 98) East Nineteenth street." Jane Valentine died in, 1888. The house and lot has since been sold for $19,200. The object of this accounting is to account for and make distribution of said $50,511 and the $19,200, with the increase.
It appears that John H. Valentine assigned all his interest in the estate to his mother, Jane Valentine, in 1867; the assignment was produced on the accounting of 1870, and the execution of it was acknowledged before John W Mills, the then surrogate, and the assignment was recognized as valid by the decree.
On the 13th day of November 1872, John II. Valentine again assigned his share to his brother, George F. Valentine. To the assignment to Jane Valentine was affixed no internal revenue stamp. Two days afterwards, on the 15th day of November, 1872, he made a like assignment to George H. McFadden. That to McFadden was recorded in the register’s office in New York, on the 6th of June, 1873; arid that to George F. Valentine on the 12th of the same month and year. Jane Valentinp assigned the interest conveyed to her by John H. to George F., on the 28th December, 1876, and the assignment was recorded in the same, office on the next day. John H. had died in November preceding, leaving an only son, John H. E. Valentine, to whom McFadden, on the 30th day of January last, assigned his interest.
Coffin. S.—The chief question this court is called upon to determine is, who is the owner of and entitled to the share of John H. Valentine, deceased. It is claimed on the one hand by George F. Valentine, his brother, and on the other by John H. É. Valentine, his only child. The former asserts his right to' it by virtue of the assignment from his mother, and also under one to him direct: the latter, through that from McFadden. There can be no reasonable doubt but that John H. had an assignable interest when he made the assignment^ subject to the mortgage, to his mother. It was recognized as valid at the accounting in 1870, and his share, less the mortgage, decreed to be paid to the assignee. All in interest were personally or by representation present and appear to have acquiesced in the decree. The assignment was then acknowledged before Judge Mills, at that time surrogate, and was recorded December 21, 1876. The sixteen year period, at which time the real estate was directed, by the will, to be sold, had not elapsed at its date, but it had, when the accounting occurred and the Amlidity of the assignment aaus judi
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cially recognized. At that time the surrogate had power to take the proof and acknowledgment of conveyances (Laws of 1851, chap. 175), although, in the view to be taken, it is regarded as immaterial
By the will, all of the stores, houses and lots, etc., were devised to the executors, and were ordered to be sold in July, 1869. This operated at that date as an equitable conversion into personalty of the whole, including the Nineteenth street house, but in that the widow was to have an estate for her life. It was, therefore, to be sold with the rest, but subject to her life estate. The executors were ordered to permit her so to enjoy it. They were directed to sell, but in such manner as to preserve her rights. The fact that it was not so sold cannot destroy the effect of the rule relating to equitable conversion. Where a testator directs a sale of his real estate, it becomes legal assets at his death, whether it be actually converted at the end of one or ten years, or more. It seems quite apparent, from the language of the will, that this property was to be sold with the rest, subject, however, to the incumbrance. No other provision for its otherwise ultimate disposal can be found in the will, and the testator’s intention to dispose of his whole estate is entirely clear.
It is claimed, however, that, inasmuch as the decree of 1870 recites that the executors had then sold and conveyed all the ¿ands and real estate of the deceased ordered to be sold, when in fact the Nineteenth street house had not been sold, it operated as a judicial construction of the will to the effect that it was not included in the property directed to be sold, and is therefore res adjudícala upon that subject. This position does not seem to be tenable. In the first place, it is a mere recital. Nothing can be found in the decree adjudging any such fact; and beside that, no such question could be involved in that accounting. The executor was merely rendering his account of moneys received and disbursements made. Had the question in any way arisen, as, fox-instance, had some one asked the executor to account for the value of that house, he could only say, “I have not sold the remainder following the life estate,” and on his then asking the surrogate to compel him to sell it and distribute the proceeds, he must have x-eplied that he had no power to so order, that he must apply to some other forum. • It is perfectly apparent that no such question was raised on that accounting, See Miller v. Maniac, 6 Hill, 114 ; and it is equally clear that had there been, the court had no power to make any decree on the subject capable of execution.
The fund set apart to produce the widow’s annuity añd the payment of taxes, insurances and repairs, was so adjudged by the court, on consent of all the parties, and those matters must be regarded as res adjudícala.
The affixing of an internal revenue stamp was not essential to the validity of the assignment to Mrs. Valentine when offered in evidence in, and submitted to, the courts of this state. People ex rel. Barbour v. Gates, 43 N. Y., 40 ; Moore v. Moore, 47 id., 467.
