Camden Safe Deposit & Trust Co. v. Read

• Decision Date: 02 February 1939
• Citation: 124 N.J.Eq. 599,4 A.2d 10
• Parties: CAMDEN SAFE DEPOSIT & TRUST CO. v. READ et al.
• Court: New Jersey Court of Chancery

4 A.2d 10

124 N.J.Eq. 599

CAMDEN SAFE DEPOSIT & TRUST CO.

v. READ et al.

Court of Chancery of New Jersey.

Feb. 2, 1939.

Syllabus by the Court.

1. The income of a testamentary trust is payable to testator's only child for life the trustee is directed and empowered "if at any time it shall become necessary owing to bad health or accident to my said son, to use so much of the said principal as they may deem necessary for his medical care and comfort during said sickness and convalescence." On Bill for construction, the latter provision held to have no relation whatsoever to the receipt of income by the son—that the use of principal for medical care and comfort is something to which the son is entitled over and above the income, in the named contingencies.

2. A trustee must assume the duty of determining what is a reasonable and sensible amount of principal to use under the circumstances, taking into consideration the station in life of the parties and the increase or decrease of the severity of the son's ailment.

3. A trustee will not be ordered to presently exercise the power of sale of real estate where conditions of the real estate market do not favor an advantageous sale.

Suit by the Camden Safe Deposit & Trust Company, trustee under the will of Edmund E. Read, Jr., deceased, against John S. Read, Mary Coffin, William T. Read, and others for a construction and certain instructions with respect to the will of Edmund E. Read, Jr., deceased, wherein Mary Coffin and William T. Read filed a counter-claim.

Decree in accordance with opinion.

Ephraim Tomlinson and Furman A. DeMaris, Jr., both of Camden, for complainant.

Boyle & Archer by F. Morse Archer, Jr., all of Camden, for Mary Coffin and William T. Read.

Starr, Summerill & Lloyd by Joseph J. Summerill, Jr., all of Camden, for John S. Read.

DAVIS, Vice Chancellor.

Complainant's Bill seeks a construction and certain instructions with respect to the will of Edmund E. Read, Jr., who died August 7, 1923, leaving his will dated January 7, 1923, duly admitted to probate by the Surrogate of Camden County on August 20, 1923, in which he appointed the Camden Safe Deposit and Trust Company (now Camden Trust Company) executor thereof, and to whom letters testamentary were granted. The will made a specific bequest of certain personal belongings and furniture to testator's son, John S. Read, and gave certain directions as to the burial of testator, and then provided that:

"All the rest, residue and remainder of my estate, real and personal, I give, devise and bequeath to the Camden Safe Deposit and Trust Company, in trust nevertheless, for the following uses and purposes:

"To pay to my said son as soon as may be after my decease the sum of One Thousand Dollars.

"To collect the rents, issues and profits thereof and after paying the necessary expenses of the trust, to pay the net income thereof to my son, John S. Read, in monthly installments as far as practicable, so long as he shall live, and I hereby authorize and empower the said Camden Safe Deposit and Trust Company to sell any and all of the real estate of which I may die seized, and to change any of the investments which I may have made in my lifetime, with full power to re-invest the same in such securities as they in their judgment deem best without regard to investment of the same in those securities which are legal for trust estates."

He further provided: "I further direct and empower the said Trust Company, if at any time it shall become necessary owing to bad health or accident to my said son, to use so much of the said principal as they may deem necessary for his medical care and comfort during said sickness and convalescence."

It is the latter paragraph to which our attention is directed for the purpose of determining the scope of the authority of the trustee respecting the use of the principal of the estate for the purposes mentioned.

The will further provided that upon the death of testator's son, John S. Read, leaving a widow and no children surviving him, that said trust should be continued for the benefit of such widow as long as she should live and remain his widow, provided she be in being at the time of the death of the testator, otherwise for the term of twenty years after the death of his said son; that if the said son, John S. Read, should die leaving a widow and children surviving him, then to continue said trust for the benefit of his widow as aforesaid and for his children equally, share and share alike, until the youngest shall have arrived at the age of twenty-one years, when the principal is to be divided among said children, share and share alike; and that in the event that the said John S. Read should die leaving no children surviving, or that all said children should die before they reached the age of twenty-one years, then subject to the devise to the widow, if any, as aforesaid, the sum of Ten Thousand Dollars in trust for the use of Saint Paul's Church, Camden, New Jersey; and the remainder of the said estate to testator's niece, Mary Coffin, and to his nephew, William T. Read, in equal shares; and if either or both of them should die before testator, their children to take the share their father or mother would have taken if he or she had been living. Testator made directions for the burial of his son, the said John S. Read, in like manner as for himself, and for the erection of a similar cradle over his grave.

John S. Read, William T. Read, and Mary Coffin, all of whom survived the testator, are parties defendant in this cause. William T. Read and Mary Coffin are half first cousins of John S. Read.

In lieu of the filing of an account by the complainant trustee, it was stipulated under date of December 21, 1937, for the purpose of the proceedings herein, that a summary thereof appended to the stipulation should be accepted as a true and correct statement of the figures therein set forth. It appears by this stipulation that the amount of principal, as per the first and final account of said executor, is $145,904.52; that the present book value of the principal is $160,384.05; and that the present market value of the principal is $141,223.01. There is, in addition, certain real estate consisting of the Read homestead property at 604 Cooper Street, Camden, New Jersey, and the lot adjoining on the rear and having a frontage of twenty feet on Broadway. It further appears that the total gross income from the estate so held in trust, from 1924 to 1937 inclusive, was $114,742.49, and that there had been paid in taxes out of the income, from February 1925 to date, covering premises 604 Cooper Street and lot adjoining in the rear, the sum of $38,299.24. The taxes for the year of the testator's death on these premises were $688.18, and for the year 1936, the sum of $3,348.62; and for 1937, after a deduction by a tax appeal, a net sum of $2,866.24. The trustee, under the authority of the quoted paragraph of the will relating to the medical care of John S. Read, has expended an aggregate sum of $7,710.19; and from the income, the trustee has expended for repairs on 604 Cooper Street the sum of $953.72, and has erected a garage on that part of the premises facing on Broadway at an expense of $2,061.05. After testator's death, North Broadway, Camden, was opened and certain assessments made which, together with certain arrearages of taxes, were paid out of the principal of the estate, amounting, in the aggregate, to $11,413.64.

John S....