In re Wilcox

• Decision Date: 09 February 1909
• Citation: 87 N.E. 497,194 N.Y. 288
• Parties: In re WILCOX.
• Court: New York Court of Appeals Court of Appeals

194 N.Y. 288

87 N.E. 497

In re WILCOX.

Court of Appeals of New York.

Feb. 9, 1909.

Appeal from Supreme Court, Appellate Division, Fourth Department.

In the matter of the judicial settlement of the account of Frances D. Wilcox, as trustee under the last will of Bethuel McCoy. The decree of the surrogate was affirmed by the Appellate Division (125 App. Div. 152,109 N. Y. Supp. 564), and, from the order of affirmance, certain of the parties in interest appeal. Reversed.

George H. Ansley, for appellant.

Archibald M. Laidlaw and Rodney R. Crowley, for respondents.

CULLEN, C. J.

Bethuel McCoy died testate in 1874. He left him surviving three children, William McCoy, Charles McCoy, and Frances D. Wilcox. A daughter, Maria E. Sanders, predeceased him, leaving a husband and two children. This controversy relates to the validity and effect of the seventh clause of his will, which is as follows: ‘I give, devise and bequeath all the rest, residue and remainder of my estate, both real and personal, as follows: * * * and the remaining third thereof to my said executors in trust for the purpose of paying the income thereof to my daughter, Frances D. Wilcox, for and during the term of her natural life, annually, and at her decease I give, devise and bequeath to her issue, share and share alike, such income, and as each of her said issue shall attain the age of 21 years, I give, devise and bequeath to it one equal undivided share of the principal of said remaining third, and in case my said daughter, Frances D. Wilcox, shall die, leaving no issue born to her, which shall attain the age of 21 years, then and in such case, said remaining third of my residuary estate, I give, devise and bequeath to my daughter, Maria E. Sanders, and my son Charles McCoy, share and share alike forever.’ By the will the testator's son Charles McCoy was appointed executor thereof.

By one of the codicils the provisions of his will in favor of Maria E. Sanders was modified so as to give her the income of this share for life, and on her death the principal to her husband and children. Maria, as already said, died before the testator. The will was proved and the executor qualified. On the settlement of the executor's accounts in 1880, it was found that the fund for the benefit of Frances D. Wilcox under the seventh clause of the will amounted to $7,512. The executor was directed to invest said sum and apply the income to said Frances during her life, and upon her death to distribute it in accordance with the provisions of the will. The executor died in 1898, when the beneficiary Frances was appointed trustee of the fund. She received the income during her lifetime. On her death in January, 1906, the executor of her will instituted these proceedings for the settlement of her accounts as trustee. Frances was married at the decease of her father, the testator. She left no issue her surviving, having had but one child who was born March 6, 1859, and died on the 3d of June following. The contest is between Charles B. McCoy and Frank G. McCoy, the children of the testator's son William McCoy, who contend that the whole of the seventh clause of the will is invalid, and that the fund passed as in case of intestacy, and the legatees to whom by that clause the fund is bequeathed on the contingency that Frances should leave no issue who should reach majority. These legatees contend that the gift over is valid regardless of the invalidity of any provisions directing the prior disposition of the fund. The surrogate decided in favor of the legatees. That decision has been affirmed by the Appellate Division by a divided court, and the next of kin now appeal to this court.

