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A trustee's handook.

3 1924 018 769 202

Cornell University Library

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A TRUSTEE'S HANDBOOK.

.B. BOSTON: LITTLE. 1898. OF THE SUFFOLK BAR. BY AUGUSTUS PEABODY A. LL. HART.. _LOPJNG.B.TEUSTEE'S HANDBOOK. AND COMPANY. BROWN..

All rights reserved. By Augustus P. Loking.: Copyright. John Wilson and Son. SEtuiJttsttg Press S. . Cambridge. A. U.

Howes. for press. trust estates. especially where dependent on I statute. simply and conof cisely. doubt- But pains has been taken to notice the peculiarities of local State law. Edward A.. . his valuable assistance in digesting cases and passing volume through the AUGUSTUS PEABODY LOSING. the rules which govern the management and the relationship existing between the trustee and beneficiary. PREFACE. the citations proach to completeness only where the law ful or conflicting. all of I have used freely.. and to which have referred often for a fuller discussion of prin- ciples and this I and a more complete citation of authorities have to thank Mr. As the book is for general as well as professional are illustrative. Jr. This little book is meant to state. The lack of a Handbook of this kind has led me to complete and publish what were originally notes for personal use merely. wish to acknowledge my obligation to the writers of the many admirable which I text books which bear on my subject. with an apis readers.

NOTE. cited as " Underhill. Amer. is cited as " Flint. ed. Trusts is and Trustees. is cited as "Lewin. 4th Amer. ed." Flint. 9th Eng.. Wislizenus. ed." Perry on Trusts.. The citations : abbreviated — of the following text books are thus Lewin on Trusts." Underhill on Trusts and Trustees.. 2 vols. is cited as " Perry." .

.. Acceptance Should he formal 4-6 4 5 5 What is construed as an acceptance Presenting will . .. 3 4 4 Effect of disclaimer . 1 1 .CONTENTS.. .. . may disclaim But dry trust may vest in representatives of sole trustee .. Pages The Office of Trustee is not always Desirable . Doing any act to execute trust Not disclaiming in reasonable time 5 6 ... I. .1 2 2 Is restricted in his dealings with the heneficiary — compensation Disclaimer Acceptance necessary .. 2-4 2 2 3 3 is No form of disclaimer is necessary It should he affirmative and decided By deed. THE TRUSTEE AS AN INDIVIDUAL.. 1-2 Because he Cannot come in competition with trust estate Cannot delegate the management Cannot render expert services freely His only reward II. Table op Cases xix PAET I.. Vests in other trustees 4 4 Joint power lost by III. In Probate Court when instrument Must disclaim whole trust special a will 3 3 3 May disclaim executorship or trusteeship May Exceptions disclaim one of two separate trusts title .. .

. office vests in successor . when donee of power does not act 7 What court will have jurisdiction 8-9 Appointment not complete without title to property May vest by terms of trust instrumeut May vest in new trustee by statute Decree may order conveyances Appointees of court must give bond Without sureties when . 1 17 1 If sole trustee dies or is removed. required Who Any is Trustee 11-12 person intermeddling with trust property An executor investing and performing duties of trustee Where a second set of trustees appointed under power . 14 14-1 15 15 . 9 9 ... 6 6-7 6-7 7 the Trustee is Appointed Must be ratified by court when Court will appoint when there is no adequate the instrument How provision in 7 . . Pages 6-11 6 IV. or beneficiary unfit Relationship objectionable 13-14 . Appointment No trust fails for want of a trustee Temporary trustee may be appointed Appointment under terms of trust instrument . 11 12 12 VI.. Who Any 13-15 person of legal capacity to hold property and exercise 13 13 can be a Trustee power Such person may be a corporation Who cannot be a trustee 13 13 Lunatic and infant may be Trustee should be " capable " and " fit " Bankrupt. . Appointment op Trustee Maker may choose whom he will Donee of power must choose honestly and reasonably Courts will only appoint proper persons Or such person as all agree on Public trustees in Colorado 15 16-16 15 16 VIII. . . VII. . Devestment op Office 16-17 By By extinguishment of trust or completion of duties death or disability office vests in survivors . .10 10 10 10-11 11 Amount V.5 6 7 Vlll CONTENTS. .. ... bad character. ..

. THE INDIVIDUAL AS TRUSTEE. 19 19 All interested in trust are parties Removed for Waste and mismanagement Wilful breach of trust Property insecure Unreasonable prejudice Unreasonable disagreement 19-21 19 20 20 20 20 20 20 21 21 Will not remove Por poverty Caprice of beneficiary Unpleasant relations with beneficiary Por non-exercise of or manner of exercise of discre- tionary powers..9 CONTENTS. I. INCIDENTS OP THE TRUST ESTATE. . 18 19-21 19 must resign both unless devisable Matter is addressed to discretion of court Probate Court has statutory jurisdiction . Cannot abandon trust Resignation Must be accepted either by all interested IX Pages 17 17-18 17 17 Who are interested for this purpose Where Removal there is Or by court. . . unless prejudiced or unreasonable For technical breach of trust Por breach of trust through mistake 21 PART II. . more than one What trust in court 17 same instrument.. The legal and equitable estate in every trust. 1 Any court of equity in absence of statute . . Ownership op Tkust Property absolute in Trustee Incidents of ownership fall to trustee Suing and being sued No right of action if trustee barred Is stockholder in corporation Is personally bound by contracts and criminally Is liable to taxation Is liable in tort 22-26 23 23-24 24 24 24 25 26 .

. only what is needed In personal absolute In Code States.. cannot he severed Transmission op the Trustee's Estate. . 37-38 .. . . Pages Ownership not Beneficial Can take nothing but established compensation Cannot Cannot Cannot Cannot Cannot set off debts in equity 26-29 27 27 27 27 use the property May in buy the trust property borrow trust property buy up claims at discount some States render estate expert services for for 28 28 hire. • Title passes to' remainderman even .. Effect of conveyance Purchaser for value without notice.. death of trustee Vests in survivor how On death of sole trustee vests in General devisee when Heir or personal representatives 43 43 43 44 when 44 44 ..X CONTENTS. .. 37 37 . 37 38 38 .. Commissions allowed in various States 29-30 29-30 30-33 33-36 Trustee's Estate In real estate . no title. . Alienation Inter vivos.. and is holder of power only Is entitled to possession at law .38 Possession of beneficiary is that of trustee Estate is joint . extent . . Entitled to reasonable What are compensation. is 39-45 39—44 39 39-40 40 41 41 41 May convey at will.. who is and Title will not pass under general assignment Cannot be taken for trustee's individual debts Subject to execution for trust debts To what Set-off not . in others not Must account any benefit received 28 29 Ownership should not be a Burden Can charge legitimate expenses. . if equitable 42 42 43 Passes to successor Forfeiture On. What is . .

POWERS. etc Control of Court over Execution Will control obligatory powers Will ratify when Will not control discretionary powers Will not inquire reasons 51 51 51-52 52 52 May Will consider reasons if given set aside for fraud 52-53 53 53 53 53-54 Extinction of Powers By death of person having discretion trust Expiration or accomplishment of Exhausted by what .CONTENTS. What powers treated What Powers a Trustee has As incidental Granted by court or statute Granted by maker of trust 44 44 45-47 45 46 Vesting of Powers When powers do not vest in trustee . Vest in all trustees jointly Pass to successors and survivors when General powers Special powers . XI II. 46 46 46 46-47 47 47 Execution of Powers The essential part of a power Joint execution necessary 47-48 47 Exception about collecting money 48 48 48-49 48-49 49 49-51 50 50 50 50 51 Delegation Cannot delegate essentials Can delegate non-essentials Partial or defective Execution Defective execution aided for purchaser Substantial execution of essentials confirmed Literal execution of prescribed non-essentials necessary . Consent. Pages In General. .

65-69 65 65 65 65 amount 67 ... 58 58 Under statutes By court 58 58 59 .. Pages Power of Sale Not a general power Usual power in trust instruments Usual power under statutes Court of equity 54-60 54 54 55-56 57 may decree sale Execution of Powek Must be accurate Defective aided when.Xll CONTENTS. Purchaser takes risk of what Purchaser must see to application of purchase money when 59 Pledge or Mortgage Not a general power When given by statute Court will not order 60-61 . PARTICULAR POWERS. mortgage 60 60 60 60 61 61 Power to sell does not include May give power of sale Partition and Exchange Leasing What What leases trustee can make leases are binding 61-63 61-62 61-62 62 63 63 Special power to lease Liabilityon covenants To Sue and Defend May May incur expense 63 64 64 64 All trustees must join What admissions bind compromise To Contract Express contracts bind estate when Trustee personally bound by contracts Signing as "trustee" 64-65 64 65 65 Maintenance and Support General power when Special power how exercised Mainly discretional General power how exercised Discretion as to ... III.

. 69 Duties to the Beneficiary owing to Status To unable to care for self When others have duty to support Beneficiary is not a stranger in matters outside of trust Contracts with beneficiary Must not take advantage of position Such transaction may be set aside support if 69 70 ... 71 71 71 72 72 72 72 73 73 May accept employment from beneficiary Duties in Exercise op Office Must exercise utmost good faith in execution of trust . 77 77 77 78 79 Account in court Account between parties Expense of accounting 79-80 80 80 May get instructions of court where duties doubtful .... DUTIES. Discretion as to Discretion as to o X1U Paoes amount reviewed when apportionment when more than one 67 beneficiary 68 68 69 69 Miscellaneous Revocation Appoint successor IV. Must be loyal to its and the beneficiary's interests Must not aid adverse claimants Must not come in competition Must consider interests of trust exclusively in its management Must prosecute suits Must not release securities .. 73 73 73 74 74 Duty to exercise Trust personally Cannot delegate to co-trustee or agent May employ agent where there is necessity May employ agent to perform ministerial acts 74 76 76 77 77 Duty to Account Must keep separate and accurate accounts Books open to inspection of beneficiary Must settle accounts periodically Entitled to settlement of account Eorm of account Effect of account '. .CONTENTS. . 81 ..

partnership... undivided. . possession of May Receipt for to settlor not come into possession at once Must examine predecessor's account ... speculative. 89-90 90 90 90 90 91 .. unproductive.. Transfer of stocks necessary Notice in case of equitable claims Should sue on all claims .. .. 82 82-85 84 83 84 84 85 85 85 85 . . . 82 MANAGEMENT OF FUND. Conversion op Real into Personal or the Reverse 91 91 May not convert without What is a conversion Authorized by statute Authorized by court authority 91-92 92 92 92 92 Cy pres Infant's estate Implied authority 93 .. or generally property not trust securities Liability for delay What need not be converted Maker's reasonable investments Securities at a premium Property to be enjoyed in specie . Cake and Custody 86-88 Eeal estate. Should require tenant to attorn or take possession 86 86 Personal property. Pases Where May the Tkustee is in Doubt as to his Duty . Place title in joint names Take Personal property.XIV CONTENTS. What may be trust property Must take Steps to secure Property at once Real estate. Trust chattels Money Non-negotiable securities 87 Negotiable securities 88 88 89-91 89 Conversion Usually necessary to some extent What should be converted 89-90 Business. 81-82 81 81 notify beneficiary Cannot get instructions to enlighten ignorance Proper form of raising questions V. .

Investments Must keep funds invested XV Pages 93-104 93 93 . The estate paid in is principal Proceeds of conversion of securities Damages Gain and loss recovered in value Advance or depreciation Timber and gravel Chattels .. Ordinary Betterment and extraordinary . 107 108 108 108 109 109 Farming Dividends. stock Accumulated income Current On wasting investment Extra dividend Stock dividend Rents Interest. what are Determined by statute ... 99 99 99 Proportion in one security Investments allowed in various States 100-103 104-113 104 104 104 106 107 107 Pbincipal and Income Need of dividing Receipts.. 94 95 96 96 96 96 97-98 Must Determined by court exercise a sound discretion What is sound discretion Determined by condition of affairs Margin of security at time of investing . at all times Liable for simple interest Liable for compound interest when 93 Change investments when Must invest securely and to get current return Trust investments...CONTENTS.. . generally 109-110 109-111 112 112 112-113 112 113 income May require apportionment Bonds bought at premium Apportionment at end of life estate Payments Discharge of encumbrances Alterations and repairs When principal and when income On newly acquired property 113-117 113 114-115 114 115 115 115 Taxes.

.128 j28 . To Strangers. 122 Unless one joined in the breach of trust Or contributed by neglect Or gave joint bond Contribution from co-trustee 122 122 122-123 122 124 125-127 125 125 125 126 127 127 127-128 ]28 For errors of judgment In investing Paying to wrong person Must use average Measure of damage Interest simple. 122 Por crimes of strangers where there and default of co-trustee neglect . supra Criminally for embezzlement . Premiums 11 5-1 1 Proceeds of policy Expenses. Pages Insurance. TRUSTEES' LIABILITIES.6 XVI CONTENTS. See Incidents of Ownership. .. discretion Otherwise where discretionary power Compound when required to replace property Liability terminated May be By death Release .. 120-121 120-121 To Beneficiaries Are joint and several Each transaction stands alone Por neglect of duty Whether damage is directly or Not for act 121-129 121 121 121 indirectly the result is . Care of property Brokers' charges Legal expenses 116 117 117 117 Distribution 117-119 117 118 118 118 119 119 At risk of trustee have decree of distribution Who bound by decree Should not be by fictitious account Payment to an attorney Compensation for May VI..

135 Restraint on alienation 136 136 136 137-138 138 139 Tendency of modern jurisprudence Exception as to married women Rules in various States Spendthrift trust made by cesser Support of family Condition over on alienation III.. III.... 140-147 140 140-141 141 Where enforced How enforced Can compel what Damages for breach Special rights of trust 142 142-147 143 Right to Right to Right to Right to Right to Rights lost information income support conveyance possession 143-144 144 145-146 147 147-149 148 148-149 149 • By Release Assent Acquiescence Statute limitations • 149 . May be alienated What Notice Priority 132-140 132 133 1 33 133 134 134 .. Account and apportionment of successor Statute of limitations XV11 . The Estate op the Beneficiary Incidents of the equitable estate Will descend like other property Dower and curtesy estate passes . Pages 128 128 128 128-129 Insolvency Successor's taking over property PART I.CONTENTS. Who mat Who is II. . THE BENEFICIARY. be a Beneficiary 130 131 the beneficiary . 139-140 . Rights op Beneficiary against Trustee .

... Pages IV.. 155 Where Where Where trustee is is property trust is established by judicial decree . Non-resident trustees Foreign investments Taxation 155 155 155 155 156 157 157-158 Index 159 .. Trust invalid in jurisdiction where sought to be enforced Trust can be enforced .. Rights against Strangeks To constitute transferee of property trustee May follow as long as can identify Money may be followed Must elect whether to hold trustee or follow Rights to pursue stranger aiding breach of trust 149-153 .. INTERSTATE LAW. .. 149-150 150 151 151-152 152 152 153 . . What is notice of trust Rights where disturbed in possession V. Liabilities 153-154 PART IV..XV1U CONTENTS.

Brady Brimmer Adams v. Alford v. Pages Abbott. Arnold u. L. v. Adm'r. Briggs Gleg Landerfield Proprietors. Mercantile Ins. In re 14 Barnes v. McWhorter 137 Baker v. Barker 142. Brown Arnould v. 152 23. Bahin Hughes Bailey. Gillette 27 Alleys. Tibbetta 26 Barclay v. Ailing 71 Ames v. Underhill 123 Bayard «. v. Grinstead Atkins v. In re 110 Bassett v. Co. Colley 149 Bergengren v. Hubbard Bacon v. Dow 137 Barney v. Gill 73 Bennett v.TABLE OF CASES. 153 Bailie v. 27 95 111 93 56 38. 154 33. Armstrong 122 v. Granger 80 Bate v. 57 v. Albree Attorney Gen. Mut. N. Bartlett 133 Barton's Trusts. Caswell 25 Arguello. 1 48 113 Albert v. Scudder 87 Amory v. 24 Barker's Trusts. 151 v. Bacon Badger v. etc. Joy 30. 34 Bartlett v. Lloyd v. O'Brien 46 Beloved Wilkes' Charity. Spencer 103 37 76 134 v. 38 Beach Beach v. Belknap . Ex parte Belknap Belmont v. Lawrence 50 Ailing v. 48 124 47 135 v. Eng. City of Baltimore 152 Aldrich v. Aldrich 67 Allen v. Davis 50 Bates v. Wyndham 26 Benjamin v. Pet'r v. Badger Babcock Baer's Appeal Bagshaw v. Aldrich 62 Belchier. Lowell 80 Anderson v. Green 99. Mather 92 Ansley v. In re 52 Benett v. Adams 6. Co. Parsons 103 Barrell v. McKinley 111 v. v. Ins. Hooper 104. Lorillard 56. Farmers' & Mechanv. 40 134. 154 Bateman v. 47. In re 87 Abell Adair v. Pace 56. Pet'r ics' Bank v. 13 150 33 52 148 v. 157 a. 57 Anthony v. Wainewright 109 Barker v. 34 Foots v.

Oglesby Boys v. 32 92 Billington's Appeal Bird v. In re Bouch. Ackermann 77 Bogle v. Mixter Bostwick. ' Bouch Savage Bowditeh v.141 67 61 Butterfield Brandenburg v. In re Bosworth.XX Duff TABLE OP CASES. Penny 120 151 Bowers v. 121. Brown v. Banuelos v. 71. o. Boston v. Evans Bowes v. 15. Pet'r Desmond French 116 110 140 99 . Fidelity Co. Bowen v. 124 Blauvelt v. Bobbins Boston Safe Dep. Ligon 62. Laws Blake v. Birchmore Bradby v. 53 122 64 55 70 81 o.. Adams Broeck v. Thorndike Braswell v. & F. Boys 48 30. 110 38 18 Boursot 10. Rollins Bostick v. Pierce Boyd v. 30 81. Jackson Brought v. 131 146 108 137 34 32 Higgins Brown. I. Bradshaw Bradstreet v. 80. Seeger Bowker v. 63 57 Blacklow v. 49 Berger v. In re Sproule . 74. Pegram 31. Brooks v. 32. Bogle 18 Bohlen's Estate 55 Borel v. Whitchurch Bradlee v. Floyer 61 49. 122. 48. v. 90 36 91 Bradbury v. Morehead Broadway Bank ». v. Andrews Fane v. Winton Bostock v. Gallatly Biddle's Appeal 31. Chicago. Rail153 road Black v.

XXI Beers . Clark v.TABLE OP CASES.

Western 106. v.. 151 John v. Heard Sparrell Ellig ».XX11 TABLE OP CASES. Everett Drew 23. 9. Naglee Barker Boston. 65 56. 91 Ervine's Appeal . Wellesley Earl Cowley Earp's Appeal v. 73 & E. 75. road u. 110. H. 111 Eldredge Eliott v. 64 Frazer v. Emery Evans Batcheldei' 18 31 101 2 Evans's Estate v. Ellis v. v. 70. Rail4. Ellis v. 107 52 93 51.

TABLE OF CASES. XX111 .

XXIV TABLE OP CASES. .

69 Nelson ?'. McCartin v. 88. 91 Coates 103 37 National Bank v. Court More v. 107. Hassam Adams Universalist 41 Meyers v. Muscogee Co. Walsh 67. v. v. Phelps 41 108 Nugent v. 42 63. Blake . Farquhar 137. Eaton 21 Meeker v. Thompson 90 Nyce's Estate 98 Mitchell v. Walker 135 v. 148 61 McQueen v. Olpherts Mendes v. Guerrard 18 Miller. 123 Oeslager v. May v. Coal Co. 59 16. Evans 96 Neyland v. Kansas Pacific Rail12 Olney v: Balch road 12 23. Bennett Soc. Redwine 60 Norton v. Eure 102 Old South Soc. Wallis v. Fitch 6 110 North Amer. 16 v. Tappan 46 v. 74 Mayer Galluchat 28 v. v. Crawford 30. Moore 58. v. Holmes Feinour v. Traphagan M'Clanahan v. 123 Morgan v. 127. Calkins 58. v. v. Cloon v. 132. Olcott 99. Allee 26. 109. Wright 48 Monell v. Duncombe New Eng. 47. 94. 106. Hibbard 94. 58 Norris v. 89. Hogg Meeks v. Nance McDonald v. Matter of Dyett 65 v. Norton 37 50 Minot v. Bendy 73. Keteltas 153 McKnight v. 66. Noel Morrill v. May XXV Pages v. 128. 68 Mortlock Morville v. 115 62 v. Cox 20 Nichols. D'Oench 47 Mercier v. Zanesville 96 127 McKim v. 154 Co. Winslow 82 Molton v. Morrill 78 Ormiston v. v. Philips 103 24 Nobles v. Clymer 55. 56 150 North Merriam v. 139 v. Ireland 67. Millen v.TABLE OF CASES. Hyer 78 94 34 Nance Nash v. Monell 92 87. 157 94 Morse v. 81. West Kansas Land Norling v. Insurance Co. 70 Newhall v. 128 Newcomb v. Appellant 72. Gleason McCoy v. 141 Onslow v. Hill 27. 42 Ord v. 68. Schuyler McLeod v. Henderson 24. Fowle MoCann v. Crocker 57 32 Oliver v. Henderson MoCloskey v. 79. 34. Ouseley v. Doane 90. Kneeland Mclntire'sAdm'rsw. Prescott a. Anstruther 137 142. Wheeler 134 151 New York Co. 152 Norcum v. 148. 150 Ochiltree v. 68 17. 31 Nickels v. Randall 8. Trust Co. Acton McPherson v. Irvine 87. 44 Owens v. 149 Overman's Appeal Mortimer v. 146 McNeillie v. Fisher Moore v. Poor 141 124 73 103 150 Munroe Murray v. Guedalla 48. 121. Buller 59 38. Eaton 82.

95. Doughty Reed v. Rogers 6 31 Pitney sary v. Whitney 63 34 38 148 Pusey v. Sherwood Peckham v. Couch 108 Russell v. Samuel 139 51 Sargent v. 148 Hubhell 110 Randolph v. Collier 1 08 149 v. Wheelwright 136 115 28 Rogers v. Grinnell 1 46 130 Ryan v. 115 Prevost v. Clemson v. v. Richardson Boston Treeland v. 28 12 29. Harrison Pope v. Premier Steel Co. 100 47 109 133 73 145 25 110 149 48 Pennell Mullins v. Yandes Pacific Bank v. Haughton 108 . Boston Dispen- Rome Exchange v. 137 37. Windram 135. Pace Pierce v. v. Bowen v. People Townsend Moore Newell 26. E. v. v. Chase 40 «/. v. 99. 129 98 Samuel v. Piety Pinckard's Pinckard's Adm'r 137 12 Robertson v. Whitney Reid v. Burroughs Stace Distributees v. Porter 56 64 Ryder v. Blackburn Pool v. Land Co. v. Pass v. Dimdas Pearson v. 42 20 Johnson Moore v. v. v. Whitehill Ridgley Roberts v. Gratz Proctor v. Bank v. 115 Cox 137 135 Poindexter v. Plympton Everson v. 30 126 13 Richardson Riddle v. JFarnsworth v. In re 83. Converse v. i>. 155 124 48 116 103 15] Kaby Band Kidehalgh 124. v. Bank of Rutland "Woodruff Portsmouth v. 154 Rhoads ». v. Palmer Parcher v. Rhoads v. Eames Roxburghe 113. 92 Dill 33 v. Perkins's Appeal Perkins Perrine v. Jamison Peck Pell v. Birmingham v. 79 32 16 106 14 105. Head 60 Reed v. Deffell v. Sargent 12 139 Saunders v. 38 Powcey Presley v. Devereux v. Bussell Parker v. Shackford Potter v. Robinson 93. 113. Newton De Winton v. Bickerton 100 148 14 Salmon. 114. Johnson Stevens Person Warren Philippe Philips Philbrick's Settlement Philippi Philips Pierce v. Porter v. 52 55 36 20 133 Quackbnboss Quin's Estate Southwiek Parsons Paschal Winslow Aeklin v. Ray v. 125 v. Johnston 137 134 Robinson v.XXVI TABLE OP CASES. 136 Stribling Packard Marshall Paddock v. Heyer Purdie v. Ames v. Pages Pace Pace a.

TABLE OF CASES. XXV11 .

Murphy v. Foster of 72 23 110 121 "Wadsworth. Finch v. Higham Thompson v.xxvm Thomas v. v. 124. 52. Trull Trust Co. Terry Van Vronker v. 126 35 23. v. Pomeroy Tnrner v. 64 Vandever's Appeal Van Doren v. v. Eastman Vaughton Vetterlein v. 111 23 106. State Tucker Turnbull v. Olden Van Vechten v. Pages 18 121. Townend Sherburne Salisbury Mfg. 82 4 101 102 28. Kobinson 99. Bradford Coggeshall v. 106. S. 128 Peake v. TABLE OF CASES. Townend Townley Co. Sheldon Tryon. 31 7 Tucker v. 137 133 139 28 122 Treadwell Trull v. v. v. Roche 31 Utica Ins. 137 40 Tillinghast o. In re 82 98 49. Maule Tuttle v. 60 Trust Co. Urann v. v. Matter . In 52 47. 113 Noble Barnes Vinton's Appeal v. Coates TJ. Tolles Wood v. Lynch re 93 Vanderbilt. Vyse v. Gilmore v. Co.

Womack Austin XXIX v. .TABLE OE CASES.

.

2 An individual may be willing to trust the whole or some part of the management of his personal affairs to but a trustee must manage the trust affairs him3 The individual might have important employment self. but as trustee he is deprived of these privileges. 691. It is not always desirable to be a trustee.. and before undertaking any trust the individual should make a careful examination of the trust instrument to ascertain 1 its particular provisions will be. 72. but trustee such services will be unpaid in if he is the some jurisdictions. Lloyd. and often the sacrifice of personal convenience and chance of profit. J. others . pp. 74. 1 T>. THE TRUSTEE AS AN INDIVIDUAL. 74. involving many duties and liabilities. he is put in such i Keckiwith.A TKUSTEE'S HANDBOOK. PAKT I. Moreover. He and what his duties and liabilities should also examine the property to see that his personal interests will not conflict with his duties as trustee. I. The duties of a trustee to his beneficiaryrequire not only the highest good faith in their execution. or at least looked on with suspicion. 2 Infra. to manage property for another. p. or he might buy from the estate or sell property to it. Office mere contract Trusteeship is not not always Desirable. Infra. . as broker or counsel for the trust estate. but also the absence of conflicting personal interests. but it is — a relationship. 39 Ch. 82. in Hallows v. 8 Infra. p.

§ 3190. p. 9 Wise v "Wise. . 403. 45. p. p. 2 Jon. 4 Beav. 6 He may No one need be a trustee against his an acceptance of the office is necessary 6 and the office may be refused or disclaimed at any time before acceptance. 8 Infra. 26. If the office is to be disclaimed it must be disclaimed at once and unequivocally. as otherwise an acceptance may be implied. p. even though the trustee were nominated under his promise of acceptance. 7 II. John. p. and if he is the personal representative to settle th& ac- counts of the deceased trustee. p. any profit- confidential relationship to his beneficiary that able business dealings which he has with the beneficiary are subject to suspicion. . 4 Infra.. 27. Disclaimer. Code (1895). 9 1 Infra. 35. 6 7 8 2 Infra. even where the trust property not in question. 5 Infra. the trustee assumes all the liabilities involved in the ownership of property. 9 a. . Infra. & La. generally to the same extent as an agent or factor who manages the affairs of others. 2 be required to give bonds with sureties for the faithful performance of his duties. and is for neglect or errors in judgment in its management. Evans v. 1 In addition to the complications that may arise from the relationship to the beneficiary. 2 a trustee's handbook. Litt. when appointed. 4 He is absolutely prohibited from taking any other benefit from the trust. 71. 3 To counterbalance these possible disadvantages the trustee is entitled in America to compensation. Co. 10. and a limited trust to transfer the estate to the new trustee. 30. since It is true that a trust estate 8 may vest in the heir or rep- resentatives of a deceased trustee without possibility of disclaimer takes only the but in such case the heir or representative title to the property. Ga. — will.

(1888). Conn. J. Rev. 207. In New Jersey trusts are divisible. 3 No particular form of disclaimer is necessary but it should be affirmative and decided. as trusts are not divisible. . 328. ITnderhill. in some States. not as a disclaimer. §490. 6 trustee under the Where. and recorded where the settlement is recorded and if the settlement is not recorded. § 3420 . unless there appears to be an inteni Lewin. Stat. a disclaimer filed in the Probate Court is appropriate. . such a disclaimer would be unwise in most cases.. 2608. n.. 8 (1887). 68. (1896). (1883). . 13 Pick. and probably difficult of proof after a considerable period had elapsed. (1894). Stat. ch. Stat. he may disclaim either office and accept the other. § 5983. then the disclaimer should be by deed. § 4155. 298. See Shaw. Ohio (1890). Rev. Code Ala. 1 If the trust instrument is a will. 110 Mass. . however. Rev. then addressed and delivered to whomever has the custody of the instrument that person being in most cases one of the beneficiaries. 331. he cannot separate his duties and accept part and . Stat. Va. Me. Howe 4 5 Ray. In general the disclaimer should be in writing. If the trust instrument is a deed. (1889). § 8689 . p. § 3 Rev. 420. A disclaim the other. 8 trust must be disclaimed wholly. p. Although a simple verbal refusal to undertake the trust is sufficient. § But the refusal to give bond is treated as a ground for removal. v. and vesting of the estate though in practice it would not probably be so construed. Gen. 4 and if an executor have the management of real estate given him. THE TBUSTEE AS AN INDIVIDUAL. or the other administration of property in which he acts the part of a trustee as well as executor. Code 2 . Mo. Laws Vt. Wainwright. although the failure to qualify or give bond in court is usually construed as a disclaimer by statute 2 but such a disclaimer cannot be set up by a person other than one for whose security the bond is given until some action is taken by the court. C. but not in the form of a reconveyance which presupposes an acceptance. in Dorr v. a person is appointed executor and same will.

if the settlement — Daggett v. 48 L. he may have the expense of consulting counsel and all . 1. and no intention appears that both or neither shall be accepted. and if a gift or legacy is attached to the office it will be lost by a disclaimer ' but a gift which is not attached to the office or conditional on its acceptance will not be affected by a disclaimer of the office. Boston. 1 when two trusts are created by the same 2 both must be disclaimed or accepted. (N. 6 on however. Pub. § 12. J. 8 III. 93. Railroad. 214. R. end. § 264. by the disclaimer. Ga. 4 Generally and by statute in Md. "Watney. Carrnth. Code (1895). 2 1 §§ 288. The effect of a disclaimer accept. p. 8 is to vest the whole estate in and relates back to the time of the gift. his costs. 128 Mass. 5 s 7 Ellis v. but the instrument better view seems to be. If the individual were not consulted about the appointment. 7 Beav. » In re Cunard's Trusts. S. p. testator that he should accept both on the part of the or neither. 208. 431.) 192. 398. Carruth v. §3190. and the result is the same as though the individual 6 As to the legal disclaiming had never been appointed. that where they are wholly separate trusts not interdependent. Acceptance. Perry. .. H. 496. Art. but nevertheless it is held to be devested If. the trust instrument bestowed any power the trustees nominated. 107 Mass. L. & E. Gen. 289.. the disclaimer of one will destrojr the power. In re Tryon. An acceptance should be made formally according to the provisions of the trust instrument 9 but if no manner is therein specified. 418. Slaney v. Lewin. 4 tion a trustee's handbook. White. 4 the trustees who title the exact effect is less clear. one may be accepted It is said that and the other disclaimed. 8 9 Lewin. Laws (1888). 2 Eq. 148 Mass.

