Fid. Union Trust Co. v. Reeves

• Decision Date: 04 August 1924
• Citation: 125 A. 582
• Parties: FIDELITY UNION TRUST CO. v. REEVES et al.
• Court: New Jersey Court of Chancery

125 A. 582

FIDELITY UNION TRUST CO.

v. REEVES et al.

Court of Chancery of New Jersey.

Aug. 4, 1924.

Suit between the Fidelity Union Trust Company and Francis Reeves and others. On final hearing. Decree in accordance with opinion.

Francis Lafferty, of Newark, for complainant.

Charles G. Titsworth, of Newark, Charles M. Dolliver, of Plainfield, and Lum, Tamblyn & Colyer, Whiting & Moore, and W. Howard Demarest, all of Newark, for defendants.

BACKES, V. C. Harriet Schuman became an inmate of the Bloomfield Home for Aged Men and Women at the age of 79 and remained 4 years, until her death. She signed the usual form of application for admission, by which the Home agreed to maintain her for life "or so long as said Home shall be supported by said voluntary contributions in the manner warranted by its income," and in which she agreed in consideration of being received as an inmate to pay an entrance fee of $300 and "to assign and set over in proper legal manner any pension or other property, real or personal, of which I may be seized or possessed or may hereafter acquire." She died possessed of an estate valued at $30,000, which, oddly, came to her shortly before her death. Sixteen days before she passed away, her son-in-law, Charles P. Zabriskie, died testate leaving his estate to his widow, who died testate a few days later leaving it to her mother. Mrs. Schuman's next of kin are nieces. The complainant, Fidelity Union Trust Company, holds the fund and asks instructions to whom to pay it. The next of kin claim that the contract to assign does not include the mere possibility of a legacy, and that a contract to assign all future-acquired property is contrary to public policy.

The great weight of authority in England and this country is that a mere expectancy or possibility by inheritance or testament is not assignable at law, but is assignable in equity for a valuable consideration, and that the assignment will be enforced in equity when the expectancy or possibility has changed into a vested interest or possession. 3 Pom. Eq. §§ 1271, 1287; Warmstry v. Tanfleld, 1 Ch. (Eng.) 29; Bennett v. Cooper, 9 Beav. 252; Wilson Estate, 2 Pa. 325; Smithurst v. Edmunds, 14 N. J. Eq. 408; Bacon v. Bonham, 33 N. J. Eq. 614; Mitchell v. Winslow, 2 Story, 630, Fed. Cas. No. 9,673; Holroyd v. Marshall (Eng.) 10 H. L. C. 191.

The general principle is not controverted, but it is contended that to be good in equity the subject-matter of an assignment of an expectancy or possibility must be in contemplation of the parties. In other words, that the source of the possible inheritance or bequest must be apparent. In support of the proposition cases at law are cited where specified prospects, including all future acquisitions, were assigned and where it was held that the assignments were inoperative as to the latter because it was found not to have been the intention of the parties that property later accidentally acquired should thereby pass; the logic being that it would include future earned income, and one does not intentionally deprive oneself of the means of livelihood, and that the impolicy of permitting one to do so reflects the absence of such intention. Tadman v. D'Epinenil, L. R. 20 Ch. Div. 758; Cook v. Conway, 2 Cranch, 99, Fed. Cas. No. 3,154; Munsell v. Lewis, 4 Hill (N. Y.) 635, reversed 2 Denio (N. Y.) 224, overruled Field v. Mayor of N. Y., 6 N. Y. 179, 57 Am. Dec. 435. These cases do not hold that an assignment of a possibility unless a definite source be contemplated is inoperative and nonenforceable in equity. In Field v. The Mayor of N. Y., supra, the Court of Appeals said:

"Whatever doubts may have existed heretofore on this subject, the better opinion, I think, now is, that courts of equity will support assignments, not only of choses in action, but of contingent interests and expectations, and of things which have no present actual existence, but rest in possibility only, provided the agreements are fairly entered into, and it would not be against public policy to uphold them. Authorities may be found which seem to incline the other way, but which upon examination will be found to have been overruled, or to have turned upon the question of public policy."

In the case in hand there were possibilities but no prospects, and in the very nature of tilings all possibilities, whatever the source or origin, were comprehended. The contract was fairly entered into and faithfully and honestly carried out by the Home and ought in conscience to be upheld, and may be upon the principle and authority above stated, unless it is in conflict with the policy of the law.

The principles and doctrine of public policy are matters of common, professional knowledge. While the term is profound as well as panacean in legal jurisprudence, it admits of no exact definition. Its virtue and vigor lies in its flexibility of application, and while reported cases furnish guides they rarely are compelling in precedent. I am referred to Baltimore Humane Soc. v. Pierce, 100 Md. 520, 60 Atl. 277, 70 L. R. A. 485, in which the court refused to enforce a somewhat similar contract on the ground that it offended public policy. There Pierce, the father, made a written application to the society for admission to its home, in which he promised to obey the house rules. The society reserved to itself the right to expel him for cause. Pierce, the son, and another, covenanted with the society that if Pierce, the applicant, should acquire any property by legacy, devise, or otherwise, they would cause the same to be transferred and conveyed to the society. The son died and the father inherited from him $3,500. The father refused to transfer, and the society brought suit for damages for breach of the covenant. The court felt that it would be contrary to the public good to lend the aid of the courts to enforce such a contract and the reasons seem to be: The inmate's term was...