42 the benefit of minors, and must terminate with, at, or before, the expiration of their several minorities. If for minors not in being the accumulation must begin within the time specified in the rule against perpetuities for the absolute vesting of future estates.+3 If the accumulation is directed to continue beyond minorities, the direction is void only for the excess and it does not necessarily vitiate the entire limitation, provided it vest within the rule against perpetuities.45 44 Trusts for the accumulation of personalty are similar to a like restriction, except as to the time of vesting. Trusts to accumulate the income of personalty for the benefit of persons not in esse must vest, if at all, within or at the expiration of two lives in being.40 Remainders Limited Over on Trust Estates. If trustees of express trusts take a fee simple defeasible, then, a limitation of a remainder based on such a particular estate is not really a limitation of a "remainder" but of a fee upon a fee which is now permissible by statute.*7 If the limitation over abridges or determines, as it must, the prior fee simple, it is always a conditional limitation,* and the posterior estate must comply with the rule against perpetuities. If, on the other hand, the trustees of an express trust take an estate for the lives of others (pur autrie vie), then the remainder must be in fee.50 When a fee simpliciter is mentioned in the statute it always means a fee simple absolute. 49 If an estate is devised to trustees of an express trust for their own lives (and there is no reason why, if they do not exceed two, the limitation should not so run) a common law remainder certainly may be limited thereon. But if there are more than two trustees the remainder would be accelerated after the death of the two first named.51 If trustees of realty take a fee simple, defeasible as to duration and qualified as to descent, any limitation of a fee over, or of “a 42 § 61, Real Prop. Law. 43 $ 42, Real Prop. Law; Manice v. Manice, 43 N. Y. at pp. 375, 376. 44 § 61, Real Prop. Law. 45 42, Real Prop. Law. 46 § 11, Personal Prop. Law. 47 $$ 42, 50, Real Prop. Law. 48 $ 53, Real Prop. Law. 49 $ 42, Real Prop. Law. 52 fee on a fee, must comply, as stated above, with the rule against perpetuities. After an estate to trustees of an express trust there may be an estate limited by way of remainder to the very same persons who are the beneficiaries of the trust. This point is now settled beyond all controversy. Such a limitation by way of remainder is strictly a conditional limitation, if the trustees' estate be regarded as a base or defeasible fee. But the estate limited over is persistently termed a "remainder." 53 The contingent remainders over, thus permissible in the case of realty, are not allowable on trusts of personalty. At the expiration of a trust for two lives remainders in personalty must vest absolutely.54 In this State, since the Revised Statutes, the favorite form of family settlements or property arrangements, whether the same are made by deed inter vivos, or created by a will or devise, is a limitation of an estate to trustees for two specified lives, or parts of lives, and then remainders over to designated persons in esse either as survivors or on some other collateral contingency, or else remainder over to "issue" of beneficiaries, or to grandchildren of settlor, or to "descendants" of settlor. The great number of the cases reported in the books relate to such devises or family settlements. Legal particular estates for life with common-law remainders over are much less common, as in such a settlement, unless the remainders over are contingent to persons not in esse at the date of the settlement, all the estates are alienable for a fee simple, and there is no protection to the welfare of the family as a unit.55 The main legal question arising, on such settlements of a particular defeasible estate to trustees for two lives in being, usually arises on the validity of the limitations over. That there is a reversionary interest of some kind existing on the cessation of the trustees' estate (whether that be regarded as a fee defeasible or as an 52 § 50, Real Prop. Law. 53 Stevenson v. Leslie, 70 N. Y. 512; Cass v. Cass, 15 App. Div. 235; Connolly v. Connolly, 122 id. 492; In re L'Hommedieu, 138 Fed. Rep. 606, 610; Ogden v. Ogden, 40 Misc. 473. 54 11, Pers. Prop. Law; $ 42, Real Prop. Law; Manice v. Manice, 43 N. Y. 303, 382; Wells v. Wells, 88 id. 323, 331, 332; Beardsley v. Hotchkiss, 96 id. 201, 216; Radley v. Kuhn, 97 id. 26, 36. 55 Thieler v. Rayner, 115 App. Div. 626; affd., 190 N. Y. 546. 63 estate pur autre vie) can not be doubted." Wherever there is a reversion of any kind, as it is always vested, it is, of course, susceptible of limitation, in order to prevent intestacy. The question is, can the reversionary interest after estate to trustees be made defeasible by means of any number of shifting executory limitations, or must the second limitation, allowable on the contingent defeasible fee, vest absolutely? This question depends wholly on the construction accorded the present statute.57 This same point has really been discussed at length under the head of "remainders," 58 for any future estate which depends upon a particular or precedent estate is now a statutory "remainder," 5" although whenever the particular or precedent estate is a defeasible or contingent fee the limitation over is really one of a "fee on a fee" now expressly permissible by statute. Any limitation of a fee on a fee was inadmissible by the common law. But after the Statute of Uses and Wills, and prior to the Revised Statutes of this State, there could be a limitation of a "fee on a fee," provided such limitation was contained in a devise or in a conveyance to uses, and the limitation or limitations of fees over complied with