Opinion
11-04-1886
MULFORD and others v. MULFORD.
Potter & Nixon, for complainants.
Bill for construction of will and instructions to executors. On final hearing.
Opinion states the facts.
Potter & Nixon, for complainants.
RUNYON, Ch. Horatio J. Mulford, late of Bridgeton, in this state, died July 16, 1885. By his will, dated March 3, 1884, he first directed that his executors pay all his just debts and funeral expenses. By the second section he gave to his wife in fee, in lieu of dower, a house and lot in Wenonah, in this state, and a house and lot in Bridgeton, together with certain other interests thereinafter particularly specified in his personal and real estate. By the third he devised and bequeathed, gave, granted, and conveyed, unto his executors, all the residue and remainder of his estate, real and personal, of which he should die seized and possessed, for the following uses, viz., one-half of the income of it for the use of his wife for life, and the other half for the use of his son, Horatio J. Mulford, until he should become 30 years of age; the testator's wife and son, "during the years above limited," to have the use and occupation of the house and lot where the testator resided, on the northeast corner of Atlantic and Vine streets, in Bridgeton, together with the household furniture contained therein, and also to have the use and occupation of his horses, carriages, and riding equipments, and his stable and lawn at the south-east corner of those streets, to within 100 feet of the line of Ludy's lot. He directed that after the death of his wife, the income of one-half of his estate should be used as his executors might choose to dispose of it; that in the event of his son's death before attaining the age of 30 years, and before the death of his wife, the income of one-half of the estate should be used as his executors might choose to dispose of it; and that, in the event of his son's death before arriving at the age of 30 years, and after his (the testator's) wife's death, all of the estate be disposed of as his executors might choose. And he directedhis executors, when his son should have attained the age of 30 years, to set off, according to the best of their judgment, one-half of his estate, and assign, set over, grant, and convey it to his son, to the sole use of his son, his heirs and assigns, forever; and that should his son desire to have the house, lot, stable, and lawn which at the time of making the will, were occupied by the testator, included in his half of the estate, they might be so set off to him, subject to the beforementioned privilege of the testator's wife in those premises,—the remaining half of the estate, after the wife's decease, to be disposed of as the executors might choose. He also provided that his executors might, in their discretion, sell any of his real or personal estate except that part the occupation whereof he had given to his wife and son, either at public or private sale, and invest the proceeds for the benefit of his estate, and that if, for any reason, the property could not be sold advantageously, they might mortgage it, so far as necessary, to pay borrowed money, or to keep it in good condition and repair. He appointed his wife and his sisters his executors to carry out the provisions of the will, and added that, after the death of any of his executors, the survivors or survivor were requested and empowered to appoint other executors to fill any such places as might be thus made vacant by death until the will should have been wholly executed.
The bill is filed to obtain a construction of the will and instructions and directions to the executors in the discharge of their duties under it. Numerous questions are presented for decision. Such of them as it is necessary or proper to decide in order to enable the executors understandingly and correctly to perform their duties and discharge their trusts will be answered. The others, which are based upon a hypothetical state of facts which may never exist, it is not necessary, and it would not be proper, to pass upon at this time.
The gift of use and occupation to the wife, in the third section, is a gift for life. The will, by the first section, directs that all the testator's just debts and funeral expenses be paid by the executors, and then gives to the testator's wife certain real property in fee. It then gives all the residue and remainder of the estate to the executors in trust for certain uses, viz., one-half of the income of it is to go to his wife for life, and the other half to the use of his son until he shall become 30 years old. He then gives to his wife and son, "during the years above limited," the use and occupation of certain specified real and personal property. The doubt as to the extent of the duration of the wife's estate has arisen from the words just quoted, "during the years above limited." That the testator did not intend to limit the wife's use and occupation to the time when his son would attain to the age of 30 years is evident from the fact that he provides that if, at that time, his son shall desire that that particular real property shall be set off to him as part of his half of the estate, it shall be done, not absolutely, but "subject to the privilege of the wife there in above described," referring to the gift of use and occupation to her. From that provision it is entirely clear that the testator did not intend to limit the wife's use and occupation to the time when his sonshould attain to the age of 30 years, but meant that she should have such use and occupation for life.
The taxes upon that property, and the cost of ordinary repairs thereto, should be paid by the trustees out of the income of the estate. There is nothing in the will to indicate an intention on the part of the testator that those expenses should be paid out of the corpus of the estate. So long as, under the will, the wife and son are entitled to joint occupation of the property, each is also entitled to one-half of the income of the estate. The trustees should retain, and pay out of the income, before dividing it, the taxes and cost of ordinary repairs upon that property up to the time when the property is to be divided.
