Citation Numbers: 88 Ky. 242
Judges: Pryor
Filed Date: 2/14/1889
Status: Precedential
Modified Date: 7/24/2022
delivered the opinion of the court.
TT. D. Newcomb, by Ms last will, devised to Jolm B. Smith and Thomas L. Barret two hundred thousand dollars, to be held in trust and invested in safe securities, “so as to yield an income, which, after paying all taxes and charges thereon, shall be applied by said trustees to the continual support and maintenance of my wife, Mary Cornelia Newcomb, and her children, free from the control, use or enjoyment of any husband she may have; but neither the said trustee, nor Mrs. Newcomb, nor any future husband, nor her child or children, shall at any time have the power, right or authority, in any way, manner, or for any purpose, to encumber or anticipate the said fund or the said income, or any part thereof, for any purpose whatever; and in case these instructions are violated, this bequest at once shall be void, and the fund become a part of
The devisor also bequeathed to the trustees, for his two infant children, the sum of one hundred thousand dollars each, and provided that, if one of the trustees should die, or decline to act, the remaining trustee was invested with the power to appoint another, with like powers, etc. Barret refused to- act as trustee, and John B. Smith selected Gfeorge W. Morris in his stead. Smith was the father of Mrs. Newcomb, the widow of the devisor, and was the actual manager of the trust estate, both for his daughter and her children. New-comb died in the year 1874, and no settlement was had by Smith, as trustee, until July, 1882. Up to that settlement no charge had been made by the trustee for his services, either against his daughter or her children. It seems that the trustee had given his notes, payable on demand, for what he had used of the trust money, amounting to four thousand dollars, and the Chancellor allowed him, as commission at that time, five per cent, on income, and one and a half per cent, on investments. After that date, in July, 1882, he continued to charge his grandchildren his commission regularly up' to his death, but made no charge against his daughter for managing the trust from which her income was derived. Smith died in April, 1887, leaving his wife his executrix. The office of trustee becoming vacant, by reason of his death, the present appellee, the Fidelity Trust and Safety Yault Company, was appointed trustee in his place, and Mrs. Smith resign
Smith died insolvent, and this is, in fact, a claim asserted by the administrator for the benefit of creditors. After the death of her father, Mrs. Ten Broeck demanded her income, and was told that his commissions would have to be deducted, and she claiming that the services rendered were gratuitous, and such as her father had the right to donate to her, by reason of the relation between them, that of parent and child, declined to pay the commission, and hence this appeal. The claim of the appellee is, and upon that the Chancellor based his judgment, that the’' father paid to his daughter the whole of each quarterly income, from the year 1882 until the year 1887, without making any deduction for compensation, because her necessities demanded it. After the settlement in 1882, he continued to deduct his commissions from the income and investments made or paid to his grandchildren, and kept a separate account as to the income of the appellant. He had made judicious investments of the principal, so as to enable him to pay his daughter a
Besides, such a fund, Avith the facilities afforded him in his bank for managing it, could not have been attended with much expense or trouble, and under the circumstances we perceive no reason why he should
It is true the daughter had no legal or equitable right to exact’ from her father the discharge of these duties as a mere gratuity, but the father had both the legal and natural right to aid his daughter in the transactions connected with this trust free of charge on his part, and we think that such was his purpose, as is evidenced from his conversations with Burford, and the manner in which he disposed of this income from 1882 until his death. He made regular charges against his grandchildren, and it is not unnatural or unreasonable that he should decline to make any other charge. for his services at the expense of the welfare and happiness of his child. He never ,changed his intention or purpose with reference to this compensation. The same circumstances, appealing to his affection for his daughter, and inducing this generosity on his part, existed at his death that influenced his whole action from the year 1882. His personal representative should not be allowed to change that intention, or to show that the surrounding circumstances demanded an exaction of compensation during the entire period, instead of a gratuitous discharge of services prompted by
In Abbey v. Deyo, 44 N. Y., 347, it was held that such gratuitous services did not prejudice the rights of creditors, and in James v. O’Driscoll, 2 Ray, S. C., 101, the oourt, in speaking of a purpose to charge for a benevolent or friendly act at a future day, said “that it will never permit a friendly act, or such as was intended to be an act of kindness or benevolence, to be after-wards converted into a pecuniary demand; it would be doing violence to some of the kindest and best affections of the heart to suffer them afterwards to be perverted by sordid avarice.”
The testimony of the book-keeper explains this whole transaction. The bad health and pecuniary condition of.Mrs. Ten Broeck was always referred to as a reason for not making any charge, but coupled with the intention to do so when her condition was improved. The appellant had the right to presume that the father did not contemplate such a charge, and from the proof in the record, if the father had been alive, and the demand made for the income in 1887, there would have been no refusal to pay. He had no intention of misleading his daughter by inviting her, in effect, to live up to her income, and. after the lapse of years violate the express provisions.
If the purpose, however, was to charge the daughter when her condition improved, that does not authorize his personal representative to create this burden, and exact a compensation that the father had, by every .act, induced'the daughter to believe had been waived.
The judgment below is reversed, with directions to sustain the exceptions to the commissioner’s report awarding this compensation to be paid out of either the principal or the income of the fund from which the appellant derives the benefit. Remanded with directions to reject the claim.