THE TEUSTEE AS AN INDIVIDUAL. 141. 413. care should be taken to avoid any assumption of authority. ch. 1 If an individual be named both executor and trustee. p. and hold them in trust for certain purposes. § 18. Pub. p. * Kilbee v. if a disclaimer is contemplated.. 3. 1 5 6 Supra. . until the disclaimer has for- mally been made since such assumption or interference be construed as an acceptance. 2 Molloy. 2 Grant's Cases. In some jurisdictions the sureties on the executors' bond will not be liable for his acts as trustee. 8 Infra. then if 5 the trust be the probate by qualifying in court. 3 An acceptance will be implied if the individual intermeddles with the trust property. Supra. 432. Sneyd. however. And a trustee who has acted as such cannot disclaim. 4 Hence. 2 In absence of statute the executor or administrator accepts the decedent's trusts. and should be qualified as trustees as well as executors. § 157. although in practice they often qualify as executors only. and cannot disclaim them but by statute the law is usually the reverse. 12 N. or performs any act to carry out the trust. H. It is not unusual for a will to provide that the executors shall manage certain estates. Smith v. will readily Mass. 5 He may. 2 Flint. Clinton Co. or established by will. then by joining in the deed. but in other States they will. Stat. Flint v.. Knowles. 12. and by statute a person not so qualifying is held to have disclaimed. or was merely 6 to protect the property until a trustee could be appointed. p.. and a new trustee may be appointed. . be by deed. 186. prove that the act from which an acceptance would be implied was done as agent. he will be construed to accept both offices if he presents the will for probate without disclaiming either. and not executors. either as volunteer or agent. or voluntary interference with the trust estate. 3. even though the deed needed his signature and he has not signed. In such cases the executors act as and really are trustees to that extent.

though such a course is very unusual. (1894). 111 N. or if those who have been nominated disclaim. Dak. § 3959 Code No. 8 Gray. Gen. Civil Code Cal. Brunt. R. Hosp. But the power of appointment under the trust instrument will only arise under the exact terms specified therein. the property will be held by whoever may have the title until a proper trustee can be if — No trust appointed. 445. 2030. or when the safety of the fund or the proper administration of the trust requires an additional trustee. trustee or a receiver. Fitch. L. p. and 1 Adams v. an acceptance will be implied and the burden will fall on the appointee to show that he had no reasonable opportunity to disclaim. 228. but the burden of proving be on him. As when the number of trustees sinks below the prescribed number. . North Adams Universalist Soc. 6 or a trustee becomes disqualified by going abroad. IV. 185. 6 Eq. or if all the trustees die. Rogers v. Mass. (1887). 4 The power to the circumstances make an appointment will arise whenever make it necessary. 21 Wall. estate vests in a transferee subject to disclaimer. Adams. as in the case of the death or disclaimer of all the trustees. § 4302. 6 a trustee's handbook. Infra. and in that case disclaim . either in the nature of things. 142. 3 In case of need the court will appoint a temporary and rnaj' in certain contingencies administer the trust itself. 8 4 5 Brightly's Dig. Y. (1885). (1895). v. § 18. § 2289 Comp. . 1 therefore if an appointment be known of and not disclaimed it will The within a reasonable time. 580. 12 Pick. . v. Laws Dak. Rogers. Amory.. Pa. 2 and will be allowed to fail for conveyance is made to one that cannot act. p. or that he acted in some other capacity than that of trustee. or whenever the provisions of the trust instrument prescribe it. " . 421 Dodkin v. want of a trustee. Appointment. or as it may be otherwise provided in the instruments.

reason. p. the Probate Court has jurisand the appointment. or convenience of the beneficiaries. and thus come under Rev. even if made will. must be confirmed by a decree of the although the trustee's powers in such cases come from the settlement. and in others to the surviving trustee. 1 or in the case where the power to appoint arose on the refusal and neglect of the original trustee to execute the trusts. 1 2 Turner v. 77 . If the trust is diction of the estate under a will. § 15. will . and the method prescribed must be carefully followed but if it becomes impossible to follow the method prescribed. Underhill. ch. In Maine a trust may be confirmed by court.THE TRUSTEE AS AN INDIVIDUAL. or for the security of the fund. the court has no jurisdiction iu the case. the power did not arise. and he died without executing them. Stat. In some States the power to appoint the trustee is given . 15 Jur. 6 the court for any reason. p. its jurisdiction. Maule. — by statute to the beneficiaiy. under the terms of the statutory law. (1883). according to the prevailing court. Me. 7 not arise under similar terms as." will not give rise to a power to appoint when one becomes bankrupt and therefore "unfit" but still "capable". 4 court in 5 The appointment of any voluntary trustee may be confirmed by Maine Rev. 400. Pickett. aud the appointment must be made by the court. and not the court. for instance. 8 Infra. n. 42 Miss. 68. an appointment made under a power in a settlement should be recorded with the settlement. §§ 15. 2 vision that a trustee shall be How the Trustee is appointed. 8 As a matter of precaution. but usually to the court. 50. 68. 2. 16. a proappointed on one of the trustees becoming "incapable. the power is wholly lost. eh.* The same is true if the trust be under the jurisdiction of and a letter issued. If the trust instrument adequately provides a method to be pursued in making the appointment of a trustee. . (1883). either to If for any fill a vacancy. Stat. 761. Guion v.

Randall. 2 but 3 less parties are required in some jurisdictions by statute. Gen. See infra. . p. 6 but it is hard to see what effect the decree can have unless the trustee be aided by statute or be reappointed in the jurisdiction where the property lies. (1895). Laws Md. and vest it in the appointee of the court. 4 In the absence of such statute there is no way of vesting the title. . (1891). Art. or if the person holding the power to appoint a trustee unreasonably refuses or neglects to act. v. Pub. 147 Mass. Col. 9. whether in possession or remainder. Statutes exist in some jurisdictions which authorize trus- 1 2 8 4 Statutory provisions in most jurisdictions. v. but in the absence of stat- ute any court of chancery or equity will have jurisdiction court will have jurisdiction and can appoint a trustee if the person who holds the title to the property is within a statute by which the title will vest in the new trustee appointed. Smith. p. Ordinarily. § 6 6 Randall. Annot. McCann McCann Curtis v. 12 Allen. Stat. or if the property itself is its jurisdiction and there of the jurisdiction.8 a trustee's handbook. N. § 112. 147 Mass. within its jurisdiction. (1888). § 212. The operation of the statute is to confiscate the title of the person out of the jurisdiction. 60 Barb. 1 though it would not take any notice of the application of a stranger. 2535 Gen. and the court is powerless. the appointment of a trustee is desirable. 81. 81. 16. although the property and holder of the title are both out is among The its ordinary powers. HO. All persons in interest must be parties to the suit. 5 It is held that the court having original jurisdiction of a testamentary trust may make a subsequent appointment. J. Paine. 394. Shaw v. Stat. jurisdiction in these matters is conferred on the Probate Court by statute . and the trust instrument does not contain an adequate provision for appointing the trustee. 293. the court will appoint a trustee upon the application of any person interested in the trust.

680. where the sole beneficiary has moved into a State and wishes the property there also. but do not get title to the personal title to estate until it is turned over by the executors. since the matter is one of practice. since the outgoing trustee is not relieved and is still liable for the trust. 259. Gen. Bumgarner Boston. Ellis v. ordinarily vests in later appointees by express provisions of the trust instrument. not complete until the the trust property is vested in him.. N. The original trustees under a will get title to the real estate from that instrument itself. (1896). Code W. 1 Ky. & Erie Railroad. requiring care and professional advice. 9 tees appointed in other States to recover trust property in the State where the statute exists. The original trustees under a deed will have the prop- erty vested in them by the conveyance. Va. 4711 . §§ 4709. Stat. 1. Code Ala. (1887).. p. 49 Mo. Stat. 2 8 4 Code Va. 107 Masa. (1891). (1895). and may incur heavy liabilities without any right to indemnity out of the trust estate. usually after a considerable interval. and the incoming trustee is acting wrongfully as trustee. Cogswell. p. — The Appointment not Complete without appointment of a trustee is Title to Property. THE TRUSTEE AS AN INDIVIDUAL. but this case seems open to the criticism as the foregoing. § 4. § 9. J. (1894). as the consequences of administering a trust under a defective appointment may be serious. § 2630. the court may same appoint a trustee . H. all the prescribed conditions concerning 4 the appointment must have been accurately fulfilled. v. 1 So too by statute. though simple. which commonly provides that on the appointment of a new trustee he shall 3 become entitled to and vested with the trust property The property but in order that the title shall pass under the terms of the instrument. § 4200. 2 No attempt will be made to state the rules of procedure in such cases. 3685. .

Stat. p. 95 ch. a well drawn decree will contain an order for the necessary conveyance. 7. Laws (1896) Del. Stat. § 6. N. Stat. Stat. Statutes in nearly all jurisdictions. the appointment being that of the individual and not of the 8 court. Conn. Gen. 68. Bowditch Banuelos. conve3 ance must be made by whoever holds the title 4 and where the court appoints. Gen. any written Loring v. Salisbury Mills. . . Stat. i s c. (1888). 7 In testamentary trusts these bonds are required to be with sureties. 424. Stat. 1 Gray. ch. or unless all parties in interest join in requesting the exemption. Me. . 43. 6 7 For further discussion see pp. n. Laws Vt. . § 8684. Rev. Where there is no adequate provision in the trust instrument and no statute applicable. Stat. (1882). Eldridge. Pa. Gen. 141. 709. 2030.. 6 — and the court may require an appointee under a power in the instrument to give bond if the circumstances require it. ch. ch. amended by Stat. Wis. 220. In many jurisdictions the property will vest in the new 1 but this vesting of title is appointees of the court 2 and even usually confined to where the donee of the power is the Judge of Probate. § 7168. R I Mo. § 284. § 1. v. 138 141 Rev. Minn. 6. 709. ch. 3684. 2 . p. Gen. § 492 (1895). Pub. Gen. are required to give bond to the court for the faithful performance of their trust. Kan. § 4. (1889). Mass. . 125 Mass. § 4. 115 Mass. 208. Stat! (1889). Brightly's Dig. infra. Trustees under wills. Pub. 1878. 254. the title will not pass under the statute. Stat. § 26: Rev. (1894). §§ 6. § 4297 Annot. 44. p. 6 trustee by statutory provision T Trustees' Bonds. In such cases " all persons beneficially interested" refer only to persons in being and who have a present vested interest i Perry. § 2094 Webster Bank v. and p. (1888). so as to vest title in appointees under instrument. (1883). Laws Md. (1889). 16. 10 a trustee's handbook. unless the testator has expressly excused the trustee from furnishing them. Art. (1894). § 208. J. § 2612. (1894). 250. (1893). and usually trustees appointed bj' the court.

Who is who Trustee. "When the court orders a narily order the trustee to sale of real estate file it will ordi- a bond sufficient to cover the price received. to decline a trust where he is required to fur- nish security and the wiser course seems to be to select the trustees with care. for instance. 1 It is not unusual for a trustee. The amount of the bond required is sufficient to cover with a margin of fifty per cent the personal property in the trustee's hands. V. if there is a power of sale of real estate in the settlement. 256. rather than to take a less desirable individual with security. furnished sureties may be rea later time the court. considers it necessary for the safety of the fund. Dexter Brown v. preciation be sure that the security remains sufficient and that no deis occurring. 1. the executor or administrator of a deceased trustee. and is accountable as such to the same extent as though he were duly appointed.THE TRUSTEE AS AN INDIVIDUAL. arises. if such a bond has not already been given. since continual watchfulness is required to . — The question of who is the trus- tee and is to administer the trusts not unfrequently Any person who intermeddles with the trust property is a trustee de son tort. 11 in the estate. and. especially if he be a man of standing. Perry. 92. v. on application of any one in interest. §§ 245-247. and not to persons unascertained and not in being. or an executor administrator who meddles with the real estate of the deceased. 74 Va. trustee A who has not if at quired to do so. Lambert's Adm'r. and cases cited. and trust to the carefulness of the selection. . vol. 8 1 2 8 Cottingr. and bondsmen are difficult to collect from. 149 Mass. sufficient to cover the value of the real estate also. 3 As.

6 Ames. 5 N. Sheets's Estate. not the trustees. 91. p. Moore. H. or their discretion is relied on. Ch. Hall v. Perry. . though the trustee calls himself an executor. if in and not an executor. . the executors of the will. 8 Drake t. Aldam. In Alabama. 257. . 98. 6 Onslow v. 16. * Crocker v. 420. has in regard to that property the powers he would have if he qualified as trustee. See infra. . Price. 2 White v. 7 Where a general power of appointment is exercised by will. J. will carry out the trust. or done some other notorious act of transfer. 7 Philbrick's Settlement. 34 L. Balch. 17 Me. in the eyes of the law. 1 That is to say. 430. Olney v.. the duties of a trustee conferred An who has on him by the will. 140 Mass. he holds the property as executor until he has settled his account in the Probate Court as executor. 2 but the rule is otherwise elsewhere. St. L. n. 1 Wheeler v. 12 a executor trustee's handbook. 137 Cushing. 513. Ditson. Massachusetts. 8 fact he acts as trustee he is a trustee. and Maine the sureties on his bond as executor are liable for his acts as trustee. and where the power is special the same rule should prevail unless the appointment is directly to the objects of the bounty and was not meant to pass through the executor's hands. . they will take the property. crediting himself with any funds which he holds as trustee. 19 Eq. 168 Mass. 397 . 154 Mass. 8 Where the same person is appointed executor and trustee under a will. 368. Busk v. 460. 4 Where a power of appointment is given by the trust instrument and the donee appoints new trustees. 9. the second set of trustees in point of time will not necessarily administer the trust 6 but if the property be given to the second set to convert. 6 and it is immaterial whether the trusts can be carried out or not. 6 Allen. 16 Ala. 1 Hall & Twell. 8 Sargent v. Carson. R. as for instance the payment of an annuity out of part of the estate. 395 Perkins v. Sargent. Wallis. Buggies. 133 Mass. 52 Pa. 307 . 351 Groton v. Carson v. p. 9 Pick. Dillon. 84. even though he qualifies as executor only. 318. Y. 18 N.

Infra. 7 Having no discretion. A its charter powers corporation having such capacity and rights among 1 is such a person. Paul Co. St. 9 At common law a wife could not be a trustee for her husband. a person in . & M. Landerfield. 38 N. 488. v. * Briggs v. J. 3. v. 147. they cannot act in trust affairs any more than they can in their own affairs. but she may be now in most jurisdictions under convey by the statutory rules.. Stat. (1894)." that is to say. Irvine. 6 Irvine v. . p. and the right to exercise the powers. ch. 4 Ves. N. 343. 577. p. 286 Dublin Case. but will be removable. 6 statute. Thus the trustee should be a person of full age and sound discretion. Laws E. 48. 'Who can be a Trustee. . * Winona Co. (1896). H. 2 King v. An infant may be compelled to and so long as infants or lunatics hold the property the trust will be administered by the court through them or their guardians. 9 Wall. Boys. 8 and if one of three trustees is an infant or lunatic. 8 until the property is convej'ed to some one amenable to the jurisdiction of the court. but the beneficiary cannot enforce the trust except by petition. 4 The they trust estate 6 may vest in a lunatic or infant. may be a trustee. 10 trustee should be " capable. Jr. 8 Person v. 26 Minn. § 46 Gen. 283. (1895). . An alien enemy or an alien in a jurisdiction where he cannot hold property could not be a trustee. 14 Barb. Schluter 1 Hem." that is to say. Pa. Light Boat. 6 Brightly's Dig.THE TBUSTEE AS AN INDIVIDUAL. 3 Dyer. Swartwout v. 1 Barb. 208. 125. 495. and may be a trustee. Warren. 157. 11 Allen. Bowery Savings Banks. § 16 7 Ex parte Sergison. §§ 2. 9 10 King v. VI. Burr. p. Y. 3683. 2033. 617. 9 Mod. 2 The sovereign may be trustee. I. a person having the legal and actual capacity to hold the title to A the trust property and exercise the powers. Bellord. whose Attorney General v. Gen. action by the other two is barred. 13 that has — Any person the capacity to hold the title to the property. 179. 117 N. He 1 should be " fit.

7 1 2 8 In re Barker's Trusts. which is the only safeguard Deviation from the rules of strict acof trust estates. is not a "fit" person. 423. 43. Moore. . Dean v. 9 Rich. 363. 21 Beav. 1 and who will be impar- Thus a bankrupt the administration of his trust. 458. Bolder. But where a husband is trustee for his wife. 6 Porter v.. 1 Weekly Rep. 6 and the maker of the trust may make such an appointment. 19 Vt. Wilding v. Lanford. Ch. 1 Ch. 9 Paige. D. 222 Parker v. Eq. court will not appoint a husband trustee for his wife. and a drunkard or person of dishonest or of bad character is unfit. Shirley. Livingston 2 Johns. 240. 228. The fact of near relationship makes the trustee less able to withstand 8 the importunities of their beneficiaries. whether he be a tenant or remainderman. 25 N. 537. is too often made an excuse for lax partial to his own interests 2 management. although in this country they are more often appointed than strangers. Ex parte Conybeare's Settlement. So too a life would not be safe in his hands. since he will naturally be since the property beneficiary is and for similar reasons a near relation is objectionable. Eq. 4 and there is no resulting trust between husband and wife 5 but there is nothing in the relationship of husband and wife absolutely preventing the appointment. Bank of Rutland. 7 Shirley v. 4 8 v. an unfit person. . countability only too often leads to speculation and the loss of the property. 410. her equitable estate is supposed to be reduced to possession. J. and the knowledge that a breach of trust is likely to be condoned not infrequently leads to disregard of strictly legal management. Alexander. A for his debts. and may be attached . trustee for a child. 14 A trustee's handbook. 619. Jencks v. as being unsuccessful in his own affairs he is not likely to be successful in those of others. II Paige. will hands the property tial in be safe. and moreover such especially where a parent or older relation is a connection. Livingston.

L. § 297.. to a considerable extent do away with the element of personal . Appointment Trustee. 11th ed. sometimes fail from improper management as utterly as individuals do. 408. it them .. person who is actually and legally 4 but it will capable and fit. § 1289 b. Underhill. which have of late years said that the trust combecome so numerous. Eq. If the holder of the power be himself a trustee.. the power. ». Stat. (1894). . Truslow. § 39 Jur. 51 N. he should consult his beneficiaries and appoint some one agreeable to s and should the matter of the appointment become a matter of litigation. In this connection it 15 may be panies. 485. T. — The is making his appointment and if the appointment be of an unfit or incapable person 2 the court may review it. vol. cannot be exercised without the assent of the court. 1 Ch. R. Story. trustee. and may appoint a person actually incapable or unfit. oversight of individual trust in maker of the bound only by the consideration of the legal capacity of the individual. Banuelos. 487. of VII. in Bowditch v. . and lacks the great advantages often secured by the able personal trustees. and as a rule the lack of personal manage- ment results in securing the minimum return only on the amount invested. 231. will appoint only a i Wetmore Shaw. p. § 3410. THE TRUSTEE AS AN INDIVIDUAL. 5 In re Tempest. risk attaching to an individual trustee but they lack the These companies advantages of personal management. * Rev. and within its jurisdiction the maker of the trust have due regard to the wishes of 5 if they can be discovered. and his appointee will be removed for cause only. Perry. but the power is not an arbitrary one. C. 220. 1 The donee of a power to appoint may also use his discretion in determining the fitness and actual capacity of the appointee. 2 8 J. 338. Ind. 1 Gray. Where the court is called upon to appoint a. See Perry. 2. though discretionary.

52 Fed. Brightly's Dig. Laws Dak. 3 Gray. for instance. (5) by judgment of a competent court. Rep. Annot. Ames. 336. §§ 4557-4559. (1891). (2) by completion of his duties. 7 The trustee's office may come to an end by the extinc- This may come to pass either by the completion of the purposes of the trust. but the statutes have been held unconstitutional. McKim v. § 84. v. 8 as." act. §4298. 138 Mass. who will be appointed whenever the beneficiary shows that his trustee is absent from the country or refuses to collateral proceeding. Young. 319. 11 3 4 6 6 7 250. If all the beneficiaries agree on a person. the court will the beneficiaries or part of the property In some cases the court nearly always appoint him. n. 4 Cranch C. . on the remarriage of the widow. Stat. Stat. 10 or by the legal title and beneficial title merging 1 2 in one person. (1887). even though he be a beneficiary or otherwise unfit. p. Young v. 3 Doane. 9 10 Morgan Moore. 9 or in the case of a trust to enable a widow to support her children. Fox v. parte Stone. v. (3) by such means as the instrument contemplates. 2039. 11 Parker Converse. 1 2 8 statute. 137 Mass. estate in the remainderman. § 3410. 476. 265. Glink v. Ex (1885). Col. on the death of the life tenant and the vesting of the tion of the trust. La Fayette. Ind. § 3955 . Code Cal. Rev. (1895). will appoint a non-resident where is out of its jurisIn some jurisdictions it is forbidden to do so by diction. 499. Code N. (4) by consent of the beneficiaries. § 2282. Pa. (1894). Devestment of Office. 75 Ala. 5 The regularity of the appointment in by the court cannot be questioned any VIII. 4 The laws of some States provide for a public trustee. 195. (1) — A trustee is discharged by extinction of the trust. C. . Storrs. Comp. Civ.16 a trustee's handbook. Dak. Rev. 857. (1894). 5 Gray.

THE TRUSTEE AS AN INDIVIDUAL.
If the trust itself continues
disability, or

17

and the trustee dies, or is one created by the trust instrument, if there be more than one trustee, the office will vest in the surviving or remaining trustees, even though there be a provision in the instrument for keeping up the
under a natural

number of the
If he
is

trustees. 1

disabled, the title will remain in him until a

is appointed, and the powers will be suspended or vested in the court. If a sole trustee dies, then in absence of statute his

new trustee

executor or administrator accepts his trusts and at common law cannot disclaim them, though in some States he may disclaim by statutory provision. In many States the statute provides that the executor or administrator dots not succeed to the decedent's trusts, and in such cases the office vests in the court, or is in abeyance, and will vest the person in whom the in a successor when appointed
;

title

to the property has vested in the meanwhile, not hav-

ing the office of trustee in anything but a limited extent, namely, to preserve the property and act in an emergency to prevent a loss, and finally convey to the new trustee

when appointed. 2
It is the duty of the executor or administrator of a deceased trustee to settle the decedent's trust accounts, and his estate is liable for breaches of trust committed in his
lifetime. 8

The guardian of an insane person would stand
same
position as the executor of a deceased trustee.
trust,
still

in the

The trustee cannot abandon his conveys away the property he will 6 trustee 4 but he may resign.
;

and even if he remain liable as

1

2
8

Warburton v. Sandys, 14 Sim. Mortimer v. Ireland, 11 Jurist,

622.

721

;

Ames,
;

510, n.

Infra, p. 45.

Dodd

*
6

Wilkinson, 41 N. J. Eq. 566 Perry, § 344. Webster v. Vandeventer, 6 Gray, 428.
v.

Mass. Pub. Stat. (1882), ch. 141, § 2

10.

; ;

18
Resignation.

a

trustee's handbook.

— The resignation in most jurisdictions may

be at pleasure, 1 and in any jurisdiction for good reason. 2 To be effective, the resignation must be made either according to an express provision of the trust instrument, or with the assent of all the beneficiaries or the court. 8 The assent of the beneficiaries must be unanimous hence, if some are under age, unascertained, unborn, or incompetent, a valid assent cannot be given by the beneficiaries, and resort must be had to the court. The mere resignation and acceptance thereof will not convey the title to the property, but the trustee should then devest himself of the property by suitable conveyances, and complete his duties, and until he does so he will remain liable as trustee. 4 Even where all persons in interest assent, it has been suggested that the resignation is not complete without the action of the court, 6 but it is, to say the least, doubtful and especially as all persons who are likely to raise the question are concluded by their assent. The resignation need not be in writing, and where a trustee has conveyed the trust property to a successor appointed by the court, there being no evidence of any direct resignation, one would be presumed. 6 Ordinarily courts of probate have jurisdiction in these matters but where it is not specially given to them, a court of equity will have the power to accept a resignation among its ordinary powers, and generally has concurrent jurisdiction where the probate court has the power. 7
;

The
1

court will not accept a resignation until the retiring
v.
;

Bogle
1

107 Mass.
2

Craig

v.

Bogle, 3 Allen, 158 ; Ellis v. Boston, H., & E. Railroad, Statutes, passim. Craig, 3 Barb. Ch. 76 ; Dean v. Lanford, 9 Rich. Eq.
Halliday, 11 Paige, 314.

(S. C.) 423.
8

Cruger

».

* Ibid. 5 6
7

Thomas

Matter of Miller, 15 Abb. Pr. 277. v. Higham, 1 Bail. Eq. 222. Bowditch v. Banuelos, 1 Gray, 220.

;

THE TRUSTEE AS AN INDIVIDUAL.
trustee has settled his account, 1

19

and returned any benefit and in some jurisdictions they will require a successor to be provided for. 8 Where there is more than one trust in the same instrument, the rule for resignation is the same as for acceptconnected with the
office,
2

ance

;

viz. unless

the trusts are divisible,

all

or neither

must be resigned. 4

The court may remove a trustee for good but the application is addressed to the reasonable discretion of the court, 6 and each case, therefore, stands on its own merits. 7 The power is among the ordinary powers of a court of equity, 8 but jurisdiction in such cases is generally given to the probate courts by statute, and action should always be taken in the court having original jurisdiction of the trust. 9 All persons interested in the trust must be made parties in a suit for a removal. 10 Ordinarily a trustee will be removed who refuses to give bond, 11 or who has been guilty of a wilful breach of trust, or who wastes or mismanages the trust property, or who refuses to account, 12 or who is a minor, lunatic, 13
Removal.
B
;

cause

1 2 8

Statutes, passim.

Craig
Civ.

v.

Craig, 3 Barb. Ch. 76.
(1887), § 3942

Code Cal. (1885), § 2260; Corap. Laws Dak. Eev. Code N. D. (1895), § 4285.
* 6

Carruth

v.

Carruth, 148 Mass. 431.

Statutes exist in most jurisdictions giving courts of probate jurisdiction to act in these matters.
6 7 8

Scott

v.

Eand, 118 Mass. 215.
v.

A number of examples in Underhill, p. 393, n.
Dodkin
Brunt, L. E. 6 Eq. 580.

As

to

who

are interested, see

infra, p. 131.
9
10

Howard v. Gilbert, 39 Ala. 726. Infra, p. 140. Shaw v. Paine, 12 Allen, 293. As to who are interested,
See supra, p. 3, note 2. Stated to be the only causes in

see infra,

p. 131.
11

12

Webb

v.

Dietrich, 7

Watts

&

Sar.

401.
18

Generally, but in some States expressly by statute.

Eev.

Stat.

;

;

20

a

trustee's handbook.

drunkard, 1 or a person of such bad habits that the propz and the fact that he is is in danger in his hands the testator's son and has a discretionary power of paying the income will not protect him if he mingles the funds with his own and refuses to account. 8 So too they will remove a trustee who denies the trust
erty
4 is unfriendly to it, who unreasonably or corruptly disagrees with his co-trustee, 6 or who, having a discretionary power over payments to his beneficiaries, has an unreason-

or

able prejudice or dislike to him which is likely to defeat the purposes of the settlement, 6 or favors one beneficiary
to the prejudice of the others.'
trustee

sometimes, though not necessarily, remove a or goes to reside permanently without the jurisdiction of the court 9 but the court will not remove a trustee simply because he is
It will

who becomes a bankrupt, 8

poor,

10

or to satisfy the caprice of a beneficiary
is

;

u or beto

cause he

prejudiced against or dislikes a beneficiaiy

where he has no discretionary power over the payments
N.
J. (1895), p. 3684, §
; ;

4 Gen. Stat. Conn. (1888), § 611 Rev. Stat. Me. Pub. Stat. N. H. (1891), ch. 198, § 8 Vt. Stat. (1894), § 2610; Pub. Stat. Mass. (1882), ch. 141, § 9. 1 Generally but in some States expressly "by statute. Rev. Stat. Ohio (1890), §§ 6472, 6334; Brigbtley's Dig. Pa. (1894), p. 2035,
(1883), ch. 68, § 4;
;
;

§§ 59-61.
2

The

statutes

existing in nearly all jurisdictions generally ex-

pressly cover one or
to in each case.
8

more

of the above cases.

They should be

refeired

Sparhawk
Irvine
v.

v.

*

Dunham,

Sparhawk, 114 Mass. 356. 111 TJ. S. 327; Quackenhoss

v.

Southwick, 41

N. Y. 117.
6

Infra, p. 47.

6

McPherson

v.

Cox, 96 U.

S.

404

;

Wilson

v.

Wilson, 145 Mass.

490.
7

8 9

Scott v. Rand, 118 Mass. 215. Paddock v. Palmer, 6 How. Pr.

215.
;

Culp's Est., 5 Pa. C. C. R. 582 Brightly's Dig. Pa. (1894), p. 2037, § 70; Hughes v. Chicago Co., 47 N. Y. Sup. Ct. 531. 10 Jones v. McPhillips, 77 Ala. 314.
11

McPherson

v.

Cox, 96 U.

S. 404.

P. Davies.. a discretionary power. 4 DeG. Philips. 732 . 1 of. 2 Perry. §§ 275 to 287. 133. Nor will a trustee be removed for a technical breach of trust. or one made unintentionally or through mistake.THE TRUSTEE AS AN INDIVIDUAL. v. 393. 2 1 Nickels v. n. . & J. for other instances. 21 Nor will a trustee be removed for the non-exercise or the manner in which he exercises. and Underbill.. 18 Fla. him. Forster p. provided he is honest and reasonable in the use or non-use of his discretion.

and that of the beneficiary or the equitable estate. p. Transfer of Stock. but not in an}' estate in the property itself. merge legal and equitable rights. and they will be treated separately in this treatise . that of the trustee or the legal estate. . 42.PART I. 130. 6 and is accountable to no one in the world but the is 1 2 8 4 6 By Infra. INCIDENTS OF TRUST ESTATE. Statutes that reduce the legal estate to a mere power. Hendershott. Ownership. Lowell. statutory enactments in most Infra. 2 and the beneficiar3''s in his right in a court of equity to compel the trustee to carry out the provisions of the trust. — the trustee's estate here. and the beneficiary's estate later on. are examples of these tendencies that might be in is The tendency America to largely multiplied. 1 The trustee's estate consists in the ownership of the property itself. and may eject even the beneficiary from the premises. 4 Nevertheless a trustee in either a court of law or equity the absolute owner of the trust property as to the whole world. 8 and for courts of law to act on equitable principles. 192. as in New York and other Code States. Devin v. Code States. 32 Iowa. These two estates are separate although bound together and travelling on parallel lines. In every trust there are two estates. and the refusal of a court of law to allow trust property to be sold on execution. II. THE INDIVIDUAL AS TRUSTEE. § 37. p.

2 In a case of agency the principal owns the property. trust the trustee owns the property. beneficiaries for his use of the ownership. K Beach Morgan v. beneficiaries are by statute necessary parties. 549. 28. many Contra. Wetmore v. but expressly by statute See infra. 2 Johns.. Porter. 41 Hun. 76. 261 u. and South 8 Carolina. 134. — All Owner- actions against strangers to or loss of the prop- either in law or equity for erty. 124 U. Brown. and so must be joined. in jurisdictions. 197. rights. p. 1 23 The popular merely the agent of the beneficiary expresses an entirely erroneous and mischievous conception of the trustee's relationship to the property and his beneficiary. Beach.THE INDIVIDUAL AS TRUSTEE. he 1 2 8 4 may sue for an injury to his possession to the same v. 21 Blatch. And the trustee may sue and be sued without any joinder of the beneficiaries. Ed. all the Incidents of to the Trustee.. Drew. must be brought in the name of the trustee. Charles River Branch Ed. 11 Cush. 6 where the relations between the trustee and beneficiary are not in question. acts in his own name. 92 Y. but a claim In the case of an agency the person with whom the agent contracts may sue his principals on the contract he has no such rights against the beneficiaries in a trust. 150. 14 Vt. 171. and the agent acts in his name and place in a error that the trustee is . and his interests are adequately represented by the trustee 6 but in foreclosure a beneficiary has the right to raise mone}'. Everett v. As Owner ship fall of the Property. . S. P. Davis r. Co. 8 . New York. If the beneficiary is in the possession of trust property and all actions to protect or recover . as Alabama. Vac Vechten v. S. 6 Vetterlein v. 129 Mass. 92 U. Generally. 7 In some jurisdictions. Trust Co. and the beneficiaiy has no property against the trustee only. 4 damage it. Ch. 64. a. S. 6 Carey v. 506. Barnes. K. 169. 8 Ames. Roche. Terry. 7 U.

the trustee's right to possession is absolute. Rev. (1888). 46. Stat. (1894). (1892). see infra. v. Annot. 8 and the beneficiary equally barred and has no other rights which he can enforce against the property or a stranger. 426. (1892). 162. If the trustee's right of action of limitations. Laws Md. and not the is eligible beneficiary. §85. §37. 6 and the trustee. 6 Wend. Transfer of Stock. 309. Stat. East India Co. Wms. I. (1896). Stat. Cooley's Dig. 8 The trustee is personally liable on the contracts which he makes in respect to the trust property. Olpherts. Stat. §608. Stat. p. eh. . 444 and note. Stat. 2 or if is is barred by the statute he lose his right of action in any manner. Minn. 100 U. C. Mercantile Ins. Wash. p. 180. 6 Barker v. 42 Am. Eev. Art. as an owner of stock. §§ 2132. §3419. §26. extent as any other bailee of property 1 but as against all the world other than the beneficiary.. 6 By statute in most States. . 1026. §23. ch. 110 U. § 2661 Mont. Pub. the trustee is personally liable as stockholder even beyond the extent of the trust property. § 130.' but his liability is generally limited by statute to the extent of the trust estate. 1 ... 564. Henderson. 4 Molton v. 149. Stat. 330. Stat. . N. 252. § 28 Lewin. 62 Ala. S. Annot. Dec. the right is absolutely lost. Me. Co. Code (1896). p. 119. Mass. Rev. cl. Transfer of Stock. . (1896). H. Stat. S. . ch. Comp. (1884). Rev. 279. § 495. Stat. But not personally on contract in Mutual Ins. M. 111. § 1500. 24 A trustee's handbook. 2172. Co. § 27 Herron v. is as a director. ch. § 3431 ch. (1891). (1894). § 206. is entitled to vote stockholder in not. . 32. Laws R. . 4 The as trustee. D. §20. N. and cannot be questioned. Y. 8 Pub. Stat. Y. §516. 23. Wy. Lowell. (1896). . 9 and this fact emphasizes the difference between a person acting as trustee who binds 1 As to his rights. 3 P. Gen. . (1883). (1887). 30. (1893). a 2 Wych Meeks v. ch. 6 corporations. S. Laws N. and if he is not bound nobody is bound. § 66 unless he voluntarily invested in it. and the beneficiary In the absence of statute to the contrary. N. Rev. Pub. Fla. Marshall. (1882). n. Col. 150. C. (1891). § 54 Ind. Gen. Civil Code (1895). p.. 9 Taylor i. Davis.-. 509 Lowell. 7 Ames.

and the property In many jurisdictions a list A . . 5 statute making the property taxable where the benethe beneficiary resides When A ficiary lives. THE INDIVIDUAL AS TRUSTEE. — The trustee is personally liable for taxation. 15 R." or " as trustee.. 313. whether he signs as trustee or not and it is important in this connection to bear in mind that there is an implied covenant for quiet enjoyment on behalf of the lessor in every lease. et al. In the absence of statute. p. Greene v. although his liability to the extent of the trust estates name " trustee. Perry. 3 Infra. 65. 4 Richardson v. when neither the trustee nor the property are constitutional. 508 6 Gray. . 2 Infra. although recourse will be had to him in the first instance. both the trustee and beneficiary are non-resident. 159. p. only himself. Ames. Boston. the contract will bind the trust effects in his hands and those of his successor. 6 Anthony Caswell. 279. on the personal property where he resides. is it is the trustee's duty to bring in of the trust property for taxation. and one acting as agent principal. too. n. 131. and Taxation. 1 Infra. 6 Dorr v. 148 Mass. 8 . the personal property is not taxable to any one. Boston.. v. et al. I. Hunt v. Mumford I. and in others he may do so. trustee who neglects his duty would be personally liable for the penalty of his neglect and where he neglects his opportunity to file a list. a trustee will be personally liable on the covenants in a deed or lease. 63. It is erroneous to liability 25 binds his who suppose that the trustee limits his by signing his he has the power if he properly describes himself as trustee." 1 may be limited by appropiate words but if to contract for the benefit of the trust. p. 4 R. 2 So. 287. . 6 within the State. and on land where the land lies 4 but statutes are not unusual making the personal tax payable where who is entitled to the income. 165 Mass. 65.