It is conceded by both the learned courts below that the provision creating a trust in favor of the issue whom Frances might leave surviving until such issue respectively should reach their majority was illegal and invalid, in that it might suspend the absolute ownership of personal property during lives not in being at the death of the testator. This conclusion was undoubtedly correct (1 Rev. St. [1st Ed.] p. 723, pt. 2, c. 1, tit. 2, § 15), though it would have been valid in the case of real estate if it could be assumed that the trust was several as to the share of each issue. Manice v. Manice, 43 N. Y. 303. The trust during the lifetime of Frances was plainly valid and is readily severable from the ulterior provisions and limitations. Tiers v. Tiers, 98 N. Y. 568. But it was also held that the invalidity of the provision for the issue of Frances did not affect the validity of the gift over. It was considered that such gift, being made to named beneficiaries in being at the death of the testator, and the interests of such persons being at all times susceptible of alienation by them, did not suspend the absolute ownership of the property for any period. The learned judge who wrote for the Appellate Division said that the estates provided for by the will were alternative, and that, as the first and invalid one in favor of the issue of Frances had not taken effect, the second was in no way affected by such invalidity. In one sense the will provided for alternative dispositions of the property, but only in the sense that every gift over may be said to be alternative on the failure of the contingency on which the gift is dependent to occur. The dispositions were not, however, alternative in the ordinary use of that term. If the learned court intended to assert that the gift over by itself implied alternatives, to wit, a gift on the contingency that Frances died without issue her surviving-a gift that would have been unquestionably good-and a gift on the contingencythat no issue that she might leave should reach majority, such a doctrine seems to be in direct opposition to the decided cases. It is said by Prof. Gray in his work on Perpetuities, § 331: ‘Very often, indeed generally, a future contingency which is too remote may in fact happen within the limit prescribed by the rule against perpetuities, and a gift conditioned on such contingency may be put into one of two classes according as the contingency happens or does not happen within those limits; but, unless this division into classes is made by the donor, the law will not make it for him, and the gift will be bad altogether. * * * (Section 331.) This is the law even when the division is of the most obvious character. Thus a gift to B., if no child of A. reaches 25, is bad, although A. dies without children; while, if the gift over had been if A. dies without children, or if his children all die under 21, then on A.'s death without children the gift over would have taken effect.’ It was said in Re Bence, 1891, 3 Ch. (C. A.) 242, 251, alluding to another decision: ‘The case is therefore no authority for the proposition that every gift over may be analyzed into as many events as are included within its language, and be held good or bad as the events happen.’ It is in this respect that the case before us differs essentially from that of Schettler v. Smith, 41 N. Y. 328, relied upon by the Appellate Division. In that case the testator himself expressly made alternative gifts, the first upon the death of the widow of his son if the son should leave a widow, which was held bad, because such widow might be a person not in being at the death of the testator, and the other in the case of the death of the son without a widow, or of his death without issue, in either of which contingencies the gift over was good. So in that case the gift over upon the death of the son leaving a widow was held void in entirety, though it was entirely possible that the son's widow might be a person in being at the death of the testator. At this point we must recall two elementary principles in determining the validity of wills: First. Such validity must be determined not in the light of what has actually transpired, but from exactly the same point of view from which it would be regarded had a suit been brought to determine the validity of the will at the time of the death of the testator, instead of at a subsequent period. That is to say, the validity of a will depends not on what has happened since the death of the testator, but on what might have happened. Second. ‘In determining the validity of limitations of estates, under the above statutes (the provisions of the Revised Statutes in reference to absolute ownership and restraint of alienation), it is not sufficient that the estates attempted to be created may, by the happening of subsequent events, be terminated within the prescribed period, if such events might so happen that such estates might extend beyond such period. In other words, to render such future estates valid, they must be so limited that in every possible contingency they will absolutely terminate at such period, or such estates will be held void.’ Schettler v. Smith, 41 N. Y. 334.

The first question is: What is the effect of the invalidity of the trust which the testator attempted to create or continue during the minority of the issue of his daughter Frances. The words of the will are: ‘And as each of her said issue shall attain the age of 21 years, I give, devise and bequeath to it one equal undivided share,’ etc. The general rule is that such terms, although apparently making the gift depend on a contingency, should be construed as applying merely to the futurity of possession. So, also, the presence of a gift over in case of failure to attain the age of 21 years confirms the construction that the gift is vested. It was decided in Manice v. Manice, supra, where the trust during the minority of the issue of the daughter was held invalid as to personalty, that such personalty vested in the daughter's issue on the death of their mother. In this case, therefore, on the death of the testator's daughter Frances, her issue would have been entitled to the principal of the trust fund subject only to the limitation in favor of the...