Edwards v. Edwards

• Decision Date: 18 June 1903
• Citation: 67 N.E. 658,183 Mass. 581
• Parties: EDWARDS et al. v. EDWARDS et al.
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

183 Mass. 581

67 N.E. 658

EDWARDS et al. v. EDWARDS et al.

Supreme Judicial Court of Massachusetts, Norfolk.

June 18, 1903

COUNSEL

Augustus P. Loring, for plaintiffs.

Edwin A. Howes, Jr., for respondents.

OPINION

KNOWLTON C.J.

This is a bill for instructions by trustees appointed under the will of James Edwards. By the will he gave all his property to these trustees, stating the trust as follows, viz.: 'To invest and reinvest the same at their discretion, in such securities as the laws of this commonwealth allow savings banks to invest their funds in; and the whole income therefrom shall be paid to my said wife as long as she shall live, for her own use and disposal, with the exception that I direct that from said income there shall be paid monthly to my son William Edwards and his wife Alice J. Edwards, in equal shares, the sum of one hundred dollars as long as my said wife shall live.' At the death of his wife the trustees are to pay the income to his children, and to the wife of one of them, and at the termination of the trust to pay over the remainder to his grandchildren or his heirs at law. The value of the personal property that came into the hands of the trustees was nearly $70,000, and the value of the real estate was more than $200,000. Much of the personal property that he left was stock carried by brokers on margins, and the most valuable part of the real estate was unproductive land on Huntington avenue, which was appraised in the executor's inventory, filed November 11, 1896, at $150,000, and in the trustees' inventory filed December 31, 1898, at $155,000, and was sold by the trustees on September 1, 1899, for $196,500. The question relates to the apportionment of income and principal between the life tenant and the remaindermen, from the proceeds of the sale of the land of Huntington avenue. It is agreed that the value of this land at the time of the testator's death was the same at which it was appraised in the executor's inventory, and that the trustees used every reasonable effort to sell it, and, in view of the improvements in that vicinity, exercised a sound judgment in holding it until the time of the sale. It did not produce sufficient income to pay the taxes and expenses upon it. Under language like that of this will, which gives the trustees all the property, real and personal, and does not indicate an intention that the time for establishing the fund shall be postponed, and which gives to a life tenant the annual income, it is well-settled law in this commonwealth that the income is to be computed from the time of the testator's death. Sargent v. Sargent, 103 Mass 297-299; Westcott v. Nickerson, 120 Mass. 410. In the present case the testator obviously intended that the entire property should be converted into one fund, and that the unproductive and speculative investments which he had at the time of his death should be changed without unreasonable delay. Much of the property held on margins was not of such a kind 'as the laws of this commonwealth allow savings banks to invest their funds in,' and the land on Huntington avenue was not in a condition to be held as a permanent investment. It was therefore the duty of the trustees to convert this property into an income-producing fund, and this they did according to their best judgment and discretion. The testator is presumed to have expected that some time would be required to accomplish this. At the same time, he is presumed to have intended that the rights of the life tenant to income should be ascertained on the creation of the fund, as if the fund had come into existence immediately after his death. This is in accordance with the rule repeatedly stated by this court. Kinmonth v Brigham, 5 Allen, 270-278; Sargent v. Sargent, 103 Mass. 297; Westcott v. Nickerson, 120 Mass. 410; Mudge v. Parker, 139 Mass. 153, 29 N.E. 543. The rule is applicable as well when the delay in converting the property is necessary as when it is caused by the voluntary act or default of the trustees. Loring v. Massachusetts Horticultural Society, 171 Mass. 401-404, 50 N.E. 936. In Westcott v. Nickerson, ubi supra, Chief Justice Gray says of the property in such cases, 'The necessary inference and the established rule are that it must be invested as a permanent fund and the value thereof fixed at the time when the right of the first taker began; that is to say, at the death of the testator.' In Sargent v. Sargent, ubi supra, the same judge says, 'The general rule is established that the tenant...