259. Baker v. may The Trustee's Ownership the trustee is is not Beneficial. Cleveland. Eev. n. 3 he will have no right to indem- may by a nity. Code of Ga. Townsend. over assessed. § 2229 Comp. Personally liable as Owner of Property. he charge the property. 162 Mass. for instance. and he may not deal with the estate for his own profit. 13 N. 479. 496. 7 All the benefits belong to the ben- * » Schwab v.. & J. 1 As. he would probably not be able to charge the over assessment to the trust. Supp. Creamer. § 3922. he will be personally liable. 4 tion is is The ac- against him personally." So. 426. Laws Dak. Civil . Code N. or causing water to overflow if .. Wyndham. and if the damage is greater than the value of the trust propertj'. Allee. a trustee be criminally liable for a nuisance on the trust property. Code (1885). (1895). 6 or may be liable to indictment under liquor or gambling laws. he can take no benefit from his ownership. or in failing to keep the sidewalk in repair. 4 6 Shepard People v. but the liability be incurred without fault of the trustee. — A trustee is personally liable as owner of property in actions for a nuisance. he is liable to a person injured by snow from the roof of a building. — Although the absolute owner of the property. Y. . Korling v. too. irrespective of his right to indemnity from the trust property. Tibbetts. and it is 5 immaterial that he described in the writ as "trustee. § 3183 . 28 Hun. 468. Dak. Benett v. and owing to bis neglect the over assessment cannot be recovered. 7 6 Cal. 160 Mass. 458. 26 is a tbustee's handbook. or for any purpose uncon- nected with the 1 trust. as where a person was injured falling limb from a tree. ¥. § 4265. 791. although the trustee had exercised all due care in having the wood cut 2 but if the trustee was in fault. 4 DeG. or for a negligent use of the property which causes damage. v. (1895). 3 Hill. (1887). Underhill.

Latham. 67. 2 Johns. If however the property be honestly sold to a third person. and may be set aside by the beneficiary. it was held that a trustee might sell to his son. 553. eficiaries. J. 2 Johns. (N. Y. Wilkinson.) 252. Nor can he pur- chase them directly or indirectly at public or private sale. Allen v. 4 except by arrangement with all the beneficiaries. 136 Mass. Infra. 34 N. 197. 28. 434. 134. p. All his skill and labor must be directed interests of his benficiaries. Brown. p. 519. as security for his debts. 5 Pick. 1 to the He may advancement of the take no benefit directly or indirectly from the estate or his office. 60. the trustee is 10 not disabled from buying it subsequently. 5 Morse v. 6 Nor can a husband or wife being trustee sell to the other. 127 U. Hoyt v. Law. 2 Infra. 136 Mass. 143 U. or under leave of court. Fritts. 5 or at a judicial sale which he does not control in any manner. v. Fanning. 8 but no stranger to the estate can 9 question the transaction. 445. except the regular compensation allowed by law. 96. speculate with the trust funds under the He cannot 1 Arnold v. 57 N. 24 Pick. Brown. p. The transaction is a breach of trust. Dayoue v. v. Fanning. s Denholm v. 60. S. Encyc. In Lingke v. Y. » Davoue Ch. Eq. Y.) 252. 2 He cannot set off bis own debts in equity against one who sues him as trustee. * 6 Hill. 8 He cannot use the real estate or chattels.THE INDIVIDUAL AS TRUSTEE. McKay. & Eng. S. 42. . Morse Amer. vol. and if he take a present or be paid a bonus or commission of any kind in a trust transaction by a stranger. 89. 148 Mass. but two judges dissented. (N. w Creveling v. Hill. 589. he must account to the trust for it. Ch. or pledge any of the property. ficiary. 7 even though the other be a beneIt is immaterial that the price paid is a fair one. and the principle is very doubtful. 27 and the trustee has no more right to any of them than he has to the property of a stranger. 9 Harrington v. » Infra. p. 27. 142. there being no scheme to repurchase. Gillette.

Ch. Stace. contra. he may render it himself and receive reasonable compensation for his services as. Gamble v. 6 make a profit out of Where the English rule prevails which refuses compen- sation to a trustee. Townend. 21 King v. 303 . 1. By statute in some jurisdictions he cannot enforce a claim against the estate acquired. Rev. will belong to the trust. But in most other jurisdictions. Pomeroy. 59 Mo. Munn. if he could have given such employment legitimately to another. 4288. 11 Paige. Laws Dak. § 2263. Civ. He cannot borrow the trust funds on any security. . v. 314. 4 Johns. that a trustee cannot deal with himself. Missouri. nor make a profit by buying up claims against the estate 4 at a discount. 41 Comp. Townend v. § 3945. etc. . and in some States he cannot take any compensation. 2 8 4 6 v. and it is a bet. Perry. 17 Ala. Jr. (1887). 620. 6 Rich. . partner to render expert services to the estate. St. 118. Gibson. directly or indirectly. for example. 140 Mass. 585 Mayer Galluchat. (1885)." But the law is not uniform. Y. broker or agent to collect. 143 . Collier v. (1895). Cushman. 31. namely. he should not employ himself or if his he does he may receive no compensation therefor. Van Vechten. 7 In practice the matter is a delicate one. 111. Dak. 1 Perkins's Appeal. Eq. 201. and he should not lend them to his family or associates on any terms. Code N. Kyle«. § v. 41 N. The reason assigned in some of the cases. 117. He cannot come in competition with the trust estate. all the profit if 2 the profit does not equal must pay interest. 306. as it is conceded that he can collect other expenses. where he acts as counsel. 4 Ves. 1 guise of a loan to himself. can take none in New York. and interest he if he does. nor the trust estate in any other manner. § 432. or 1 Brown Piety Slade v. Barnetfc. or South Carolina. 373 7 He v. Code Cal.28 a trustee's handbook. 108 Pa. 8 He cannot swell his personal credit by keeping a large balance of the trust funds at his bankers. 1 Giff. Lowrie's Appeal. 6 Turnbull . Rickets. Grant. is manifestly unsound.

ter rule to avoid the difficulty altogether 29 by employing a but where such employment is allowed. & Gift. 2 * . 63. . the charge for expert services. Me. 494. 1 He must pay over to the trust estate any bonus he re- ceives in the performance of his duties. Rev. the expense of brokers or agents. 57 7 Supra. incurs as owner. together with the regular commission. 104 . contra. Me. p. 26. and principal. 6 Allen. § 432. 8 Infra. Pomeroy. p. — reasonable cause. or for resigning the trust. such as taxes. 192. 58 Perry. Sugden v. 108 Pa. 2 but he need not account for the profit which he receives from other business that he receives owing to the fact that he is trustee. 314. 32. Newell. 4 Ch. 9 As to apportionment of charges between income el seq. 3 Sim. Lowrie's Appeal. 6 Porward v. § 910. ch. 1 Grant. 6 Rev. (1883). Crossland. ch. 8 May have Expenses from Trust Fund. St. repairs. should not amount to more than reasonable compensation for all the services rendered. 63. App. b the cost of justifiable litigation. pp. On the other hand. 7 or. v. where the employment is reasonable and usual. J. may be charged to the estate. Eq.THE INDIVIDUAL AS TRUSTEE. and the trustee may pay from the estate all the expenses which he. (1883). Corbitt. § 32. Infra. i Perrine v. and insurance. 117. 118. 513. 49 N. 373. 6 and and expense of consulting counsel when there is if he be not at fault judgments recovered against him as owner of the property. 9 1 Turnbull v. p. Smith. Perry. R. the trusteeship should not be a burden. 529. and he may charge the estate irrespective of the provisions of the settlement with all the legitimate expenses of management. stranger . Perkins's Appeal. as for instance having him declared insane and placed under guardianship " and in some States the premium paid a surety company on his official bond . Whitney v. 140 Mass. see infra. § 32. 69. Forward. L. 4 as travelling expenses. or the expense of looking after the beneficiary. Stat. 497 Teague Ala. Stats.

262. 437. Eq. 49 N. 202. (N. Bradbury Mass. 161 Meeker v. Y. Wright. but not if he has exceeded his powers. 6 Buckingham v. 1 and so it are not charged to the trust. are included in the ordinary allowance made as compensation. is competent to and no undue advantage is taken and the court should take the agreement into consideration in fixing the amount of compensation.* Compensation. 25 Ch. not including court expenses. In England and in Illinois 6 and Delaware 6 the trustee cannot charge for services. 569 Dodds v. 221. act. 5 Eedf. 154. Birchmore. 7 Barrell v. for performing similar services. 8 there Before incurring expense he may require security if is doubt about his being reimbursed. Pierce. " Bowker v.) 450. and the like. 117 . 188. and ranges from five to ten per cent. Little v. 16 Mass. 1 2 Little. but where is necessary to keep a clerk exclusively for a particular trust it would be 2 the ground for an extra charge. and may reimburse himself out of income or hold possession of the corpus of the estate until he is paid. Joy. 58. of the compensation and is usually gross income collected. . 130 Mass. Morrison.30 a trustee's handbook. if the beneficiary Mass. or is in default. in the absence of statute. Ordinarily. The court usually allows the highest amount paid agents. in the sound dis- sion with the beneficiary. factors. and clerk hire and office rent. 82 Cal. 6 State v. Div. 7 The trustee ma}' agree as to amount of commis. and he has a all right to his costs prior to charges. 4 Harring. Piatt. is fixed by statute or by way of commission on the The amount rule of court. 8 Although the amount to be allowed rests. Newell. J. * Perrine v. Crawford. v. the expense of accounting. 136 111. 4 Woodard v. Tuke. but in all the other States he is — entitled to reasonable compensation. has been guilty of a breach of trust. 617. He has a lien on the estate for his expenses.

' it is a case of extraordinary trouble entitling the trustee an extra charge. the court will not allow compensation by way of commission. or for collecting and disbursing the funds. 9 un10 less there was a complete separation of duties. but the commissions. 117. 15 Stew. The court disallowed a commission of five per cent for warranting a title. 6 Jenkins v. Lawrence. Pegram. Ellis. (N. are usually considered extra services. 361. * Ellis v. p. p. Pegram.' In some jurisdictions the diture . Y. Brightly's Purdon's Dig. 101 Mass. . 31 cretion of the court. 6 Blake v. 154 . Whyte. May.THE INDIVIDtrAIi AS TRUSTEE. however and on whatever charged. Y. 41. Everson. 12 Pick. p. w Johnson 592. 7 Urannw. 79 v. 427. 252. (N. 62 Md. A Jenkins v. 340. 1 Infra. Biddle's Appeal. 95 N. as it is against its polic}' to encourage frequent changes and excessive expento but the sale and conversion of real estate. 8 Supra. J. as for instance a commission in two capacities.) 452. . 616. 83 Pa. 6 difficult trustee will be allowed compensation for professional ser- but in other jurisdictions he will not. (1894). Pa. 1 In many cases a commission on income will not amount to reasonable compensation. 8 cumulative commission is never allowed. 4 The ordinary changing of investments is not such a service. 140 Mass. 420. such as guardian and trustee. Pomeroy. 101 Mass. v. the judgment is not conclusive on persons not properly parties to the case. 178 Pitney v. 2 Met. 117 Mass. . 109 Mass. 367. 2 Dixon Homer. a charge on principal will be allowed. § 239 Crawford. must not amount in all vices. 8 Turnbull v. or the settlement of a large claim. 2 and in such cases an extra charge will be allowed 3 and in cases where valuable service has been rendered to the principal fund over and above what is covered by the ordinary commission. 427. 5 Eedf. Whyte. . 9 Meeker v. from the management of the same fund. St.) . 6 and even where . in these cases. 62 Md. 592 May v. Blake v. 28. Coates.

57 Wis. 1 The commission should be deducted from the moneys paid from time to time to the beneficiaries. and impliedly in almost all. 121. 101 Mass. Stat. and Statutes passim Parker v. 10 Pick. More §§ 3484-3489 . 8 E. Hapgood. 95 Cal. 121 Mass. Code (1895). v." the amount will not be confined to . . and therefore not necessarily arrived at by percentage. " commission of from two and one and services of but in spite of custom it would seem that the charge should in all cases be only reasonable compensation. 125 Mass. 6 Jennison v. 441 . (1887). Tucker. 307. 220. 4 If the trustee has been unfaithful or trust. v. 6 'But under a statute allowing specified commissions. Ames. Mass. 340. it has been held that the court has no power to withhold a commission for unfaithfulness. pp. Ames. mismanaged his compensation may be withheld 5 but even in such cases it may be allowed to the extent that the estate has benefited by his services. 6 . Ga. and not in a lump on the termination of the trust.32 to A TRUSTEE S HANDBOOK. 120. No commission is allowable on assuming the trust. N. 2385. 7 Where the matter of commission is regulated by statute. Biddle's Appeal.• . the statutory rate. 7 In re Fitzgerald. 220. . 77. Jackson. as the statutes. provide that the provisions of the instrument shall govern and this. 384 Gen. and Crocker's Notes on Pub. although no exact sum is specified. 2 It is usual to charge a half to one per cent for the responsibility distributing an estate . more than reasonable compensation for all the services rendered. As. 592. § 3950. Calkins. if the instrument provides for "reasonable compensation. 121 Mass. Manual of Wills. g. 2 Met. 4 Dixon Brooks v. for instance. § 2552. St. 420. Parker v. 435. expressly in many cases. Pegram. 508. Stat. J. (1895). Compiled Laws Dak. § 125. 8 1 " 8 Blake v. p. Homer. 83 Pa. the rate prescribed by the trust instrument will govern.

and %\ per cent above $5. 592 as to executors and administrators. — — . Reasonable compensation Griffin v. 23 Ark. § 918. 2274. . and enough to make reasonable compensation Briscoe v. 282 Babcock Dakota. State.000 to $10. Pinckard's Adm'r. Rate provided in settlement. such compensation as court deems reasonAnd may establish a yearly allowance.000 5 per cent from $1. — Compiled Laws (1887). . v.000 4 per cent. Colorado. §§ 2273. Clark Hubbard. 24 Ala.000. 817. 486 5 per cent allowed in Pinckard's Distributees v. and 1618. Brady. 250. . Piatt. 56 Conn. . Civil Code § Code of Procedure. — Reasonable compensation. Alabama. Arizona. As to executors. 5 per cent on collections up to $1. § 134. see Supplement Civil Code (1889). 5888.000. Abell v. 1 per cent. is given below. . of Probate 1 may make allowance for extraordinary services. Civil — See .THE INDIVIDUAL AS TRUSTEE. Statutes (1894). 284. §§ 3949. so far as it is 33 determined by a reported decision or statute.000. California.000. § 1700. No authority as to executors and administrators. Revised Statutes (1887). in the absence of actual knowledge of a definite practice recognized and followed in the lower it is usually safe to follow the rules laid down for executors and administrators. 7 per cent up to $1. On the amount of estate . and such further allowance for extra services as court may allow. Rep. — gle.000 to $20. n. . not exceeding one half amount allowed by statute. 3950. Statutes (1891). cent. able. § 1212. accounted for. $50. $20.000. Where no authority exists. Prin56 Ala.000 All over $100. Digest of . The rule in each jurisdiction. 3 per 2 per cent. — No authority. $10. mutatis mutandis? courts. p.000 to $100. Arkansas.000 to $50. § v. Judge $1. see Perry. 437. Trustee under a will.000 . (1886).000 4 per cent between and $5. for other authorities on the 3 subject in general. 30 Conn. Annotated 4805. Connecticut. 28 Atl.

Fleming v. . 5586. 136 — 111. 817. 61 N. compensation in discretion of v. Iowa. 437 (1891). 1\ per cent on both income and payments § 3487. Reasonable Commissions. — — of Delaware (1893). same compensation as administrators. Hyer. p. 139 Ind. Joy. . 698. W. eh. Reasonable compensation. 6 Bush. — . — — — . 34 Delaware. Executors and Administrators. May. 221 May v. § Illinois. Statutes (1894). In re Gloyd's Est. extra in discretion of court. Revised Statutes (1883). Rep. Muscogee Co. Rep. 5 per cent on income. 144. 610. same as administrator. No authority. Georgia. § 32 5 per cent and expenses.. § 6805. Fidelity Co. § 2552. court. and extra in discretion of court. Administrator on all personal estate and proceeds of real estate sold.— Annotated Statutes (1882).. 16 Mass. — Massachusetts. no compensation. allowed 1 J per cent yearly on amount of principal Ten Broeck v. 252 . First $1. Kentucky. Yandes.000. vision of settlement. § 7. 712. § 3883. Code (1895). and 1£ per cent on investments. W. Statutes (1887). over. 63. 10 per cent on proceeds of land worked § 3489. on paying . ch. Barrell v. 798. . § 3168. Abell v. not to exceed 5 per cent on amounts received and distributed. 18 Fla. 307. Wilson. 975. 10 S. Same commissions as guardian § 3484. Morrison. and extras earned. Discretion of court general rule. Premier Steel Co. Kansas. Maine. a Laws trustee's handbook. § 5959. Reasonable compensation. Buckingham v. Rep. Michigan. 5 per cent on income. . Trustees appointed by Probate Court. 109 Mass. allowed 5 per cent on income. — Reasonable Florida. 28 Atl. v. the — No authority. Maryland. —Public Statutes (1882). Brady. Indiana. — In absence of stipulation or contract or proIdaho..

28 Miss.000. Shattuck.000 and $10. 2890. 13. all above $20. . see Com- Statutes (1885). . Code all Civil Procedure.000.000 $1. New Mexico. for all above $11.000 to $10. West.000. New Hampshire. 118. 5 per cent. tors. 2402. — Gordon v. — . General Statutes (1895). For executors. 444. 2 per cent extra not to exceed amount allowed pensation.THE INDIVIDUAL AS TRUSTEE. Minnesota. H. 1 35 all $1. reasonable com- For first $1. 1 per cent. Actual value. H. between $10. 5 per cent $5. above. 2\ per cent. (1894). (1895). 33 N. ing 5 per cent Sherrill v. Shuford. Eq. All above. 4 per cent. rate of income being 6 per cent. between $1. Practice is 5 per cent on income Tuttle v. just. by statute.000. 22 Mo. Code (1895). 6 Tred. 7 per cent. Nebraska. 2380. For executors. p. 228. 104. § 3031. but executors. 4 per cent. Reasonable Compensation. Robinson. 8 N. Reasonable commission not exceedNorth Carolina. Revised Code (1895). — — . Shirley v. see General — No — § authority. §§ 109. Allowed 5 per cent up to $1. 5 per cent. Reasonable compensation not exceeding 5 per cent on income. 1445. § 204. trus.000. — Kemp v. § 6492 for first $1. §§ 2730. No authority. § 4724. same as North Dakota. 643. New York. piled Statutes Neb.000 and $20. 2£ per cent. § 4293. p. and presumably reasonable such compensation as court decrees Statutes Minn. — No authority — . Missouri. 110. ty percent. Civil — Montana. administratrustees. 2802.000 to executors. App. Code of Procedure (1895). $1. Reasonable compensation.000.000 to $5. New Jersey. Mississippi. .000. For executors. and guardians are allowed. §§ 1404. tee allowed 1 per cent on principal. Nevada. No authority.000.000. § 2776. see — — Compiled Laws (1884). Foster. per cent. § 2798.

Wisconsin. St. Clerks and masters' fees Texas. 3 W. & K. defined. ReasonWest Virginia. able compensation. 100 Pa. — Wyoming. 1. exceeding 10 per cent. South § — No authority. —Revised Statutes (1890). able. Carolina. No authority. v. Statutes (1893). C. — No authority. vices. Tennessee. 36 S. 201. Code (1896). § Ohio. vol. Code (1897). Annotated Statutes (1889). Executors. 2069. §§ 3929. and masters. 87. not exceeding 5 per cent. 2695. p. — Brightly's Purdon's Digest (1894). Washington. § 8. — No authority. executors allowed not Court has no discretion. Fant. 688. — Revised . ch. — Code (1891). reasonable Oklahoma. Clemson. § 3525. 2031. Annotated Laws Pennsylvania. cent. Executors. Revised Statutes (1895). § 1180. — Reasonable compensation Fisher. Hammond. §§ Hubbard Vermont. — Code (1887). . 5 per cent reason. Rhode Island. 484. compensation. No authority. as (1892). Pusey v. 2099. Oregon. 12 W. 17. 539. 23 Gratt. 25 Vt. Sayles. Va. 3993. Coicpiled Utah. v. Laws (1896). § 1410. § sion on receipts or otherwise. Usual 5 per cent. 10 per cent allowed for extraordinary serShepherd v. — No authority: Executors. 427. Executors entitled to 5 per Laws — 4223^225. same as executors v. reasonable compensation . Executors. 9 Serg. ch. Hoke v. § Oglesby. 6333. — No authority. Statutes (1893). Boyd § 6314. General 219. Usually 5 per cent. (1888). Executors. § 2245. 1. Reasonable commisVirginia. 204 Davis's Appeal. Hoke. Va. Cobb § — Same § as clerks 6388. — On personal estate distributed or real .36 a trustee's handbook. § 29 . 674. to executors.

Coleman. Y. 839 . (1896). 150. 393. Slevin v. Mich. See infra. Wise. 21 Wend. Stat. Greenwood Parker. 1 per cent. 1801. p. but a estate is granted without words of limi- power of sale is given to the trustee. Stat. 1 Mo. N. Norton. § 2803. 150. Comp. Bagshaw v. for instance. Minn. Pace v. Wise. as e. C. 176 . 4 Although a fee be given to the trustee to support a less . 71. Civ. or the technical phraseology of the trust instrument. 3 King v. Sen. 37 up to $1. — The trustee Thus where the tation. § 3191. for the benefit of A until B comes of age. 67 .Code 6 (1895). New York. estate sold for debts. Welch v. (1896). Spencer. 2 Sand. 34 Ves. he will take an estate in fee instead of a mere life estate. 6 In some Code States. 6 Cush. Y. takes an absolute but in real estate he will take a large enough estate to administer the trusts and no larger. p. 7 a trust is cut down to a mere power by statute and no 1 title vests in the trustee. Laws Dak. $1. Rev. 2 Cleveland Ala. § 5577 . (1895). 4 wood 6 Norton v. he comes of age irrespectis and there often statutory pro- vision that the estate of the trustee shall terminate on the completion of the purposes of the trust. Minnesota. 7 Annot.. § 4285 Annot. 2 estate in personal property 1 The Trustee's Estate. Wisconsin. & Adol. to $5. § 2084 . (1887). Minn. 49 v. . (1889). § 3191 Greenv. 142 . 9 Cush. 34 Ala. 2\ per cent for all over $5. 5 per cent. Stat. 3 B. Code Ga. (1894). Mich. THE INDIVIDUAL AS TRUSTEE. (1882). Coleman.000..000. Brown.. Pierce. Allen. g. Cal. as. a life estate being sufficient to support an annuity. estate. viz. Dak. Stat. 296. entirely irrespective of the use or absence of words of limitation.000. 32 Mo. . 1797. the estate will vest in ive of the trustee's fee B when 6 . Hallett. Nash o. §§ 56. 57 Stat. Bev. v. 8 since without a fee he could not exercise his power but no larger estate is given than is absolutely necessary. § N. Coates. . 403 . Ga. no larger estate will be implied. . Michigan. and Dakota. p. 86.000 . 147.

Gleg. 1 Atk. n. 134. p. 527. v. 9 Co. § 334. 6 Frierson v. p. 543 . 3 Dev. 38 A title trustee's handbook. 7 Atty. Savage. Gen. 7 Joint. 393 . All the trustees are equalty seised. 8 eject the beneficiary. 513. A passive trustee naked collect the rents) a trustee who merely holds a to permit another to do something. 49 Mo. R. be the possession of the trustee. 6 is Trustee's Estate partition. 153 Beach Presley v. v. — At law the trustee may is is entitled to the pos- session of the real estate. Learned v. 3685. 144 Mass. Albertson. . 48 N. 86. 2 title if nor can the beneficiary deny the trustee's he is his equally entitled to the possession of the personal property. 40 Cal. 8 Cow. where there are more than one. § 7.. § 3342 . J. Branch. Lit.. as such trusts are not within the scope of this treatise. 109 but see contra. Ames. Western Rd. Ind. 356 Rev. 24 Miss. 349 Sinclair v. Rev. and on the death of one the whole estate vests in the survivors. v. 28. 113 . Stribling. 8 . 241. Perry. 14 Vt. Stat. Co. 1 and landlord. Pierce. 9 provision in the trust instrument for keeping up the number of the 1 2 8 * A Clark v. White Pace v. Nolan. Pirst Univ. 8 Gray. 4 but the beneficiary may have an equitable right to possession will technically He and will receive it under those circumstances. takes a modified title. Jackson. Y. and Boursot v. Soc. about which we need not concern ourselves. Stat. Beach. 453. 580 . Welton. 8 Chapin v. Possession. g. L. 6 though even then at law his possession buys in a tax title. v. (that is. N. Powle. Morville v. — Trustees. as e. Clark. 30 Ark. & 2 Eq. 6 Infra. take a joint estate which is not subject to If one trustee conveys his part without joining is void. 8 Paige. . If he he cannot hold it against the trustee. (1895). 346. . (1894. and the grantee does not take an undivided estate in the premises no title the others the conveyance passes. .

in common do not apply to trus- tees' estates. § 7163 N. Stat. Stat. but a power merely. 150. Daws Dak. Stat. (1896). 4 Alienation. Pub. Kan. his transwould take no larger title than the trustee conveyed. § 5583 § 2091 . (1895). Mich. In the Code States the trustee having no e. Stat. Code (1896). Stat. has a full discussion of authorities. Eev. may make conveyance. §§ 217 et seq. 19 Barb. (1894). p. N. 6 This 6 is universal law. Stat. (1889). Troutman. § 4294. 653 . Civ. Civil Code Calif. § 856 N. Me. p. Ala. . § 5572. Dak. — 1 Shook v. Y. (1889). 8 But if the trustee had feree — no power given him to convey. THE INDIVIDUAL AS TEUSTEE. Stat. Okla. . . Minn. 73. 7 Mass. (1894). (1887). If the trustee transfers his estate to a purchaser for value without notice of the trust. Stat. Stat. 2 8 * Underbill. (1894).state. N. Mich. (1882). 12 Cush. and his transferee will stand at law entitled in his place. §§ 64. § 1042. Y. 6 Perry. Rev. § 3395. . and would be bound by the trusts his grantor was bound by. 65 (1882). Kan. Homer. (1883). . Annot. § 3761 (1885). Minn. Code (1895). § 2080. being the legal owner. p. In some jurisdictions an attaching creditor is on the same footing as a purchaser for value ' but if the property . (1893). (1889). Annot. Ind. (1893). Dixon v. ch. Dak. Gen. the conveyance would be simply void. . Gen. § 3400 Comp. Okla. Stat. Wise. (1896). 286. § 3387 Eev. § 3392. (1889). n. Stat. but is often enacted by statute. Eev. § 65. §4283. Annot. vision in Indiana. 155. 41. The trustee. § 7160. Ind. 382. . § 2810. Canoy v. Stat. § 12 (1894). 2 Transmission of the Trustee's Estate. trustees will not prevent survivorship 1 39 common and the statutes in States providing that joint tenancies shall be construed as tenancies... § 3. 141. 1799. 7 Ired. Stat. the purchaser will acquire the title discharged of the trust. (1882). Wise. 1799. Annot. u. Shook. See also infra. Ames. Stat. Stat. and no estate would pass and there is a similar statutory pro.. 6 Eev. . § 3773. ch. Stat. Co.

v. 2 Wormeley v. 138. to transfer. 51 Md. . If the purchaser has reason to believe that the property held in trust. 45 Rogers v. 55 Me. 17 S. W. No trustee's private debt. p. 56 N. S. 4 Doe d. 1 Brock U.40 A trustee's handbook. is and the word " trustee" not a purchaser without notice occurring on the face of the deed or certificate is sufficient to put him to his inquiry as to the trustee's power to title. 150. 8 Where the trustee was one of the beneficiaries as well as trustee. 580. Supra. 1 Starkie. and fails to make proper inquiries. . 382 Third Nat. 2 No title to trust property will pass by a general assignment. he will 1 Smith v. Chase. 2 Dow & 6 6 Clark. Wormeley. Ames. but the better opinion seems to be that will not. 8 Thomson v. Burgess. Spencer. Raikes v. he is . or that it goes elsewhere than to the trust estate. 393. Bk. his transferee power good title . 14. Ct. will be sufficient notice of fraud to invalidate the title. E. 133 Mass. 51 1 Shaw v. 1 If a purchaser has once acquired a good transfer a he may de- good title to any one but the person first who frauded the trust in the If the trustee have the will take a place. Cir. 4 pass to the trustee's assignee in bankruptcy or insolvency 5 nor can the trust property be taken for the title will . as the trustee will not be supposed to intend to commit a breach of trust. Adm'r. n. Carpenter. 155 . and the deed will not be so construed as to make him do so. the transferee is not a purchaser for value. Abbott. were transferred to secure a pre-existing debt. . Anderson. Peake. Lange. 6 If the creditor levies with notice of the trust. 100 Mass. 537 . trans- fer the property. Infra. Fausset v. . 232. it was said that the it legal title would pass sub- ject to the execution of the trusts. p. Pet'r. unless he knows that the transfer is a breach of trust and the fact that the consideration is inadequate. 330.

in most jurisdictions the creditakes only by subrogation through the trustee. however. Div. R. mechanic's lien will attach to a trust estate only where the trustee has the power to contract for the labor for which recovery is sought. Mason v. 245 Ames.. Davenport. 9 Ga. take title 41 subject to the trust x but States without any notice. 131 111. where he is authorized to carrj on the testator's business. 9 -Franklin Savings. Y. 8 and is not forbidden to encum9 ber the estate by the trust instrument. 13 Pa. L. (1896). 590. Mander- son's Appeal. Phelps. 5 6 Fairland v. Phelps. 6 The court has held in Mississippi. Bennett. instance. for instanoe. 151 Mass. n. Code Percy. 2 3 p. Norton v. 467 (1895). 7 Daly (N. 26 Ch. 8 That is to say. 376. § 4183. 467. 1 Law Rev. §3185. 54 Miss. Pomeroy. his tor and in some without regard to claim. the creditor would only take the amount due. less the default. and so to all the set-offs which the trustee would be . . 1 Strickland v. 3 Prob. creditor must come against the trustee first. 423. 449 . 7 Stat. 223 . 15 Arner. the creditor may proceed against the trust property direct. . 7 that where the trustee is provided by dead. Ala. Taylor. 54 Miss. 62 . & Div. or out of the court's jurisdiction. 631. Bank v. for eral agent by statute or by the trust instrument. 217.). if the trustee were in default. Ireland. Collins. in all jurisdictions to the extent to which the trustee is entitled to reimbursement. is liable as. 8 Meyers v. Norton v. 4 If. 6 and it is statute in Alabama. 2 The trust property may be taken on execution for debts incurred by the trustee in the execution of bis trusts. insol- vent. Houghton ». 74 Me. . Ga. 164. the liability would bind the trust estate to the but even then it is held that the extent of his authority — - — . Wylly v. the trustee were given the powers of a genas. 29 Me. A 1 Warren Supra. v. THE INDIVIDUAL AS TRUSTEE. Symona. . he -will if he attaches in some stand in the position of a bona fide purchaser. 471. 39.

6 or his Estate is be the trustee's estate reduced mere power by where a life estate only was necessary to execute the trusts. Supra. . v.' 104 XJ. and is generally entitled to such set-off as an equitable plea. 6 Title passes to only Equitable. Ins. bankruptcy. . but see Walker v. 168. 319. unless he knew . 2 The trustee's private creditor has no set-off in equity. M. Me. creditor of the beneficiary may set off his debt in equity or in au action at law by the trustee as an equitable bar in most jurisdictions. p. n. Packard v. Marshall. or insolvency. he may keep his set-off. trustee's private creditor — The might set off his debt in a suit at law. Moore. 82. § 4260. n. §§ 11. Walker v. School Dist. § 63 5 . A trustee's hakdbook. 270. ch. Co. at the time of its was a trust claim. and vest in the remainderman. 6 Stats. (1883). Ames. Morgan . Stat. § 2343 Annot. 4 In equity the defendant may set off a debt due a third person as trustee for the defendant.42 Set-off. a convej'ance by the trustee under such cir- cumstances 1 2 s 4 is necessary. But in the absence of statute. 59. First Bank. Brooks... to a — Where Remainderman though statute. when the purposes of the trust are accomplished. 125 Masj3. ch. 270. Mass. 138 Mass. 125 Mass. Comp. 102 Mass. (1882). Laws N. 8 The trustee can only set off such debts as his beneficiary could set off. Bk. and the intervention of the trustee will not be necessary to perfect the 7 title. in N. even though he have an equitable estate only. 241. where the trustee took a fee. the trust estate will pass out of the trustee's hands. Pub. 241 Rev. 8 Nat. Stat. Wise. 7 8 Wise. 14. Ames. (1889). &c. Stat. 174.. v. (1884). . Y. in which case he be enjoined from doing so in equity 1 but if he were ignorant of the trust relationship. S. 3 Gray. and in equity can set off the debts of the creation that the claim will A beneficiary. Brooks. u. 301. 54. Mich.