the then existing rule. against perpetuities, or, in other words, was made to vest within. any number of lives in being and twenty-one years in addition. The revisers of the Revised Statutes merely shortened the period of the old rule against perpetuities to two lives in being, and an actual infancy instead of the old term in gross of twenty-one years. If a limitation formerly valid by way of executory devise or shifting use complies with the amended rule against perpetuities, the revisers did not intend to abolish it. The object of the Revised Statutes was to enlarge the freedom of alienation, and to obliterate the distinction between conveyances invalid by the common law and yet valid under the Statute of Uses or Wills.03 62 56 §§ 101, 102, Real Prop. Law; Crooke v. County of Kings, 97 N. Y. at p. 446; In re L'Hommedieu, 138 Fed. Rep. 606, 610; Knowlton v. Atkins, 134 N. Y. 313, 317. 57 §§ 42, 50, Real Prop. Law. 58 Supra, pp. 152, 155, 161. 5938. Real Prop. Law. The term Remainder is now nomen generalis 60 §§ 42, 50, Real Prop. Law. 63 62 Manice v. Manice, 43 N. Y. at p. 375. 63 See revisers' note to R. S., p. 1277, Fowler's Real Prop. Law (3d ed.). It is reasonably apparent from the cases already cited that a limitation of a fee to take effect at the expiration of an estate to trustees may be made defeasible on the death of the first taker under the age of twenty-one years, or on any other contingency by which the estate of such persons may be determined before he attains full age, and that, within the actual infancy of such first taker of the defeasible fee, any number of shifting fees may be well limited to take effect in the alternative so that only one can possibly vest in possession in case the first or defeasible fee divest.65 66 Devises on Trusts for Two Lives, with Power to Beneficiaries to Appoint the Remainder. A devise to trustees for two stated lives in being with power to receive and apply the rents and profits to any number of persons, whether in esse or not in esse, is, as stated above, a very common form of family settlement in this State since the Revised Statutes. It is also customary in such a devise or settlement to devise a power to any one or more of the beneficiaries of the trust to appoint by last will and testament the remainder existing on the termination of the trustees' estate, either generally to and unto any one they please, or else specially to and among their own issue, or failing such issue to and among the right heirs of the testator.cs At common law the mere execution of a general power of appointment subjected the property to the claims of creditors of the donee of the power. But this rule was abrogated in New York by the Revised Statutes and a general power of appointment over the trust property, whether real or personal, given to the beneficiary of the trust, does not subject the property to the claims of the appointer's creditors.70 And the same construction holds even if the beneficiary has power to ap 64 Supra, pp. 157-161, 190. 65 § 42, Real Prop. Law. 66 Supra, p. 188. 67 Crooke v. County of Kings, 97 N. Y. 421. 68 Cutting v. Cutting, 86 N. Y. 522; Genet v. Hunt, 113 id. 158; First Nat. Bank v. Mortimer, 28 Misc. 686, 688; Crooke v. County of Kings, 97 N. Y. 421. 69 69 See Johnson V. Cushing, 4 Sharws. & Budd, Lead. Cas., Real Prop. 5; and id., note, p. 26; 2 Sugden, Pow. 128. 70 Cutting v. Cutting, 86 N. Y. 522; Hutton v. Beukard, 92 id. 295, 305; Cook v. Lowry, 95 id. 103, III. 71 point the remainder by deed as well as by will." But in framing the devise of a power of appointment great care should be taken to limit the donee to estates which do not suspend the power of alienation, but which are wholly vested and immediately alienable for a fee simple.72 A power, for the application of the rule of perpetuities, always relates back to the instrument creating it;73 and, consequently, if the limitation of the original instrument and the limitation contemplated by the power together exceed the legal time limit the appointment under the power is void.74 In a late essay, published in the Columbia Law Review, a thoughtful writer on the subject of perpetuities discusses the doctrine of relation as applied to powers and the effect of what he calls the "reading in formula" on the construction of estates limited under a power.75 The essay in question discusses a rule of construction only: Is the validity of the estates limited under a power to be determined by reading in the will or deed creating the power, the instrument in execution of the power, or are the several instruments entitled to be regarded apart? The essay is thoughful, the subject obscure, and one entitled to consideration by the lawyer dealing with this subject. But the gist of the rule, after all, in plain language, is that by the doctrine of relation no estate limited in execution of a power will be lawful unless it would have been valid if contained in the instrument granting the power. It is the estates which may be limited either under the instrument creating the power or the power itself which afford the only true criterion of the validity of the power. If such possible estates violate the existing rule against a perpetuity, the power is unquestionably void. Resettlement of Estate Under General Power. A grantee of a general power of appointment may appoint to himself in fee. By the execution of the power he is seised of an estate in fee, under the Statute of Uses now in force, and he may then resettle the estate for two lives in being with the contingent remainders 71 Farmers' Loan & Trust Co. v. Kip, 192 N. Y. 266. 72 Crooke v. County of Kings, 87 N. Y. at p. 445. 73 § 178, Real Prop. Law. 74 Fargo v. Squires, 154 N. Y. 250; Hillen v. Iselin, 144 id. 365, 378; Farmers' Loan & Trust Co. v. Kip, 192 id. 266, 278. 75 Mr. Stewart Chaplin, 10 Col. Law Rev. 495. |