Summary
In McLean v. McLean (174 App. Div. 152), however, it was held that a power similar to the one now under consideration was valid. If the executor who has been given the power should die or should be unable or should refuse to act, the court could divide the residuary fund between those mentioned as beneficiaries.
Summary of this case from Matter of LawlerOpinion
October 6, 1916.
Albert B. Boardman [ Philip W. Boardman, Henry F. Herbermann and George E. Cogswell with him on the brief], for the defendants McLean.
Arthur I. Strang, for the respondent Laura M. Schofield, as executrix, etc.
Frederick W. Clark, for the respondent Mount Vernon Hospital.
Arthur M. Johnson, for the respondent The Martha Wilson Home.
The completed exercise of the testamentary power of appointment, through the effect given to the residuary clause in the will of Cornelius McLean, works out a result which Cornelius McLean may not have foreseen. Apparently it reverses the testator's intention as first expressed, which, though perhaps but a partial plan, was to give his wife an interest during her life, or widowhood. Although he gave a conditional right to income, that did not exhaust his acts in execution of the power. Neither did the execution of the power stop in his abortive attempt to make an appointment to the two institutions which were not the legitimate "objects" of the power.
This result, that the wife could dispose of the corpus of the fund comes from a presumption of law introduced by our Revised Statutes. The revisers' notes point out the unsatisfactory and confusing state to which the law of powers had come in England, especially the over-technicalities surrounding execution of powers which led to marked divergences between the law courts and those of chancery. (3 R.S. [2d ed.], Appendix, 591, 592.) Our revisers vigorously cut the knot, in a way that was afterwards followed in the English Wills Act (1 Vict. chap. 26, § 27), in 1837, and in many of our States. (See 22 Am. Eng. Ency. of Law [2d ed.], 1119.) The instrument executing the power need not now refer to the source from which the power is derived. As to wills, there was a still broader rule. "Lands embraced in a power to devise, shall pass by a will purporting to convey all the real property of the testator, unless the intent that the will shall not operate as an execution of the power, shall appear, expressly or by necessary implication." (1 R.S. 737, § 126; Real Prop. Law [Gen. Laws, chap. 46; Laws of 1896, chap. 547], § 156; Real Prop. Law [Consol. Laws, chap. 50; Laws of 1909, chap. 52], § 176; 4 Kent Com. 333.) This statute "steps in and sends the property, subject to the power, in the same direction as that in which the testatrix has sent her own property." ( Lockwood v. Mildeberger, 159 N.Y. 181, 188. See, also, New York Life Ins. T. Co. v. Livingston, 133 N.Y. 125; Hogle v. Hogle, 49 Hun, 313.) Section 18 of the Personal Property Law (Consol. Laws, chap. 41; Laws of 1909, chap. 45) assimilates personalty to real property by adopting the same words as to powers over personalty; so that this rule as to powers is, in the same manner, to be applied to wills of personalty. ( Hutton v. Benkard, 92 N.Y. 295; Pers. Prop. Law [Gen. Laws, chap. 47; Laws of 1897, chap. 417], § 6.)
Such a residuary clause ordinarily purports to convey all the testator's property. Thus under the canon of construction to avoid intestacy, even in the absence of the New York statute as a guide, Justice STORY deduced from a residuary bequest a full execution of such a power. ( Blagge v. Miles, 1 Story, 426.)
The bequest by Cornelius McLean's will was:
"I give and bequeath the use of all the property and estate over which I have the power of appointment under the last Will and Testament of my beloved father, James M. McLean, deceased, to my wife, Leslie A. McLean, as long as she shall remain my widow, with full power to appoint and direct by last will and testament the payment, transfer and conveyance of the principal of which she shall have enjoyed the use during her life or widowhood, one-half thereof to the Mount Vernon Hospital to be used so much thereof as shall be necessary in building a wing or ward to said hospital, to be known as the Leslie A. McLean Memorial Ward, and any surplus to be invested by the trustees thereof, and the income derived therefrom to be applied towards the proper furnishing and maintaining of the same; the remaining half to the Westchester Women's Club of Mount Vernon.
"All the rest, residue and remainder of my estate, real, personal and mixed, I give, devise and bequeath to my beloved wife, Leslie A. McLean, whom I hereby name to be executrix of this my Last Will and Testament."