Forfeiture. on the death of a sole trustee testate the property will pass to his general devisee in the absence heirs of intent to confine the disposition of property to that in but it will not pass to beneficial interest a general devisee where such an intention would be neg- which he had a . 10. 19 Barb. Forfeiture of the trustee's property formerly carried with it a forfeiture of the trust property. or otherwise incapable or unfit. see survival of powers.. 4 Aside from statute. of the legislature. infra. THE IKDIVIDUAIj AS TRUSTEE. as the estate taken is not beneficial to the trustee. Shook. p. 43 title On the resignation or disability of a trustee the to vest in the successor by conveyance of the outgoing trustee. 46. p. 4 As to survival of office. or where there is a statute authorizthe property may ing it the court may appoint a person to convey the estates. atived by the circumstances as. & Ad. p. When one of sevand the title to the estate vest in his co-trustees by survivorship 8 and when a sole trustee dies. 38: Shook v. although the Crown took subject to the trust 2 but now there is no forfeiture in equity. 653. 5 Barn. the title in the meanwhile remaining in the court or his eral trustees dies. In the absence of such statute there is no way of divesting the outgoing trustee's title save by act. if he be beyond the jurisdiction. King v. 1 2 3 Supra. vised estate. 254. or where the general devisee is a minor. — Transmission on Death of Trustee. Such acts are not unconstitutional. — and personal representatives. . where the general devisee is a class of persons. In such case the property will descend to the heir as unde. Supra. Mildmay. and it is generally provided by statute that there shall be neither forfeiture nor escheat. both the office . 1 Transmission. it is generally provided by statute that the property and office shall vest in his successor in the trust. for instance.

in to trust. over to the new trustee. or personal representative of a trustee. Gen. and make up an entirely inappropriate for him to attempt on the trust. Of Powers in General. Ferrers. Michigan. (1882). § 344. Laws Md. and Missouri . for instance. 8 and he has power to exe- cute the trust only so far as and to make it account. 7 Jur. 10 it is ex- pressly provided that he takes II.44 A tktjstee's handbook. Mass. 132. 46. (1888). Art. to carry It is 9 is necessary to preserve it. 2 and a husband no curtesy in a trust estate. Flint. 9 DePeyster v. 873 . N. (1896). § 11. — 1 2 a Schenck . 11 Jurist. 13. 721. 46. some States. 174. Gen. S. But otherwise West . where personal representatives succeed Va. § 344. 16 N. Harlow v. the property will descend to his representative 1 but a widow has no dower. ch. 109 Mass. § 24. 4 New York. § 125 Perry. § 1044. If the sole trustee dies intestate. Stat. Code (1891 ). §§ 321. As. Pub. Wisconsin. p. 6 When the title to an estate vests in the devisee. § 6. Ireland. p. 6 Pub. It does not come within the scope of this treatise to consider the powers which a trustee may have collateral to the trust estate. § 25. (1895). 183. 322. Cowdrey. Code Ala. ' he does not succeed to the office. and in many jurisdictions no estate. 6 Perry. POWERS. Infra. 141. whether they are to be exercised over the trust property or elsewhere. heir. 6 In some jurisdictions they may disclaim. 1280. J. N. a power to distribute the trust property among v. Schenck. Eq. Perry. but to the only. jurisdictions the title to real estate vests in the court 4 or eldest son by statute. 10 Perry. ch. J. Alabama. Austen. 8 Or in some . 8 Mortimer v. the devisee or personal representative only holds the title until such time as a successor may be appointed title . Stat. 1 Stevens v. §341. 11 Paige.

receive. or against him as trustee to disburse and dis.THE INDIVIDUAL AS TRUSTEE. . and not general and incidental to the office. . . The trustee retains in equity as incidental to his office certain of the powers which are his at law as . since the original conception of a trustee was some one to be trusted with the title to the property. a Trustee has. and sue for the trust property or any income accruing on it to invest the funds and lease the real estate to take proper measures to keep the real estate repaired and insured. but in a court of equity the rights of the beneficiary are paramount. 45 a certain class of persons. and to defend suits against him in respect to the property. or ordinarily does have. and to convert real into personal estate and vice versa. and consequently a trustee will be restrained from exercising any power inconsistent with the beneficiary's rights hence a trustee may be said to have only those powers which he will not be restrained from using. and apportion the Bhares among beneficiaries. . tribute the property tain . could exercise all the ordinary powers which an absolute owner might. The general powers to incidental to the office are limited and comprise all those that are necessary to the performance of his duties. We need only concern ourselves with those powers which the trustee must. as the office has more and more become. At common law a trusbeing the absolute legal owner of the property. to sell the trust property. and not a sort of business manager. such as power to demand. to protect the beneficiary. and those powers which are conferred by the trust instrument. and to change investments. What Powers — tee. but are special. such as children or charities. owner of the property he has also those additional powers which are conferred by the legislature or the court. in connection with the management of the trust property. or main- him if The powers incapable of maintaining himself. are usually bestowed on the trustee by the legislature or court.

6 Gray. O'Brien. or in a stranger by a conveyance not properly authorized. Vesting of Powers. p. where the ownership vests in the heir or personal representative of a sole trustee. and neglects and in every to give expressly the powers to perform it such case the trustee will take by implication all the powers necessary to execute his duty. 12 N. 428 Belmont v.. Nugent v. 55. Infra. will pass to the survivors or sur4 and will vest in the successors in the trust and this notwithstanding a provision for the 1 keeping up of the 2 8 Supra. in express terms the . The general powers vivor. 46. he may give a mortgage containing a power of sale. 2 or where he is to keep the estate safely invested he will have implied . — powers as are necessary to preserve the property until it can be conveyed to a properly constituted trustee. Statutes in many jurisdic4 . but will not have the usual incidental powers to manage the estate but only such . of a discretionary character. for instance. where a trustee is to borrow money on mortgage. and. 1 As. Y. in all the trustees jointly. p. 219. 8 The powers will vest in a trustee properly appointed. Vandeventer. and usually does. For instance. confer powers which the court and legislature giye and it usually enlarges the general powers incidental In addition it frequently gives other powers to the office. In such cases the owner will be a trustee. There are some cases in which the powers incidental to the office do not vest in the holder of the title. "Webster v. p. may. Implied powers are also often given by the trust instrument where it places a duty on the trustee. Cloon. power to sell hazardous investments left by the maker of the trust. 46 a trustee's handbook. or a power of appointment as to distribution of The trust instrument itself income. 117 Mass. if there is more than one trustee. . 61. 394. Infra. such as a power of revocation of the trust. tions to same effect.

47 number of the trustees. even though a majority. Johns. 8 Watts & S. . the powers will pass to their successors. — moted by corrupt or 1 selfish motives. Pet'r. I. 584. Swale. 4 Blackf. Contra. 60. 7 Swale v. but not of one trustee. Granger. it can only be executed by tbe joint action of all tbe trustees and an execution by part. unless the conduct of the trustee has been factious and unreasonable. 128 Mass. p.' and where the trustees disagree. and their and assigns. 381. 5 in the trustees. or procution of a . 71 111. 115. 8 Norcum v. v. Amb. : . Franklin v. the limitation is heirs a personal confidence to the trustees by name. 21. 527. 484 . but not to their personal representatives. White. 405. unless provided for by the instrument. 4 Execution of Powers. Ch. Gen. 1 Atk. Supra. 2 Lamb. Lord. 17 Mo. 22 Beav. Supra. . D'Oench. Doughty. 8 * Wemyss Warneeke v. which the court will not do. 13." they have been held not to pass to a single survivor. and so will not survive or pass to successors. The essential part of the exepower is the exercise of the discretion vested As this discretion vests in them jointly. 1 If. 159 Mass. p. In the Matter of Wadsworth. 15 B. 109 Vanderer's Appeal. Bailey. as the settlor evidently meant to trust the discretion of any two or more. however. the only remedy is to have a trustee removed and a new one appointed. 2 Barb. v. Gleg. 134 Mass. Osgood. the powers are limited to " my trustees. 144 Mass. individuals who are nominated trustees they can only be exercised by the individuals named. 31 L. If. v. Ch. 272. 5 Stott v. 391 Eay v. 98. 14 309.THE INDIVIDUAL AS TEUSTEE. 6 Hence is void. however. J. Pet'r. 91. Powle. 2 Special powers conferred by the trust instrument upon the trustees in that capacity will pass to survivors or successors ° but if they are a personal confidence in the . the insanity or refusal to concur of one trustee can block all action. 426. 356 Morville v. 6 Atty. 8 Hammond Hibbard v. Lembca. Schouler.

. Pearson v. 88. Infra. 466 Wehb v. 7 The liability of one trustee for allowing his co-trustee to treated below. 385. 7 Lee v. Ridgley Johnson. 368. Ledsam. Infra. receipt. as he may collect it all by a compromise. Gleg. rents. 259 . Ch. . 266-270. Sankey. 1 Atk. Ch. 4 6 6 Infra. Seeger. 1 McLean (Ken. p. Ochiltree Wright. 3 nor could he collect a judgment. v. Gen. Jamison. p. 336. See article in 12 Central L. Trustees are joint tenants at law. or any other income accruing and he may receive a simple debt or discharge a mortgage. 2 He cannot. & Hem. pp. 64. 75. 197. 31 L. 122 et seg.. assign a mortgage. Guedalla.. 6 In equity a joint receipt is required hence if the debtor knows that the trustee is committing a breach of trust in receiving the money. Bk. & Bat.). L. J. J. — The execution of a power part cannot be delegated either to a stranger or by one of Nor can the trustees divest themselves of their discretion by asking the advice of the the trustees to another.. as all the trustees must act in a sale or assignment of the trust property. Duff. or if he has been warned to pay to all the trustees only. Queensland N. however. so one trustee may pay out income. 37 Ch. R. Eq. 48 a trustee's handbook. 391. u. & S. Lord. 204 Magnus v. 8 Infra. . 2 Johns. Stott v. Mendes v. Div. 15 Eq. interest. & J. 8 in its essential receive or have the custody of the property is a different question and is Delegation. as all the trustees must join in the suit. 527. 87. alone. 1 K. 8 Watts v. . 11 Barh. — . 4 Johns. Atty. Must be Joint. 1 Nor can one trustee bind 5 Conversely. hence one of them may give a debtor a good discharge if he pays his debt into his hand 1 hence one trustee may collect dividends. 87. he will not be protected by his single . 356 Berger v. 1 Dev. but in dealing with matters of principal all should join. 222. 3 i 2 8 Bowes v. p.

ed. 6 Hence a trustee. Weed. 6 such as the delivery or execution of a deed or lease. 307. 1 Eq. 59 Vt. or any other matter not requiring the exercise of discretion. 58. James. ubi supra. power to carry out the sale there is nothing to suggest that the trustee has delegated But an attempt to reach the same results under a general power would be otherwise. as his attorney a special . 26. 79-85. the execution may be completed at a later date. A convenient mode of action in such cases is to authorize the agent to contract subject to the assent of the trustee.THE INDIVIDUAL AS TRUSTEE court. having fixed the terms of sale. or the appropriateness of the security selected for investment. the exercise of his discretion in determining the selling or letting prices. . Berger v. Hawley v. attorney. v. Floyer. St. as the evident implication is that the trustee has not passed on this particular case. unless the trust instrument requires his personal execution of these unessential matters. 487. and the transferee will not be put on his inquiry. 4 This does not prevent the trustee from intrusting the unessentials to an agent. pp. R. James. 318. Woddrop Gillespie v. L. i. Sugden on Powers. ubi supra. Bostock v. 7 Partial or Defective Execution. Transfer of Stock. 154 Pa. 3d Amer. and has delegated his discretion to his general his discretion. Duff. namely. may give and convey the property or in the case of a sale of stocks may sign a special power of attorney in blank to transfer the stock. 1 49 Thus a trustee cannot appoint an agent to sell the property 2 or to manage the real estate. § 76 Hawley v. A power need not be executed at one time. 5 Paige. 4 . Smith. Infra. 76. 374. v. and if it be only partially executed. 3 because by doing so he delegates the essential part of his power. or hand the funds to a solicitor to invest. 473. Sheldon. Lowell.. 8 J — 2 8 * 6 6 7 8 Trust Co. or the need of repair. 29 111.

§ 2. 8 If the validity of a special power be dependent on a condition. 98. but if in nonessentials prescribed by the trust instrument there has been an error. 10 Gray. 3d Amer vol. and if any party die whose consent is necessary. v. 495. an execube ineffective. 18.. Encyc. Alley i. 50 A TRUSTEE S HANDBOOK. a deed witnessed by a man and a woman will not do. and it was held that.. & Eng. 8 1 2 See page 58. ch. 142. the execution is absolutely void. and the assent was no longer necessary to its execution. Bateman v. the condition must be proved and may be traversed. Pub. g. cution of the power. Amer. as there were no interests to be protected. ed.. 3d Amer. . the court might act in his place. 373. 7 And in some jurisdictions it is provided by statute that where the person has died whose consent was necessary to the exeficiaries they all died. Leeds Ex'r v. is to be executed by deed. the power will be 6 but in a case where the consent of a class of benelost was required to protect their own interests. e. Sugden on Powers. 1 If in essential matters the power is substantially ex- 2 ecuted. Prescott. 6 the subsequent ratification will not be sufficient. Lawrence. 3 Mad. Law. and the court will not interfere. 300. 8 4 5 6 7 « Sugden on Powers. 4 is If the consent of a beneficiary a condition precedent. 514. If the execution is defective. or one having a meritorious claim. the court will confirm the execution. or if it is to be executed by deed witnessed by two men. but it will not aid a volunteer. 299. "Wakefield. Mass. (1882). it Thus. 14 Mass. Stat. Davis. i. ed. the power had become unconditional. p. if the power will tion by parol was held that no power of sale arose. Minot v. where a trustee was to sell land to support the bene-flciary. 927. the court will compel the trustee to complete the execution in favor of a purchaser for value. 391 . where there proved to be plenty of personalty. 1 2 Gray.

H. . that the court will ratify anything which it would order to be done. 683 Perry. Y. Control of Court over Powers that Duty to Exercise. 46 N. Crabb v. as it is where it acts on its own equitable jurisdiction. . 92 N. the court will treat him with indulgence. § 476. Infra.. Hurck. it is the Trustee's trustee is bound to use a sound discretion in the execution of those powers which are incioffice. since the maker of the trust meant to 6 trust to the conscience of the trustee and not of the court 1 — Infra. ing since the court can only execute the by statute. and espe2 cially if he act under advice of counsel. THE INDIVIDUAL AS TRUSTEE. 1 Only those interested can object to the execution of the power. p. So too a decree of the court acting by is 51 statute authority invalid which does not conform to the statute authorizit . 9 Cal. Naglee. v. and it is It is said 8 just as the trustee does not quite safe. 81. " 8 * 6 Eilig v. 55. if a trustee has any doubt as to his duty. p. but this is not quite true. Haydel v. since a court will not ratify an unauthorized conversion. motive. dental to his —A . . Sbackford. 423 . Portsmouth 253. Young. The Control of Court over Discretionary Powers. or which are conferred on him by the and he is answerable to the court for a failure to perform his duty. without any selfish legislature or court . since a court ma}' not look at the matters hence. Hence the court will inquire into the manner in which he has executed such duties. and will hold him responsible if he has not used sound discretion but if he has acted in good faith. court will not interfere with the trustee's action where he has a discretionary power. 56. his best course is to ask the instruction of 4 the court before he acts. and is power given it not itself the party creating the right. 72 Mo.

20 Hun (N. but is influenced b}' hostility to the person to be 6 but the proper remedy in benefited or by selfish interest If the discretion given the trustee such cases is the removal of the hostile trustee. 47 Perry. his discretion and a trustee cannot divest himself of 1 sulting the court. Costabadie. Garvey. 8 Comp. 8 Bull v. . which he cannot be compelled to do. however. 52 A tetjstee's handbook. Y. 6 Hare. the court claimed the right to interfere. (1887). Supra. since he and not the court is the tribunal trustee gives his reasons. 185. 273. 8 It will not inquire into his reasons for acting or not act4 but if the ing. 9 Tabor v. Costabadie v. that discretionary power is presumed to be subject to the control of the court if not reasonably exercised. the holder can only exercise it with the court's approval. the execution of the power becomes a matter of litigation. Wilson. 440. but did not exercise it. Bacon. Civ. and he is under no legal obligation to do either. Heard. 59 Vt. 8 Conn. 4 Ee Vanderbilt. Div. 55 Vt. Code (1885). & 6. 8 In Cromie v. of compelling an honest and bona fide exercise of the power. 3948. 579. 1 2 . 150 Mass. Bacon v. § 2269. 21. 6 Garvey v. 122 Mass. Bull. 6 Ee Beloved Wilkes' Charity. 520. v. 81 Ky. Bull. 7 It is provided by statute. Heyer. 525. 243. since it is a mere matter of choice with the trustee whether he will or will not act. . and if it finds them insuf- may reverse his action. 145 Mass. § 511. 374 Proctor v." he cannot act the court will interfere where he refuses to act as a reasonable man. in two jurisdictions. and only to the extent. Eldredge v. or is brought into court for execution. 6 is to act on his " good upon his mere will or caprice. the court ficient may review them. The court seems to extend its control to the extent. 410. 490. . 646. rather than a request to the court to change his determinations. however. p. Laws Dak.). 1 Wilson v. Cal. 448. 10 Ch. Brooks. and judgment. 2 If. Sheldon. 9 If the trustee exercises the power in such a manner as Trust Co. 3 McN. by con- They will not compel an execution. 106 Mass..

240. Thus where a trustee appointed a double portion to his 4 son to avoid a lawsuit. Western. And accordingly the person attacking the exercise of a power on the ground of fraud must prove his case affirmatively. exercise an unlimited power for his own it gain.. 5 Jones Eq. where a power or become impossible was given died. 30 W. or out of spite or revenge. p. 46. or to get an advantage for himself or his family. be a fraud. 1 — If the trustee will What amounts to Fraud in the Execution of a Power. Hogan. 1. Supra. 524. though not injurious to others. Barrows. 2 If he exercise a power in such a way as to defeat the purposes of the trust. Ch. 8 Lovett v. — A power cannot be exercised . 53 to be a fraud. 1 Barb. 6 . or the purposes for which it was given have been fulfilled as. Bostick v. and A had A power will not 1 2 be exhausted by an exercise of part Brittlebank. 169 Mass. he pays the whole amount over at one time for the purpose of revoking the trust. 1 Sneed (Tenn. R. the court can on that ground set it aside. Ch. 4. the execution will be set aside. as.) 82. if under a power to use the principal for the support of the beneficiary. 47. THE INDIVIDUAL AS TRUSTEE. t Slocura v. 8 If he exercise a power for corrupt motives. 69. Farnham. 99. Re p. Slocum. for instance. pp. C. and not because it has jurisdiction to review the exercise of the power. 6 v. (N. 16. 6 after the trust has expired. it will be a fraud. See infra. 613 Lessee of "Ward 2 Ohio St. . Frazer v. 241. * Holt v. Winton. 7 to sell and convert into cash for A. 220. See supra. for instance. having the usual jurisdiction to remedy a fraud. Extinction of Powers.). the execution was set aside. A power may become extinct by the death or disclaimer of one of those to whom it is given 6 . 4 Edw.

Jones Atch... . I. the balance may be sold at a or if a power of appointment fail. At the present day the usual object of a trust is to settle property in the hands of persons of good business ability to manage . p. 8 Lowell. exercised again.. Top. Jr. 208. in part at least. ch. Power of Sale. Transfer of Stock. Hall. Sugden on Powers. . PARTICULAR POWERS. 4 1 Supra. persons unfitted for business and the care of large . v. . 2857. Rev. (1894). Fe' Ed. As. The tage. Sale. 1 III. p. Gen. for instance.. 304 Code Ga. is — — is it not a general power incidental to his office. but where the court gives the power it may be otherwise. Stat. 49 . ed. (1894).54 a trustee's handbook. Laws (1896). if part of a tract of land be sold under power of sale at one time. In New York power of sale to pay collateral inheritance tax. it for the benefit of others not or to settle property so that it possessed of such ability may form a family fund to descend in the family as long as it can be tied up. (1896). the object of a trust then being to avoid feudal clues 3 and forfeitures. § 4707. it may be later date .& S. and so that the property may not be dissipated by the improvidence or bad management of the persons to be benefited who usually are. p. § 12 Ky. 80. § 3172 . Ky. 4 R. 2 Wheats v. (1895). policy of the the fullest power to modern trust is to give manage the estate to the the trustees best advan- and hence a power of sale is a feature of all well drawn trust instruments. 3d Amer. § 5. In some jurisdictions there is a statutory provision that every will shall be construed to give the trustees power to change all trust investments. Although a power to sell one of the most important powers a trustee may have. Stat. 150 Mass. 5 since the original theory of a trust did not contemplate a trustee's doing anything but holding and taking care of the propert}'. 391. § 2356. 17 Ves. Stat. § 62. estates.

6 Boston Safe Deposit Oo. §§ 2616-2622.. . and the decree of the court must conform to the statute. St. 7 and such statutes are held to be constitutional. too. Weld. & S. Stat. p. ch. 8 How. 75 Pa. 6 Sale under Statutes. 25. 4030. 1 Mass. v. 146 Mass. 141. Atch. 3415. 4 or to invest as seems prudent. 159 Mass. § 2617. § 3172 Rev. 1 As. on the application of any one interested. 150 Mass. 68. 9 Williamson v. Berry. and provide for persons in interest. 531.. 779. 1799. § 65. Stat. Rev. §§ 2100a. Clymer. 2 or where the trustees were to invest or reinvest in safe securities. and the appointment of it guardians for in being. ch. (1887). § 10 Stat. 8 Norris v. 8 Purdie v. be implied from the fact that the trustee is given a duty which cannot be performed without a power of sale. p. 8 or where they were given the power to manage and invest. Goodrich v. . Laws of Del. Mixter. (1888) §§494.22. N. 2 . 304. 55 it will In many cases where the power is not expressly given. 20 Pick. (1894). 6 Bohlen's Est. 9 The statutes generally provide that the court. 6 So. court thinks notice to all may order a sale if the necessary or expedient. 114. 2 Pa. (1883). p. §§20. Me. (1893). (1894). 4 Harvard College v. Y. and then the income to B.. Stat. § 11 Pnb. Stat. Vt. 46 Jones v.. 277. 100. 721 Code Ga. St. where the trust was to pay the settlor's debts. Code Va. Whitney. Top. Annot. 198. for instance. (1896). all minors or persons unascertained or not Supra. 1 . 567.THE INDIVIDUAL AS TRUSTEE. 8 — In such cases the power given the court is subject to the same general rules as other powers. 304.Pub. Ind. and not exceed it. N. Conn. Rev. (1889). In most jurisdictions power is given to the probate court by statute to give the trustees a license to sell. §§ 3411. (1882). 1 Gray. 495. (1891). Proctor. the trustees have an implied power to sell. Stat. F4 Ed. H. Wise. Stat. where the maker of the trust leaves illegal and improper investments. (1895). Stat. ch. Gen.

119. 8 Cowman v. 6 may order a sale on the cy pres docit is difficult or represented by guardian. (1882). 2 « * 6 Davis. Gen. Colt. Stat. 4 Comst. 7 Baker v. Clarke v. Leggett v. 127. Clymer. 14 Allen. and often does so. St. Hunter. Y. 277. § 18. 377. 233. St. Ryan v.. Such statutes do not give the court power to act in disre1 gard of the testator's wishes. 256. Stanley v. 8 There are statutes authorizing the court to order such and sales of estates which are subject to contingent remainders or executory devises in some jurisdictions. 2 Pa. Hayes. Gen. Morris 6 . 426. Pet'r. Baber. If such persons are not represented. 257 Ansley v. has been held constitutional. where it is impossible to use the property so as to carry out the testator's wishes. v. 164 Mass. Weeks v. but even a sale under special act of the legislature in direct controversion of the settlement has been held void in Pennsylvania 4 but elsewhere a special act for a sale. Pace. v. as a change of investment. 120. where adequate provision is made to protect the interests of all persons 6 interested in the trust. to see what remedy they would possess at a later time. 403. were parties to the suit. 445. though contrary to the testator's intentions. Briggs. . Porter. 9 Gray. 106. 56 A trustee's handbook. I. 9 and providing for the appointment of guardians to represent sales. 8 Beav. Ervine's Appeal. Moreover. Hobson. the legislature may 8 authorize a sale by special act. Atty. § 19. ch. Lorillard. Where there is no general statute. 5 Wall. Pub. the court without an act of the legislature trine. 60 Md. the sale 1 is of no Johnstone v. and the fact that the income 2 will be increased is not a sufficient reason to decree a sale. 7 and the trust passes from the property sold to the fund received in its if all and parties in interest place. 201. 19 N. 61 Tex. 16 Pa. Colquhoun. 561. persons who are unascertained or not in being. ch. 68 Ga. (1896). 24. 9 Mass. Laws R. 150 Mass.

68 Ga. 119 Mass. Lorillard. Pace. and so the parties were immaterial. Where there is no statute. v. and a minor or person unascertained might object on becoming sui juris or vested with is . a court of equity or any court having the power to regulate trusts maj. should they afterwards entitled. But see. 2 Hare. . It is said that a court will not confirm sale even . Ansjey v. 4 Baker v. or his agent may arrange them subject to sale requires discretion. 40. even though the sale is at auction. where it was decided that persons unascertained and not in being are not necessary parties but in this case a special power was given by the will to the court. . the court would undoubtedly ratify it as the trustee had power to make it ex necessitate. 1 become there of Court of Equity to decree a Sale. Power — the estate. his approval. Brown. Lorillard. effect. It is settled — law in Missouri spot. 8 Blacklow v. ubi supra. contra. Laws. 64. The management of the and hence cannot be delegated. that. THE INDIVIDUAL AS TRUSTEE.do so as one of its ordinary powers 2 but where such a statute exists. Execution of the Power. or where a sale is necessary to preserve the property s that such a sale would be beneficial to all concerned is not sufficient ground of action. the court would only act under and to the extent of the statute.. he should attend in person to decide tion arising 1 on the any quessuch as an adjournment or the Baker v. Crocker. a court of equity will decree a sale only where the trust cannot otherwise be carried out. 1. 2 Old South Soc. 4 an unauthorized though it would have authorized it had it been consulted but if there was no time to get leave of court. Where no statute giving any court power to decree a sale. ubi supra . 57 so far as they are concerned. Where the trustee sells at private sale he must arrange the terms himself. 70 6a. Schley r. and the sale was necessary to preserve the property. 403.

but he himself be- comes the purchaser the that case the purchase If there is an}' sale may be disaffirmed. 7 The trustee cannot purchase directly or indirectly either if for himself or another at the sale. so that it fraud. 488. 7 Mass. 5 or appearance of a party. and it may be disaffirmed. Knox v. shall of a purchaser from a licensee of a competent court. 9 Infra. 27. in acceptance of a bid. in the description or advertisement. 8 and if the power be to sell the whole estate. 6 And in some jurisdictions there are statutory protitle visions providing that the sale. the court will affirm the sale. Once having successfully attended to the details. 142. or a right to mine or cut timber could not be sold but an authority to sell the whole estate will not prevent a sale by lots. 7 Mass. 10 2 8 4 6 R 7 8 Graham v. West Kansas Land Co. 473. 5 Madd. Oliver v. 425. p.. Stat. even though there may have been some irregularity. Mass. such as inadequate notice. a partial interest such as a life interest. Jenks. Knox v. or if the selling price is wholly inadequate. such as an immaterial error . who has given bond and due notice of the not be set aside for irregularity in the proceedings. 22. 127. Pub. 165. . he need not deliver the deed in person if he takes proper precautions to secure the purchase money. 8 Price. King. Ord v. 9 amounts to a fraud. 51 111. (1882). Waterman v. ch. 1 but the usual practice is not so strict most jurisdictions. 10 Court. 50 Mo. 8 but in money must be refunded. 438. p. See supra. § 18. The sale must be carried out in the manner prescribed in the trust is derived . Jenks. the sale 1 may be disaffirmed. Spaulding. 142. instrument or decree from which the authority and any error or omission will vitiate the sale. 4 If every essential requisite has been substantially fulfilled. a sale for credit cannot be made. Mercier v. Noel. if the power be to sell for cash. 2 For instance. 488.58 A trustee's handbook. 72 Mo.

If the sale is by order of court. § 77. as. 8 rule . 7 Coombs v. & 8 Fin. Jordan. 5 Madd. 6 or if he has a general power of sale. . Noel. Bank v. 766. Ross. v. 1 and that it has been properly carried out. Bank 2 8 Lange. 59 The purchaser must ascertain at his peril that the power of sale arose. Supra. " Third Nat. (Va. Wormley Wormley.412. Jr. 10 Ves. THE INDIVIDUAL AS TRUSTEE. 284 Wilson 384. or if he knows that the trustee intends to misapply them. He will be liable if he have notice that the trustee has not exercised a personal discretion. Where the sale is a breach of trust. — i Cassell v. 6 the purchaser need not see to the application of the purchase money. 3 but he may get damages at law from the trustee individually for the breach of the contract. 3 Bland. 4 . Application of the Purchase Money. The general is. that where the settlor or court has intrusted the funds to the trustee. and if conditions are attached to the power he must see that they are properly performed. 421. v. p. Transfer of Stock. 8 v. 49. he will be liable if he neglects seeing that they are properly applied. but also for damages and he cannot compel the trustee to carry out a contract that is a breach of trust. Dayisson. 138. as. he need not see to the application of the purchase money unless required to do so bj' the decree 7 but if the funds are to be applied in a particular manner at a definite time. where the trustee took a note and discounted it for his own benefit. 33 HI. but has delegated his duty to an agent. 438 .. as for instance where the investment requires time and discretion. 51 Md. for instance. for instance. CI. v. if he purchase from an agent under a general power of attorney 2 but the determination of the court that a sale is proper will protect him. v. Lange. Ord v. White Cuddon. Perry. § 798. 51 Md. since equity would not compel the trustee to do wrong. Lowell. 244 .) . 138. * 6 6 Mortlock Buller. Wheat. the purchaser will be liable not only for the purchase price. 292. Third Nat. 2 Rob.

C. S. . §1039. Y). 6 6 7 8 9 Trust Co. Wormeley v. 4 Madd. v. 2 DeG. Stat. § 8691. Stat. Annot. and many of our States. (1896). v. U. Lowell. 4 Mass. § 4295. If the trustee has power to "sell and dispose of" the property. (1882). Underbill. Minn. 68 Iowa. § 75. (1894). Baldwin. (1882). 549. Y. Rev. Code Cal. the court will not order a pledge or mortgage unless it is essential to carry out the purposes of the trust. Brodie. S. 134 Mass. Waterman v. Rev. and the power has not been usually given him by the settlement or bjr the legislature this . (1896). Miller . Stat. 2 De Winton. C. Pub. Dak. 1 Whole subject treated in 8 Code Ala. 1801. 41 Hun (N. (1894). (1895). Stat. C. . Redwine. 141. Rev. § 7167. § 4277. (1896). 4 In the absence of statute. Ky. Loring !. If the purchaser has paid in such manner that the funds might be properly invested. N.. The trustee has no power to Fledge or Mortgage. Y. & J. § 66. Stat. (1894). § 4846. Wormeley. § 3399. 7 and it is said that where a trustee has a power of sale. Stat. 453. 9 1 Keane Pell v. (1889). Ind. Mich. he will have an implied power of mortgage. U. Stat. ch. n. 255. Stat. 8 Wheat. 356. 13 . (1889). he is liable for it. Stat. N. 75 Ga. Robarts. Kan. so that he has notice of 2 the contemplated breach of trust. Roche. 130. 60 A TRUSTEE S HANDBOOK. 330. Wise. Mo. 421. §2244. § 5584. Brock. Gen. S. pledge or mortgage the trust property incidental to his office. Stat. v. p. he will 8 but the better opinion also have the power to pledge seems to be that a mere power of sale does not confer the power to pledge. Annot. he is exempted by 3 statute from seeing to the application of the funds. In England. § 2092 Rev. 332. (1889). § 23 . — but of late years power has been more frequently given to enable the trustee to improve the real estate. 356. Civ. 1 he is not liable but where he pays in an improper manner. 1799. 5 and in such cases the authority is 6 really an implied one given by the instrument. p. § 65. Code N. Transfer of Stock. (1885).

3 Drew. as. R. terms as are customary. Greason v. .. the pledgee will be holden to more care than a purchaser. since i 2 Lowell. 11 Ves. 8 These leases are binding on the estate for their whole term. and he will take by implication the power to give a merchantable mortgage. Eq. 8 9 Earquhar. 17 N. THE INDIVIDtrAL AS TRUSTEE. v. § 75. 236. 569. Transfer of Stock. Longman. or they maj. iv. — The trustee has the estate as a general power to lease the real power incidental to his office. p. A partition or exchange can be made by express authority in the instrument. Kent's Commentaries. . 534. 491. even though the trust may terminate during the term of the lease. Keteltas. the power of sale is restricted to sales for cash. except that. 408. 1 If the trustee have a power to mortgage. Rollins. 7 — Leasing. Bridges o. although he has form. 6 or the reinvestment is restricted. the partition or exchange could not be made' in this way. however. Y. 27 .be indirectly effected under an ordinary power of sale and reinvestment. 16 Ohio St. 472. 61 The same remarks that apply to the execution of a power of sale apply to this power. State Bank. Borel v. Greason v. McQueen Bradshaw v. 4 although a power of sale and a power to sell and exchange do not include a partition. 6 If. pp. 8 4 5 6 7 Lewin. he may give a no power to sell 2 since without such a power of sale the mortgage would be unmerchantable. 106-108. ubi supra . vol. 24 Bear. Fane. or one in the usual power of sale mortgage. and the remainderman is bound by them 9 but if the trust must terminate at a given time. as this power is more unusual. Re Chawner's Will. 8 Partition and Exchange. Keteltas. 467. 8 L. Cleveland v. Jr. for such it is his duty to get the customary return from the property. 30 Cal.

