Nat'l Newark & Essex Banking Co. v. Rosahl
Decision Date | 08 April 1925 |
Citation | 128 A. 586 |
Parties | NATIONAL NEWARK & ESSEX BANKING CO. v. ROSAHL et al. |
Court | New Jersey Court of Chancery |
(Syllabus by the Court.)
Suit by the National Newark & Essex Banking Company against Johannes Hermann Curt Rosahl and others, wherein the trustee asks for advice of court in administration of trust. Trustee advised.
Pitney, Hardin & Skinner and Edward O. Stanley, Jr., all of Newark, for complainants.
Cecil H. McMahon, of Newark, pro se.
BACKES, V. C. Johannes Hermann Curt Rosahl, by deed, assigned and delivered to the complainant securities of the face value of $10,000, upon trust to pay the net income to him for life, thence to his widow for life, corpus to his lawful issue; if no widow or issue, then to pay the net income to his mother, and upon her death to his three sisters, and the survivors of them, and upon the extinction of these life interests to pay the principal to his appointee by will, and in default of appointment to his next of kin who would be entitled under the laws of this state to succeed to his personal property. The deed contained a provision that the trustor may during his lifetime, by instrument in writing, duly acknowledged, The trustor died intestate and unmarried, leaving his mother and his three sisters, his next of kin.
The defendant McMahon was appointed administrator of the state. Shortly before the death of the trustor he executed and duly acknowledged an instrument in writing, styled thereon "Amendment to the Deed of Trust of Johannes Hermann Curt Rosahl, Dated July 16, 1921, in Which the Newark & Essex Banking Company is the Trustee of This Estate," in which the trustee is given authority to manage the estate for 10 years after his death, and semiannually divide the income among his heirs (sic?) in equal parts, and at the expiration of that time to divide the corpus equally among his remaining heirs (sic?), and, if there be none, then pay it to the city of Lueneburg (Hann.), Germany, to be used to feed the hungry school-children and orphans. The trustee seeks the advice of the court in the administration of the trust and the determination of the rights of the parties in the estate. The trustee is advised that:
1. The deed of trust is not, as claimed by the administrator, testamentary, and therefore invalid, because it was not executed as wills are required to be. The trust was completely executed. The property passed out of the donor, and vested in the trustee to the beneficial use of the cestuis que trustent. That some of them were not to come into enjoyment until after the death of the donor did not affect the vesting of their interest. If the power of revocation is not exercised, the interest remains vested as though such power had not been reserved. 1 Perry on Trusts, 137. The power is personal to the trustor. Jones v. Clifton, 101 U. S. 225, 25 L. Ed. 908; Brandies v. Cochrane, 112 U. S. 344, 5 S. Ct. 194, 28 L. Ed. 760. The reservation of such power is not inconsistent with the passing of title to the property to the trustee. Stone v. Hackett, 78 Mass. 227; Windolph v. Girard Trust Co., 245 Pa. 349, 91 A. 634. The omission of such reservation has led to voluntary settlements being set aside on the ground of mistake. 26 R. C. L. 107; Garnsey v. Mundy, 24 N. J. Eq. 243.
The distinction between trusts thus created and transfers of property to take effect after death, as in Stevenson v. Earl, 65 N. J. Eq. 721, 55 A. 1091, 103 Am. St. Rep. 790, 1 Ann. Cas. 49, upon which the administrator relies, is that in the one the property immediately passes out of the donor, while in the other it remains in him and passes at death. The doctrine of that case, as pointed out by Chancellor Walker in Robeson v. Duncan, 74 N. J. Eq. 745, 70 A. 685, ...
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