Allen v. . Stevens

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[EDITORS' NOTE: THIS PAGE CONTAINS HEADNOTES. HEADNOTES ARE NOT AN OFFICIAL PRODUCT OF THE COURT, THEREFORE THEY ARE NOT DISPLAYED.] [EDITORS' NOTE: THIS PAGE CONTAINS HEADNOTES. HEADNOTES ARE NOT AN OFFICIAL PRODUCT OF THE COURT, THEREFORE THEY ARE NOT DISPLAYED.] [EDITORS' NOTE: THIS PAGE CONTAINS HEADNOTES. HEADNOTES ARE NOT AN OFFICIAL PRODUCT OF THE COURT, THEREFORE THEY ARE NOT DISPLAYED.] Under the law of this state, prior to the enactment of chap. 701 of the Laws of 1893, the tenth clause of the will in question would have been void upon two grounds: First, because of the indefiniteness of the beneficiaries (Bascom v. Albertson,34 N.Y. 584; Tilden v. Green, 130 N.Y. 29); and, second, because, although intending to found a permanent charity, the testator did not direct the formation of a corporation within two lives in being to take over the trust property. (Burrill v.Boardman, 43 N.Y. 254; Cruikshank v. Home for theFriendless, 113 N.Y. 337; People v. Simonson, 126 N.Y. 299.)

The question now presented is, whether the act of 1893 has so far amended the law relating to the subject of charitable bequests, as to make it possible for the charitable intentions of this testator to be executed. Before examining the statute, which was concededly intended to affect in some wise the law upon the general subject, it will not be out of place to have in mind the situation of such law. No one disputes that it was the intention of the legislature to change in substantial respects the law as it had been settled by the courts of this state. The controversy is as to the extent of the changes intended by the legislature, and upon the question of intent some light will be thrown by a very brief reference to the early state of the law in this state upon the subject of charitable uses, and the changes from time to time which finally resulted in its overthrow. This subject was exhaustively considered in an opinion written by Judge DENIO in the case ofWilliams v. Williams (8 N.Y. 525). In that case the opinion declared that, according to the law of England, as it existed at the time of the American revolution, and as it still exists, devises and bequests in support of charity and religion, although defective for want of such grantee or donee as the rules of law require in other cases, would, nevertheless, be supported in the courts of chancery; that such parts of the common law had become incorporated into our system of jurisprudence prior to the adoption of the Constitution, by force of the provisions of which they became a part of the common law of this state. In answer to the claim that the law of charitable uses was created by the statute 43 Eliz. c. 4, and, hence, was abrogated by the repeal in this state of the statute of Elizabeth (Laws 1788, chap. 46, § 37), the court asserted that the doctrine of charitable uses was a creation of chancery and had been regarded as an important part of its jurisdiction long prior to the enactment of the statute of Elizabeth, and such system having become engrafted upon the common law, and the practice thereof having been undertaken and carried on by the Court of Chancery in this state, that it was not affected by the repeal of the statute of Elizabeth; that the provisions of the Revised Statutes did not affect property given in perpetuity for religious or charitable purposes, and, hence, that the bequest of $6,000 to Zophar V. Oakley and other individual trustees, with power to perpetuate their successors, as a perpetual fund for the education of children of the poor who should be educated in the academy in the village of Huntington, with directions to accumulate the fund up to a certain point, and apply the income to the education of children whose parents' names were not upon the tax list, was valid.