There is one case where a lease of ninety-nine years was approved. 8 Cow. Jackson. A trustee has no power to make a lease to begin at a future day. 205. 581. v. 543. on A's lease. part of the rent is the consideration of the tenant's improving the property. 2 Newcomb Neweomb Black v. and any lease made by a trustee beyond his power will terminate with his estate. which do not benefit the lessor until the end of the term. Eq. 8 4 v. because. and will not bind the remainderman. 139 Mass. they do not fall within the class of leases which are covered by the power incidental to the office. In a building lease. accrue entirely to the remainderman. and it is determine what is a customary a question of fact in each case to be ascer- tained by careful inquiry. 19 Barb. 4 A trustee may make a building lease. but the circumstances not were peculiar. but are paid for by the life tenant by the use of the property at a less rent during his life. 608. . 1 nor to bind the estate by a covenant of renewal which will extend the whole term beyond the term for which he has power to lease. Bergengren v. Harp. but may make reasonable covenants of renewal to the same extent as he might for instance. Keteltas. 2 It is often difficult to term. giving the trustee a special 1 power to lease Sinclair v.62 a tktjstee's handbook. and must necessarily differ somewhat according to the location and the character of the property let. the trustee has no power to make a lease extending beyond that time. All these rules may be modified by the provisions of the trust instrument. al- though such leases may be in one sense of the word customary. and these improvements. and farming property is often let on even a longer term. Ligon. 19 Barb. 8 Twenty years has been considered a reasonable term for business property. Aldrich. 608. Keteltas. 259. becoming of age.

205. p. p. 24. but also where the trustee has acted with reasonably good faith in attempting to protect the beneficiary himself. 107 Black v. 4 Kent Com. DuDcombe. 6 1 2 8 — Isherwood v. Harp. & S. and as a covenant of quiet enjoyment is implied in every lease. e. g. The trustee has the duty of gathering in and protecting the trust property . as. Bowen. an}' term less will be a good execution of the power. or make building leases or leases of unusual length. G. 1 Ch. 2 If the beneficiaries have acquiesced in an improper lease. Powcey v. Supra. or in which he is involved as trustee. 3 M. carefully considered. and does not make the lease valid if invalid. .THE INDIVIDUAL AS TRUSTEE. 1 and if he exceed that term the lease will be good to the extent of the authority. unless he has been improvident or unwise. and if the trustee be given a power to lease for a specified number of years. Ca. 23. 4 DeG. p. 5 and to employ counsel and incur all necessary expenses at the expense of the trust fund. and received the rents for a long time. 63 power he has by virtue of his so that it may be lawful for the trustee to grant covenants of renewal. they will not be heard to object but this is merely a matter of remedy against them. Ligon. 382. 3 The trustee will be personally liable on the covenants in a lease unless there be an express provision to the contrary. 4 To Sue and Defend. the matter of what risks he assumes should be . and to defend suits in which it is involved. . 29 . 4 5 & Supra. These expenses are allowed. 6 Chester v. 23.. 211. where he has attempted though unsuccessfully to have him adjudged insane. not only in cases directly affecting the property. supra. Nelson v. M. 9 Beav. Rolfe.. as the beneficiary has no right to make or unmake leases. in addition to the general office. whether successful or not in the litigation. Oldknow. hence he has power to sue for it or for any damage to it. 798 . Eq.

Coates. Laws R. Clarke v. §§ 13. 4 Allen. and notice to one but neither the admissions of one of several trustees. Bobbins. 142. Rev. Gen. 10 Ames. 9 Cal. . 9 Ellig v. 70 Pa. and the result of litigation dubious. 8 court of equity would have the same power where there is no statute.3430. (1895).' powered by statute to some jurisdictions trustees are emcompromise or submit to arbitration with the approval of the court. n. (1883). 384. 31 L. Scott v. Gen. 5 Gray. 466. J. 409. Vanderer's Appeal. Conn. as to duties in such matters. 2 trustee is sufficient. but the bene1 ficiaries need not. 10 1 A Generally. St. ch. 68. 9 Allen. Chadbourn v. 208. 85. All the trustees must join or be joined. § 12. Such statutes held constitutional. Boston v. CodeGa. Naglee. he may require indemnity. Cordis. 494. Pub. Devereux. and in compromising a claim he should show a strong probability that it could not be recovered in full. Me. 8 nor the erroneous representations of one 4 of several trustees. 23. ch. 1891. suit hostile to their title. 126 Mass. Lord. (1882). Supra. §§ 3429. 3 Ch. Low v. Bouverie. Ch. § 10. unless they are not adequately represented by the trustees but they should be notified of a . 683. §595. 350. 6 the beneficiary will not defeat the The trustee may compromise and in or submit doubtful cases to arbitration. (1888). Chadbourn. 6 The admissions of trustee's title. 8 Watts & S. Infra. p. 391 . 405. Stat. 2 3 * 6 Mackey's Adm'r v. 18 . p. 82. Stat. will bind his co-trustees or the estate. (1896). D. ch. 173. A estate. trustees will not bind the compromise of one of several The demand of one is trustee sufficient. I. The trustee should never compromise a suit unless it is decidedly for the benefit of the trust estate. 6 7 8 Pope v.64 a trustee's handbook. If the trust fund is insufficient. 9 and unless his right is doubtful. but expressly by statute in many jurisdictions. Stat. Mass. p.

b. North Amer. on the estate since he has and a contract would be imestate is merely the right by law to pay for them. Bushong v. p. 7 So a contract for repairs to the trust property will be binding the power to plied make repairs. Civ. Perry. 167 Mass. Langley. (1887). 129 Mass. or to bind it upon one different from that which would be implied. 6 Hapgood v. In such case he would bind the estate by any contract which he made as trustee within his powers. not only the assets in the business. But the right to hold the to be subrogated to the trustee's claim to be indemni- out of the estate. 4 In some States the trustee is given the power of a general agent. Dak. (1885). Code Cal. and not a claim against the bene8 and this would probably hold true even in those States where the trustee has the powers of a general agent. 403. 5 (1895). Dyett. 5 Gray. Ballard. Rev. 577. 660. § 4289. Houghton. 120. if he has power to do the act as trusestate — which he contracts to do. 6 7 8 9. Comp. . 82 Mo. whether he signs as trustee or as an individual only.THE INDIVIDUAL AS TRUSTEE. 8 Thus. Code N. and not his successor in the trust. 1 The trustee binds himself personally. if at all. 8 but if he contracts within his powers the estate will be bound. fied ficiaries . § 437. 2 whether he adds the word "trustee "to his signature or not. where a trustee has power to carry on the testator's business. To Contract. 10 Pick. 5 and he may have such power by the terms of the trust instrument. and generally he may make any contract and bind the trust estate thereby. he will have power to bind the estate by his contracts in carrying on tee the business. v. Everett v. 1 Durkin v. Infra. but even the general trust assets. § 2267. Coal Co. 150. 2 8 4 Luscomb v. § 3946. 7 Paige. Taylor. 65 The trustee has no power to bind the by an express contract when one would not be implied by law. Drew. 154. Laws Dak.

instead of discretion and judgment. The trustee has a general power incidental to his office to maintain and support his The power is coextensive with the duty. the trustees being given the power to select the whom the income is to be paid or to accumulate in their discretion. . and not to revise his acts. he is prejudiced and cannot fairly exercise his office of trustee. or in many 1 Infra. Wilson v.. 492. 6 but it will only interfere to remove a trustee who acts from caprice or mere will. 136 et scq. or has is entitled 8 any real interest in the trust and so long as the trustee applies the income within the limits assigned. which is treated farther on. 109 Mass. or from improper and selfish motives. 6 6 May v. 6 So. v. 4 2 Infra. will have. 69. he may be removed from and he this is the only remedy the beneficiary and is interested to that extent. 490. the court will not inquire into his motives or revise his acts. Wilson Wilson. a power is often expressly given to apply such part of the principal as either the trustee. In such a case none of the possible recipients to anything. 1 He very commonly also has a special power given him to apply the income of the property to the maintenance and support of the beneficiary. p. however. May. The extent is to which a valid power of later. beneficiary. 66 a trustee's handbook. If. too. Wilson. 490. 2 this kind can be granted treated This special power persons to it is usually discretionary to the fullest extent. 4 In such trusts the court considers that the power should be exercised primarily for the support of the beneficiary. Maintenance and Support. 145 Mass. the power. 252. pp. 8 But see below. instead of paying it to him directly. the object being to enable the beneficiary to enjoy — the property in spite of his creditors. 145 Mass.

141. 6. I. it is more prudent to take the direction of the court as although it may authorize an expenditure of principal it is said that it will not ratify one 6 but in those jurisdictions where the courts give the trustee a large discretion it would probably ratify an} expense it would have authorized. at all. 2 Del. Serverson. 136.. Aldrich. Williams v. and where exercised reasonably will not be reviewed by the court. Smith. where the question arises as to spending any part of the principal. J. 12 R. 50. 1. J. 10 R. 1 Barker. § 3185. and void. 1. Hills v. . 67 may deem necessary for his comand support. 23 N. 2 Stroh. . cases as the beneficiary. Eq. 17 R. 324 I. Code (1895). Walsh. 280. in 2 Same case. - Lovett v. 169 Mass. McKnight v. 283. s although in some jurisdictions the court claims the power to review the trustee's action. Andrews. 4 and it will interfere where the trustee makes no payments fort . 7 The interest of the beneficiary. 6 In the case of an infant. dealing with existing facts and reasonable anticipations of the future. In this last case income was payable to a woman " for her use " as support. and cases cited. Eq. 28. 6 6 i Collins v. Putnam. Farnham. 8 Bradlee v. Ch. The amount spent by whoever has the power of deciding what is needed " must be founded on a reasonable judgment. and having a due regard for the purposes for which the power was given. . 152 Mass. Smith. and the court held that the trustees must exercise a sound discretion in paying her such reasonable amounts as she could spend for that purpose. 289 . Ga.THE INDIVIDUAL AS TRUSTEE. The general power to support a beneficiary incapable of acting for himself is also in a large measure discretionary in its execution. and also for the rights of those whose interests are injuriously affected by its exercise " * and an exercise of such a power to draw all the funds out of the trust so as to effect 2 a revocation is not a good exercise of the power. . and not the accumulation of income for the benefit of the remainderman is the chief . Walker. * Owens v. 123 Greene v. 137 Mass. Aldrich v.

68 consideration. 6 In re Coleman. "Walsh. . there is an express or implied intention to give the trustee the power to expend the income according to the needs of the several beneficiaries. . 443. 109 Mass. and compowers above treated. 1 a trustee's handbook. Owens v. Tribe. D. 18 Beav. he must ascertain those needs. Eq. is to be determined by the intention of the maker of the trust as gathered from the instrument. 252. Brackenbury. and he is capable of enjoj'ing as. and one beneficiary needs if If the income a larger expenditure than the others. Bradley. for instance. 23 N. 4 If there are more beneficiaries than one entitled to sup. J. and the trustee may provide such comforts and luxuries as are suitable to the condition in life of the benefieiar}-. es- Miscellaneous. port. by setting aside for those individuals a sufficient sum to bring the amount distributed to them up to the largest amount expended. 5 the amount expended must be equal. 136. McKnight v. and accumulate the whole balance. 300. 446. expend accordingly. . among them according to their needs. 215. 39 Ch. or whether the trustee maj' apportion is settled on a certain class of persons. 270 Jones v. 147 Mass. making a home for his father or mother 2 keeping a horse 3 or providing expensive farm buildings or gifts to charity where the fortune is ample. Foote. v. the question whether they are entitled to equal support. Harte v. the trustee should take the largest amount actually expended and make up to those whose needs are not so great. 137 Mass. trust instruments often contain other special powers too numerous to treat. 289. 6 Besides the general powers. Nelson. If there is sufficient income. If. special — mon pecially as the 1 mode of execution is generally carefully May 2 8 4 5 May. 3 Allen. or an equal division of property in general was intended. however. 543 Jackman v.. Eq. and only the balance will be added to principal. Walker. 2 Strob. 2 Colly. v. Langton . Williams v.

v. 211. 8 Powers to appoint a successor in office or to terminate the trust are not infrequent. and its absence is ground to set it aside but such is not the law in America. Buttrick. His duties are to all the beneficiaries collectively. and if incapable for any reason to maintain and support . the trustee is the absolute owner of the property. As we have already seen. 2 Keyes Supra. 69 provided for by the instrument. 63. and he is bound to treat them all with equal justice. number of duties to his beneficiary outside of and places on the trustee a large and beyond the questions affecting the trust property. it is the trustee's duty to see that he has proper care and sup4 If insane. we will treat of the duties his beneficiary aside which a trustee owes from the management of the property. it is his duty to have him declared so port. 547. Supra. 9 Beav. but an individual in assuming the character of a fiduciary or trustee for another immediately enters into a status with respect to that other which modifies their re- lationship as individuals.THE INDIVIDUAL AS TRUSTEE. First. A IV. so as to effect a revocation of the trust. 1 even where the special motive for creating the trust has disappeared. — 1 Taylor v. and also because they are governed by the general principles set forth above. Duncombe. 165 Mass. If the beneficiary is under a disability. In England a power of revocation will be inserted in a voluntary settlement. 67. except in so far as his ownership is modified by his duties to the benficiaries. Nelson Carleton. DUTIES. v. 141 Mass. . . p. These duties are not limited to the disposition of the property for his benefit. Support. 8 * p. 45. 2 power of drawing the principal as needed for support will not authorize the drawing of all the principal.

4 Johns. The matter of support is often complicated by the fact that others may have a duty to support the beneficiary. Eq. . and thej' there are two funds to be drawn should be taxed ratably. 837). in The support in . Ervine'a Appeal. in which case the court may make an allowance from principal but the trustee should not do so 8 without an order from the court. J. C. 23 N. they may take all his support from that fund irrespective of his other means 6 and if the from fund . however. 152 Mass. 2 is to be taken wholly from income except a case where the property is absolutely vested in the beneficiary. Thus. 653 . 4 McKnight v. Walsh. which case the trustee is excused. 350. 16 Pa. . Where. him out of the funds which he would otherwise pay over to him. § 190. if the parent be alive and able to furnish support adequate to the minor's condition and fortune. 123. Jr. the accumulations. 100. Ch. D. He cannot 1 use funds the person would not be entitled to otherwise. § 612 Lewin. Hills v. may advance 5 Brown. a is given to trustees to use in their discretion for the support of an insane person. 362. the trustee should .70 a trustee's handbook. the trustee should not contribute except under order of court * if the parent cannot furnish sufficient support. St. 256. Flint. settlement be on the father as trustee to support his child. 66. but now in England by statute support to an infant contingently interested (Re George. 4 Ves. where on estate becoming vested he would be entitled to 1 Lee v. p. contribute sufficient to all make reasonable if support. In re Bostwick. 136 . Perry. taking sources together. he may take the whole support from the trust funds irrespective of his own ability and if the income is to be paid to a father or mother for the support of a child. and an act of the legislature authorizing him to use the principal for the support of the life tenant is unconstitu- tional and void. the settlement being in a certain sense for the benefit of the father. Supra. " 6 2 . Putnam. and accumulate any balance not needed. Underhill.

but the court will see that they do so. — He cannot. Supra. as e. 1 Chase v. the existing statute law married in their relations with their Under Contracts with Beneficiary. any transaction with a beneficiary in which the trustee Chase. g. 27 Atl. 2 Ailing v. even 'concerning the trust propertj'. Where the beneficiary is of full legal capacity. and that he. 92.THE INDIVIDUAL AS TRUSTEE. 101 Loring v. 2 husband must support his wife. 28. generally have the same status as other individuals. 2 Allen. or the transaction may be disaffirmed. to support a minor child who is not taken from his or her care but a stepfather or a mother under coverture has no such duty. in which case he should protect her rights. except husbands. as in dealing with a stranger. and the same rule applies in payments to the beneficiary himself. . and not delegate the management of the funds for support to another. 8 Flint. the trustee. . 130 Mass. It is the duty of the trustee to handle the funds himself. 67. or a mother not under coverture.' 6 Bowker v. 71 they are entitled to it so long as they support the child. Von Zedlitz. Smith. 262. 1 It is the duty of a father. v. 100 Mass. take . 1 7 R. Jackson Mass. See Greene v. 165 Mass. 342. has taken no advantage of his position or influence. 136 . the trustee may deal with and make binding contracts with him. 340. 3. advantage of his peculiar knowledge or position but if he gains any advantage in the transaction he will be under the burden of showing that the beneficiary was fully informed and thoroughly understood the matter. * Taylor v. Loring. 655 52 N. Ailing. 3 women. § 620. 547. says he may exercise sound discretion in paying to parent or guardian. A father. 6 In other words. I. p. . 4 and the trustee has no peculiar duty to them except in preventing the husband from reducing his wife's property to possession. Buttrick. J. Pierce. he must not delegate the duty to the . Rep. Eq. § 191 but Perry. n.

being subject to suspicion. § 3928. whether be in dealing with the trust property itself. If. if and refund the he acts as soon as he discovers the misrepre- sentations. Comp. his the trust. 34. to allow him to buy in the property on foreclosure to pre- vent loss. § 434. receives a benefit is burden of proving The rule is presumed to be fraudulent. § 2228. Appellant. § 4271. there seems to be Good good Faith. or counsel in other than trust matters. 3 It is said that his position to obtain the a trustee may not receive a gift from a beneficiary. 2 The trustee may accept professional employment from if the beneficiary. the beneficiary maj disaffirm the purchase and r require the trustee to take the property money. As to professional employment in trust matters. (1887). . or with the beneficiary in matters concerning the trust. Perry. Dak. and loyalty to 1 acts His fealty is to must be governed by strict 6 it and the Code interests of the beneficiaries and Cal. § 2235 (1895). § 3921. see supra. transactions. Dak. p. 4 but with the limitations specified as to other no reason why a spontaneous present. Nichols. but he takes compensation must show that he has not used employment. 157 Mass. as that of attorney. for instance. Still such transactions. Civ. . a trustee sells to the trust fund a mortgage for more than the property is worth. L. and afterwards induces his beneficiary. 30 Beav. Cal. Rev. Code N. are better wholly omitted. 2 8 * 6 6 (1885). Noble. 1 the same whether the transaction concerns it the trust proper or property outside of the trust. 20. relying on his representations. Vaughton v. — A trustee all is bound to exercise the utmost it 6 faith in all the concerns of the trust. 28. Civ. Dak. should not be given and accepted.. 72 a tktjstee's handbook. Comp. L. (1887). and the otherwise falls on him. broker. Code (1885). especially if of small value.

104 Bendy. 1 Ellis v. 3 nor set up an adverse claim 4 If he buys an himself. 6 He must not come in competition with the trust estate. 2 8 4 5 Neyland v. he must appropriate any sum he collects ratably between the two claims. 7 and if he have demands both as an individual and trustee 8 against the same person. and claim all exceptions. . Civ. 110. he must do nothing to prejudice the interest of his beneficiaries. 48 Mo. 5 DeG. Code Cal. (Ky. (1887). Thomas v. 30 111. 6 Stone v. 1 and in a suit for a conveyance he cannot set up a superior 2 title. any act which 73 is pot in the interest of the beneficiaries is a breach of trust. vol. Amer. even where the trustee honestly believes that the intention of the maker of the trust was otherwise. nor admit the adverse claim of another. 711. v. Henderson.THE INDIVIDUAL AS TRUSTEE. 12 Am. In defending suits he should take all good ground that he has. 9 His Duty is the fund. Law.) 388. Laws Dak. Gill. 69 Tex. 84. pp. he must resign the trust. (1885). 2 A. Ray. Marsh. He must not divulge a defect in the title. Thus. Benjamin v. Encyc. 18 Pick. 76. Bowman. § 3925. 344. 10 It is not his duty to appeal from an adverse decision. 7 Ch. unless it is evident that nothing can be gained. K. 6 If be accidentally acquire an adverse interest which he intends to assert. E. In the case of a demand he must press it by suit. M'Clanahan 45 6a. L. 8 » 10 & G. 155-157. unless the beneficiaries are informed and consent to his retention of the office. 360. § 2230.. M. 412. Comp. Scott v. Barker. adverse interest. Eeid v. or accept an adverse employment. In the management of is wholly to his trust and he . Godfrey. — must do of all that can be honestly done for the furtherance its interests. Mullins. 28. p. 27. the trustee's duty All to the Trust. 7 Supra. & Eng. he cannot set it up against the trust. Dec. .

—A trust is a personal confidence. p. pp. Attorney General. Eloyer. L. Kilbee Sneyd. 9 10 Guilford. 143. 128 Mass. other. Jones's Appeal. 74 A trustee's handbook. or part of it. 8 Watts & S. See also Morville v. 7 Thus. 2 Molloy. 64. he must maintain the suit. as is exemplified in the case of Winthrop v. the income to be accounted for to them. p. 273. 143. 6 Nor can the trustee his duty is to delegate any part of his duties or powers exercise the powers and discretion himself. 4 where the trustees of a fund for the support of a museum at Harvard College were refused leave to turn the fund over to the general fund of the College. the beneficiary has a right to himself. he must not release it. 122. where two trustees divided the trust and each managed a half. active i it is usual for one trustee to assume the the property. 9 In practice. Austin. 666. But where the duties cannot be jointly exercised they may make a reasonable apportionment of them. Supra. Fowle. 500. that is to say. 1 Eq. without adequate consideration. 144 Mass. Bostock v. B. though he may do so in exercise of a. p. 26 Jones's Appeal. 186. 50 Mo. 1 and he should not compromise unless it is clearly for the benefit of the trust 2 and if he have security. 513. & S. Supra. 6 and if he permits another to act in his place he does so at his peril. 10 but the law does not management of v. 109. and neither will be liable for the loss of funds or neglect of the . v. Graham v. Trust cannot be Delegated. 18 Ohio. 6 Paige. 65. Wood Burnham. 8 Graham State v. . 8 . as to conduct of suits. 8 "Watts . Infra. 48.. one was held liable for the half lost by the 8 other. 22. 258. 2 8 * 6 6 7 Lewin. 2 Gratt. v. King. sound discretion and under good advice but if a decision in his favor is appealed from. compel the individual who is trustee to perform the trusts The trustee cannot turn over the whole trust to another.

(1895). 48). §§ 2258. Code Ga. p. Guilford. and probably justifiable. 4 Comp. 6 though it would still remain their duty to keep a general oversight of his doings. 2259. 153. Clark. to allow one trustee to collect and disburse the former. 7 . THE INDIVIDUAL AS TRUSTEE. 49. Infra. still the prop- erty should not be placed in his exclusive possession and wholly beyond the reasonable control of all the trustees. § 4284. 6 As noted above (p. Infra. p. A principal it . (1887). 143. should be drawn between income and being customary. Infra. would be held liable for its loss. except in so far as one trustee can act for all. 48. (1885). Evans's Estate. 18 Ohio. Supra.. in his hands. 6 Supra. i 8 . Clark v. and not leave funds an unreasonable time in his hands. 2 Supra. 48. p. 123. although the management must usually be confided to a certain extent to one trustee. It is not a delegation of the trust to permit the managing trustee or an agent to perform any ministerial acts not re9 Thus the quiring the exercise of discretion or judgment. but not the latter and a trustee who allowed his co-trustee to collect a large amount of principal and let it lie uninvested distinction . 470. D. Laws Dak. and "fulfil the purposes of the trust with ordinary care and diligence " 4 and a managing trustee stands on the same footing as any other agent. 8 Watts & S. . (1895). 123. Perry. 123. 8 6 7 8 8 State v. 8 Each trustee must exercise at least a general supervision of the trust affairs. as in collecting . the trustees may prevent one of their number from collecting money by notifying the debtor to pay to all the trustees only and it is their duty to do so. p. 75 recognize a pass^ trustee 1 and he cannot delegate his powers. 500. Jones's Appeal. p. 2 hence. p. Code Cal. Code N. but in absence of such knowledge they are justified in permitting one of their number to exercise his powers. § 3941 Rev. 8 Paige. rents or dividends. § 409. 2 Ashmead. § 3170. if they know their co-trustee to be unreliable or likely to commit a breach of trust.

and in general act for the trustees wherever there is a moral or legal neces1 Such a necessity exists where the sity to employ an agent. and keep the books. 50 Mo. 6 but they might authorize one of the trustees to execute and deliver the deed for them. after they had determined the matter of the sale. but is the lawful act of the trustees by the hand of another. 2 8 Speight v. of business would employ an agent for example. Again. Ex parte Belchier. Supra. 6 Graham King. Speight v. and paying for them through him. determining the price. n. the trustees could not give an agent or one of their number a general power of attorney to sell stocks but they might give a special power to transfer a particu- — — lar stock. Supra. Parkin. 22 Ch. § 8. The difference between a delegation of the trust itself and the performance of a ministerial act by an attorney may be illustrated in the case of a sale of land. employing a stockbroker to purchase stocks. 11 Eq. 727 . 22 Ch. 2 In such cases the trustee will not be liable for the default of the agent. But see criticism on this « case. a trustee who has employed a good conveyancer is not responsible for a flaw in the title which affairs. 49. for instance. TJnderhill. p. v. Lewin. terms. Contra. 22. p. . 76 A trustee's handbook. 219. The trustees could not delegate the matter of making the sale that is. and whether it was better or not to sell or adjourn the sale to one of the trustees. 1 which is a purely ministerial act.. 267. D. ordinarily prudent in his man as. which transfer. Gaunt. . 300. Ex parte Belchier. 4 219. 4 The employment of one of the trustees or an agent in such cases is not a delegation of the trust. Gaunt. 6 Amb. p. Amb. 74. managing trustee or an agent may be allowed to collect dividends and rents. D. 57. . but only for his care in selecting him 8 as again. In the first instance the trustees are delegating . 727. own he overlooked. is a delegation of the trust in the latter case they are employing an agent to make a their power to sell. Hopgood v.

p. Stat. the an inventory (by statute in practically all the States) soon after his appointment. & 6 Infra. Accounts. and to a formal is not entitled to a release under seal. Eq. 32 Pa. 4 6 and passim. 119. 2 A court of A equity may compel any trustee to account. 419. Ackermann. . 3 Weaver King v. trustee must keep accurate and separate accounts of the trust. 1 If the account is inaccurate or obscure. any trustee can account and pay money into court B but in the absence of statute in America there seems to be no general jurisdiction in the court to compel the beneficiary to come in discharge or settlement in court. 6 If the trustee holds by appointment of the court. and if one trustee allows another to render a fraudulent account. even if kept in a book with other accounts. under the trustee's relief act. 495 . 144. 3 K. 421. 124. (1882). 447. Eisher. THE INDIYIDUAL AS TRUSTEE. 1 Drew. In re Wright's Trusts. Scott.. J. since everything will be taken against the trust is — If trustee will be required to file A him. 308. If the trustee does not hold under appointment of court. Mass. L. E. vals. J. 8 is but as a general rule the jurisdiction courts by statute. ch. he will be required to settle his account in court at stated interIn such cases he need not render any other account. 7 Provided for by statute in most States. Pub. 2 Ch. Infra. 77 a testanientary one. 1 2 Hopkinson v. but he and settle his account. St. v. 23 N. p. § 15. the trustee is the loser. he is liable as a party to it. 7 and the beneficiary must come into court to settle. Mullins. 146. 4 In England. Landis v. which should be always open to the inspection of the beneficiary. 110 HI. Blauvelt v. All the trustees must join. 495. Burghley. given to probate testamentary trustee is entitled to a periodical settle- ment of accounts with his beneficiaries.

8 but only the surplus brought into the jurisdiction of the court. and does not involve the trustee's personal account with the remainderman or with other trusts. additions to principal. the survivors will settle the account and if may do a sole trustee dies. as by income The changes side all the . principal on hand. deductions from principal. 110 Mass. although he does not succeed him in the trust. He must charge himself with each item received.: . 369. . 157. Infra. Blackington. If a trustee dies. . 359. 1 2 8 1 Mnnroe v. in investment should contain on the debtor amounts received as principal for the remainderman. all the amounts paid out as principal and these two accounts should balance. his exeeutor or administrator 1 so. income paid. and ask to be allowed for the same. p. beginning with any balance of cash on hand. 4 The court in which the account is settled will prescribe but in every the form in which the account will be made trust account there should be at least six schedules. Dodd v. The income received should contain all the sums to which the life beneficiary is entitled. 133 Mass. Winship. Holmes. and the income paid all the charges against him. show the condition of the — trustee's account is intended estate. and changes in investments consisting of debtor and creditor sides. In accounting to a court he need not include in his account real estate. 78 he should a trustee's handbook. and credit himself with every item lost. or as often as the settle "his settlement requires. 109. If there has been any gain to the principal. viz. Form to The of Account. v. 13 Allen. and include a list of property in the hands of the trustee. Clarke Morrill. 2 The account must show every transaction in detail. or the rents from real estate which lies in another jurisdiction. income received. expended. or paid out. and on the credit side. accounts yearly. Morrill v. 132. 1 Allen.

120. 60. carried out and the schedule of the current year will always equal that of the previous year. after adding the schedule of additions and deducting the schedule . 107. The form of account above given is that used in the courts of many States. 26. Bass. Effect of an Account. An account settled in the probate court is final. and the difference in amount between these two schedules will be the difference between the schedule of the current and preceding year. The schedule of deductions from principal will be made of similar items of loss and of any charges against the remainderman. but all amounts received as principal are charged. 4 Cush. or the recovery of an amount not shown in the inventory or previous accounts. McKay. The acquiescence of a guardian ad litem does not preclude his ward. 62 Md. it should appear in the schedule of additions to principal. either actual or appraised. and its correctness cannot be questioned in a collateral proceeding in equity 4 or in a court of law. § 9. . 11 Cush. 79 added. 134 Mass. Stat. 461. 144. ch. Pub. 6 Morse v. Bussell. 427. Whyte. 144 Mass. 1 2 . and all amounts paid out of principal are credited. 6 . Winship. Denholm v. Hill. 1 as to all questions heard and determined between the parties 2 it cannot be reopened ex8 cept to correct a mistake or fraud. Russell. (1882). The schedule of principal on hand should enumerate each item of the trust property with its cost. and a minor or a person unborn or a person unascertained must be represented by a guardian ad litem in order to be concluded. but in some States the schedules of changes and additions and deductions are not put in. of deductions. . — Stetson v. or sale of a security above its cost. 67 Jenkins v. Foster v. 8 Dodd v. 4 Sever v. 5 The account has no effect on the rights of a person not party to the proceedings. 434. 29 Mass. 148 Mass. Foster.THE INDIVIDUAL AS TRUSTEE. 9 Pick. 136 Mass. 513. 5 Parcher v.

109 Mass. Lowell. & G. the settlement is final in so far as the account is assented to by persons interested and able to act for themselves. It is the trustee's duty make up an account therefore ordinary compensation covers the making up of the account. In many States there are statutes providing for notice to such persons. Pegram. the successor's duty may require him to investigate his predecessor's acts. — fault in not accounting. and for the appointment of guardians. 2 8 * 5 Cummings v. may be reopened by the court in its discretion. to correct a mistake or fraud. 109 Mass. in which case he may be ordered by 1 the court to pay the costs. but any court charges will be borne by the trust estate. ubi supra. but not on the ground that the former determination was erroneous 2 but if the beneficiary had an estate in possession and has assented to the account. even after so long a period as twelve years. Amory v. Amory v. . Granger.. p. successor in a trust is not accountable for the faults of his predecessor. Infra. Ex parte Geaves. reopen his accounts. M. 140 Mass. 6 A The Expense of Accounting. 558. although there is no statute of limitations to bar him. 541. the fund would bear the expense of v. 104 Mass. 4 If the account is not settled in court. 5 but in so far as fairly made is binding on all who take part in it even though it cover a breach of trust. 148 . Pegram. p. and where the trustee acts without compensation. 183. yet as the state of the funds may be affected by his act. 291. 7 Blake v. 541 . 265.. 149. 8 DeG. 8 or has neglected for a long period to enforce his rights. unless the trustee was at to . 1 An account simply allowed by the court without making all persons interested parties. 6 Bassett Tnfi-a. Lowell. 80 A trustee's handbook. and may be reopened even by them to correct mistakes of fraud. 128 Mass. and recover from him or his estate. the court will not help him. In England. 532. 7 Blake v. Cummings.

Pub. Siddal. 6 . 313 Underbill. 7 or on such a question as the apportionment of a fund between the life tenant and remainderman. he can and should apply to the court s for instructions but he cannot consult the court simply because he is ignorant and does not know his duty or what the law is. Stat. i Wheeler v. 152 Mass. 6 sale or investment of the trust property. 4 and if he involves the estate in unnecessary litigaBut where a question tion he may have to pay costs. but the expense of furnishing an unnecessary account must be borne by the person requiring it. * Greene v. Chadbourn. Stat. H. (1891). § 6202. W. Where a trustee the Trustee is is 81 in Doubt as to his Duty. compromise. Chadbourn v. although there is no obligation on him to do so. 432. he is given a discretionary power in is the matter. I. 142. he may refer the matter to the court and will be protected by He may ask its instructions as to a its determination. 4 R. he may . 5 Hills v. Re Bosworth.. Where. however. § 12. F. the court will not interfere since he the accounting. 124. 307. Stat. & J. 2 Bradby v. J. In such case. notify the ben- and if he does not object he will not be heard to do so at a later date 1 and where the beneficiaries are of full capacity. 58. 58 L. tain repairs. THE INDIVIDUAL AS TRUSTEE. yet it is undoubtedly a prudent plan for the trustee to consult his beneficiaries before taking any important step. 1868. p. H. Ohio (1890). Whitchurch. 436. § 10. — When in doubt as to his duty. N. for instance. 81. 3 DeG. and so is incomplete. 198. Pub. Mumford. arises as to the proper construction of the settlement. or a determination between conflicting claims 6 is necessary. a stock dividend or the apportionment of the expense of cereficiary of his intended action. If therefore there is a doubt as to what the trustee's duties are. N. 9 Allen. Eev. the court may tell him to take advice. 2 but generally this mode of procedure will only protect the trustee against the life beneficiaries. 173. ch. 8 Generally. n. Putnam. 6 Mass. Perry. ch. Ch. but by statute sometimes. 18 N. (1882). as. i Life Association of Scotland v. . 74.