Although counsel questions the right to create by appointment merely a life estate, when the testator's power extended to appointing the fee, we think there is no ground for such objection. The present Real Property Law, section 177, expressly declares that a disposition is not void on the ground that it is more extensive than was authorized by the power, but an estate or interest so created so far as embraced by the terms of the power is valid. (See, also, Real Prop. Law [Gen. Laws, chap. 46; Laws of 1896, chap. 547], § 157; 1 R.S. 737, § 123.) If we may eliminate the excess as harmless, then the omission to go to the full extent of the power could not be a grievance, even if the execution stop at an estate for life or for years, as the donee of the power is not bound to dispose of the whole fee. ( Root v. Stuyvesant, 18 Wend. 257, 273.)
The appointments expressly declared for the hospital and women's club are not to be got rid of by treating them as merely precatory words, and not imperative. ( Smith v. Floyd, 140 N.Y. 337.)
The real question is whether this gift of an estate in income, for life or widowhood, followed by the non-execution of the attempted dispositions for the two institutions, excludes our statutory presumption that these failing and defective gifts may be supplemented, and the power fully exercised, through the force of an unqualified residuary clause.
A residuary clause is held to include property described by appointments failing, or becoming invalid. ( Matter of Hunt's Trusts, L.R. 31 Ch. Div. 308. See 31 Cyc. 1142.) Still, in the other parts of a will there may be inconsistencies by partial gifts, which may operate to exclude, or at least to circumscribe, the terms of a general residuary clause. Are there, then, in this will, such inconsistencies as would "expressly or by necessary implication" (for that is the revisers' term restricting our right of construction) exclude the inference by statute, that through this residuary clause the power was exercised? (See New York Life Ins. T. Co. v. Livingston, supra; Hirsch v. Bucki, 162 App. Div. 659.)
As Mr. Justice YOUNG said in his opinion in this case: "It must also be observed that, under the statutes above quoted, the court is not called upon to find or determine a direct intention on the part of the testator, as gathered from the will, to execute the power. That intent is presumed; the contrary intent must appear. The duty of the court in this respect is to consider the provisions of the will and determine whether or not there is disclosed by the will expressly or by necessary implication an intention on the part of Cornelius not to execute this power of appointment."
On this subject, testamentary intent really means a purpose to make a will according to its statutory effect. ( Crooke v. County of Kings, 97 N.Y. 421; Farmers' Loan Trust Co. v. Kip, 192 id. 266, 279.)
In Scriven v. Sandom (2 J. H. 743) a testator, under a marriage settlement covenant, was to pay to the settlement trustees £ 2,000 in trust for his wife for life, with remainder to his general appointees by deed or will. By his will he directed his executors to pay £ 2,000 to the trustees on which the income was to be paid to his wife for life. He then bequeathed her his residuary estate, subject to certain legacies. WOOD, V.C., held that his life estate was not inconsistent with the widow's receiving the capital of the fund, as the facts did not bring the case within the principle that a partial gift of a fund may be read as excluding the intention to appoint the whole by a residuary bequest.
The decisions in New York Life Ins. T. Co. v. Livingston ( supra) and Lockwood v. Mildeberger ( supra) go even more emphatically to execute a power through a residuary bequest.
This result seems to be sufficiently supported without adverting to the additional fact that the testator had no other property, as appears by the transfer tax affidavit, as well as by accounts of his estate as filed, in which situation courts sometimes have inferred from the absence of property that such a power was necessarily the one and only object on which the residuary bequest could operate.
This, then, is an instance where it is safer to adhere to our statutory presumption adopted before powers had come into use in New York, and now accepted as a practical guide in the construction of wills, having become a long-settled rule of property, rather than to attempt to disturb it by drawing distinctions based on the testator's supposed expectations.
To weaken this rule by reading into the bestowal of a life interest upon the wife an intention to impair the force of the residuary clause would be a violence to the testator's legal intention as well as a dangerous interference with a statutory rule of property both in land and in personalty.
So I advise to affirm, with costs to respondents payable out of the estate.
CARR, STAPLETON and RICH, JJ., concurred.
Judgment affirmed, with costs to the respondents payable out of the estate.