If that case had continued to be the law of this State there would have been no opportunity for questioning the validity of the tenth clause of this testator's will. That decision, it would seem, should have settled the question in this state, but the struggle between the advocates of a liberal policy towards charities and the opponents of such a policy, did not stop with that decision. In Levy v. Levy (33 N.Y. 97) Judge WRIGHT challenged the position taken by the court in theWilliams case, and discussed anew the question whether the English doctrine of trusts for charitable uses was the law of this state. The discussion was continued in Bascom v.Albertson and Burrill v. Boardman (supra), and inHolmes v. Mead (52 N.Y. 332) it was finally decided that the system of charitable uses, as recognized in England prior to the revolution, has no existence in this state, and that such uses are not exempt from the provisions of the statute abolishing all uses and trusts, except such as are authorized thereby. Efforts in the interest of upholding important charitable bequests have, from time to time, been made to persuade the courts to reopen the subject to a limited extent, without other result than an approval of the case of Holmes v. Mead, as in Holland v.Alcock (108 N.Y. 312), where the court felt called upon to point out that "charity, as a great interest of civilization and christianity, has suffered no loss or diminution in the change which has been made. The law has been simplified, and that is all." So the fact seemed to be at the time of such writing, and so it may have been, except as to that class of charities which, for convenience, we may call original charities, as where a person desires to found an institution to carry on a charity that will bear his name and be a monument to his memory, or wishes to benefit a class of unfortunate persons in his own community in whom he may be interested. Many a testator has attempted to provide by his last will and testament for such a charity, but, so far as the decisions show, nearly every such attempt has come to naught, because the courts, in applying the rules resulting from the final overthrow of the Williams case, have been obliged to hold that the language employed by the testator was either indefinite as to beneficiaries or in violation of the law against perpetuities. (Holmes v. Mead, 52 N.Y. 332;Prichard v. Thompson, 95 N.Y. 76; Cottman v. Grace, 112 N.Y. 299; Read v.Williams, 125 N.Y. 560; Fosdick v. Town of Hempstead,125 N.Y. 581; Tilden v. Green, 130 N.Y. 29; Booth v. BaptistChurch, 126 N.Y. 215.) Our attention has not been called to, nor have we discovered any case in the books since the decision ofHolmes v. Mead where an attempt to create an original charity has survived the test of an application by the courts of the rules of law to the language employed by the testator. Among the last, if not the very last, of the successful attempts in that direction was in respect to the will of James H. Roosevelt, deceased, which was before the court in Burrill v. Boardman (43 N.Y. 254). In that case the court declined to decide the question whether the peculiar system of charitable uses as it existed in England has ever had foothold in this state. The decision of this court, holding that will to be valid, made Roosevelt Hospital a possibility. As these statements seem to make their own comment, we pass to the position of the legislature in 1893, which had its attention sharply drawn to the subject by a comparatively recent decision of this court, the effect of which was to deprive the public of a great charity, in which Samuel J. Tilden sought to employ the bulk of his fortune, aggregating millions. Looking back over the twenty years that had elapsed since the decision of the court in Holmes v. Mead, the legislature could discover nothing but wrecks of original charities, charities that were dear to the hearts of their would-be founders, and the execution of which would have been of inestimable value to the public. Further back of that period, however, it found that in Williams v. Williams (supra) the court had declared it to be the law of this state that charitable devises and bequests were not subject to the statute against perpetuities, nor subject to strangulation by the rule against indefinite beneficiaries, for the court, having equitable jurisdiction, claimed the right to administer the law of charitable uses. Our legislature not only saw that a great wrong had been and was being done to the public by the loss of many devises and bequests for the purpose of founding original charities, but it further saw that the remedy could alone be furnished by it. It perceived that its repeal of the statute of Elizabeth furnished the foundation for the decisions of the courts and did away with the law of England upon that subject, as well as with the practice in this country in that regard which had been founded upon such law, so it set about making a change in the law, and the statute which it enacted, together with the title, reads as follows: "An act to regulate gifts for charitable purposes. Section 1. No gift, grant, bequest or devise to religious, educational, charitable, or benevolent uses, which shall, in other respects be valid under the laws of this state, shall or be deemed invalid by reason of the indefiniteness or uncertainty of the persons designated as the beneficiaries thereunder in the instrument creating the same. If in the instrument creating such a gift, grant, bequest or devise there is a trustee named to execute the same, the legal title to the lands or property given, granted, devised or bequeathed for such purposes shall vest in such trustee. If no person be named as trustee then the title to such lands or property shall vest in the supreme court.

"§ 2. The supreme court shall have control over gifts, grants, bequests and devises in all cases provided for by section one of this act. The attorney-general shall represent the beneficiaries in all such cases and it shall be his duty to enforce such trusts by proper proceedings in the court." (Laws of 1893, chap. 701.)

