Opinion
02-28-1910
ROGERS v. GENUNG et al.
On motion to amend remittitur. Allowed. For former opinion, see 74 Atl. 473.
. Application is made on behalf of the defendants to amend the remittitur in this case, so as to set forth more specifically the method of taking the account of the amount to be paid by the complainant to the defendants. It is insisted on the part of the complainant that the defendant is not entitled to the ordinary allowances to which a trustee created under an express trust would be entitled. The authorities, however, are in favor of making just allowances in cases where the trust is a constructive one, such as we have held it to be in the present case. Examples are to be found in Ex parte Hughes. 6 Vesey, 617, at page 625, where the trustee was allowed the amount laid out in good faith in substantial improvements, and in York Buildings Co. v. McKenzie, 8 Brown P. C. 42, at page 70. Other cases are collected in 1 Leading Cases in Equity (4th Am. Ed.) 234, 235. Similar illustrations are to be found in our own reports. Mulford v. Minch, 11 N. J. Eq. 16, at page 25, Smith v. Drake, 23 N. J. Eq. 302, at page 307, Marr v. Marr, 70 Atl. 375, at page 380. In Smith v. Drake, Chancellor Zabriskie directed that the administrator, who had bought at his owu sale, be allowed the additional value which improvements he had made gave to the premises, not exceeding their cost, and directed that he must account for the rents and profits received from the premises or that might have been received by prudent management and ordinary diligenee,including a fair and full occupation rent for the same when occupied by him or his family, and that he be credited with taxes actually paid and all ordinary and usual repairs. He also allowed the administrator interest on the amounts he had paid out for debts of the intestate. This states the ordinary equitable rule.
The only difficulty that arises in this case is that the dwelling house upon the property, and a plot of ground not exceeding one acre, is subject to a life estate, and the question arises whether the defendants should be allowed as against the complainant for the amounts paid for taxes and insurance. As to insurance, the general rule is that the tenant for life and the remainderman pay Insurance for their respective interests (Kearney v. Kearney, 17 N. J. Eq. 59, at page 71); but under some circumstances the insurance is chargeable to the life tenant (Perrine v. Newell, 49 N. J. Eq. 57, at page 64 i). We think the circumstances of this case are such that the insurance is properly chargeable to the life tenant, and for that reason the defendant is not entitled to credit as against the complainant.
Taxes are a proper charge against the tenant for life. Dufford v. Smith, 46 N. J. Eq. 216, at pages 221, 222.2 in the present case, however, the estate for life is in a portion of the lands only, and in strictness that portion of the taxes which would have been a lien upon the rest of the lands is a proper allowance. If, however, the defendants have chosen to pay all the taxes without charging a proper proportion to the life tenant, we think they ought not now to compel the complainant to pay a portion of the taxes, since they have voluntarily assumed the burden of paying a larger amount than would be properly chargeable to the complainant, and it would probably be impossible at this time to secure any apportionment.
The defendants suggest that the complainant should pay interest on the purchase-money mortgage, but this will be covered by the allowance of interest upon the full purchase price paid by the defendants. To this interest they are entitled in accordance with the equitable rule above stated. Under the circumstances of this case, we think that the interest should be calculated at 5 per cent., which was the amount to be paid upon the purchase-money mortgage. It is not necessary that the complainant should indemnify the defendants against further liability on the bond which was given for the purchase money. That bond, it appears, is now due, and the defendants can discharge their liability thereon by payment.
The remittitur should direct that a decree be entered requiring the defendants to convey the property to the complainant upon being paid the purchase money with 5 per cent. interest from the date of the conveyance, less such amount as may have been received by the defendants for the rents, issues, and profits of the land not subject to the life estate, or such rents, issues, and profits as might have been received therefrom by prudent management and ordinary diligence, including a fair and full occupation rent.