It does not seem to be necessax-y to determine what effect, if
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any, is produced by the neglect of Jane Valentine to have her assignment from John H. recorded. He had an interest at its date m the unsold real estate, and the assignment was made subject to a mortgage he had given for $10,000. In July, 1869, as has been seen, he ceased to have any interest in the real estate, by reason of its equitable conversion. When that occurred, the assignment took effect on the assignor’s interest as legal assets and did not thereafter require recording to give it precedence over any subsequent conveyance of the share, and any assignments thereafter affecting his interest in the estate were not covered by the recording act. Hence, his assignment to George F. Valentine, being prior in date to that to McFadden, takes precedence of it, having been given, as appears, for value. What the equities were between him and his mother, growing out of his assignment to her, is not shown. At all events, John PI. had as much interest to assign to George F. as he had to McFadden. The latter, taking nothing by virtue of the assignment to him, had nothing to assign to John H. E. Valentine, the present claimant of the .share. Whatever interest Jane Valentine may have had was also conveyed to George F in 1876. Under the circumstances, it is determined that George F. Valentine is legally entitled to whatever may be the amount of the share in controversy.
The testator, among other things, directed the proceeds of the sales, to be made in 1869, to be paid to the nine children of his deceased son, Abraham G. Valentine, and that if any of them had. then died leaving lawful issue or descendants, it should be paid to such issue or descendants. One of the nine, Mary Jane, died in 1877 without issue or descendants. She was entitled to her share in possession in 1869, and her share belongs to her estate, and should be decreed to be paid to her executors or administrators, if any have been appointed.
The legatees who received payments on account of their several shares are not chargeable with interest thereon, because they were then due and payable to them; but the interest received by the trustee since all of the shares became payable should be so apportioned as to equalize it among all as far as practicable.
This, it is believed, disposes of all of the questions submitted. Should anything have been overlooked, it will be determined on the settlement of the decree.
Thomas M. Wheeler, for app’lt; Israel Minor, Jr., for resp’t.
Abraham Valentine died leaving a will admitted to probate June 7, 1858. By the ninth clause of this will, which is very long, the testator devised certain real property to his executors to receive the rents and profits and apply them as directed by this clause for the lives of two persons named therein, not exceeding sixteen years if these lives or either of them survived that period. The property was then, at the end of the sixteen years, to be sold and the proceeds divided. There was included in this property a house and lot in the city of New York. By the ninth clause in question a gift of a life estate in this house was given to Jane Valentine so long as • she remained the widow
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of testator’s son Abraham Valentine. The direction at the end of the sixteen years did not exempt this house and lot from sale, only providing that the devise to the executor was “ subject to the right of the said Jane Valentine.” Both of the lives survived the sixteen years and all the property was sold except the house and lot The scheme required the sale of the remainder in this parcel as well as of the rest of the property contained in that clause. John H. Valentine was one of the distributees of the moneys under this clause and he survived the sixteen year period. He therefore had a vested estate with a right to immediate possession when that period arrived, and this embraced the house and lot as well as the other property.
By the tenth clause of the will the testator gave certain property therein described, one-half to Samuel M. Valentine and the other half to his executor to be managed and rented by his executor and the proceeds applied to the use of the same children of Abraham G. Valentine who were the distributees of a portion of the property in the ninth clause. The property in the tenth clause was subject to charges particularly specified therein. .The executors were authorized to sell and apply proceeds as directed, and “ to divide and pay to the aforesaid children of the said Abraham G. Valentine, deceased, and the issue of such of them as may then be dead leaving such issue or descendants then surviving in the same proportion as I have hereinbefore directed my executors to pay to them the moneys arising from the sale of the ■said stone house and lot in the ninth article of this my will.”
John H. Valentine, one of the children of Abraham G. Valentine, died in November, 1876. The life estate expired in November, 1888. I think the words “ then be dead ” and “ then surviving ” refer to the end of the sixteen year period if not shortened by the death of both lives before that time. The testator evidently intended to dispose of all his property in the 9th and 10th clauses in the same way. The trust could not exceed sixteen years, and at the end of that time the property was given absolutely to the persons then entitled. A postponement of the time of sale of the New York house until after one of the beneficiaries died would not deprive him of the estate if such beneficiary survived to be entitled to take immediate distribution if one was practicable. The assignment of John H. Valentine before the sixteen year period had expired was good. He had either a vested interest or would have if he survived until a specified event happened which caused the vesting of the estate. In either case he had an interest which was alienable to the same extent as if in possession. Ham v. Van Orden, 84 N. Y., 257 .
The absolute direction to convert the land into money operates as an equitable conversion. The recording acts did not therefore apply to the assignment from John H. Valentine and his successors in title.
The decree should, therefore, be affirmed, with costs.
Dyicman and Pratt, JJ., concur.