Reading the statute in the light of the events to which reference has been made, it seems to me very clear that the legislature intended to restore the law of charitable trusts as declared in the Williams case; that having discovered that legislative enactment had operated to take away the power of the courts of equity to administer trusts that were indefinite as to beneficiaries, and had declared a permanent charity void unless the devise in trust was to a corporation already formed or to one to be created, it sought to restore that which had been taken away through another enactment. This is markedly indicated, not only by the absence of details in the statute, which is broadly entitled "An act to regulate gifts for charitable purposes," but also in the brevity of the statute, which confers all power over such trusts and trustees on the Supreme Court and directs the attorney-general to represent the beneficiaries in cases within the purview of the statute, as was the practice in England. Practical effect can be given to the provision that no devise or devise shall be deemed invalid by reason of the indefiniteness or uncertainty of the persons designated as beneficiaries only by treating it as a part of a general scheme to restore to the courts of equity the power formerly exercised by chancery in the regulation of gifts for charitable purposes; for, in order to ascertain the class of persons who were entitled to the benefits of the trust, the rule formerly in force must necessarily be invoked by which the court ascertained as nearly as possible the intention of the testator, by decree adjudged who were intended to be the beneficiaries of the trust and directed its administration accordingly.

Fowler, in his work on "Charitable Uses," in speaking of the act of 1893, says: "It must be very obvious that the act of 1893 has seriously affected those decisions of the courts of New York which require great certainty or a vested interest in the beneficiaries of a charitable trust. The act, in this respect only, is designed to restore the ancient law touching charitable uses for uncertain persons, and to this extent to relieve charitable trusts from the narrow boundaries prescribed by the Revised Statutes for private uses in lands." While that learned author expresses the opinion that the act does not relieve charitable or public uses from the application of the rules relating to perpetuities, which, he says, "have no reference to public trusts," he asserts that had that been done the ancient law would have been almost revived by the legislature. That he is right in saying that the legislature "designed to restore the ancient law touching charitable uses for uncertain persons" seems unquestionable, and it appears to be reasonably clear, from a reading of the entire act, that the legislature designed to restore the law governing the administration of such trusts as well. And if such was the design of the legislature, then effect must be given to it, though such a construction seems contrary to the letter of the statute. (Smith v. People, 47 N.Y. 330.) As this statute is remedial in its character, it should be liberally construed with a view to the beneficial end proposed. (Hudler v. Golden, 36 N.Y. 446.) The statute provides that if there is a trustee named to execute the trust, the legal title to the property shall vest in such trustee, and, further, that if no person be named as trustee, the title shall vest in the Supreme Court. That there might be no opportunity for questioning the authority of the Supreme Court in such matters, the second section provides that the Supreme Court shall have control over all gifts, grants, bequests and devises in all cases provided by section one of this act. Under the provisions of the act a testator may name a corporation as trustee, or provide that a corporation to be founded shall act as trustee, or the trustee named may be an individual; but if he name none of these, the statute provides in effect that the trust shall not fail, but the title to the property devised or bequeathed in trust shall vest in the Supreme Court, which shall have control over gifts, grants, bequests and devises provided for by the act. If the contention be well founded that it was not the intention of the legislature to revive the ancient law as to the administration of such trusts by the Supreme Court, and to do away with the rule requiring the formation of a corporation for such purpose, then no permanent charity can be administered by the Supreme Court, notwithstanding the title to the trust property is by the command of the statute vested in the Supreme Court when no trustee is named by the testator. It is insisted that it cannot be, because the trust term is not measured by lives. Neither is a corporation, which may, as a trustee, execute a permanent trust for charity. But, it is answered, the law has created an exception to the general rule in favor of corporations. True, and the law-making power had the right to create other exceptions or change the law altogether, and it has changed the law as to all cases within the scope of the act, "to regulate gifts for charitable purposes," so that now the Supreme Court must execute such a trust, if the title to the trust property vests in it under the statute, and shall have control over the administration if a trustee be named by the testator. A construction of this statute allowing the Supreme Court to execute a permanent charity when the title to the real estate is vested in it, and at the same time declaring that where such property is devised to a trustee named the devise is void, would be absurd.

The learned counsel for the respondent points out that it is not all gifts and devises to religious, educational, charitable or benevolent uses, that shall not be deemed invalid by reason of indefiniteness as to beneficiaries, but only such as "shall in other respects be valid under the laws of this state," and with signal ability seeks to persuade us that in order to give these words effect it must be held that a trust is not within the protection of the statute if it contravenes the law against perpetuities, and, as a necessary sequence, that if the devise in trust be not to a corporation, or provision be not made for the formation of a corporation, within a period measured by two lives in being, to take over the trust estate, then the devise or bequest is invalid, and this statute is without effect in such case. It will be observed that if this contention be well grounded the authority attempted to be conferred upon the Supreme Court to take title and execute a trust of a permanent character when no trustee is named, is practically of no effect, and the statute itself is limited in its application to a case of the type of Prichard v. Thompson (95 N.Y. 76), which is the single case brought to our attention where the only objection to the validity of the trust was that the beneficiaries were indefinite. In the light of the destruction of so many original charities, as shown by the decisions, the thought cannot for a moment be indulged in that the legislature had in view this case only and sought to furnish a remedy for just such cases in the future, and for none other.

