In Re Butler's Estate.

• Decision Date: 08 June 1945
• Parties: In re BUTLER'S ESTATE.
• Court: New Jersey Prerogative Court

42 A.2d 857

In re BUTLER'S ESTATE.

Prerogative Court of New Jersey.

June 8, 1945.

Proceedings in the matter of the estate of Eustace Cameron Butler involving a trust created in the will of deceased.

Decree in accordance with opinion.

Syllabus by the Court

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1. A trust to provide scholarships for higher education is a charitable trust.

2. If a trust be created for a charitable purpose, the giving of a preference to those members of a certain family who come within the general class of beneficiaries does not deprive it of the character of a charitable trust or convert it into a private trust.

3. The question is not what the testator desired to accomplish but what will be the result of the trust upon the community and society in general.

4. The presumption is that trustees will fulfill their duties in an impartial manner.

Luke M. McKenny, of East Orange, for trustees.

Edward L. Stasse, Sr., of East Orange, for executors.

Robinson & Morris, and Irving Morris, all of Newark, for appellants.

Lionel P. Kristeller, of Newark, for infant respondents.

BIGELOW, Vice Ordinary.

Dr. Eustace C. Butler, late of Essex County, bequeathed his residuary estate to his brother Kenneth, and his nephews Robert E. Duncombe and William H. Maura, all of Nassau, in the Bahama Islands: ‘In trust, nevertheless, to use the income htereof to provide annual scholarships for higher education to deserving children resident in Nassau, Bahamas, with full power to my said trustees to appoint their successors and/or substitute trustees for this fund with power to name and designate their successors in office. It is my wish that preference in the awarding of these scholarships be always given to the descendants of my brothers and sisters if they are in need of and apply for such assistance. My said trustees or their successors in office shall and may make such reasonable rules and regulations as may to them seem advisable for the awarding of said scholarships. To the end that this trust shall not fail for want of trustees I authorize the appropriate probate authorities of Nassau aforesaid, to appoint trustees in the event at any time of the failure of trustees to be appointed as I have provided and qualify.’

The respondents, who are the next of kin of Dr. Butler, say that this is a private trust which violates the rule against perpetuities and therefore fails. A trust to provide scholarships for higher education is a charitable trust. Noice v. Schnell, 101 N.J.Eq. 252, 137 A. 582, 52 A.L.R. 965. But the respondents insist that the preference given to descendants of testator's brothers and sisters is fatal. A trust for the benefit of the descendants of the donor's relatives is not a charitable trust. But if a trust be created for a charitable purpose, the giving of a preference to those members of a certain family who come within the general class of beneficiaries does not deprive it of the character of a charitable trust or convert it into a private trust.

In re MacDowell's Will, 217 N.Y. 454, 112 N.E. 177, L.R.A.1916E, 1246, Ann.Cas.1917E, 853; Restatement-Trusts, sec. 375 (c); 2 Bogert on Trusts and Trustees, § 362; 3 Scott on Trusts,...