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as such a suspension was not allowed for more than two lives in being, every such trust, to be valid, must necessarily be confined within the limits of such a term.

To summarize what has just been stated, a trust to receive and apply rents and profits, or income, furnished, in the first place, a means of absolutely protecting a beneficiary against himself; and secondly, it effected, while it continued, a suspension of the absolute power of alienation, and therefore must be so framed as not to continue longer than during two lives in being.

Before concluding this preliminary statement, attention should also be called to two other points. It has been settled that the existence of power in the trustee to sell the particular property held by him, retaining the proceeds subject to the same trust, did not avoid the existence of a suspension, since the statutes, in referring to that subject, inalienability, were dealing not with a mere change in the form of the trust property, but with the impossibility of freeing the corpus, however constituted, from the grasp of the trust. On the other hand, if the situation was such that an absolute fee could in any way be transferred, so that both the property conveyed, and also the proceeds, were freed from the trust, there would be no suspension ; and in order to attain this result it was not necessary that there should be a given person or persons capable of directly conveying ” an absolute fee, in the literal sense. It was enough that there were persons in being who could, amongst them, if they chose, whether by conveyances, releases, or otherwise, patch together a fee, with the result that by the act of all of them an absolute fee could be vested in some one, and the trust, even as to the proceeds, brought to an endi.

Such was the condition of the law when, by L. 1893, chap. 452, the Legislature injected a novel element into the statutory scheme. This was accomplished by adding, to the section (63) of the Revised Statutes above quoted, which prohibited any assignment or disposition, by a beneficiary, of his right to receive rents and profits, a new clause permitting the beneficiary, under certain circumstances, to bring the trust to an end. Subsequently, this new provision

Beardsley v. Hotchkiss, (1884), 96 N. Y., p. 214.


appeared in altered form in Section 83 of the Real Property Law, which now reads as follows:

“The right of a beneficiary of an express trust to receive rents and profits of real property and apply them to the use of any person, cannot be transferred by assignment or otherwise ; but the right and interest of the beneficiary of any other trust may be transferred. Whenever a beneficiary in a trust for the receipt of the rents and profits of real property is entitled to a remainder in the whole or a part of the principal fund so held in trust subject to his beneficial estate for a life or lives, or a shorter term, he may release his interest in such rents and profits, and thereupon the estate of the trustee shall ease in that part of such principal fund to which such beneficiary has become entitled in remainder, and such trust estate merges in such remainder.'

It is obvious that the new provision thus introduced effects a very marked change in the general scheme of the law. Thus far, it has led to the consideration, by the courts, of several questions not bearing on the present subject of discussion.

In Mills v. Mills, however, the court had occasion to

Real Prop. Law, L. 1896, Ch. 547, 883. A similar provision is also to be found in Personal Prop. Law, L. 1897, Ch. 417, $ 3.

2 Oviatt v. Hopkins, (1897) 20 App. Div. 168; Butler v. Butler, (1899) 41 App. Div. 477 ; Snedeker v. Congdon, (1899) 41 App. Div. 433; Matter of Heinze, (1897) 20 Misc. 371; Newcomb v. Newcomb, (1900) 33 Misc. 191 ; Matter of Hogarty, (1901) 34 Misc. 610. affi’d (1901) 62 App. Div. 79; Matter of Rutherford, (1901) 36 Misc. 314; Estate of Helena Rogers, N, Y. Law Journal, July 22, 1902, p. 1373; Matter of Sheldon (opinion of Hon. George F. Ditmars, Surrogate, Ontario County, not reported); Matter of Seymour, (decision of Hon. Charles Hickey, Surrogate, Niagara County, not reported). The editors of the REVIEW, in an effort to ascertain whether there had been any decisions under the statute here considered, other than such as appear in the reports, addressed a letter of inquiry to all the surrogates, and received replies in nearly every instance. The only unreported cases thus discovered are the two above cited, neither of which involved the question discussed in the present article. The Sheldon case related to personal property, and turned on the applicability of the statute of 1893 to a case where the expectant estate following the trust was not validly disposed of, and accordingly passed to the beneficiary of the trust as the testator's sole next of kin ; the Surrogate writes that his decision has been affirmed by the Appellate Division, without opinion. In the Seymour case, no opinion was handed down, but the Surrogate writes that the testatrix created a trust of personal property for the life of K, remainder to K's two daughters, and it was held that one of the daughters having assigned her interest to her mother, the latter thereby became entitled to effect a merger and demand one half of the principal ; that the time to appeal has expired and that no appeal has been taken. Attention should also be directed to the valuable discussion, in the opinion of Edward B. Whitney, Esq., Referee, in Estate of Helena Rogers, supra, of the applicability of the statute where the beneficiary's interest in the income is indeterminate in amount, depending on the discretion of the trustee.

