Opinion
No. 4941.
Argued October 3, 1961.
Decided January 29, 1962.
1. A decedent's bequest to his widow of the residue of his estate for the duration of her lifetime with the power to consume such portion of the principal and income thereof as may be necessary for her reasonable comfort and support created more than a conventional life estate but less than an absolute fee simple interest.
2. In the absence of statute, a creditor of a widow-life tenant having the power to consume the principal and interest of her husband's estate if necessary for her comfort and support cannot reach the life tenant's interest after her death where neither the right to consume nor the power to appoint had been exercised by her in her lifetime.
3. An action by a physician against the children of the deceased widowed mother for medical services rendered her in her lifetime founded upon an alleged oral assurance by them that their mother had a substantial estate and if the medical bills were not paid therefrom they would be responsible therefor was properly dismissed where the statement made could not be deemed deceitful or a negligent representation because of the complicated nature of the estate.
4. So also, the children's alleged oral promise to pay the medical bills of their mother if the estate did not is unenforceable under the statute of frauds (RSA 506:2).
5. In an action by a physician against the children of the deceased mother for medical services rendered her in her lifetime founded upon an alleged oral promise that they would be responsible therefor if the bills were not paid by the estate such promise was unenforceable as an independent undertaking for lack of consideration where any benefit derived from plaintiff's forbearance to enforce his claim during the mother's lifetime did not inure to the defendant children.
Bill in equity brought by the plaintiff physician to recover for medical services in the sum of $1,220 rendered Lulu V. Tuttle, who died in May 1958, leaving no assets. There has been no administration of her estate. The other defendants are a son, Maurice Bennett, and a daughter, Ada Downing, by a former marriage who, it is alleged, assured the plaintiff that Lulu had a substantial estate and that if her medical bills were not paid therefrom, they would be responsible therefor.
Lulu was the residuary beneficiary under the will of her husband Allison E. Tuttle, who died in 1947. His will left all of the residue of his estate to Lulu "for the duration of her lifetime, with the right and privilege to use such part, or all, of both principal and income as may be necessary for her reasonable comfort and support. If there shall be any balance of said estate remaining at the death of the said Lulu V. Tuttle, I give, devise and bequeath said balance to Richard A. Tuttle . . . for his own use absolutely." Lulu was named and appointed as executrix under this will. After Lulu's death the defendant Guy A. Tuttle was appointed administrator d/b/n, c/t/a in 1959. The inventory showed personal property in the amount of approximately $24,000 and no real estate.
The plaintiff presented his bill to the defendant administrator prior to September 9, 1959 but its payment has been refused. The plaintiff's bill in equity was dismissed as to all parties defendant by Leahy, C. J., and the plaintiff's exceptions thereto were reserved and transferred to this court.
Walter A. Calderwood and Louis H. Silverman (Mr. Silverman orally), for the plaintiff.
Harold E. Wescott and Peter V. Millham (Mr. Millham orally), for the defendant Guy A. Tuttle, administrator d/b/n, c/t/a, estate of Allison E. Tuttle.
Fisher, Parsons Moran (Mr. Moran orally), for the defendants Ada Downing and Maurice Bennett.
The decedent Lulu V. Tuttle had a life estate with the power to consume the principal or income of the residue of the estate of her husband Allison E. Tuttle. Lulu's interest was more than a conventional life estate but less than an absolute fee: simple interest. Eaton v. Straw, 18 N.H. 320; McPhee v. Colburn, 98 N.H. 406, 410; In re Gile Estate, 95 N.H. 270. Lulu had authority to consume, use, convey or mortgage the residue of her husband's estate (Lord v. Roberts, 84 N.H. 517) but she did not exercise these powers or attempt to exercise them prior to her death. According to the great weight of authority if the donee of a general power does not exercise the power his creditors cannot reach the property. 5 American Law of Property (Casner ed. 1952) s. 23.17; Restatement, Property, s. 327. Lulu's power to consume the residue of her husband's estate was not available to the plaintiff or other creditors in the absence of any exercise of her rights prior to her death. Note, The Power to Consume, 36 N. Y. U. L. Rev. 218, 221, 227 (1961); Grant v. Nelson, 100 N.H. 220, 222; Annot. 17 A.L.R. 2d 7.
The conception that the donee of a general power of appointment or a life tenant with the power to consume is immune to the claim of creditors unless the power is exercised has prompted some jurisdictions to alleviate the situation by statute. 5 American Law of Property (Casner ed. 1952) s. 23.17. New Hampshire has no such statute. 3 Powell, Real Property, s. 390 (1952). In the absence of such a statute creditors cannot reach the life tenant's interest where the life tenant has not exercised the right to consume or the power to appoint. Simes Smith, The Law of Future Interests (2d ed. 1956) s. 944. Occasionally a creditor of a life tenant with power to consume the principal for support has been held entitled to reach unappointed property but these cases are not very sure-footed, and their rationale is not too clear. Graves v. Jasper, 234 Ky. 407; Hipple's Estate, 30 Pa. Dist. 378; Hoskin v. West, 226 Iowa 612, noted in 53 Harv. L. Rev. 147 (1939). Moreover, it does not appear that these decisions have been followed and there is no indication that they constitute an adequate substitute for a statutory remedy. See Berger, The General Power of Appointment as an Interest in Property, 40 Neb. L. Rev. 104, 128 (1960): "State statutory reform is necessary and advisable in the field of powers of appointment in order to make the rules concerning them conform more with salutary policies of the law which create burdens upon ownership."
The Trial Court correctly dismissed the plaintiff's bill in equity against the estate of Allison E. Tuttle since Lulu's bill for medical services was a valid claim only against her estate. Fiske v. Warner, 99 N.H. 236. This makes it unnecessary to determine whether the claim was filed in time. RSA 556:3, 28.
The claim against the son and daughter of Lulu by a former marriage stands on no better footing. Their statement, as alleged by the pleadings, that Lulu had a substantial estate could not be deemed to be deceitful or a negligent representation. Laymen are not expected to know the legal labyrinth and the legerdemain which distinguishes a life estate with the power to consume from a fee simple interest. Leach Logan, Future Interests and Estate Planning, ch. 16 (1961). It would be natural for the layman to understand that Lulu had a substantial estate and the inventory filed by the defendant administrator indicated that it had been an estate in assets of substantial value.
Breach of the alleged promise to pay if the estate did not could subject the defendants to no liability. As a promise to pay the debt of another it was unenforceable under the statute of frauds. RSA 506:2. It was likewise unenforceable as an independent undertaking, since it was unsupported by consideration moving to the defendants who derived no economic or pecuniary benefit from the plaintiff's forbearance to enforce his claim during Lulu's lifetime. Beede v. Foster, 88 N.H. 131.
Since the claim was not against the husband's estate, which was not liable for the medical bills, it cannot successfully be contended that the plaintiff was prejudiced or damaged because he withheld action against that estate in reliance upon the defendants' assurances. Accordingly, the dismissal of the bill in equity as against the son and daughter by a former marriage was proper.
Exceptions overruled.
All concurred.