Titsworth v. Titsworth
| Decision Date | 10 January 1931 |
| Citation | 152 A. 869 |
| Parties | TITSWORTH et al. v. TITSWORTH et al. |
| Court | New Jersey Court of Chancery |
Syllabus by the Court.
Where a testator provides by will that his estate shall be held in trust for his children, and makes different disposition of the corpus in the case of the share of each child, and there is no right of survivorship, the trustees should keep a separate trust fund for each child.
Syllabus by the Court.
When there is a surplus of income in any year, and the beneficiaries who are alone affected consent thereto, such surplus income should be reinvested as principal.
Syllabus by the Court.
This court will not authorize executors or trustees to disregard the statute directing them to file their accounts and have them properly audited, and at the same time fix their commissions in the future for services not yet rendered on accounts not filed and never to be filed or audited.
Syllabus by the Court.
The only legal way for executors and trustees to secure commissions is to file accounts at the proper time in the proper court and have them audited and allowed according to the provisions of the statutes.
Syllabus by the Court.
Where rights to subscribe have been sold by the trustees and stock dividends received, and the beneficiaries who are alone affected consent, the trustees should allocate them to corpus.
Syllabus by the Court.
This court will not pass upon unnecessary questions, or those not presently before it; therefore it will not determine what authority a person may have under a will as trustee if he should become a trustee.
Syllabus by the Court.
By the language of this will it is clear that the testator meant to allow the life tenants only such yearly income as the trustees shall think reasonable. Therefore the life tenants are only entitled to an income which the trustees in their discretion may think reasonable. They may, however, at any time apply to this court on the ground that the allowances are unreasonable and that the trustees have abused the discretionary power vested in them by the testator.
Suit by Frederick S. Titsworth and others, as executors and trustees of the estate of Charles Grant Titsworth, against Charlotte Grant Titsworth and others, for the construction of decedent's will.
Decree in accordance with opinion.
Pitney, Hardin & Skinner, of Newark, for complainants.
William H. Osborne, Jr., of Newark, for defendants Charlotte Grant Titsworth and Grant Titsworth.
Alexander T. Schenek, of Newark, for defendants Board of Foreign Missions, etc., Board of National Missions, etc., and Board of Christian Education, etc.
CHURCH, Vice Chancellor.
This is a bill for the construction of the will of the late Charles Grant Titsworth. The facts have been stipulated as follows:
Charles Grant Titsworth died a resident of the city of Newark, Essex county, N. J., March 29, 1927, having first duly executed and published a last will and testament bearing date March 15. 1927.
Said will was duly probated by the surrogate of Essex county, April 11, 1927, and letters testamentary thereon were issued to complainants, Frederick S. Titsworth, Frances T. Dusenberry, and Mary T. Taylor, the executors named therein. Said executors thereupon undertook the administration of the estate. All of the said executors are alive and are acting as executors and trustees under the will.
Charles Grant Titsworth, the decedent, left him surviving, his daughter, Charlotte Grant Titsworth, born September 7, 1902, and his son, Grant Titsworth, born February 19, 1908, both of whom are unmarried and are residing in the city of East Orange, county of Essex, and state of New Jersey. Grant Titsworth is at the present time attending Harvard Law School, in the city of Cambridge, state of Massachusetts, as a student for a degree therein. Charlotte Grant Titsworth has not requested the purchase of a residence for herself, nor has she been nor is she now engaged in any business or profession. Both of said children have duly executed their respective wills and testaments.
The executors have paid the debts, funeral expenses, and administration expenses of the decedent. They have also complied with the provisions of the second clause of the will and have paid the legacies mentioned in the third, fourth, fifth, sixth, seventh, eighth, ninth, and tenth clauses of the will. The executors have not prepared or filed any account of their administration of the said estate, either as executors or as trustees, in any court. They now hold the residuary estate, largely invested in securities, and have been continuously collecting the income from the corpus of such residuary estate. The executors as trustees have been paying to Charlotte Grant Titsworth and to Grant Titsworth allowances sufficient to cover their respective expenses for support and maintenance, and other personal expenses, and in the case of Grant Titsworth, sufficient also to defray the cost of his attendance at Harvard Law School. Such allowances and disbursements do not, however, exhaust the income received by them as trustees, and there is a substantial surplus of income over and above such allowances and disbursements. Neither of the beneficiaries, Charlotte or Grant, have at any time requested the payment to themselves of the entire income received by the trustees, but have acquiesced in the amounts paid by the trustees. The executors as such and as trustees have made and filed income tax returns as required by the federal statutes and regulations applicable thereto for the years 1927 (exclusive of that portion thereof, prior to March, 1928), 1928, and 1929.
The executors, in setting up and keeping their accounts of their administration as trustees and in making their said income tax returns, have considered that the terms of the will required the holding by them as trustees of two separate, individual trusts, each of one-half of the residuary estate. They accordingly segregated the securities, inventorying certain securities, equal in value to one-half of the residuary estate, as comprising the corpus of the trust for Charlotte Grant Titsworth, and inventorying the balance of the securities as comprising the corpus of the trust for Grant Titsworth. The executors as trustees have also accordingly kept four separate bank accounts, one each for the corpus and for the income of each separate trust and have recorded separately the receipts and disbursements as to corpus and as to income of each trust. Exception to this method of segregation and accounting has been taken by the Bureau of Internal Revenue of the Treasury Department of the Federal Government in reviewing the income tax returns of the executors as fiduciaries, which has asserted that the will contemplates the existence of only one trust fund for the benefit of both of the beneficiaries, Charlotte Grant Titsworth and Grant Titsworth. Federal income taxes upon the income received by the trustees, if treated as one trust, would be...
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