(1900) 50 App. Div. 221.


pass on the question here to be considered, namely, whether a beneficiary, of a trust to receive rents and profits, or income, is entitled to effect a merger and destroy the trust, in whole or in part, if he is in any sense whatever "entitled " to an absolutely vested remainder, irrespective of whether the remainder was conferred upon him by the trust instrument or was otherwise acquired. In the Mills case, the testator devised certain lands to trustees to receive and apply the income in equal shares to the use of his widow and three daughters, and the will further provided that upon the death of either of the beneficiaries the income previously paid to the one deceased should thereafter be applied to the use of the surviving beneficiaries, “it being my desire that the entire income from said trust fund shall be divided into as many parts or portions as there are survivors of my said wife and daughters from time to time."

The trust provision was followed by an absolute disposition of a vested remainder in fee to other persons. Apart from any operation of the amendments now under consideration, the scheme of this trust would undoubtedly be hostile to the statutory prohibition of a suspension for more than two lives in being, for it attempted to suspend the power of alienation throughout four lives. Nevertheless, the Court held that by virtue of the amendment of 1893, this trust involved no suspension whatever, and was therefore valid. The reasoning was this: that as the remaindermen could, if they chose, convey the remainder to the beneficiaries, and as the beneficiaries, having thereby become “entitled” to the remainder, could, if they chose, release their interest in the rents and profits, and thereby effect a merger and terminate the trust, it necessarily followed that there were at all times persons in being who could convey an absolute fee in possession, and therefore no suspension of the power of alienation existed.

The soundness of this conclusion is made by the Court to depend on the construction it gives to the word “entitled " in the statute. The statute says that a merger, and resultant destruction of the trust, may be effected where the beneficiary is also “entitled " to a remainder. As to the meaning and scope of this word, the Court, in

Mills v. Mills, supra, held that there is no limitation, in the statute,



as to the manner in which a beneficiary may become entitled to the remainder.

The statute makes his power to release depend upon his ownership of the remainder, and sets no bounds to the manner of obtaining that ownership. If one buys the remainder he becomes entitled to it.

If he did purchase it he became entitled to it just as much as though it had been devised to him.”



In discussing the opinion of the Court on this subject it is not proposed to consider the propriety of its conclusion, under the peculiar terms of the Act of 1893 on which the decision turned, but merely the question of its supposed bearing upon the proper construction of the existing statute.

It is readily perceived that if this decision represents the true construction of the present statute, it has effected an extraordinary change in the law. For it means, first, that few, if any, trusts to receive and apply rents and profits, or income, to the use of beneficiaries in being, no matter for how many lives they are intended to endure, can ever effect a suspension, if the beneficial estate in each case is immediately followed by a vested remainder to any. body, and this irrespective of whether the beneficiary does or does not in fact acquire the remainder; the fact that he might acquire it if the remainderman chose to transfer it is enough to obviate suspension of the power to alienate the entire estate. And if a trust may validly be constituted to continue for four lives, it is obvious that it may be constituted to continue for a thousand lives; and if a remainder vested in another, to take effect after the expiration of four lives, obviates suspension, so will a remainder vested to take effect in possession after a thousand lives. In such a case the trust would be valid because the only objection to its validity-namely, undue suspension—is absent. And if the remainderman chooses not to part with his remainder, the trust must continue throughout its allotted term.

In the second place, the theory of Mills v. Mills means, in the case of nearly all, if not all, of such trusts, that if the beneficiary does in fact acquire title from the remainderman, he may then destroy the trust, in whole or in part, and come into absolute possession of a corresponding portion of the trust estate.

It certainly appears strange, that if the Legislature intended to destroy a large part of the elaborate structure which had been framed and long preserved with so much care, they should take this method of doing so. Instead of repealing or recasting anything, they leave all parts of the statute standing as before, and merely add one qualifying exception to a single section. The form adopted suggests the absence of a radical purpose of wholesale destruction, and indicates the mere introduction of a minor exception which is deemed, for special reasons, not to require the application of the general prohibition. Besides, it is not in harmony with general rules of construction to give such destructive effect to such an amendment if its language is fairly capable of a meaning which will, on the whole, fall naturally in as a new and reasonable feature (even by way of exception) of the former statute which is still in form left standing, and preserve, so far as reasonably practicable, the existing scheme. It is proper to consider, therefore, whether such a meaning is not here to be found.

Turning again, then, to the beneficiary who may effect a merger, if he is also "entitled to a remainder," it would seem equally possible, and more reasonable, to hold that the statute refers solely to a beneficiary whose title to the remainder is derived directly from the trust instrument itself. In that view, the statute would mean that where the trust instrument makes a person the beneficiary of a trust to receive and apply rents and profits, or income, and also vests him with a remainder in the whole or a part of the principal, subject only to the trust estate, then he may release his interest as beneficiary and effect a merger. The result of this would be that if a will created such a trust for the benefit of A, to continue, for example, during the whole or a part of A's life, or during the life of X or until the earlier death of A, etc., with remainder to A absolutely, the new amendment would apply; but if it created a correspond. ing trust for A, remainder to B, it would not apply, for even if B should convey his remainder to A, the latter, while thus "entitled " to it in a literal sense, would not be entitled in the sense intended by the statute, and so could

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