7 even though it be real estate outside of the jurisdiction of the court. 6 Dodd v. Winslow. 19 Ch. 4 the existence of the The proper way structions. 9 or trade secret or patent right. Trust Property. 313. §§ 67. 7 9 10 8 Perry. 6 meant to show the state of the estate. and not to such things as the performance of an act. 149 Mass. Trust Co. Elsley. 4 Bullard v. 6 Cranch. 10 Taking Possession. I. Watts. 8 Treadwell v. for instance. as the emploj-ment of a particular person as attorney or agent. as. — Any sort of property. 140 Mass. What may be est. and trial An is account not for the of disputed claims. . 518. Hence a question as will who be entitled in remainder cannot be asked during life estate. Mumford. real or personal. trustee's handbook.. 532. Aldrich. 2 Story. or any inter- whether vested or contingent. 532.82 forum and not a it. 4 R. 68. 141 Mass. Foster v. 342. 160. v. 7 Gray. 5 Lincoln v. in possession or reversion. Winship. 1 Nor could he . Salisbury Mfg. use this method of de- termining a question at law. Div. to raise the question is by a bill for inis and not by a fictitious account. 8 No to practical one application will be considered until the question is a and must be decided. but trusts only extend to property. 374. Eaton. 59 Vt. Mitchell v. what is his 2 or what his powers and liability to a creditor or for a tax contemplated reorganization of a duties will be under a corporation. 2 . 133 Mass. 1 v. 8 or something not actually in existence. 6 V. may be the subject of a trust. 630. Greene v. 393. 148. which can be assigned. it is the trustee's duty to inquire into the nature of the property Trust Co. Sheldon. Massie v. 359 New Eng. Co. Chandler. — On accepting a trust. MANAGEMENT OF FUND.

Div. 1 If he succeeds a former trustee. Kinsey. at any rate. and he must see that the instrument is recorded in every jurisdiction where there is any land. he will be responsible lor them at that price. 42 Ch. — If the appointment is an original one. 8 DeG. the will or settlement will vest the title of the real estate in the trustee. 80. 232. Porcher. Loring v. 170. 291. 351 Thayer v. 1 Strobh. Salisbury Mills. and he is not appointed hj a decree of court vesting the property in him. In He Salmon. Having acquired title he should at once take possession. or. . actual or constructive. Div. 4 Meal Estate. 6 or if there is no provision in the instrument. the estate may vest in him by the terms of the trust instrument or by statute. 1 If the real estate is let he should 2 8 4 6 6 Hallows v. Lloyd. He must take immediate steps to secure the trust property and properly invest He will have an equitable action against a transferee of the legal title made before he became trustee. 162 Mass. p. 450. The same executor. p. rule applies where he takes the estate from an it. 2 He is not bound to take the securities tendered him if they are improper investments. 686. Eq. 39 Ch. 691 Underhill. 219. & G. in which case he must see that he is duly appointed or his appointment recorded in each jurisdiction where the land lies. then he must take a conveyance and record it in each jurisdiction. Hext v. which will involve the examination of his pre- decessor's accounts so far as they are open. . 8 If he takes the securities at their inventory value.. he must ascertain that he receives all the property that belongs to the estate. 77 Va. but may insist on having them converted into cash. 6 If the trustee comes in the place of a former trustee. he need only take the securities at their actual value and then should collect the balance from the outgoing trustee. Ex parte Geaves. Supra. M.THE INDIVIDUAL AS TRUSTEE. . Boyd. 138. 83 and trust documents. Cogbffl v. 125 Mass.

and qualify as trustees or do act showing a transfer. If the trustee is an original appointee under a deed. as until the executors have administered the estate they are entitled to hold it and where the same persons are trustees and executors. it shall constitute the trust There must be some act of appropriation which transfers it to the trust fund and gives the beneficiaries right to have it held for them.84 a trustee's handbook. p. until they terminate the executorship by filing . Personal Property. in Sheffield v. take constructive possession by compelling the tenant to attorn. 330. Parker. 158 Mass. to be created property with the intention that fund. Crocker v. an account crediting themselves as executors with the trust property. p. or if there is no tenant he should take actual possession of the land. 120. as the beneficiary's possession is constructively the possession of the trustee. to any person acting on the faith of his receipt. 1 — If the trustee is appointed under a will. and does not as a matter of fact receive it." 4 1 2 8 Low * v. Knowlton. he will be liable for it as though he had received it. 91. 332. D. Dillon. Supra. 9. 3 Ch. they will still some other definite remain liable as exec- 8 " When a trust fund by an executor out of the assets of an estate. or the evidences of it. If the trustee joins in a deed acknowledging the receipt of the property. 133 Mass. 2 he may not be entitled to the personal property at once. If the beneficiary is in possession under the terms of the trust he need do nothing. . the personal property will probably be in the hands of the settlor. [1891] 82. should be delivered to the trustee when the settlement is made. See supra. 12. p. Bouverie. or acknowledge him as his landlord and agree to pay rent to him. and it. See infra.. J. something more must be done by the executor in order to impress the trust on particular property than to hold the utors is and will not hold as trustees.

327. 129. and should specify the trust under which they are held on their face. is is desirable where the property : . unitself or it of the evidence of it is essential. and on a stock or registered bond by indorsement and transfer on the books of the company. 8 a payment of the claim or other novation of the security to the previous holder before notice 4 will discharge the debtor. Daniels. 121. 2 * Ames. 113 Mass. p. THE INDIVIDUAL AS TRUSTEE. "Where there is no decree of the court. unless they are such as to constitute a proper trust investment and if necessary the trustee should sue without delay. But where the property is vested in the new trustee by force of statute or provision of the trust instrument. or no provision of the trust instrument vesting title. to have a written transfer from the former owner. and no well advised purchaser will take a transfer of such a stock without farther assurance. and not the former owner. the obligor should be notified at once 2 as for instance a bank account. an assignment by the holder of the title is indispensable. for although notice is not necessary to complete the title in some jurisdictions. . p. 85 In the case of an incoming trustee it is his duty to examine the executor's accounts and ascertain that he obtains all the estate that he is entitled to. notes. The transfer should be made without delay on a note by indorsement. To describe the holders as " trustees " merely is not sufficient. yet in the case of personal property a delivery of the property and in every case such as not to pass by delivery simply.. is the proper person to transfer. n. Infra. Registered bonds. and certificates of stock should stand in the names of all the trustees. so that there can be no question as to its identity. as it is not apparent to what fund the stock belongs. he. 8 Thayer v. If there is a chose in action or equity. 1 Infra. 1 Although the provisions of the trust instrument or decree of the court may have the force of a written transfer. 134. All claims which are due should be called in.

v. to be enjoyed in specie by the meant and may be lets. 27. But Davis. 1 not only for these.86 less a trustee's handbook. of Law. is he can show that more to be gained by forbear- ance. 138. Salisbury Mills. and the property properly into their hands. although unsupported by the cases cited. 3 Burr v. & Am. 1. of which the legal title has passed to a third person by a breach of his predecessor in 2 the trust. C. turned over to him. and the cases in general and the English statute. Meal Estate. Encyc. but for any of the trust property which he cannot obtain on demand. § 487. and in and pay the taxes on it. — The it trustee should immediately insure it if the real estate for a reasonable amount. and there- must keep the property insured. which states that the trustee must insure. and he is usually required to do so by well drawn trust instruments. C. and Eng. . and put after he repair. their next duty is to take proper care that the trustees have got titles. in Insurance Co. Personal Property. — of it. Chase. in the absence of special power from the trust instrument or court to do so.. Baldw. . and if he uses them up. Lewin. McEwen. and Perry. he must be careful not to convert the personal property of the estate from personal to real estate without authority in doing so. 163. and he will have an equitable suit for property. Assuming Care and Custody of the Trust Property. J. where every prudent man does insure his own risks. in a condition to be let. 509. 5 Wall. 154. 514. as by spending any cash that may be on hand or the proceeds of the sale of securities. Loring v. all say that a trustee may insure hut under modern conditions. 494. p. but. 3 fenced. n. 125 Mass. vol. 1 2 or de- Ames. p. — Trust chattels are usually beneficiary. 314. If the property is unimproved he may improve it so as to secure a tenant. should fence necessary. it would seem that a trustee must insure.

and consequently the funds could not be invested. 328 . dividual names. 8 Sim. since it is not unreasonable to allow one trustee to collect It it. though without their otherwise. 13 Pick. 591 Clough v. . Code Cal. 593. Supra. D. 97 Cal. ficiary. Nobbs. see infra. (1885). Sneyd. Ch. and as several persons cannot conveniently hold them they may be left in the hands of one trustee. McDonald ». 48. p. the use of the chattels is not given to the benethey should be converted into money. 2 unless they were to be held unconverted. 101. L. 6 7 Kilbee v. 112. Civ. 168. 5 Johns. 87 stroys them. Comp. Corya v. Monell.THE INDIVIDUAL AS TRUSTEE. 5 Lewis v. Money should be deposited in a good bank in the joint names of all the trustees and if it is deposited in the in. § 2236. § 4272. 298. 7 that the trustees were entitled each to hold half and pay interest was held i Dorr v. 283 9 Amer. Dixon. Ames v. 89. 6 But one trustee may be allowed to draw checks against income. 3 fault. 196 Ames. Dec. App. 186. as by a failure of the bank or All the trustees are responsible if they leave money for more than temporary purpose in the name of one. Ind. B. 119 In re Arguello. Laws Dak. . Code N. they should not permit large amounts of principal to lie in the bank subject to the draft of one of their number. the trustee will not be liable but the trustee should require him to sign an inventory when they are delivered. Scudder. . 2 a . * Monell v. (1895). Wainwright. D. 2 Moll. in which case the trustee Where must keep the actual possession. 594. § 3929 . 8 Ch. Bev. . 8 C. the trustees will be liable if it is lost. . Irvine. (1887). As to when a conversion is proper. Corya. 484. Dak. p. 6 in a case where there was a dispute. n. 11 Mo.4 And while it is customary and probably justifiable to permit one trustee to draw checks alone against an account which consists wholly of income.

239. Where a bond could be registered. and this latter dictum seems to accord more nearly with the general usage in this country. 124. 6 said that it was too much to say that ordinary prudence requires a box with three keys. or in case 2 as for of necessity or propriety in the hands of an agent instance deeds could be left with a solicitor. Wood. may be left in the custody of one trustee. banker's in a separate box. v. 1 &c. as the question still remains whether allowing one trustee access alone is reasonable care. 1 Ch. Nobbs. The general must use reason- able care. R. 6 In that case the coupons only remain 1 Dyer Jones Field v. was not thereon. Mendes Lewis v. only postpones the question. 591. C. but it is somewhat doubtful whether this rule can be safely followed it would seem more appropriate to deposit the money in a safe place in the joint names. as most bonds may be. Mr. . it would appear to be the trustee's duty to have it . Non-negotiable stocks. 8 Ch. 425. registered bonds. Lewis. in a leading earlier case. that the trustee box alone. and one becoming insolvent the other held liable. 6 Beav. . Brise. J. 2 Johns. 8 Negotiable securities. & Hem. 4 5 6 Eield. notes. J. in the joint names of all the The question of how far the trustees are justi- fied in allowing one of their number to have access to the rule. or such as registered coupon bonds. 278. D. 2 Ves. registered if he gives his co-trustee separate access to the securities. the trustees would undoubtedly be liable.. deeds. or stocks with a stockbroker who is negotiating a sale but if negotiable securities be left in the hands of an agent unnecessarily . v. cannot be considered as authoritatively deter- mined. should be deposited where none is convenient at a trustees. E. L. 1894. Guedalla. 594. Sen. Kekewich in a late case 4 expresses his own opinion strongly that negotiable securities should not be got at without the consent of the whole body but V. v. 240. 259. 51 N. L. 88 A tettstee's handbook. Eiley. and partially negotiable securities in a safe deposit vault. 2 " Matthews v. Eq.

it would seem a wise precaution to register bonds where possible. Conversion.THE INDIVIDUAL AS TRUSTEE. lie 89 and as one trustee may collect income alone. not adapted to trust purposes but is generally more adapted to the needs of the individual than to the requisites of successive estates. 2 491. 48. or in fact any property which the trustee would not be authorized to invest in under the terms of the instrument or prevailing law. Brise. 4 1 Supra. 8 would be liable. he must immediately and without delay proceed to convert all such property into investments authorized by the terms of the trust. p. business risk. uU supra. 277. App. to a trustee. . n. Thus where the maker of a trust transfers a partnership. or in the speculative value. In general a trustee is bound to take the same care of the trust property which any bailee is bound to take of the property put in his charge. negotiable. Guedalla. speculative or unproductive property. could be reasonably allowed separate control of these. Mendes v. 6 Beav. Brown v. in part at least. Ames. 1 There is no question that a trustee who should neglect for a long time to for four years. — The form . as for instance who should confide them to his co- trustee in an unusual manner. 2 or examine the securities. 4 Kinmouth v. but the trustee is not bound to do so where it is not customary with prudent men to do so in caring for their own securities. in a part- management of his property for the purposes of gain. In any event. Brigham. 751. 5 Allen. An individual may be engaged in business. and rarely in this country has his property permanently invested without some regard to nership. Gallatly. 2 Ch. 270. 8 Matthews v. . in which the property usually is exists at the formation of the trust. 239. or such care as a prudent man would take of his own. and will have the implied power to do so.

140 Mass. he will be liable for any loss of the property but where the time within which the conversion is to be made is expressly left to his discretion. 446. (1888). even have a large prospective value. is doubted. 462. § 465. v. Thompson. 3 Thus. and the settlor has impliedly authorized these . control over them If the trustee delay beyond a reasonable time. since trust property should yield the usual income to the life tenant. Harvard College v. but the distinction N. Perry. he will be protected in a reasonable use of his discretion. if it Vacant land. Conn. 583. . unless the investments are such as he is forbidden to make by the terms of the settlement or by law. not with a view to speculation. which afterwards became worthless. or if he has left his property prudently and permanently invested. Gen. 4 which therefore yield a very small return on the money invested.90 a trustee's handbook. in which the principal is being consumed in dividends to the life tenant. All undivided estates should be converted. 8 Bowker v. &c. 9 Pick. On the other hand. investments. or the holding of his securities. ments. since the trustee has not the absolute leaseholds. Eng. such as stocks in land companies and mines. 6 if he used a reasonable discretion in the matter. No conversion can be made of property which the settlor 1 2 8 Minot v. the trustee need not sell and reinvest. should be converted into trust investments. and in some jurisdictions the trustee must go so far as to get an order of court to change the property from the form in which the testator left it. Trust Co. 106 Mass. * Eaton. 262. where the testator has left bonds that will sell for a large premium. Stat. the trustee should not convert it. if the settlor has provided for the continuation of his business. 130 Mass. 2 since he is entitled to put confidence where the settlor did. 1 and all wasting invest. Amory. § 496. Pierce. should be converted. 532. Nor will he be held responsible for not selling a stock at par.

142.. 8 tee. for the beneficiary to live in. Mass. 91 a house as. 2 Green's Ch. the trustee may not convert the real property into personal. 8 Snowhill v. .. 6 Ired. Howe v. 5th D. St. If the sale is 1 2 8 Ervine's Appeal. THE INDIVIDUAL AS TRUSTEE. 524 Shumway v. . 1 or household goods and chattels meant for family use. Berrier. 20. 21 N. . Stat. as the general rule is that all property is to be converted. meant to be enjoyed in specie . McDonald 4 6 7 Irvine. or property to be sold at the end of the life estate. 2 White & Tudor L. ed. Boys. § 9 Fidler v. also. 6 Conversion of Real into Personal Property and Vice Unless the power be given by the trust instrument. 3 Where is specific real estate is left of life. it loses its character as real estate. See pages 108 and 147. 4 which the beneficiary to have the rents for the right to use the property is but otherwise where the real estate is to have the dividends on the property. unless the property yielding the dividends is in specie is implied not specified. Snowhill. 436. Pub. Higgins. 101. 2 but such intention must be shown affirmatively. Cooper. Lord Dartmouth. . 8 Ch.. 296 Perry. Boys v. . . or buy real estate with uninvested funds. or vice versa. Eq. So. 6 Perry. ch. 556. 16 Pa. — . enjoyment in specie is not implied. the proceeds will be treated as real estate and not as personal ' but where the estate is sold and converted into personalty under order of court by a trusVersa. 112. Eq. v. unless they are the proceeds of a sale of real estate for where real estate is sold by an administrator or guardian under order of court. 16 Barb. 138 March v. C. where the beneficiary specified. 28 Beav. § 605. the trustee must not sell real estate and invest in bonds. §451. 6 Thus. the reason of which seems to have originally depended on the different way in which real estate and personal property descend or could be disposed of by will. for instance. 256. J.

249 6 Hill. Rowe. however. it is Hassard v. St. 1 By it statute in in others. and by equity jurisdiction may order a conversion. the court will authorize a conversion on the cy pres doctrine. 2034. 48. p. Billington's Appeal. 9 If an unauthorized conversion be made. 20. although a conversion. Dill. 2 8 May by statute in Pa. . 7. 3 Rawle. 22. the proceeds of land will not be treated as real 6 But the court will not order a conversion where 7 it is contrary to the wishes of the testator nor will it ratify an unauthorized one. it has become impossible to carry out estate. Where. the infant will not usually authorize a conversion. Williamson v. 92 a trustee's handbook. court. 11 Barb. but such statutes exist in nearly all jurisdictions. 1 . 16 Ala. 377. § 49. Weeks Rogers Hobson.. 1 Evidently the trustee cannot use the personal property of the estate to improve the real estate. a court many States. Ex parte Jewett. says a conversion. the trust is for an infant. the court it has been denied that the court has the power to do so in the absence of statute. rebuilding with the insurance money was held to be a conversion " but buying in land to protect a debt from great loss. 8 Where. Berry. v. under a power in the trust instrument. which amounts to decreeing that the wishes of the testator shall be carried out in the nearest possible way. 2 and where the testator left an insurance policy on a building which was subsequently burned. 495. 44 N. 2 Pa. 409. 6 Hill. 50 Mass. Snowhill. (1894). 154 Mass. 8 How. Y. 415. Mather. the intention of the maker will govern as to whether the proceeds shall be considered as real estate or converted into personalty by his authorhy. § 458. and 1 Hovey v. Dill. Oeslager v. v. Rogers v. 5 and where does so. v. 415 . Perry. is an authorized conversion. Dary. the testator's wishes. 2 Green's Ch. Fisher. Brightly's Dig. and one that will be ratified by the . however. and seems to rest on his implied authority. 467. 4 6 6 7 8 9 not Anderson Snowhill v. 55.

M. 33 Weekly Perry. 4 6 v. or to sell 93 elect to take the property or the proceeds at his is given the power to invest and reinand manage the property. 114 Mass. Utica Ins. 11 Paige. 843. if the fund is for accumulation he will be charged with compound interest. affirmed on appeal. 2 Robinson Rep. 404. 131. 38 Barb. 40. 22 Iowa. Crawford. 520. 44 N. — It is the trustee's duty to keep all the trust funds at all times fully invested. or but the better authority seems to be that the court has the Wood v. Lynch. Infra. 1 vest. v. Robinson. Ex parte Jewett. & G. So. . 427 531 . since it was his duty to have invested the interest as it accrued. if not expressly so.. to order a sale. c. Eiiott v. and under the general language used in most modern settlements the power is generally im- Where a trustee pliedly given. 4 trustee will be chargeable with compound For instance. power . Sparrell. 851 . 409. . 127. 127. § 462. Cann v. 8 Simple interest will be ordinarily computed. 4 DeG. 371 . 6 is for actual profits or simple In some jurisdictions the trustee will be charged compound interest as punishment for fraud. 11 Beav.THE INDIVIDUAL AS TRUSTEE. too. misbehavior. Investments. 9 1 Robinson v. e Atty. Gen. may majority. 2 What is an unreasonable delay is a question of fact depending on all the circumstances. but in if and some cases the interest. Mather. 3 Robinson. p. Kaufman v. since . he neglects doing so he will be liable for interest for the period of any unreasonable delay. 473 s. the claim of the beneficiary interest. 249. v. Watts & Sar. if the property was invested in trade. p. Cann. a power to convert will be implied. p. Alford. since the profits will be presumed to have amounted to that 6 but in this case the trustee may show that the actual profits were less.. Infra. Y. 16 Ala. Co. gives numerous examples.

Co. or universally followed. Cruce v. 456. and will do so for good reason i and where an emergency exists and there is no opportunity to get a decree. Eng. 2 Md. 94 A trustee's handbook. 533 Murray 2 Md. or fund. . The property being once well invested. Hapgood. 140 Mass. 10 Beav. 422. N. Ch. Cruce. Eng. 453. 140 Mass. 77. 30 N. o. 4 Murray v. 532. Eq.. The true principle would seem to be "that the trustee is accountable for all interest and profits actually received by him from the trust fund. Eaton. Co. readily be pressed so far as to sanction a practice of trading and trafficking in trust securities. 532. 2 8 Perry. 676. Anstruther. 142 Mass. 31. 418. the investment should be changed so that the life tenant may receive the increase of income he is entitled to. the beneficiary may the number of shares the money would have purchased with the dividends. . Feinour. which would be attended with dangerous results to the trust fund " 6 but . 1 McKim v. Feinour. Hibbard. Kitchen. that become unproductive and the life tenant is suffering loss. the court can authorize a change. end . Jennison v. v. 418 Ward v. if it has acquired a speculative value much above its value as an investment. 537. and for all which he might have obtained by due diligence and reasonable skill. v. Tr. . an investment has become insecure and the remainderman is likely to suffer loss. § 472. will ratify a change made by the trustee without authority." 2 If he was directed to invest in a particular stock or elect to take simple interest. Ch. 8 If the trustee has no express power under the trust instrument to change investments. J. 1 for disobeying the orders of court but this doctrine is not general or commendable on principle. Ouseley v. . or because it has for instance. 6 N. 81 Mo. K . Tr. 10 Pick. the investments should not be changed without a good reason 6 such as. Eaton. The mere fact that the property has increased in value is not a sufficient reason to sell for " the doctrine can .

general authority to the trustee to invest 3 cretion " does not specify any kind of property. Womack v. "Wadsworth. . namely. 1 The trust instrument may. Cummins r. 76. Y. 64. 19. evenly. Y. 159 Mass. but see Knight v.. Arnould v. so that they shall yield the current rate of He must hold the scales interest to the life tenant. and ordinarily does. the class will not be held to cover a bond 4 but a house for secured by a mortgage of a railroad the occupation of the beneficiary has been held to be an 6 investment in productive real estate. 5 Allen. Grinstead. and to invest them productively. Schaffer v. 11 Beav. 89. Robinson v. 84 N. Boston. and must not sacrifice the interest of either beneficiary and the popular idea that security is the only con. 6 there is a change in the firm. to invest them securely. 4 Harris. Talbot. 371 King v. If the trustee is authorized to invest in real securities or mortgages. 8 King v. . . & Lat. prescribe the kind or class of property in which the trustee may invest. THE INDIVIDUAL AS TRUSTEE. 21 Weekly Reporter. so that they shall be preserved intact for the remainderman. they should not continue it against A partnership cannot be continued after their judgment. nor should the amount shall death. Cummins. 50 Barb. testator not infrequently provides that his business A be carried on by his trustees for a period after his In such case it is their duty to do so but if the matter is permissive. A "at dis- and does not enlarge his powers. Brigham. as the trustee life is equally bound to get the customary income for the tenant. 1 2 Kinmouth v. 40 N. and where it does so its provisions will supersede 2 but being special powers those of the court or legislature they must be complied with strictty. sideration is erroneous. 155 Denike v. Talbot. Robinson. 551. 270. and can- not sacrifice his interests to those of the remainderman. The trustee's 95 is duty in investing the funds a double one. 1 So. Austin. 3 Jo. 453 5 6 . . Ca. 106 Mass. and dissenting opinion. 421 . .

as well as the probable safety of the capital to be invested. 87. 96 a tkustee's handbook. and intelligence manage their own te a different rule. * 6 6 Worrell's Appeal. 17 Ohio St. 40 N.. Mat- tocks . Statutes in some jurisdictions are construed to be for the protection of the trustee merely. M. In England the only kind of investments formerly allowed were in the government funds ° but in America the total absence of such securities in early times. St. and not as forbidding other investments than those specified by law 8 yet where such a statute exists. and are determined in some by statute and in others by rule of court. Acton. J. v. Now under the Trustees Belief Acts a large field is opened. 9 Pick. 7 ch. § 4. 446. . Putnam. Y.. 1 "Where it is impossible to invested in it be increased. 44. but in regard to the their funds. their relative scarcity in later times. 1 although he might be justified in not converting unspecified securities. Mclntire's Adm'rs v. Talbot. Supra. permanent disposition of not in regard to speculation. Amory. considering the probable income. 84 Me. gave rise of necessita- American rule. 4 DeG. 461 Moulton. Beers. 744. if he took them from the testator. 5 Where there is no statute or decision of the highest court fixing the class of securities in which a trustee may invest.' .3 What classes or kinds of investments are trust invest- ments vary in different jurisdictions." The courts and legislatures in various jurisdictions have. recourse must be had to the court for directions. xiv. 90. and . Harvard College v. he can safely follow the rule prescribed for the investment of the funds of savings banks. Lewin. Zanesville. discretion. i 2 8 McNeillie v. & G. Clark v. 76. 61 Conn. which is in general terms that " a trustee must observe how men of prudence. comply with the investments required by the trust instrument. a trustee would be imprudent if he invested in other than the specified securities. 545 . King v. p. 352. 23 Pa. called the affairs.

J.. . in addition to the class of York. Harvard College v. A trustee. . and the amount of such money to when compared with the amount of be invested. manufacturing or insur- ance companies. 1 saving that "The moment a fund is invested in a bank. 141 Mass. railroads. . part as follows difficult to : New — this Commonwealth undoubtedly finds it make satisfactory investments of trust property. the court de- ciding in New York that a prudent man would not invest in the stocks of railroads. lays down and explains the Massachusetts rule in allowed in business corporations. 9 Pick.. manufacturing and insurance companies. banks. 76. ubi supra. in the stocks of good such as banks. and the hazard or risk of loss is no longer dependent upon their skill.. Field. . Woodruff. care. THE INDIVIDUAL AS TRUSTEE. Y. in Dickinson's Appeal. The amount of funds seeking investment is very large the demand for securities which are safe as is possible in "A trustee in the affairs of this world securities is small. and the terms of the investment do not contemplate that it ever 2 but that the ideal man will be returned to the trustees " would invest in real estate. 40 N. any temptation to make extraordinary profits. whose duty is to keep the trust fund safely invested in productive property. corporations. On the other hand. Talbot. 152 Mass. or discretion in its custody or management. from 97 this rule. 184. first mortgage bonds of . 8 and in notes of individuals secured by the stock of such companies. or insurance. it has left the control of the trustees its safety. Appellant. i 2 8 4 King v. bonds of individuals secured by first mortgages of real estate. Hunt. in King v. and certificates of deposit of good banks. at p. evolved very different results. ought not to hazard the safety of the fund under . 515. 187. is great . 7 . 446. Amory. the courts of Massachusetts hold that a prudent securities man may invest. or railroad stock. 4 C. J. Talbot. and principal securities..

viz. or the New York rule. a. and a large majority of their discretion. 1 Hunt v. n. and not from consideration of their discretion or business ability. 64. 80 Md. however. 36 N. partnership." In the hands of a good trustee the Massachusetts rule undoubtedly superior. carefully drawn trust instruments give the trustees the is larger discretion. J. leasehold security. as much less is left to is . 84 Me. loans on personal security merely 2 investin unincorporated business ventures. 8 Trull v. 40 Amer. § 456. 545. show that trustees in this cases. : and patent rights first 8 . 6 Slauter v. Eq. Trull. c. The laws of the various States give a preponderance in favor of the Massachusetts rule. is better adapted to inexperienced or ignorant trustees. Dec. 4 Gen. Conn. investments. 471. 498. 13 Allen. 107 Ind. since it gives him a larger opportunitj' to use his skill and ability as a financier for the advantage of his beneficiaries but undoubtedly the English rule. . 2 Cox Eq. 1 Perry. and unfortunately trustees are too often appointed from considerations of friendship. opines to the contrary. Dring. 6 however large the margin. 485. second mortgages 4 and mortgages on unproductive real estate. such a reputation that cautious and intelligent persons commonly invest their own money in such stocks and bonds as permanent private business corporations. . by reason of the amount of their property and the prudent management of their affairs. since the mortgage may be foreclosed . See note to Nyce's Estate. Favorite. following kinds of investments are everywhere dis- approved. Gontrum. Porter v. 292.. 1 The The ment rule prevailing in each of various States briefly stated at the end of this chapter. Moulton. . Com- monwealth are permitted in dividend to invest portions of trust funds paying stocks and interest bearing bonds of when the corporations have acquired. 98 a "Our tkustee's handbook. . 407 Ames. 296. Stat. § 495 Mattocks v. 2 Holmes ». Woodruff. 174 Ames. . (1888).

152 Mass. In re Salmon. Amory v. 13 Allen. Amory. it has fifth part of the The margin of security required on a mortgage loan is 8 generally fixed either by decision. French. or may be forgotten. 1 . 339. Y. King v. 42 Ch. v. 352. Y. Div. will be sanctioned. Investments without the jurisdiction of the trustee are not usually approved. 347. 5 there was a sound exercise of be determined according to the state of facts as they existed when the investment was made. Ca. Green. 446. n. J. 486. 413 Austin. 40 N. Re Whiteley. Olcott. and not in the light of later developments but as these are sometimes difficult to reproduce. Keding. . 350 4 5 6 Ormiston v. or by statute at one half. Talbot. of service in refreshing the recollection. 84 N. the trustee must exercise a sound discretion in selecting investments within the authorized class. 410. . 2 Having ascertained the kind of investments he may make. 351. Div. Y. any memorandum of the inducements made at the time may be discretion 6 The question of whether will . 31 N. v. 421 . 33 Ch. Tuttle v. 125 Mass. H. Coll. say one third. Where the class of investments allowed been held imprudent to invest more than a estate in one investment. 3 Womack . a less margin. 76. 8 That is to say. 1 8 Gilmore. 184. 351 Harv. Div. 36 N. if they are in conformity with the purposes of the trust.' is large. but. 617 Brown v. 99 and all investments of' an untried * or speculative nature. although it maj-. So. . 339. extend the class of investments in which he may invest. 9 Pick. i Kimball v. 84 N. he must exercise the same degree of intelligence and diligence that a man of average ability would exercise in making bis own investments 4 and a provision of the settlement giving him unlimited discretion does not alter his duty to use care. 2 Ames. 42 Ch. . Eq. but will not necessarily.. Ormiston v. Dickinson's Appeal. but the amount of margin required also depends on the nature of the estate. THE INDIVIDUAL AS TRUSTEE. In re Salmon. Olcott.

and savings bank securities. however. he was not excused for making an unauthorized loan to a person unsecured.. Bank stocks. Birmingham Land Co. Investments Allowed in various States. — . 104 Ala. 87. — Alabama. rule. Civil Code (1885). 288. § 495. statute not alluded to. E.— Rev. 100 A TRUSTEE'S HANDBOOK. §§ 1936 and 2095. but — No — American In re Consins's Estate. § 4174. 1 Stat. American v.. Statute not mandatory. Clark v. n. 1892. United in securities of State or Code (1896). — Massachusetts Civil § 3943. (1892). § 2261 Cal. or year notes secured by same. rule. Stat. or city bonds. Statutes (1891). but in America business property in a city would probably be so considered. California. English rule laid down. Dakota. § 2189. See Alabama. town. Constitution. Florida. 1 since the loss was on account of going outside of the class and not because the investment was poor of its kind. rule. Mortgages and United Ryder v. 80. . Where. being required where the values are more stable. 2095. (1888). Beers. no decisions. 3 Swanst. 111 Colorado. 355. rule. Constitution forbids any law authorizing trustees to invest in bonds or stocks of private corporation. State. Massey Stout. but there is a rigid responsibility for other investments. — English Arkansas. United States securities. § 359. In England farming lands were considered the most stable. — By statute may invest States. 274. Connecticut. First mortgages to fifty per cent of value United States. Delaware. — Code (1887). Stat. State warrants. 61 Conn. the settlement provided that the trustee should not be liable for loss on account of taking insufficient securit}-. 4 Del. Ch. Rev. authorities. See Randolph v. 441. §§ 2094. Bick&rton.

or These statutes refer to executors and guardians. Statute not mandatory. 136 but in Tucker v. Batchelder. Glover. W. Kansas. Gontrum. — — English rule. Rep. — No — Massachusetts White.. Rev. municipal securities that have not defaulted within ten Substantially Massachuyears. 90 Ky. 62 82 Sherman Indiana. 72 Ind. or other securities issued by State. appointed by court should get its v. rule. Code (1895). 107 Ind. rule. Stocks and bonds of United States and State. c. — Real estate. §§ 3415. ILouisiana. court. Sholty v. Fidelity Co. 35 Atl. Ep. — — No — Under direction of authorities. 355. . 243 setts rule. and not expressly to trustees. 296 Shuey v. 271. Stat. Sholty. 233. Maine. 80 Md. c. Convention of Prot. v. 64 (semble). Favorite. . Massachusetts rule. § 3180. Illinois. (1894). 39 Ga. Any other investment must be made under order of court. No authorities. 111. Lowe Trustee. 242. Iowa. Hunt v. § 364. — Mortgage Idaho. or loans secured b} But not in railroads unless operated ten years without defaulting. 140 v. or . 84 Me. mort§ 4706. securities allowed on . Mattocks v. but trustees would be safe in following the same rules. 409. directions. (1894). Wright. 14 So. § 4284. — 111. Moulton. . authority. Code (1897). bonds. App. . Rep. and mortgages at fifty per cent of value. sale. 3416. 78 Me. Maryland. Kentucky. — No — Stat. authorities. s.. THE INDIVIDUAL AS TRUSTEE. ubi supra. In stocks. 87 s. gages. 83 Md. Ch. 96. 101 States or State securities. Brown v. stocks and bonds. Michigan. Massachusetts Massachusetts. Georgia. 292. 90 Ind. which are free of taxation. 545 Emery v. — . others ordered by court. Stat. New York rule approved. (1894). Latta. Minnesota. State. Massachusetts rule approved in Slauter v.

rate of interest not less than five per cent. (1891). J. United States bonds or any bonds guaranteed by United States. American rule. Meeker's Ex'rs. mortgages of State or United States. Taylor v. 11. (1895). In notes secured by mortgage of real estate worth at least double. Hite. (1890). (1895). 136 Tucker v. in savings banks. Rev. 194. . Certificate of indebtedness of State or United States. or as approved by court. — No authorities. city.102 a trustee's handbook. 85. 2401. Stat. 9 Mo. New York rule. and in State bonds. 178. Montana. 198. Eq. Gamble v. 471 (N. Rev. 270. Nebraska. Bramlitt. J. Stat. 197. C). Authorizes investments in bonds of New York cities. 18 N. 33 N. 192 Halsted v. MasMoore v. bonds. New Jersey. or bonds and loans of State. Mo. — Code (1895). 2747. § Stat. 142. Smyth v. Code (1883). — ' — — thorities. ubi supra. 422 Coffin v. town. ch. Gibson. Lathrop v. Reasonable security and interest. 144. Eq. Massachusetts rule. 235. § 11. §§ 1594 and 3596. Mississipipi. §§ 196. Nevada. 42 Miss. Drake v. ch. 127 Mo. 25 Miss.— Pub. New York. p. and in no other way. — No authority. Ohio. Rule of court English rule. Statute not mandatory.— Rev. Massachusetts rule. sachusetts rule approved. App. E. § 6413. 101 N. . 65. Eq. — — . 59 Missouri. p. C. Civil § 3013. § 4286. c. Dak. (1896). Oregon. 23 N. not over six per cent. 106 Garesche v. 61 Mo. 7 So. Priest. Eure. Rep. Stat. Code N. 585. — No authority. Allows mortgage fifty per cent. or count}' of New Hampshire. Codes. North Dakota. — . s. Reasonable New Hampshire. No au9. In North Carolina. Tucker. or of the United States. Sm alley's Es'rs. J. security and interest. Gen. Crane. ch. . etc. Burns.