The widow is entitled to one-half of the income of the estate for life, and she is entitled to nothing except what is given to her by the will. The $200 exemption, as it is called, would be in conflict with the terms and provisions of the will.
In case the widow should die before the son reached the age of 30 years, her half of the income will go to the trustees, to be disposed of as they shall see fit.
If the son survive the widow, and attain to the age of 30 years, one-half of the corpus of the estate will go to him under the provisions of the will. The corpus of the other half will, in case the widow should predecease the son, go, upon her death, to the trustees, to be disposed of as they may choose. If the son die before reaching the age of 30 years, and the widow survive him, by the terms of the will, his half of the income is to go to the executors, to be disposed of as they shall see fit. But the testator makes no disposition, in that case, of the corpus of the half the income of which is given to her. Although the legal title to that half of the corpus is in the trustees, yet it is not in them beneficially, but only in trust. The general rule is that whenever it appears, upon a conveyance, devise, or bequest, that it was intended that the grantee, devisee, or legatee should take the legal estate only, the equitable interest, or so much of it as is left undisposed of, will result, if arising out of the settler's realty, to himself or his heirs; if out of his personal estate, to himself, his executors or administrators. Perry, Trusts, § 150. That share of the corpus will therefore, under those circumstances, go to those who at the testator's death were his next of kin or heirs at law according as the property is personal or real.
The income given by the will to the widow and the son is the income of the residuary estate. They are entitled to it from the death of the testator. Green v. Green, 30 N. J. Eq. 451. The proceeds of the sale of building stone taken by the executor from quarries upon the testator's land which were opened before his death, and never abandoned, is part of such income. Gaines v. Green Pond Min. Co., 33 N. J. Eq. 603.
The provision that if, for any reason, such of the testator's real estate as he has given the executors power to sell cannot be sold advantageously, the executors may mortgage it so far as necessary to pay borrowed money, or to keep the property in good condition and repair, has no reference to the payment of money borrowed by the testator himself, butrefers to such money as the executors may find, it necessary to borrow for the preservation of the estate. They are empowered to borrow money upon mortgage of the property to pay borrowed money, or to keep the property in good condition and repair. The will provides in the first section that all of the testator's just debts and funeral expenses shall be paid by the executors, and, after the specific gift to his wife, he gives all the residue to the executors. He does not charge his debts, or any of them, upon his real property in exoneration or in relief of his personal estate. The power to mortgage is not given in connection with any provision for or any reference to the payment of his debts, but in connection with the sale of his real estate. In view of the fact that the executors may not be able to sell advantageously the real estate which he has empowered them to sell, and hence may be compelled, in order to keep it up, to expend money upon it, he authorizes them to borrow such money, if necessary, and secure the payment thereof by mortgage upon the property, or to secure the payment of the expenses of keeping the property in good condition and repair by such mortgage. The provision authorizes them to raise or secure the payment of such money by mortgage of the property, instead of taking it from the income of the estate, as otherwise they would have been bound to do. Combes v. Cadmus, 36 N. J. Eq. 382. It is the duty of the executors to sell that part of the real estate which they are empowered to sell, if they can do so advantageously, rather than to hold it, and make expenditures upon it which are to be paid for by money borrowed upon mortgage of it, or to mortgage it to pay the expenses of keeping it in good condition and repair. The power to mortgage is not a general one, but one which is to be exercised in a certain contingency,—that of the inability of the executors to sell the property to good advantage,—and then it is to be exercised only so far as necessary.
The interest upon such mortgages should be paid out of the income of the estate. The object in providing that the money may be raised upon mortgage is to relieve the income, for the time being, of the burden of large expenditures for repairs, etc., which otherwise it would have to bear. There is no evidence that the testator intended that the interest should be paid out of the corpus of the estate. The testator's indebtedness for borrowed money is to be paid in the same way as his other debts. The executors should use their discretion as to selling that part of the real estate which they are empowered to sell. There is no absolute direction to convert the property into money, but merely authority to them to sell it if they see fit.
The gift of income, after the death of the widow, to the executors, to be used as they may choose to dispose of it; and the gift of the estate to them in the event of the son's death before he is 30 years old, and after the death of the widow, to be disposed of as they may choose; and the gift of half of the corpus of the estate after the death of the widow, in case the son reaches the age of 30 years, to be disposed of as they may choose, —are all absolute gifts, to take effect in the respective contingencies mentioned.
The testator requests and empowers the survivor or survivors, in case of the death of any of the executors, to appoint other executors to fill any such places as may be thus made vacant by death, until the will shall have been wholly executed. The person or persons who may be thus appointed will not only take the place of the deceased executor or executors, so far as the duties of executorship are concerned, but will be clothed with the trust-estate in the place of his, her, or their predecessor or predecessors.