We are thus led to inquire whether this clause in the statute may not have been intended to serve some other purpose than to require the continuance of the practice of the formation of corporations for the administration of permanent, charitable trusts, a result apparently in conflict with the other provisions of the statute providing for the execution of trusts by trustees or by the Supreme Court. In the attempt to ascertain the intention of the legislature, it is a just rule, always to be observed, that the court shall assume that every provision of the statute was intended to serve some useful purpose, and in obedience to that rule, we now inquire whether this clause of the statute does not have a useful place therein, and yet is not in conflict with the letter and spirit of the rest of the statute. It is so obvious that it has that we need cite but one instance for the need of such a provision, and that is suggested by one of the contentions made in this case. A., having a substantial estate and desiring to provide suitably for the support of his wife and two brothers during their lifetime, for which he deemed the income amply sufficient, devised his estate in trust to a trustee during the lifetime of his wife and brothers, directing that the income be apportioned between the cestuis que trust during their lives, and that after the death of the last survivor of them the property be vested in the Supreme Court as a permanent trust, the income to be used toward the support and maintenance of the Syracuse Hospital. Such a trust would, of course, be in direct violation of the Statute of Perpetuities and void, for by it the testator would design to do what the statute aims to prevent from being done, namely, to tie up the estate for the benefit of his family for a period longer than two lives in being, i.e., three lives in being, before the trust for charitable purposes could go into operation. This clause, therefore, seems to constitute a very useful feature indeed of the statute, and because this is so all excuse is taken away for an argument that it was intended to serve as such an obstruction to a practical operation of the statute as would render it of no substantial value to the public, and it eliminates all opportunity for questioning that it was the intention of the legislature to restore the ancient law as to gifts for charitable purposes, because experience has shown that as to original charities far better results were obtained under it from the public point of view, and with a more decent regard for the wishes of testators, who do not always love their distant relatives, occasionally perhaps with justification.

We are thus conducted to an examination of the tenth clause of the will. It reads as follows: "Tenth. I give, bequeath and devise all the rest and residue of my property of every kind, personal and real, wherever situate, to my trustees hereinafter named, for the purpose of founding, erecting and maintaining Graves Home for the Aged, to be located in the city of Syracuse, in the state of New York. It is intended for a home for those, who by misfortune have become incapable of providing for themselves, and those who have slender means of support. The institution to be known as The Graves Home for the Aged. I hereby appoint Charles C. Stevens, Rasselas A. Bonta and Maurice A. Graves for the trustees to execute the above trust. I hereby authorize and empower my executors, or the survivor of them, to rent or sell any part or all of my real estate, that I may own at the time of my death. They are authorized to employ a person or persons to have charge of the real estate to collect rents and to make repairs, and to pay such sum for compensation as they may deem reasonable and proper.

"After my executors have executed their trust and paid all the legatees provided for in this will, they are authorized and directed to convey to the said trustees, above named, the balance and remainder of my property, of every kind, to be applied for the purposes above provided, and the said trustees, or the survivor, are authorized to rent or sell all or any part of my real or personal property, and to employ such agents as they may deem proper to take charge of the same, and pay them such compensation as they deem best."

While the place where "Graves Home for the Aged" is to be located is stated, and the general object of the charity is clearly given, namely, to provide a home for the aged who by misfortune have become incapable of providing for themselves, it is still indefinite as to the territory from which such aged people may be accepted at the home. But for the statute that we have been considering, this trust would fail because of the indefiniteness of the beneficiaries, but the practice that it revives makes it necessary for the Supreme Court, when properly moved by the attorney-general representing the beneficiaries, to ascertain, as nearly as may be, the intention of the testator as to the method of selecting those aged persons who are to be the beneficiaries of the home, and to make such intention efficacious by decree.