St. Baker. Vermont. rule Harman. Car. but should invest under order of court. 321 Grinnell v. Merriman. Rep. 623 (1882) McCloskey v. 184. 209 Singleton v. c.. In real estate. or Philadelphia. §§ 121. or by leave of . Hogg. 123. . — Semble. Car. Massachusetts rule. rule. Should loan on mortgage if possible if not. Parsons. 21 Gratt. 15 So. Massachusetts rule. 56. Tennessee. Peckham Newton. 54 Vt. . 15 R. court in ground rents or other real estate. — . Laws (1896). 56 Vt.41. (1889). gives Massachusetts rule trustees full power and discretion. and real securities bonds or certificates of debt of school districts. Nance v. v. State. § 12. Davis v. Massachusetts rule. English Key Hughes. Revised Laws (1894). § 69. rule. 303 Baer's Appeal. Bhode Island. 3. No bonds or stocks of business corporation.. Semble. Brightly 's Purdon's Dig. Stat. Lowndes. 322. § 2617. 122. Simmons v. 39 . Const. datory. 32 W. Semble. v. 1 So. Finlay v. Car. or such other manner as court directs. — English Real estate or government Washington. Oliver. 17 R. 189. Wisconsin. 911 s. p. Code (1896). ch. should loan on good security. thority. 633. Semble. Nance. . In public stocks and bonds of United States. 103 Pennsylvania. Gen. 127 Pa. or as court directs. Massachusetts rule. 359. 264. Court may authorize investments in debt of United States. Wyoming — No . and report to countj" court. — followed. 74 Wise. 201. securities. — — — Massachusetts in no auWest Virginia. 18 Pa. THE INDIVIDUAL AS TRUSTEE. St. 9 So. Gleason. Rep. municipal corporations of State. authority. 465 Nobles v. p. Barney v. 1. Art. Va. South Carolina. 360. — — Tex. (1894). 194. I. E. Texas. 594. § 5434. Virginia. practice. and 36 So. . — Statute manHemphill's Appeal. 208. 23 Atl.

and infra. 54. 343. Receipts. Langdale. 410. p. Cox. sons are entitled to the principal and income of the trust fund. 120 Mass. Eq. 59. the rule is different. the conversion of the estate. 154. the question will usually arise after the death of the into possession. for striking example. 338 Dowries v. in whatever condition it may happen to be. for instance. 1 Bate v. Brigham. at the time the estate comes into the trushands it is all principal. Piatt. 2 This may is other fund be the case where the amount of a legacy or not immediately received or not received in full. Fyler v. 5 Allen. . & G. and should have been invested. Cox v. when it is the remainderman comes and when too late to recoup from the income. 270 Hagan Westcott v. In fact. 1 and which even if he have the right he may not be able to recover back owing to the beneficiary's want of financial responsibility. 5 DeG. Bullock. 8 Eq. v. 550. and the erroneous determination of the question may make the trustee liable for a large — — amount . As different perPrincipal and Income. 48 N. J. 563. the fund when realized must be so apportioned that the life tenant will get the usual rate of interest from the beginning of the trust. the determination of whether a receipt or charge shall belong to principal or income is of great importance. Fyler. where he has paid the life tenant sums of money which belonged to principal. 206 8 v. and in the meanwhile the life tenant has no benefit from it. M. and these he has no right to recover back in most cases. This would always be the case where the property comes into the trustee's hands without delay and invested in proper trust securities but if there is a deferred receipt on . Nickerson. tee's In general. 62. Hooper. life tenant. and all yearly increase thereafter is income. 25 Beav. 2 Kinmouth . Where for any reason property does not come into the hands of the trustee for some time after the beginning of the trust. . as. and the remainder will be the principal fund. 8 .104 A trustee's handbook. L. R. See L. 3 Beav.

296 Code 120 Mass. 410. . 105 or where the property being an unsuitable investment is sold for conversion at an interval after the trust went into effect. Eq. in a case where a trustee who had wasted the estate was removed and only part of the estate was recovered by his successor. J. income in specie. and the whole amount recovered after one year and two months was $26. if a definite intention on the part of the maker of the trust can be shown that the life beneficiary shall have all the proceeds.50. 6th Am. 16 Mass. 2 1 Parsons u.000. as for instance vacant land. Howe . but where the return is excessive. or where an obligation is in default and the security has been realized on or whether it be converted because the earnings are greatly in excess of interest. v. L. 2 ed.257.THE INDIVIDUAL AS TRUSTEE. In either case the rule is the same. 361 . his intention will preand the whole profits will be paid to the life tenant as income. The . Eq. which is the interest at six per cent on 1 $24.. E. The tenant for life got $1. Monkhouse. 2 White & Tudor L. 73 Westcott v.50. that sum is to be found which at the current rate of interest for the period from the beginning of the trust to the time of conversion will yield the amount realized. e. 382. Lord Dartmouth. Stainton. 11 Eq. For instance. The rule is the same whether the property be converted because it is unproductive. the new capital for one year and two months . Winslow.000. . shall enjoy the vail. v. or on a wasting investment such as a land stock where the dividends will ultimately exhaust the security.. Maclaren v. i. a bottomry bond or similar security where the principal and income are included in one sum. sum so ascertained is the principal. as in the case of a business or partnership. and the interest is the income payable to the immediate beneficiary. Nickerson.742. namely. or a defaulted note or obligation on which the whole amount is not recovered. C. the amount of the original estate was $30. 47 N.

where the trustee subscribed for new stock given as a bonus. * The learned editor of the 4th edition of Perry on Trusts very justly suggests that some doubt has been thrown on this question. Eq. Trust Co. to yield unless he be in a position to insist on a sale and reinvest- ment of the property. the payment of a betterment or removal of an involuntary encumbrance.. 532. as damages for an injury or a need not be apportioned. Parker v. Eq. and any loss other than the usual yearly charges. Perry. 37 N. the court decided that the premium was a product of the stock and belonged to the life beneficiary. N. and 3 the whole gain will belong to the principal of the fund. And in Earp's Appeal. sold the subscription at a premium. 109 Mass. 140 Mass. fall to the principal of the fund. and sent the case to a master to determine how much they were.450. and whether the same was income or principal although the language of the decisions seems to cover this point as well as the question of accu. 157.106 A 1 TKTJSTEE S HANDBOOK. And in Van Doren v. 258. so far as it concerns the gain in value of stocks. i. 368. v. e. 4 2 » Heard v. Eldredge. Eastman. the court seemed to imply that any increase in value of stock from accumulated profits belongs to the life beneficiary. . — Thus real estate or securities may advance largely in value without any corresponding increase in income. Y. 103 N. § 545. 256. St. 7 Met. Olden. and the life tenant will get no benefit from the increase. 28 Pa. 176. 64 Pa. in a few jurisdictions by the principles laid down by the courts in their decisions in collateral 445. The converse proposition. St. It is to be noticed that in none of these cases was the exact question raised as to whom the appreciation in value of stock belonged. falls The amount recovered taking under the same rule. J. 19 N. 366. In Wiltbank's Appeal. Johnson. Gain on foreclosure : matters. the Chancellor decided that all accumulations since the purchase of the stock belonged to the life tenant. Eng. n. Eaton. other than the usual yearly income. In re Gerry. The general rule is that any gain Gain and Loss. so as 1 an adequate return. Van Vronker v. interest from the time of the taking. 1. as the fund invested will 2 and the amount recovered will bear yield an income. J.

THE INDIVIDUAL AS TKCSTEE. Gain or 107 loss in continuing a business temporarily until converted is to be apportioned. L. since it is impossible to tell infallibly. but it is wholly a question of intention to be deter- mined by the construction of the trust instrument. See New England Trust Co. the amount of accumulated income in the treasury. it is ordinarily all the income will go to the life beneficiary. Hemmenway. 1 Underbill. and it has been held that gravel sold will be income. 140 Mass. 2 and the loss of one year will be made up out of the profit of the next . but probably not to such an extent as to be waste. Littig. 3 mulations of income. in which case all sums added to the funds of the company become part of the principal and the property of the . If the trust estate consists of country real estate. I am not aware that it has been seriously contended that a different rule should be applied to the increase in value of stocks from that applied to the increase in value of real estate yet these cases do seem to indicate that in those jurisdictions any accumulations of profits belong to income and not principal which throws the whole question into doubt. 63 Md. Hemmenway not raised in these cases. it would seem that trustees may act safely. The premium realized by the sale of the stock is no better criterion. on the rule above stated. or reserves against depreciation. and as carrying out their reasoning to its logical conclusion would involve such anomalous results. 1 but where the business is conducted under direction of the trust instrument. and credit all gains in value in stocks as well as real estate to principal. 134 Mass. In such questions the practical solution is the determination of the matter by the directors. and are affected very by v. since the experience of every business man fluctuations in the prices of stock are chiefly show him that the governed by the state of will little business and many other considerations. other timber principal. 250. timber cut for thinning will be income. v. . even in these jurisdictions. Eaton. As the principal question was . how much of their savings are properly set aside as a necessary fund to carry on the business. 301. in the case of any corporation. and how much of the funds are excess of profit which might be properly distributed. 657. and in other jurisdictions this principle is established beyond a doubt. 446. 532. remaindermen. 1 Eq. R. 8 Earl Cowley v. Wellesley. 2 Heighe v.

581. 1 . for instance. 586. 217 Lewis v. 5 Watts (Pa. 57 Am. 124. 3 Rich. so much of the increase as is necessary to keep up the herd will belong to principal. 2 Md. If the trust property consists in part of chattels. 6 Saunders o. 53 325. 404. in fact all property must be bought out of income. 8 And where 1 Wootten v. the use. Dec. Tappan. Sullivan. Major v. Ch. however. Robertson . . v. Davis. The life tenant cannot sell it. Eq. supra. Haughton. p. Woods v. 2 unless intended to be used in specie. Franklin. C).) 498. 1 Humph. the trustee may withhold some of the yearly income to make a sinking fund for that purpose. life tenant and not converted into cash and may wear them out in ordinary and need not replace them. 507. to him. v. will lose its character as income and become a gain to principal. the stock is left with a farm. v. Herndon. Eq. Swan's. 160. . n. Eq. Haughton. it is necessary to replace chattels which are wearing out in use. Watkins. p. 370 (S. but the beneficiary for life may use them up. Leonard Owen. 678. 8 unprofitable. and only . 127 Mass.). 57 Am. 111. 265 life tenant was to keep up farm increase held to go to remainderman. Furgeson. 7 Re Housman. 4 Dem. Poindexter v. 286 Braswell v. Blackburn. 4 (Tenn. 6 Calhoun v. cattle. Hill Eq. and that will wear out in use. 91 . they cannot be replaced . 93 Ga. Morehead. which are intended to be used invested. 190. 1 Ired. even though it be replaced If the propert}. 1 it should be converted. and there is an intention expressed or implied that the farm shall be kept up. and need not replace them when they die * and the natui-al increase will belong b Where. Collier. furniture. Hunt v. 2 3 Burnett Lester.108 a trustee's handbook. But see Elowers v. 3 Mo.consists of farming stock by other kind of stock where cows are by horses. 333. 1 See infra. Saunders v. 78 Ky. as. Dec. 133. Implements. 7 Any income which is rightfully accumulated and added to the principal. 6 the excess to income. 8 Ired. 147. Burch. . . 8 Minot v.

8 Supra. and the balance will be applied to reduce the valuation. Jun. 140 Mass. 52 N. The rule has already been explained as to the receipts from an investment. Underhill. Such investments should ordinarily be converted. however. such as a mining or land stock. 105. Eaton. 6 but recent it is decisions are to the effect that 1 immaterial whether the N. which is not a proper trust investment. 72. since the premium is only a part of the price paid for an investment. of the settlement. . 6 Allen. 174. down was that cash dividends and stock dividends principal. and the amount which he is entitled to receive will be calculated each year on the new principal made by the credits of the preceding — dividends. dictions as to — The law is not uniform in all juris- whom extra dividends belong. which is presumably worth the price paid. in Lord » Brooks. though an apparent loser. n. or a definite share in a property or business. p. Wainewright. 2 When the excess of the dividends has thus entirely wiped out the cost of the investment. 106. 226. 109 Dividends. v. even when the stock has been bought at a premium. and therefore to be converted. 66 . all the dividends will go to principal. 14 Ves. Supra. § 545 and n.. because he will receive the dividends on the new investments to the same amount which was originally invested. the tenant for life will be entitled to receive only the current rate of interest on the inventory or cost value of the investment. 532. The current dividends on stocks belong wholly to income. Perry. the investment is a wasting one. 1 If. Head. Ladd. 8 Extra Dividends. p. and the life tenant. 5 Barclay v. 2 . See note. 89. 4 The rule originally laid are income. 4 Subject treated. is not. p. Eng. p. J. 77. and any gain or loss in price is the gain or loss of the principal.THE INDIVIDUAL AS TRUSTEE. Or the life tenant may be entitled to the full dividend by the terms Reed v. which is all he is entitled to. H. Trust Co.

in determining whether a income or principal. and if in it good faith add life does so the beneficiary cannot complain. 635 Rand v. 5 By the English rule followed in Massachusetts. Gron. is dividend fund. it will belong to the principal or reit is well settled that. Richardson. 434. Y. Sproule v. that. S. 104 N. Pet'r. 2 In Connecticut.110 A trustee's handbook. I. Huhbell. 5 Eq. 618. Maine. 284. " In re Barton's Trusts. 462. 461. . D. but in those cases. or the granting of a valuable 1 right to take new stock. * Greene v. part of its profits That the company may to its capital. 109 Mass. 371. 9 stances they would not follow the English rule. 102 Mass. the vote ordering the dividend is the best or only guide as to whether the distribution is one of the company's surplus earnings or of its principal It follows. L. I. 67 Ga. dividend be in stock. 7 Georgia. . it if plus earnings. as he will get the benefit of the increased efficiency. . 238. 550. 28 Pa. 3 and Rhode Island. 549. St. 28 Brown. 136 U. 8 and the United States Supreme Court. 115 Mass. 11 In Pennsylvania the question has been otherwise deEarp's Appeal. St. 10 Granger v. 17 R. . Mahon. 8 Eichardson v. 368 Vinton's Appeal. the distribution be part of the surbe income and the property of the life beneficiary. 8 Ga. Smith. 98 Mass. 6 Heard v. Code (1895). 11 In re Barton's Trusts. Eldredge. ubi supra. v. will mainderman. 7 Kernochan's Case. 570. 4 a distribution of stock was held to be principal. ReBouch. they evidently disapprove the At any Pennsylvania rule. 29 Ch. money. Bassett. 542. Hayden. and especially in Brown's Petition. R. 6 New York. 50 Conn. 258. 10 therefore. Guerrard. 1 Leland . and it would not be safe to assume ihat in another case under similar circumrate. . 75 Me. 9 Gihbons v. 99 Pa. the court did not go beyond deciding the case in hand. Bouch. § 3091 Millen v. but if it be a distribution of part of the company's capital.Brinley v. 66. 14 R.

note 4. that. 280. in Massachusetts and it scarcely seems possible to carry the cases to their . and is always pay. McKinley. H. whether they be declared in the form of dividends or not. a master should ascertain yearly what the company's profits had been. « Wiltbank's Appeal. § 545 8 See Underhill. but see supra. 226. 650. 9 Lowell. 7 Perry. 8 No part of a Ordinary Dividends not Apportioned. — Earp's Appeal. 8 and South Carolina. 359. 4 and that a master is to be appointed to ascertain the amount. . § 52. Albree. 1. Accordingly. 106. n. Olden. 52 N. . 72. the court going lations of the life TBTJSTEE. 7 stock was given. 97 Amer. Transfer of Stock. 176 * Lord p. p. 1 and this view of the case has been followed in New Jersej-. authorities Perry. St. regardany act of the corporation. Bassett. Dec. learned note by Frank Parsons. 368.THE INDIVIDUAL AS tided. Brooks. n. . Bates v. 1. and therefore is never apportionable. 2 i Van Doren . C. . 56 S. 31 Bear. J. and that an equivalent amount should be paid to the life beneficiary. * Cobb v. 256. The Pennsylvania rule has been repeatedly criticised. Eq. Fant. and in case of loss he should make it up to the remainderman. which result is certainly impracticable if logical conclusion less of nothing else. § 545 Granger v. and remains principal until separated from the 9 other funds and declared payable to the stockholders. 98 Mass. company's property belongs to a stockholder until it is separated and declared as a dividend hence a dividend is an independent debt payable to the stockholders of a certain day. v. 2 New Hampshire. 12 Allen. which would seem to be. 462. all Ill the accumu- on the principle that company during his lifetime belong to the beneficiary. 28 Pa. where a valuable right to subscribe to new 6 it was held to be prin6 cipal and in Pennsylvania income. 64 Pa. 6 Atkins v. St. 3. 19 N.

tled need be credited to principal. out of justice to the remainderman. 178. since there is no obligation to convert the bond. 6 Hemenway Shaw v. 121 Mass. since a bond purchased at a premium is a wasting security. Hemenway. 6 Cordis. 2 8 Londesborough Somerville. but is more often one of securitj'. even though it be worth more than par. and will therefore be apportioned upon a sale of the security on which it accrues. 14 Gray. and the English rule in exception. erally — All rents is and gen- the whole amount received as this interest is income. v. 274. 446. p 126. to balance those bought at a premium. have to be converted 4 but it follows that no part of the interest on a bond which is part of the property originally set. nor can the loss on one investment be set off against the gain on another. the time specified in the vote * but if the trustee sold a stock just before the dividend day to defraud the life ten- ant or buy land according to the terms of the trust instrument. v. to the stockholder entitled . Kay. Infra. Contra. as the difference of price is not simply a question of interest. 295.7 The interest accruing up to the date of sale or death being income. 143 Mass. 6 Interest accrues from day to day. Bridgewater Mfg. 6 The practice of buying bonds which sell at a discount. 600. Clive. 134 Mass. the life beneficiary would be entitled to so much of the proceeds as would equal the dividend lost by the sale. 7 Dexter Phillips. Johnson v. 443.. at no matter when paid. and the balance belonging to. Co. 4 Ibid. is not sound.112 able. i>. . which would otherwise. or upon the termination of the life estate. 1 ' Interest sometimes Apportioned. A teustee's handbook. 3 matter not subject to any In some States. 450. if a sufficient of the interest bond is purchased at a premium. the security 1 Clive v. must be set aside yearly to wipe out the premium at the maturity of the obligation. 19 Beav. and being part of.

Stat. 113 turned over. a on the — — the settlement. . 8 betterment assessment is a tax. 382. separately. but not an ordinary one. Plympton v. Eastman. the cost is apportioned between income The whole amount is charged to principal and principal. 583. for instance. Parsons v. and this is true even when the estate is not charged until a long period say ten years after estate. Boston Dispensary. Stainton. such as a betterment assessment 8 or judgment. 544. 6 Van Vronker v. E. 178. 589. 7 Met. rents Payments. (1882). where the trustees are compelled to discharge an involuntary encumbrance. v. as. Adams. Phillips. 361. 5 — Discharge of Encumbrance. and as between life tenant and remainderman is treated as an encumbrance. 7 Similarly. 449. § 25. ch. 2 are apportioned. 3 In some jurisdictions there are statutes apportioning and coupons on the termination of a life estate settled by will. 16 Mass. — If there is an encumbrance mortgage. is otherwise.. and 1 Dexter Clark v. 139 Mass. 20 Wall. and a loss occasioned by a breach of trust stands on the same footing. 157. 106 Mass. 136. and deducted from the estate of the remainderman. Any loss to the fund by depreciation of the market value of the property belongs to principal. 11 Eq. Pub. And this is the rule even where the debt is secured by a bond or mortgage. 7 Maclaren v.THE INDIVIDUAL AS TRUSTEE. Mass. but if carried 6 the interest is chargeable to income. 6 A . and the principal to the corpus of the fund. even coupons in the absence of statute. 1 But where the interest is payable by a coupon. which are governed by the common law. 4 This statute does not apply to settlements made by deed. 121 Mass. Winslow. Adams . which might be detached and sold and would then be a separate bond. and there is no apportionment but where the statute exists. the rule. 2 8 * Iowa City. L. if at once discharged it is paid from the remainder.

In America the rule is as stated in the ica. 103 Mass. the equitable life tenant is not bound to repair. 642. while putting in a new elevator in the place of an old one will be a repair chargeable to income. Y. 2 Bradf. and a trustee should charge necessary current repairs to income. where recurrent repair pairs improve the property to the extent of their cost. 3 TJnderhill. 144. 345. and not being managed as an investment by the trustees as is general in AmerLewin. or if the tenant and remainderman are beneficiaries of the same funds. Hepburn. Eldredge. 644. 251. 3 Sohier v. 250. .) 74. * Little v. Alterations and Repairs. the addition of an elevator to a building which previously had none will be charged to principal. and so all repairs should be made under order of court and apportioned by it. 4 an expenditure may be in the nature of both an addition and a repair. 361 . Brown. Winslow. 2 Hare. 8 For instance. Parsons v. they are chargeable to principal. Hepburn v. 161 Mass. Little. The English cases have arisen almost exclusively where the property was in the possession of the equitable life tenant. « 1 Sohier v. pp. of the trust funds. 103 Mass. 16 Mass. to real estate Alterations and additions whereby the usefulness or rental value is in- — creased are chargeable to principal. Little.114 the income est is A trustee's handbook. 2 It is often a a difficult question of fact to decide whether a specified expenditure is an addition to the property or a but the rule may be stated that. and the life tenant loses interest and the remainderman the principal. Eldredge. and is then chargeable to principal only to the extent to which it benefits the property and 6 in some States there are statutes allowing an apportion- So also . 188. (N. and are a judicious investment . 6 Pennsylvania. states that in the absence of express provision in the settlement. text. 161 Mass. or the interlife may be funded and charged in a lump . the principal is paid out of the corpus. pp. Caldecott v. 1 but the repairs or expenditures which are necessaiy to maintain the property in proper condition are chargeable to income. charged interest thereon yearly. 188. Little v. 345 .

532.. 246 n. 4 As vacant land gives no return to the life tenant. are chargeFor instance. 6 Special assessments. sa}'s income means net income after deducting taxes. 302 . v. 8 Watts v. Littlefield. 8 extensive job. 16 Mass. Burroughs. Stone v. 361 140 Mass.THE INDIVIDUAL AS TRUSTEE. — Insurance premiums are expressly chargeby the terms of most carefully able to income drawn is trust in instruments. v. 2 Hare. whether they are in the nature of repairs or additions. 2 All ordinary current expenses are charged to income. Eng. pairing n house to obtain a tenant. 58 N. are chargeable to principal. etc. 478. on the acquisition of a new estate will be considered as so much additional purchase money. p. and ordinary current expenses. All annual taxes. And in any case of doubt. and where no express provision v. but his whole income might be used in preserving the property of the remainderman. 1 made Caldecott 2 . such as betterment assessments. 151 Mass. 151 Mass. Dispensary. Shaw. ment 115 in such cases. 7 Plympton Dispensary. Parsons v. H. Brown. 144. fencing in land or reable to principal. N. 5 all charges against it. repairs. These expenses. v. might be very burdensome. 544. except those assessed on vacant land. " 5 " Plympton Stone Pierce v. including taxes. 544. which. 1 All expenditures on newly acquired property which are necessary to put it in condition to let or to hold. 485. Trust Co. 106 Mass.. v. although chargeable to income at other times. 7 Met. Taxes. 485. it is well to get the instructions of the court before undertaking an if charged wholly to the income. 7 Insurance. . 106 Mass. are chargeable to principal or are ap- portioned as specified. Eaton. Howard. Winslow. Underhill. J. Littlefield. — sewer taxes. C. are charged to income. and chargeable to principal.

382. Probably because in early times and in England insurance was not considered a necessary precaution of an ordinarily cautious man. On the other hand. Sherwood. although it may be otherwise where the insurance existed at the time of the will. 19. J. hence had no right to convert. 1893. Pepper. 2 In case of a total loss. and the ordinary practice of charging the premiums to income is entirely consonant with the theories of law. the court decides. Watts v. Y. Pepper. and unfortunately what authority there is is conflicting. v. as in such case the policy was a personal asset at the outset. the premium should not be charged to the life tenant without his consent. 166 Mass. 288). 166 Mass. 1 In case of a partial loss. 404. 615 (in premiums are apportionable accord- ing to the respective interests of the life tenant and remaindermen. Eq. C. 56 N. . 482.. and will retain its character as real estate. which is that the income is chargeable with all the ordinary annual expenses of maintaining the property. Higgins. 536. 2 Gratt. one of the ordinary and necessary incidents of maintaining real estate. the contract of insurance being merely to indemnify the individual for his loss. Ch. Trustees Act.. and because failure to insure by a life tenant is not permissive waste (Harrison v. 4 Dem.) of which insurance is now like repairs and taxes. the opinion. 8 Ired. and with the law as now enacted by statute in England. § 18. The fund recovered does not represent or stand in the place of the building destroyed. 408. the fund should be invested. the cost of insuring the life of the annuitant was held chargeable to income. and this case seems to state the true reason. on the authority of which no reason is stated). Croft. 8 and could be used in rebuilding if such an investment is authorized. Wilmarth. the remainderman has no claim on the fund recovered. in a carefully considered opinion. 4 If the life tenant insures the property. 9 Allen. 8 Lerow 4 6 Harrison v. 10 Leigh. that the Peck v. (see Shaw. 116 a trustee's hMtobook. and Perry. 5 But where a trustee insures the instrument the general practice 1 There is singularly little authority on the question. Howard. 99. Haxall's Ex'rs v. In that case. is to charge them to income. In Graham v. the life tenant gave bond to invest money and pay over on death of life tenant. 7 Met. in Darcy v. 9 Ir. 288. Shippen. the funds recovered would be used in repairing. the court expresses case. 478. says that. and in the New York Roberts. § 487. there being no obligation to iusure. 2 Brough v. Re Housman.

283. Legal expenses of settling the interpretation of the trust instrument or appointment of new trustees are borne by the principal. but the legal expenses of collecting the income. Eq. 8 Ired. 4 Dem. * 5 Heard v. the building. 8 N. and in such case the fund recovered would stand in the place of the property destroyed as the property of the remainder- man of which the life tenant has the use. Howland v. of protecting the property. 109 Mass. . are charged to principal. . 536 2 8 Graham ». Extra charges for services which are beneficial to the fund. . 246. or of determining the matter of payments chargeable to income. and so charged to income. which are by the of a commission on income. n. Green. p. West. see supra. 444. must bear the lossi — Leigh. or may be apportioned equitably. So also the legal expenses of protecting the property. 258. 3 Brokers' commissions on change of investment are charged to income. St. As to what expenses are allowed. 10 Gordon v. and if must distribute he distributes the wrong amount. The trustee The Distribution of the Trust Fund. Roberts. But see Spangler's Estate. where such charges were held to he the ordinary charges Underhill. 21 Pa. H. and would probably be allowed so generally.THE IND:n#>UAL AS TRUSTEE. 99 HaxalTs Ex'rs Re Housman. and so is generally charged to principal. 2 — The charges of the trustees way managing the propertj'. fall naturally to income. are charged to income. 108 Mass. the trust fund properly at his peril. or pays it to the wrong person. 1 for Expenses. 4 but in a purchase or sale of real estate the brokers' commission is in practice considered as part of the price of the property. 404. he will insure to the claim of both life 117 is all his interest which subject tenant and remainderman. p. 6 and so also the expenses of recovering the fund or paj-ing it out. 29. v. Eldredge. 335. Shippen.

in others get less. there being an overt act. Stat. Conn. as some of the questions cannot be properly raised and concluded in the form of an account. Okla. §2940. and asking the court to allow it. although the securities depreciate so that the decree of distribution from the court. Winslow. the trustee will be protected by the decree 8 . all interested have been made parties. § 235 Rev. if an improper share has been paid to a beneficiary it cannot be recovered back. in the place of a decree of distribution but it is . 1 Ordinarily the Probate Court is given authority to make decrees of distribution by statute. as. and his only protection is to obtain a But he will be propaying one beneficiary whose share becomes due before the others. (1888). better to get a decree. Mont. Ohio (1890). the trustee may require the payees to give security to reimburse against any claims that may or the}' will not be concluded. If there be any doubt as to whether arise.' (1887). § Wy. but where no statute exists a court of equity would act under its ordinary powers. 4 Frere v. Stat. he has been diligent or has taken advice The will not save him. Annot. § 445. 45 Ch.. Fulford. On There is a common practice of making a final account showing a distribution of the fund. 2 If the court had jurisdiction and proper notices be given. Div. and this by statute in some States. 4149. 1 4 Hilliard v. (1887). . but care must be taken to make all parties interested parties to the suit. Rev. He may pay the fund into court. but not if he was outside or under a statute of limitations disability. § 370 Comp. 249. 389. he pays him on a fair valuation of the estate. § 5592. for instance. 4 Ch. Div. tected if. Stat. Stat. Code Iowa (1897). the would run against a person within the jurisdiction. 118 A fact that trustee's h^tdbook. (1893). 8 Gen. Stat. a decree of distribution. 2 .

by statute in England. Supra. 1 but He must not pay a minor's share to himself or his parent or guardian without an order of court. 32. 281. § 12. p. real estate will conveyance necessary . 160.' 1 2 8 4 5 6 7 Underhill. 365. as all parties to the suit are forever barred by the suit. Pub. 144. v. a trustee payto the proper distributees. ested. will not protect him. 5 As ally allowed. The trustee 119 must pay the distributive shares at his peril The fact that he pays on a forged order.THE IKDr^UAL AS TRUSTEE. and he cannot refuse to pay until he gets a receipt. 98 Mass. p. 157 Mass. 2 or he may be re- quired to pay him again when he conies of age. He may perpetuate the evidence of his payments by an account court. Heatley. . these duties are so onerous. and he cannot de- mand a receipt or discharge where he simply follows out the distribution according to the terms of the trust. Mass. a was " to convejis *' or " divide " the real esotherwise. 4 If the trust tate. Waldron. Supra. Perry. 9 Vt. 6 In some jurisdictions the amount is regulated by statute. 41. (1882). 137. Foster Bailey. 2 Coll. Stat. 3 filed in court. p. or on a power of attorney which he supposes to be good. usually vest in the distributees by the provisions of the instrument. Chadwick v. ch. 77. Now. The trustee may retain the funds in his hands until the account is settled and he has been paid his charges. or under statutoiy law. ing in good faith under a revoked order the law is not so in America. Buell. is protected. But see Sparhawk v. and allowed after notice to all interby filing the vouchers in is The former course preferable. How v. § 624. compensation is generand is usually two and a half or one per cent on the amount turned over. but which has in fact been revoked.

