Goddard v. Brown

Dtjreee, C. J. This is a bill in equity which is brought by the complainants, as trustees under will of the late John Carter Brown, against the oestuis que trust, to obtain the decision of the court in regard to certain provisions of the will, and the instruction of the court in regard to their powers and duties under it. The will is dated December 30, 1867. It is supplemented by a codicil, dated June 12, 1873, which, except in so far as it alters, ratifies and confirms the will. The testator, by the will and codicil, after several specific devises and bequests, gives all the residue of his estate in trust primarily, for his widow and three minor children; two sons and a daughter. The property is large, the powers given to the trustees are large and highly discretionary, and the trust itself is complicated by numerous provisions. The bill sets forth that, in the execution of the trust, sundry questions have arisen as to which the complainants are advised that they cannot safely act without the instructions of the court. The bill, therefore, submits a series of ten questions for decision, some of them involving very perplexing inquiries in the law of wills. The bill does not disclose any special exigency which calls for a decision of the questions, and, in respect of some of them, it is not clear that they are now, or that they will ever become *41 practically important. Every trust which is at all complicated suggests numerous questions which will in certain contingencies need to be decided; but we do not understand that the trustee is entitled to put the estate to the expense, or the court to the trouble, of their decision, until the contingencies have happened, unless he requires instruction in the exercise of his duties and powers, with a view to the possibility of their happening. It would be unwise, in the absence of any exigency, to predetermine such questions ; for it may be not only useless to do so, but embarrassing to have done so, inasmuch as such questions may actually arise under a different state of facts from any which has been anticipated. We shall, therefore, limit our decision to such of the questions submitted as obviously may have arisen, or will be pretty certain to arise, in the execution of the trust. The first question submitted is: Whether the bequest in said will in the words following, namely, “ At the period when my youngest living son attains the age of twenty-one years, said trustees shall pay over and convey absolutely all my manufacturing property consisting of all my interest and shares in the Lons-dale Company, the Blackstone Manufacturing Company, and the Hope Company, then remaining in the hands of said trustees, in equal shares, unto my sons then living, and the lawful issue then living of any son then deceased; said issue to be entitled, in equal proportions, to the same share thereof to which said son, if living, would be entitled,” includes any manufacturing property, or any interest, or any shares of stock, in any manufacturing company owned by said testator at the time of his decease, other than in said three companies named ? In explanation of this question, the bill sets forth that the three companies named were and are engaged in the manufacture of cotton cloths; that the interest of the testator and of his estate was and is large in them, and that the income from them was and may continue to be proportionably large; that after the will and before the codicil was executed, the testator became interested in another like manufacturing company, to wit, the Berkeley Company, and that he was, at the date of the will and the codicil both, a stockholder in other manufacturing companies, engaged in other manufactures, both within and without this State, and that the estate continues to be a stockholder in them. *42 We think the bequest covers the three companies only. We cannot think the words “ consisting of,” &c., were used by way of defective specification; for if the testator, intending to give all his manufacturing property of all hinds, had begun to specify it, he would hardly have stopped with the mention of three companies doing only one hind of business. We think, too, the words were not used to denote a particular kind of manufacturing property; for the words are indicative not of the kind of manufacturing property which was given, but of the companies in which it was given. We suppose the testator intended to give his property in those three companies, and all this property, consisting of all his interest and shares, in them. If he had left out the word “ manufacturing,” there would be no doubt of this. But we think that word was used not to enlarge the gift, but simply as an epithet to describe the property given, and that the construction is the same with as it would have been without it. This view is entirely consistent with the facts alleged in the bill, if indeed it is not favored by them. It is supported by the authorities cited in behalf of the testator’s daughter. Fraser v. Alexander, 2 Dev. Eq. 348 ; Timewell v. Perkins, 2 Atk. 102, case 94; Perry, Administrator, v. High et al. 3 Head, 349 ; Garrett v. Garrett, 1 Strob. Eq. 96; Delamater’s Estate, 1 Whar. 362; Fisher v. Hepburn, 14 Beav. 626 ; 2 Redfield on Wills, *435, 436. It is true there are cases cited for the sons which favor a different view. 1 But many of them relate to residuary bequests, and when a bequest is residuary it is to be liberally construed so as to avoid intestacy. The cases are not of such controlling authority that we feel bound to follow them in the case at bar. The second question is : What interest said testator’s sons take in the said manufacturing property and in its income, under the clause above recited ? The object of the question is to have the *43 court decide whether their interest is vested