It seems to have been the opinion of the Appellate Division that the power of alienation of the bank shares and the real estate south of James street was, under the terms of the will, suspended during three lives in being after the death of the testator, but to us it seems that this is not so. It is true that, by the first clause of the will, the trustees were directed to pay to testator's wife during life the dividends on the bank stocks when declared, and the net income from the real estate after making payments for necessary repairs and taxes, while by the eleventh provision of the will the testator authorized his executors and trustees to retain his shares in the "New York State Banking Company" for a term of years at their discretion, "but may sell the same, or any part thereof, at any time, but the same is not to be continued nor any portion of my property held longer than the lives of Catharine Graves Roby, daughter of Sidney B. Roby, of Rochester, and Helen Breese Graves, daughter of Maurice A. Graves, of Syracuse." It will be observed, therefore, that the will operated to vest the title of the estate in the trustees, in trust for the purposes outlined by the testator, as of the date of the latter's death; and they were directed to pay to the widow certain rents and dividends for life, unless she survived two persons upon whose lives the trust estate was expressly limited.

The next question is whether this trust is to be executed by the trustees named in the will or by the Supreme Court. It is the next question because we have already reached the conclusion that a corporation is not necessary for the execution of such a trust since the adoption of the statute, but that the Supreme Court in a proper case must take upon itself such execution, over which it shall have control where a trustee is not named for the purpose. In this case trustees were named, and, as the eleventh clause of the will expressly prohibits the trustees from holding any portion of the testator's property longer than the lives of the two persons in being therein named, it must be held that the trustees are charged with the management and conduct of the trust until the expiration of a period measured by the two lives in being, at which time the title to the trust property will vest in the Supreme Court under the statute.

The plaintiffs claim that the tenth provision of the will is void as to one-half of the remainder of the testator's estate under section 1, chapter 360 of the Laws of 1860, which reads as follows: "Section 1. No person having a husband, wife, child or parent, shall, by his or her last will and testament, devise or bequeath to any benevolent, charitable, literary, scientific, religious or missionary society, association or corporation, in trust or otherwise, more than one-half part of his or her estate, after the payment of his or her debts (and such devises or bequests shall be valid to the extent of one-half and no more)."

The testator gives about twenty-five thousand dollars, or less than one-seventh of his estate, to organizations that are within the description of the statute, and in addition to that the residuary devises and bequests are charitable, and, therefore, within the general description of the statute; but as such devises and bequests are not to a "society, association or corporation in trust or otherwise," but instead to trustees, they are not within its prohibition. The maxim "expression unius estexclusio alterius" is applicable; for it is a man's general right in this state to do as he wishes with his own. He may now, as in the past, disinherit his relatives for the benefit of strangers, and this statute was not designed to affect that right except indirectly. It was recognized, perhaps, that in the fear of death, men who have never exhibited a charitable impulse, suddenly awaken to the fact that behind them are lost opportunities for usefulness, that in some way ought to be made good, and in order to balance the account they look about for an opportunity to do good with their money, and find at once a man interested in promoting the fortunes of some religious or charitable institution, who, without hesitation, begins to play, and with a skill acquired by long experience, upon their fears and hopes. Given such a man and such a situation, it was readily conceived that in his thought of self the just demands of wife, or child or parent might be temporarily lost sight of, and his all devoted to religious or charitable purposes through some of the many societies, associations and corporations which are to be found on every hand. Hence, the design of the framers of the statute was to place a limitation upon the power of a person thus moved, to dispose of more than one-half of his property by will to such organizations, to the end that he should have an opportunity to measure the claims of his kindred upon him as to the remaining half unembarrassed by the importunities of those whose business it is to get money for the societies, associations or corporations they represent, and this it was thought would be substantially accomplished by an act prohibiting him from giving more than one-half of his property to the societies, associations and corporations most likely to be considered. But except as thus restrained by the statute, he may still disinherit his kindred by disposing of his property in such manner and for such purpose as he may desire, and so this testator in devising his property to trustees in trust for the uses and purposes described in the will, was not within the prohibition of the statute. The result thus reached in this case in no way thwarts the general purpose of the legislature, for the only person who stood in such relation to the testator as to benefit by the statute in any case was the testator's wife, who was over eighty years of age at the time of his death, was amply provided for by the will and has since died.

The amount of costs awarded seems to be out of all proportion to the work done, and so large that it is not at all surprising that several lawyers have appealed from nearly all allowances except their own; but the Supreme Court had the power in this suit, brought as it was on the equity side of the court, to award costs to each of the parties, and the question of amount also was in the discretion of that court and not subject to review here so long as the allowances did not exceed the limitations provided by statute, and this they did not do.

The judgment of the Appellate Division should be reversed and that of the Special Term affirmed, with costs to the appellant trustees and to the attorney-general.