In re the Intermediate Accounting of Clay

Edgar F. Hazleton, S. In this combined accounting and construction proceeding, the account as filed is approved in its entirety. The construction question concerns paragraph tenth of the will which reads as follows: “ Tenth : — I direct my trustees to invest all the funds of my estate in first bonds and mortgages on unencumbered improved real estate; said loans, however, not to be more than sixty per cent of the valuation of said property, or in bonds or other securities of the kind and description which Savings Banks of the State of New York are allowed by law to invest in.” The court is requested to decide whether paragraph tenth empowers the trustees to invest the principal of the trusts in such investments as are permitted by section 21 of the Personal Property Law. The conclusion of this court is that paragraph tenth of the will does empower the trustees to make investments in the securities authorized by law in the same manner that would be permissible if the will lacked the restrictive provisions limiting investments; that the trustees may exercise the privilege granted by section 21 of the Personal Property Law (subd. 1, par. [m]) to purchase securities of corporations within the limitations of that statute. The trustees’ investments in first bonds and mortgages on unencumbered improved real estate, however, cannot exceed 60% of the valuation of the said property. (Matter of Brown, 1 Misc 2d 234; Matter of Pettit, 3 Misc 2d 713; Matter of Rosenblum, 132 N. Y. S. 2d 604; Matter of Wilson, 127 N. Y. S. 2d 876.) Proceed accordingly on notice.