or contingent. We do not see how, for the present, it can make any difference to the trustees in the administration of the trust, whether it is the one or the other. Indeed, unless one or both of the sons die before reaching the age of twenty-one years, we do not see how it can ever become of any practical importance to them. We consider it, therefore, to be quite unnecessary to perplex our minds with so subtile and difficult an inquiry in anticipation of a casualty which we trust may never happen. The third question is, as stated in the bill: “ What disposition shall be made of the income of said manufacturing property ? whether the same must be kept distinct from the income derived from "the bulk of the estate? and, if so distinct, whether your orators may from time to time pay over the same in whole or in part to said sons, or whether the same must be by your orators accumulated in augmentation of the principal, or otherwise ? and whether it is to bear any part, and if any, what part of the expenses of the administration of said trusts and of the annuity to be paid to said widow.” This is a question of great and immediate practical concern for the trustees. The answer to it is very clearly expressed, we think, in the will. The will gives the residue of the estate, which includes said manufacturing property, in trust to the trustees, for them “ to take care of and manage the same, with a view to safety and profit, in their discretion.” It directs them to collect all the income of all the said residue, and, after paying therefrom the charges and expenses of the trust and trust estate, to pay out of the net income to the widow for life not less than $12,000 per annum. The will then provides as follows, to wit: “ The residue of said income, in whole or in part, entirely in the discretion of said trustees, shall be paid over, semiannually, or as often as convenient, unto my children, and the lawful issue of any deceased child, or applied for their support, maintenance, and education, or otherwise appropriated for their benefit, in such proportions, in such sums, at such times, and in such manner, as said trustees in their discretion may think best, until my youngest living child shall attain the age of twenty-one years, or until the termination of this trust, upon the decease of my last surviving child, in case he or she shall survive my wife, and *44 shall not live to attain the age of twenty-one years, as hereinafter provided: and such part of said income as said trustees shall see fit may be allowed to accumulate, and be distributed and paid over by said trustees unto my children, and the lawful issue of any deceased child, in such proportions as said trustees shall see fit, at the period when my youngest living child shall attain the age of twenty-one years, or at any time prior thereto, if said trustees shall think best. “ And for and during the remainder of this trust, and from and after the period when my youngest living child attains the age of twenty-one years, all the residue of said income shall be paid, semiannually, or as often as convenient, in equal shares, unto my children, and the lawful issue of any deceased child: such issue taking the parent’s share.” The meaning of this is plain. The income spoken of is the income of the entire estate, without distinction of parts. The residue of this income, remaining after the payment of charges and expenses and of the widow’s provision as aforesaid, is, as it were, constituted an estate by itself, which, subject to the trust, is, during the minority of the children, confided preeminently to the discretionary control of the trustees. They are to use it for the maintenance and education, or benefit of the children; or, if they think proper, they may pay it over to them at such times, and in such sums and proportions, as they think proper; or they may allow such part of it as they see fit to accumulate and increase, by investment and reinvestment in the kinds of property prescribed by the will, until the youngest child arrives at full age, and then distribute the accumulated fund, or so much of it as remains from previous distributions, among the children, or their issue representing them, in such proportions as they see fit. The discretion is broad, and was doubtless reposed in the trustees to be exercised with a parental care for the good of the children, and for the purpose of giving the trustees a kind of parental influence over them. The discretion is therefore to be used, not arbitrarily, but judiciously, as a wise parent would use it, within the limits of the trust, until the youngest living child arrives at full age. After that time, the accumulated income fund being then distributed as aforesaid, the discretion over the income terminates, and the residue of any income which subse *45 quently accrues must be paid in equal shares to the children living, and the issue of any child deceased. It follows from this exposition that the income of the manufacturing property, which is specially bequeathed as aforesaid, becomes, as soon as it is received, an indistinguishable part of the common income, and is to be used and administered like the rest of it, unless, indeed, the trustees, under the large discretion confided to them, see fit to have regard to the source from which it comes, in their appropriations from time to time, or in their distribution among the children when the youngest arrives at full age. And, of course, all that we have said is subject to the qualification, that their control over the income, equally with their control over the principal of the manufacturing property specially bequeathed, terminates when the youngest living son arrives at full age, which may be before the youngest living child arrives at full age. We think this fully answers the third question which has been submitted to us. The fourth question is : Whether the trustees have any power of sale over the manufacturing property specially bequeathed, and if so, and the power is exercised, how, and under what trusts or limitations, the proceeds shall be reinvested ? The will does not show that there is any need, or that there is any reason to expect that there will be any need, of exercising the power, if it exists; and, therefore, we think an answer to the question would be premature and unnecessary. We may remark, however, that whether the power exists or not, it would manifestly be contrary to the spirit of the will to exercise it without some more than ordinarily urgent reason for doing so. The fifth question is as follows: Under the devise in said will in the words following, namely, “ At the period when my daughter attains the age of twenty-one years, said trustees shall transfer and convey, in fee simple, unto my said daughter, her heirs and assigns forever, one half part of all my real estate situated in the city of Providence, then remaining in the hands and possession of said trustees, including in said half part my mansion house estate, subject to the life estate of my wife. And said trustees are hereby empowered to divide, set off, and make partition of said half part of said real estate, and the division and partition so made shall be final and conclusive,” what interest *46 does said testator’s daughter take in said real estate, and in its income ? The object of this question is to have the court decide whether the estate is vested or contingent. We can only repeat what we said of the similar question touching the special bequest to the sons, that we do not see how it can make any difference to the trustees, or at least any that ought to influence them, whether the estate is vested or contingent. In the absence, therefore, of anything to show that the decision, if made, will be practically useful, we shall defer making it for the present. The sixth and seventh questions make the same inquiry in regard to the devise aforesaid to the daughter, as was made in the third and fourth questions in regard to the special bequest to the sons, and the answer which we have given to the third and fourth questions will serve for them. The eighth question is: Whether the trustees can set off to the daughter, by way of partition, the one half of the real estate given her as aforesaid, immediately, or must wait without doing it until she ai’rives at full age? We think it is plain that the trustees must wait, for the half of the real estate which is given to the daughter is not a half of it as it now exists, but a half of it as it will exist when she arrives at full age. The language is, “ one half part of all my real estate,” &c. “ then remaining in the hands and possession of said trustees.” It might well happen that any half which could now be set off would, by the operation of local causes, be more or less than a half when the daughter arrives at full age. And, for the same reason, the court cannot, any more than the trustees, make the partition until the proper time arrives. The ninth question is: Whether, under the power of leasing the real estate contained in said will, or otherwise, the trustees have and may rightfully exercise the power of granting leases for long terms of years of portions of said real estate as opportunities may offer; particularly on what generally are known as long building leases, either with or without provisions for the purchase of the tenants’ buildings or improvements, either at a fixed valuation or upon appraisal? If we understand the scope of the question, we have no hesitation to answer it in the affirmative. The testator “ authorizes *47 and empowers the trustees for the time being .... to lease any portion of said real estate for such period, and upon such terms and conditions, as they shall think best.” Under so broad a power, they can certainly grant leases for long terms of years, with provisions for the purchase of improvements made by the lessees, as agreed, or upon appraisal, and also with provisions for altering the rent from time to time, by arbitration or appraisal, for such provisions are but terms and conditions upon which the leases are made. Whether they are still further empowered to superadd covenants of renewal is doubtful; but upon that point we give no opinion, for we do not understand that it is embraced in the question. James Tillinghast, for complainants. Abraham Payne, Thomas O. Gfreene, and W. W. S. T. Douglas, for the different respondents. The tenth and last question is : Whether the provision of the will respecting the investment and reinvestment of the income of the trust estate in any way -affects or controls the power which is given the trustees over the principal “ to sell and convey, vest and reinvest ” the same, so as to require the investment and reinvestment thereof in the same classes or kinds of securities and property ? We think not. The trustees are, however, by the terms of the will, to manage the trust estate “ with a view to safety and profit; ” and the provision in regard to the investment of the income furnishes a valuable guide to what, in the opinion of the testator, are safe as well as profitable kinds of investment. Decree accordingly. Footnotes [1] Masters v. Masters, 1 P. Wms. 420, 424; Towns v. Wentworth, 11 Moore C. P. 526 ; Wait v. Belding, 24 Pick. 129, 133 ; Haven v. Foster, 14 Pick. 534 ; Goodtitle v. Paul, 2 Burr. 1089 ; Goodtitle v. Southern, 1 Mau. & Sel. 299; Doe v. Roe, 1 Wend. 541; In re Louisa Goodyear, 4 Jur. N. S. 1243 ; Gover v. Davis, 7 Jur. N. S. 399; In re Kendall’s Trust, 14 Beav. 608; Fisher v. Hepburn, 14 Beav. 626 ; Cambridge v. Rous, 8 Ves. Jr. 12; Nugee v. Chapman, 29 Beav. 290; Clark v. Preston, 2 La. An. 580; In re Richard Champion, Busb. Eq. 246.