If he exceeds his powers. as for instance in selling or leasing to a stranger. and if he . and on the recitals in a deed. Code N. Gape. 203. 26. —A personally to a stranger on his contracts. 82. when as a matter of fact. He is liable criminally for embezzlement if he misappropriates the trust funds. whether he signs as trustee or as individual merely. he will be liable for the price. Low v. 6 In all these cases he has a right of indemnity from the trust fund only so far as he has acted strictly within his powers. owing to defective appointment.be a trustee. even though under the pretence of a loan to himself. He is liable personally in tort as owner of the property on which there is a nuisance. he is not a trustee. innocently therefor. Kev.) 706. p. . if any. § 46 Rev. (1896). 1 unless the contract is specially limits of the trust property. S. 24. 6 Supra. extend beyond the also liable on the covenants in a deed or lease. Supra. 743. and will have no right to indemnity from the trust property. 25. if he should have special knowledge of their worded so that his liability. § 7464. Laws Oregon (1892). Story v. Penny. and also for damages. 2 He whom is the beneficiary not bound to give information to strangers with is negotiating a loan. 2 8 p. § 1800. LIABILITIES. n. Dak. 21 1. 1891. VI. Supra. Mass. p. (1882). Supra. Pub. 84. ch. 3 Ch. 7 1 Bowen Lewin. trustee is liable To Strangers. and the stranger gets no title.120 a trustee's handbook. § 6592. 8 makes an erroneous representation is not liable He and is liable personally as stockholder in a corporation. 4 . Annot. Code Tenn. Ohio (1890). 2 Jur. Stat. Bouverie. 6 Supra. " . 4 for taxes. p. p. § 6842. Stat. (N. p. 65.shall not He is accuracy. 76 Ga. v. 6 He will be liable personally where he assumes to. (1895).

for instance. Foster. THE IHDrVTDTJAL AS TRUSTEE. White v. 4 The trustee is liable to his beneficiary for any loss of As. 7 H. If a defaulting trustee a cause for disbarment. M. p. and a decree may 2 be enforced against fault. Wiles v. 412. 109 Mass. where the trust is created. so. p. if he neglects to insure where it is his duty to do he will be liable for the loss. he will be liable for interest. 8 He is liable not only for a loss directly due to his neg- Thus. 291. his breach of trust is Liability to Beneficiaries. Finch. 1 2 Thompson v. Greenwell. and not a separate loss. Fenwick v. Each by cannot set on another. G. Pegram. ° but in administering a fund as a whole. Vyse v. 6 to fall in arrears. Traphagen.the trustee's hence the gain on one All the gains belong to the trust estate. Tebbs v. 1 Mad. and he neglects to 6 collect or secure the property. in developing real estate. 10 Beav. the loss on a building built to make the rest more readily salable is part of the whole transaction. and his estate is liable only for the acts during . n. J. 560. 541. . 140 Mass. See supra. 258 Blake v. 86. Ditson. hence they do not belong to him to set against his liabilities . As to his duty. their beneficiaries are joint — The and even if liabilities of trustees to several. for instance. p. either. 3. 1 is 121 cannot change himself from a trustee of the funds a lawyer. see supra. R. Supra. 93 . 7 or if he neglects to invest. as. 351. Gresham. 8 4 6 6 7 8 McCartin v. 83. Eq. L. 8 DeG. the trust property arising from his neglect of dut}'. one transaction cannot be picked apart to show gains and losses. or inexcusably allows rents transaction stands off the loss itself. L. ends with the trustee's death. He into a debtor without the consent of the beneficiary. 323. 318. 2 Drew. 43 N. not the one actually at and irrespective of liability liability among themselves but this joint lifetime. & . and not to the trustee.. Carpenter.

. it is only indirectly due to his neglect he leaves the property improperly in the hands of his co-trustee or an agent. each trustee having a right to give his separate bond. for instance. 3 White & Tudor Civ. C. (1885). Jones v. 8 He will be liable where he has handed the funds to his co-trustee. (1887). L. 116. . . 7 8 Ames 9 v. Horton v. 8 Civ. 6th Am.' or joining in a fraudulent account. 195. Bowen. own acts and neglects and is rule he is liable not liable for the act or default of his predecessor in the trust. if he has that may occur in any manner mingled the trust money with his own funds in the bank. which he but he can easily make himself so by giving a need never do. Hogg. 15. 99 Mass. Comp. or looked on at a breach of trust a as. or negligently permits it . 109 Mass. for instance. .. 106 Mass. . 6 v. 26. ° joint bond. § 2239 et seq. 74 Ala. 504. 194 Hinson v. 4 6 Code Cal. 80. by join1 2 Bostock v. 1 be liable for the acts and crimes of strangers through which the property is lost. Laws Dak. if property is properly deposited and then stolen. L. Sherburne. for instance. Supra. or stolen. Pegram. Williamson. and it is misThough he will not appropriated. Sen. Floyer. Code Cal. if he has done his duty in taking care of the property. See supra. 29 Beav. 964. 541. Eq. 6 unless he joins in the breach of trust. 82. where the but also where as. destroyed. Laws Dak. p. Townley Notes. pp. ed. . Blake v. Lewis. 122 lect. A trustee's handbook. for instance. as. (1885). 1 Eq. Comp. for his — As a general only. § 2236. they would not be liable unless they were careless in selecting the depositary. 2 yet if lie has been remiss in his duty he will be liable for any loss s as. allowed him to receive them. 87. Liability for Co-trustee. 180. § 3932. § 3929. 3 Giff. Wilkins v. (1887). R. 2 Ves. 240. 4 or of his cotrustee. he will be liable for the loss by the failure of the bank while if the property were deposited in the names of the trustees. Stowe v. Brocklehurst.. Armstrong.

Underhill. 89. 87. p. ably leaves the trust property in the exclusive control of and it is lost. too. Supra. 153. § 3932. Eq. It is to v. p. if he can or by neglecting his duty and allowing his co-trustee to act improperly as his agent. where the trustees improperly divide the management of the trust. and the widow managed the trust and the brother never did anything about it. but must ascertain it himself. 166. 5 He may not rely on the representations of his co-trustee as to the status of the property. which all the must sign. 3 Redf. the brother So. pp. where the were deposited with a banker without inspection for four years. J. 5 Johns. Ch. and one trustee was allowed to draw them out. 8 Paige. 75. 4 So also the trustee will be liable if he puts or unjustifi. 378. Supra. 89. for distinction between leaving income and principal in the hands of one trustee. too. T. § 2239.. Monell v. Civ. . 88. and the widow wasted the property and died was held liable for the whole loss. for the benefit of the widow for life and then for others. Dak. THE INDIVIDUAL AS TRUSTEE. Code (1887). 3 and to do alone what ought to have been done jointly or by standing by and allowing his co-trustee to commit a breach of trust. where property was left in trust to the widow and brother of the testator. 127. 4 Crane v. he will escape liability 2 in that case. as for instance where each of two trustees took half the it . 123 ing in a reoeipt for the money on a sale of securities and afterwards leaving the property with his co-trustee. Cal. Bates v. 283. 26 N. Clark. Code (1885). (N. each will be liable for the other. Oliver Court. 6 6 ' 8 Supra. 8 Price. 8 So. 6 his co-trustee Thus. Civ. as to collection of in- come. 1 though show affirmatively that there was a necessity to join in the receipt and leave the funds in the hands of the co-trustee afterwards. Clark v. Hearn. p.property and invested 1 in his respective business and trustees 2 s be noticed that the ordinary form of a deed. Monell. See supra.) 365. contains a receipt for the consideration. 7 securities insolvent.

8 DeG. Pegram. 8 Raby v. 1030. failed. and so gives the co-trustee the opportu. 31 Ch. 3 GifE. not because the other is at fault. 43 N. too. Pass 6 Underhill. 273. 2 s Blake v. & Tudor v. Div. Pinch. 541. nity to waste the estate but the clause may be drawn so as to exempt him. Eq. C. (1892). 479. has a right not only to contribution but to full indemnit}' from his co-trustee.. 7 DeG. note to Brice v. Ridehalgh. 104. or who has made good a loss caused by his co- A . M. but who has been deceived by his co-trustees 6 as to the state of the funds. Sneyd. the other was held make up the loss. who has made good a loss occasioned by a breach of trust not amounting to a fraud. 109 Mass. 186. Hogg. p. 332.. 4 trustee. 323 Sherman v. 116 White . Parish. 2 Moll. Hughes. as he is made liable. i Kilbee v. Griffith v. Thompson Bahin v. Hughes. 1 or unfair account. 2 paid interest on to it. where the instrument says he may do so. 7 who has had the benefit Or he may recover indemnity of the beneficiary trust induced 1 who has received the benefit of a breach of by him. & G. and under statutes even from a married woman without power of anticipation.. of the misappropriation. M. Stockes.. 560. J. ed. . Y. 6th Am. 105. 2 Gratt. Eq. Graham v. Traphagen. 7 ." and he will not be liable if the loss occurred by following out the directions of the trust instrument.124 A trustee's handbook. afterwards misapplied. 53 N. Wilkins v. 483. . as for instance in leaving money in the hands of A. 200. provision in the trust instrument that one trustee shall not be liable for the acts or defaults of the other does not he joins in a fraudulent or in a receipt for money which is if A relieve him of liability in such cases. 8 Austin. and then one So. 390 McCartin v. trustee's fraud. is entitled to contribution from his co-trustees but where there has been a joint fraud the court will not help him against his partner in wrong. 6 A trustee who has been guilty of no fraud himself. 29 W. 1029. v. but because he neglects his own duties. 6 Dundas. 3 Ch. R. L. & G.

g. Robinson. . 1 P. (1895). and there is notice among the papers. 82 N. 371. where the trustee was authorized to invest in real security. is liable any loss caused by his exceeding his powers as. 290 see as to distribution. Y. § 4274. for instance. too. but not in the exercise of his discretionary powers. . t Hun v. if he convert the trust property without having the power. life tenant. supra. Code (1885). § 2238. See Underhill. Wms. 2259. he will be liable as. 51 . or vice The (unless trustee is liable for his in errors expressly exempted) the in judgment performance of his duties. Robinson v. 8 as e. 285 Simpson on Infants. Civ. p. 6 Supra. he may be compelled to replace it in kind or make good its increase in value. Dak. the infant could demand the sum on coming of age. and held railroad bonds believing them to be authorized. with the same intelligence that a reasonable man would use in the transaction of his The own affairs He must stance. for instance. Code Ga. Or. (1887). § 3170 . 180. 7 For inbe at the pains to learn his duties. 5 trustee is held to perform his duties with reasonable discretion. where he paid a sum due an infant to his father. he was held liable. Cal. §§ 2258. 117. ed. Comp. 1 Or where he invests in securities in which he has no power to invest. . 1 2 8 4 it the fact that he is incompetent is no excuse. (1895). p. 6 that is to say. Laws Dak. « " Ordinary care and diligence. even though honestlj'. Code Cal.THE INDIVIDUAL AS TRUSTEE. 11 Beav. 2 So. Liability for Errors. he has paid sums . where. 4 Or where a beneficiary has encumbered his estate. Civ. p. Infra. Rev. Tolferry. being the duty of the trustee to invest the trust . Cary. Laws Dak. which should be principal to the versa. p. Code N. p. 125 for — The trustee . Dagley v. § 3941. (1887). § 3931 . under a misapprehension. (1885). 65. 2d Eng. he is liable if he pays the wrong person. 142." Comp. without order of court.

and the loss on an improper investment is a personal liability. 617. Eq. and the fact that the trust fund has largely profited by the good management of the trustee does not affect his liability to make good any error of judgment. 5 trustee who knowingly or carelessly hazards the trust funds. Hogg. and will be given But this clause does not excuse a effect by the courts. and give the doubt. . he will be liable for the loss. YouDg. D. Wilkins v. irrespective of his honesty. 2 Drew. and where he has acted with that amount of discretion which an ordinarily prudent man uses in his own affairs. Vreeland. Gresham. 92 N. 441.* liability may be restricted by the terms of the trust instrument and a clause making a trustee liable for his wilful and intentional breaches of trust only is a common provision in trust instruments. 102. . 710. and fails in his duty where reasonable inquiry would have made him safe. Supra. he invests too large a proportion in certain secuif he uses poor judgment in investing. 7 But if he have a discretionary power to do any act. rities. Tuttle v. if he have a power of sale. provided he has been honest in its exercise as. 1 and honestly. the court will not since this fact it is not in itself . if A or trustee's handbook. an excuse. 111 Cal.126 funds. Milne. Gilmore. 8 him the benefit of if he is acting under advice of coun- though This shows that he used due diligence. (N. J. S. But he is not supposed to be infallible. the court will not inquire whether he has used good judgment or not. he will be proand even where he has acted in good faith only the tected . 33 N. Crabb v. 258.) 25. since all gains belong to the trust fund. Stott v. for instance. Perrine v. 2 especially sel. Y. 36 N. J. 1 2 8 « 6 » 7 In re Cousins's Estate. 121 Wiles v. 25 Ch. court will treat him leniently. p. 8 Jur. . 56. Eq. 6 He cannot set off the gain on another investment against the loss on any injudicious investment.

p. 6 Draper v. Freeman v. Cook. 8 If the trustee fails to perform a specified duty. p. . A trustee who has caused loss must make the fund good. p. the beneficiary may alent elect to have the money and interest. inquire into the price unless it 127 be so grossly inadequate as to suggest a fraud. Perry. honestly exercised. or an equivamount Of stock and the dividends declared in the meanwhile. as. as to the amount of support. Stone. 373 Lewin. Hapgood. to invest in specified stock. the}' can be held by the beneficiary as against his assignee in insolvency. p. 4 8 77. 1 Damages. 71 Me. Supra. or where he has a power to support. . n. * McKim v. 593. required to replace them by like real if estate or stocks and he sell trust stock and have shares same company in his own estate. 142. the discretion of the trustee. McKim Infra. v. 6 Ired. 370. 498. Blake. or if the funds have been used in trade. . since the settlement was on the theory that the account was made 1 Supra. § 844 . priated the proceeds to his Where and the amount of dividends payable up to that time. or as a punishment for disobeying the order of the court. and will be charged with interest if any would have been earned. but with an allowance for taxes and commissions. or wilful misconduct in the management of to his trust — the trust. 6 a trustee had sold the trust property and approown use. Measure of will be final. if he exceeds his powers in selling real estate or stocks. 67. for instance.THE INDIVIDUAL AS TRUSTEE. Ames. 2 but compound interest is allowed if the trust was for accumulation. Jennison v. 175. 93. 10 Pick. 139 Mass. as that amount will be supposed to be realized. he in the may be . Eq. 422. he was charged with the market value of the securities at the date of the event. but rendered accounts as though he still held the securities. 4 Similarly. Interest is simple in most cases. 142 Mass. Hibbard.

p. p. Finch. 2 the trustee value. v. Thayer 118. Ch. Clark v. 369. 8 or get- settling his accounts. with If he purchased the property himself. he cannot subsequently charge his predecessor with any loss. . infra. at the time of purchase. 162 Mass. Kinsey. 5 And if the property has depreciated in value. however. Y. 142 Mass. 3 In the absence of evidence of the actual price received. 10 9 his passing through insolvency. Hibbard. Ibid... 422. M. the 1 McKim Davoue v. supposing that he has acquired a good title. 427. Blackington. difference of the value interest. 9 10 11 Infra. 6 If. Thompson v. 2 Johns. the beneficiary might have claimed the price at which it actually sold and interest. and retains it for a considerable time unconverted. d 425 Fanning. he must make up the firmed. 7 and im- — The liability of the trustee may be ended by ting a release limitations. 147. 4 6 6 7 8 3 ib . (N. Also Davoue v. . 60. it. p. 232. he will be allowed for Liability Terminated. requiring him to pay the difference to make the full market value. the court may confirm the sale. at an inadequate price. 110 Mass. ubi supra. & G. 560. 8 DeG. faith. however. 10 or by the statute of If his successor in the trust takes over the property with- out objection at its inventory valuation. must Or if a bonajide purchaser before the sale is disafhe must account for any profit. he make good any he sell to 4 loss in price incurred at reselling. the trustee. Svpra. 149. v. Fanning. 2 Ibid. inventory is chargeable with at least the If a trustee buj-s the trust property at a sale.) 252. 136 Mass. Morse v. . 11 If. has laid out money in good proved the estate. . 1 Had the stock fallen in value. Hill. up as though the trust had been property administered.128 A trustee's handbook.

he may claim the loss. 232. v. . Kinsey. 2 1 2 In re Salmon. 1 He his death. Div. . Wilkinson. 162 Mass. but not liable for the doings in the trust subsequent to an action against him for a breach of trust survives in equity. 41 N. J. 129 successor seasonably converts the property.THE INDIVIDUAL AS TRUSTEE. Eq. 42 Ch. or he can object to taking the property at more than its real is value. 351 Thayer Dodd v. 566.

That is to say. Bequests to unspecified charities stand on another footing. For statutes against aliens holding land p. but the carrying of them out must depend on the honor of the trustee. in sundry States. since the Attorney General will appear to enforce them. if the trustee failed to support the animals properly. will not be interfered with by the court. 18 Ala. n. Harrison. A further clause might be added." and therefore cannot appear in court to enforce the trust. 514. see Coleman v. 49 Cal. Kailroad Co. Trusts for "things. could not hold it through the instrumentality of a trustee. 517. the residue to go to the trustee. a slave.. or a corporation 2 that could not hold property in its own name in the jurisdiction..PAET I. Underhill. THE BENEFICIARY. as they are not "persons. Almost any person be a beneficiary. 95. Who may be a Beneficiary. but a person who could not legally hold property within the jurisdiction cannot be entitled as As. if properly drawn. that. and dogs. might be the objects of trusts. . So. for instance. but they could not be true beneficiaries. the property should go to the next of kin." such as pets. etc. horses. the gift may be to a trustee to expend so much as he thinks fit in maintaining certain horses and dogs. 1 an alien enemy a beneficiary. may 1 2 8 — Pool v. and in former times slaves. 8 Parrots. III.

4 — Persons having a mere possibility. p. Wilson Wilson. he exercise the power The claim of the beneficiary is not to any part of the property itself. and protect the fund or recover damages for an injury to it. 19 Ch. is against the trustee onty. 2 Persons to whom income is payable at the discretion of the trustee are not beneficiaries under the above definition. 203 5 6 Dexter v. 145 Mass. 8 In the absence of statute ordering the appointment of a guardian ad litem. 149 Mass. 339. p. States and several others. Nolan. 6 Nor is the holder of a general power of apif pointment a beneficiary. infra. 4 Bradstreet . trustee. Hartman's Appeal. The claim need not be vested. 48 N. C. 103. 1 Who is the Beneficiary? Any person who has a claim against the trustee for any of the benefit of the trust property is a beneficiary. although his creditors will take the estate. Hawley Western Railroad Co. . v. the direction to 131 employ a particular person as an attorney or agent by a testator does not create a trust or make the person designated a beneficiary. or a person to whom a beneficiary has given an order on the trustee.THE BENEFICIARY. too. are not beneficiaries. Butterfield. Statutes in Code Supra. 22. v. i and the claim v. Div. 135. persons not ascertained or not in being are not parties interested. pp. St. v. although they have property that may be assigned. 7 Ross. 172. v. Deveaux. 90 Pa. 8 and 66 . 1 S. 6 All the property rights are in the . 518. 7 Paige. since they have no claim they can enforce or assign. either in law or equity hence he cannot sue to recover. Y. Supra. v. 513. 129 Mass. a contingent interest beingsuch a claim. 490. Cotting. 7 2 8 Foster Clarke Elsley. 92. although they are interested in the trust and may intervene to have a proper trustee.

or damages for all. 1 Eden. Where. however. beneficiaries is not joint. Incidents of the Equitable Estate. p. recognize the beneficiary's absolute right in this respect. qualify a voter where a property qualification is required. Morse v. 251. 110 U. they regard him as the true owner of the property. 189. even eficiaries entitled to — The estate of the though there be several ben- equal and similar interests in the trust. Hill. 6 Little v. Underhill. Little. if their interests cannot be separated the court will proceed in the best interests of all the beneficiaries and order an avoidance for all. which are attributes of the but his legal estate and consequently belong to the trustee equitable estate is property. although it is not such an ownership of things as would. and have invested his equitable estate with many of the same incidents and qualities pertaining to legal ownership in a ficiary — court of law. Burgess v. p. Earle. p. a trustee's handbook. may be described as his right to force the trustee As courts of equity to carry out the terms of the trust. 247. 136 Mass. or than even an individual. 6 1 2 8 4 6 Freedman's Co. 2 the beneficiary is not clothed with the privileges and burdens incidental to the ownership of the propertj-. The estate of the beneEstate of the Beneficiary. 6 is Or where an account one. and a majority has no greater rights than a minority. as it thinks best. Wheate. 60. 4 Each beneficiary may act independently of the others. and the beneficiaries do not agree in desiring a reconveyance. and he may treat it in general much as the legal owner of property may treat his. 640. 463. . Supra. 710. 1 As has been hereinbefore pointed out. v. . there has been a breach of trust in the sale of trust property. 177. p. 23 and see Lewin.132 II. all will corrected at the instance of be entitled to participate in the benefit of the correction. S. Lewin. 8 . 161 Mass. for instance.

Bartlett. 4 although there are some jurisdictions where there is no dower. Rev. 133 The equitable estate may descend or be devised. § 1546. Whitney. 19 Me. Coggeshall.THE BENEFICIARY. when it will attach although limited to the wife's heirs. 1 So. §§ 327. 6 Beneficial estates in lands have been held not liable to forfeiture or escheat. Perry. (1893). Reed v. Laws of Del. 2d edit. Lothrop. 444: Dunn v. I. § 275 b. 10 it will pass to dis- He may Annot. Hamlin. 9 — The beneficiary his assignee 1 may convey it away and under a general assignment. 523. 9 In Ga. 137 Mass. (1892). 436. 7 estate is The beneficial subject to disseisin where a trustee repudiates the trust. 350. Perry. Y. 383. by statute. (1896). ch. 156. W. Dunn. . 6 6 7 8 Hamlin v. Infra. § 1 . the estate must be in possession. 533. In Pennsylvania and South Carolina a married woman can convey only in the manner provided in the settlement. §323. p. 8 Alienation. as Massachusetts and Maine. Quin's Estate. § 3202. whether would pass to the State. Code Miss. Code (1895). 8 Reed a. it usually is. Bl. Burgess v. 149. Wheate. Whitney. N. the beneficial estate may be alienated as freely as any other property. 8 In early times dower was not an incident of a trust but now. 533. 144 Pa. Stat. 7 Gray. 137 Mass. Car. 7 R. but the wife is compensated in other waj's. 141 1 . may sell to any person except husband and trustee. Restraints on Alienation. failure of heirs the trust property. 7 Gray. § 3188. Gray. 2 Tillinghast v. In the absence of restraint by the terms of the settlement or statute. . p. 123. 1827. 2 estate. § 21 Bartlett v. 10 Forbes v. 4 See Stimpson. 1 That curtesy may attach. 6 but under the statutes in the United States on real or personal.. 85. and is now usually liable to the incidents of curtesy and dower. and claims the property so that the statute of limitations begins to run.

that the assignor can only transfer what rights he has. 34 N. 20 Johns. his equity will pass to his transferee subject to the trustee's counter claim. has no property to alien. or. if the beneficiary was indebted to the trustee. & J. as they are called. P.134 pose of his it a by will. Y. he may hold the property both in law and equity. 133 Mass. 468. being also a defaulting trustee. This equitj' or claim against the trustee is subject to all like the — the counter claims of the trustees. 146 Mass. 328. Life Ins. 410 Chase v. Dodd v. p. On execuHadden v. Thus. 1 tion. 154. Restraints on Alienation. 2 Or if the beneficiary. Winship. the it according to everywhere. 7 all jurisdictions the assignment of estate is complete when assignor an equity in real and assignee have Gray. Belknap. 2 Infra.. v. 6 a judgment. 4 DeG. As for instance where the counter claim is individual. H. Y. By creditor's bill for equitable execution. 17 How. §§ 170-174. 612. 554. 5 Allen. Spader. but not if it be in autre droit. Abbott v. being a claim instead of property. 343. his equity. Conn. 30. Philips. Searls. Rice. 4 If however a later assignee acting in good faith fortifies his equity by a legal payment of the claim. debts. and a purchaser for value than a volunteer. such as title in the order of their assignments.. Co. 511. v. Alienation. v. 45 N. Bridge 152 Mass. The beneficiary. 359. his assignee will take subject to making good the default. Corcoran. 6 or a new In obligation from the trustee to him direct. All he has are his rights. 3 It follows from the nature of the estate. Poote. 6 Judson v. 7 Ames. 333 . Drake v. 130 Mass. 208. assigns. 6 N. unowner. . 8 4 Belknap Philips v. 2d edit. What Estate passes. . and the assignees accordingly take gets no better right. and it may be taken by his creditors for manner in which it is reached varying local law * but there is some way of reaching . Co. trustee's handbook. Schuyler..

718 Fairbanks v. 5 Minn. if obtained in such a manner as would affect a reasonable man but if the assignor is the trustee his knowledge is not notice. Ingraham. who has 7 makes a general power of appointment and the property assets of his estate for creditors. Kneeland. If the power of appointment be special. 1 Jones Eq. Copeland v. Banks. Foster. 104 N. § 438. 133 Mass. 20. 398. . Thayer v. 330 Cowx v. . 496. 14 Ind. Howlett. . 456. p. 4 and notice to one of several trustees or other joint obligors is notice to all. 9 cific decisions. end. Cox. Wallston v. & Fin. 2 Kay & J. Supra. 352 Clarke v. 129 v. . 22 Ohio St. his notice will not . since he should have appointed to them instead of to volunteers. J. 5 Knowledge is notice. 531. Lee v. 488. n. Braswell. 5 Russ. Indiana. 6 6 ' 8 Perry. D. A person exercises it. 8 in which case qucere? 9 But a person to whom income is payable at the pleasure of the trustee has no estate that can be assigned or taken 1 2 White v. 13 W. 200. Clapp 328. 3 Ch. Bailey v. the creditors could not take unless the settlor and the donee of the power were the same. C. Y. & Hem. 1 Johns. 17 Ch. Minnesota. Cockrell. 113 Mass. Lloyd v. Lloyd. but if he be assignee _ . 126 Mass. and West Virginia. Windram. 2 but in other jurisdictions notice to the is trustee necessary to complete the assignment of an equity in personal property. The policy of the law is well set forth by Morton. 30. 137 * Koxburghe v. . v. New York. the person giving notice but if the person giving the notice first will have priority was aware of the previous assignment. . 8 Notice to be good must be given to the trustee after his appointment. Va. 175-177. 3 Foster v. 108. 3 CI. Daniels. McDonald . Hogeman.THE BENEFICIARY. There is a lack of direct Ames. Sargent. Wiley. help him. knowledge is notice. in those jurisdictions where notice is necessary to complete the transaction. 520.. 527. assented . Manton. in PaBank v. 6 Accordingly. 135 * and the same rule is true of personal property in Massachusetts.

but is invalid as regards the principal fund. 7 Ch. 2d ed. instead of giving outright. 8 while in England and in other States (there being several where the question is not determined) such a restriction is inoperative except in the case of a beneficiary who is a married woman. where she cannot settle property on herself without power of alienation during coverture. 66. Restraint on Alienation. p. § Stanley v. 1895. 6 and cannot be set aside to relieve against her fraud or breach of trust. are thoroughly discussed in Restraints on the Alienation of Property... 377 Pacific Bank v. 2 As a general rule in America. 2d 33 Beav. 136 Mass. 589. the creditors have lien by statute even where some States the power is not exercised. p. 5 Ibid.. 214. and the policy involved. 271 . . 6 This restraint in the case of a married woman cannot be removed by any one. 268 6. 175. §§ 269-277 a. Von Zedlitz. 8 Gray.136 for a his debts. 21 Beav. by John Chipman Gray. the desire of donors to secure to the beneficiaries the its enjoyment of benefits irrespective of their improvidence or extravagance. as trustee's handbook.. 342. such a restraint on the alienation of the income is valid. D. .' nor will acquiescence by the married woman excuse a trustee for disregarding it. ed. Greene. Wheelwright. 138. In such cases it is usual to insert a provision in the trust instrument that the beneficiary shall not take his income by way of anticipation. Fletcher v. See note to Underhill. Windram. is — One of the ordinary motives it for giving property in trust. 426. Jackson v. Restraints on Alienation.. 4 who is excepted everywhere except in Massachusetts and Pennsylvania. See supra. p. 268. 2d ed. * Ibid.D. Restraints on Alienation. § 167 j. and that it and the principal shall not be assigned. or be liable to be taken for his debts. §§ 134-213. not even by the court. LL. his assignees or creditors must take 1 In through him and he has no rights that he can enforce. 133 Mass. 6 ' Robinson v. The decisions on this subject.. 8 Gray. Stanley. 8 1 2 Infra.

§ 2808. Garland. 133 Mass. Johnston. 197. Pace. 111 247. 23 Hobhs v. Gray. Bradford. 716. 21 Bailie v. 20 Mo. and it cannot be taken for his debts. 170. Harrison. 14 the settlor may settle the life estate without power of alienation on any one but himself as beneficiary. § 867. 46. 56 Ga. 1 notably those having codes. Restraints on Alienation. 21 Heath v. 28 Kentucky. Smith. 137 In most States the restraint on alienation can be made only by the terms of the trust instrument. 91 U. "Whitehead. 69 Md. Corbit. 281. 59 Vt. C. 2d 1094. 758.. Ch. McWhorter. 6 Mississippi. 276. Bishop. Stevens. 17 New York (aside from statute 18). 87 Va. 297. Gray. North Carolina. 4 Rich. 8 io v. Adams. 325. 88 Pa. 183. Bk. 11 and Virginia. 81. 78 Ky. 22 Ohio. 4 Maine. Broadway Bank Steib v. 77. 4 Abb. Jourolman Tenn. Restraints on Alienation. See note 4. App. Indiana. 1» Pace v. Massengill. Dow. There are some States. Code (1896). 2 8 * Overman's Appeal. 205. Shreve. Comp. E. 73 N. Smith v. 8 Illinois. Eames. 23 Robertson v. 923. Murphy. 21 Alabama. Haydel. Code California (1885). §§ 177 a. also p. Towers. 8 and probably Tennes9 10 see. 135. Delaware. 240 h to 249 6. Lampert v. Eq. Laws Dakota (1887). § 178. but changed by statute. 17 i6 Tillinghast .' Missouri. S. Barnes v. 16 Such restraints are adjudged bad 16 in Rhode Island. 84 Me. 419. 12 and in the Federal courts 18 and Vermont. 616. Bep. 2 Massachusetts. p. 530. 36 Ala. Garland v. where such restraint is provided for by statute. 111. 6 Maryland. ed. 2d ed. 5 R. 86 11 12 18 l* i6 Gray v. Eaton.. 37 N. v. 20 Georgia. 18 Rome Exch. 4 Del. 119. Ct.THE BENEFICIARY. 15 Ohio St. 24 and i Civ. §§ 6091-6093. v. v. 69 Miss. In Pennsylvania. Thompson v. 19 South Carolina. 138 infra. 24 Knefler v. 83. 6 6 7 Roberts v. 9 Tenn. Leigh v. App. Nichols v. I.

2808 Annot. 5 6 ' 8 Rev. Gray. Y. § 4. if at the creation of the trust his debts do not exceed five hundred dollars." 1 absolutely. 4 Rev. the beneficiary may be restrained from alienating the rents and profits. . (1882). because the beneficiary has no right to any 7 and therefore specific income which he can enforce. Hahn v. California. St. § 3252. Minnesota. Stat. 2d ed. 867. 302. § 195. 341. .. 1 . Schell. §§ 2798. Hutchinson. Laws (1880). Cal. Kansas. Lickorish. Wisconsin. Civ. Restraints on Alienation. but not the gross sum. Kan. 8 Cochrane v. . 516. yet the same result is practically reached by what is commonly known as a spendthrift trust. Stat. §§ 857.138 a trustee's handbook. (1895). § 3398 Gen. § 296. in But and no spendthrift England. Harrison. C. § 63 Annot. . p. (1885). Pub. Stat. § 5581 Stat. if the beneficiary is also trustee. (1896). (1889). as appears above. and in those States w. N. Y. where a restraint on alienation cannot be successfully attached to a settlement where the gift is absolute to the beneficiary. Lindsay * . Although there are jurisdictions. p. 1798. (1894). probably in Arkansas flicting. Code (1883). Minn. N. (1887). Stat. Code N. 60 L. 859. Gray. 133. Mich. nothing that he can alien. 2 the statutory provisions of York. or accumulate so In such a case. D. the creditors of the beneficiary cannot take the income. Stat. . ch. Code . N. (1887). § 3394 . Michigan. Ariz. § 2089 (1894). 4 In Arizona 5 he may settle on his children without power of alienation. Comp. 2800. 274 Rev. § 4292. that is to say. use a part of for his support. Rev. 113. Indiana. 8 New Jersey. Stat. . In re Bullock Good v. in Connecticut the dicta are con- and there are no decisions. 140 N. J. Ind. Wise. 8 Ark. § 1335. but in such cases. and in North Carolina 6 it may be Under New so settled on a relative. the estate vests in him trust is established. 159 Pa.' (1897). Ch. J. Laws Dak. or that can be taken for his as they think much debts . and North and South Dakota. will pay the income beneficiary. by leaving it to the pleasure of the trustees to the whether they it fit.

§ 46.. 8 Gray. p. § 167 g. Supra. . 138. * Re Levy's Trust. Ames. 6 except only where the income is settled on the settlor himself. . 199. 3 The settlor may attach a condition to the gift of income. . See supra. give no power of voluntary alienation to the beneficiary. 1 Johns. see Stimpson.. Re Coleman. in most jurisdictions none of the income can be taken. that will if it be alienated. 119. 716. 91 U. Eaton. D. 342. . the trustee must account to the creditor for any income which he pays to or expends for the beneficiary after notice of his assignment. Tolles v. 8 A similar condition attached to a gift of the principal 1 Gray. 12 Ch. Statute Law. 141 IT. he has an absolute right which he can alien or which can be taken. 2 For the statutes. however. Carew. 401. D. note 4. 296. 237 straints on Alienation. § 292. 30 Ch... where married women have the same status as other individuals. 1 although if he pays or expends it for others the creditor has no claim. notably where the matter is regulated by statute. 39 Ch. Restraints on Alienation. and allows the beneficiary to alienate. Restraints on Alienation. 616 but in Illinois the statute curiously cuts out the creditor. & Hem. 8 7 Cliye v. 99 N. n. and . D. Von Zedlitz. If the provision be to pay him or support his family. 2d ed. even though the person to is whom the income passes the wife of the original beneficiary. 443. Y. Rep. or if the beneficiary become bankthis condition rupt. but in others. Wood. 4 and be valid in any case. Nichols v. Gray. S. so much as is left after reasonable support may be taken or alienated. . 152 Gray. Potter vCouch. 6 but this exception does not apply to a married woman under coverture. 139 following the English rule. If. 2 and this amount is sometimes fixed by the statute but the statutes only protect the creditor.THE BENEFICIARY. S. 136 Mass. 6 Jackson v. 2d ed. 2d ed. p 136. 7 except in Pennsylvania and Massachusetts. Restraints on Alienation. Samuel. 6 Samuel v. the provision be to pay all the income to him or appty it all to his support. 2d ed. § 296. the income shall pass to others.

154 Pa. . 316. 6 Jenkins v. 6 Massie v. 379.140 a trustee's handbook. p. 101 Curtis v. Smith. Forbes v. 3 4 Brown v. C. the beneficiary consists of his right to compel the trustee to carry out the trust. 8 then the 1 2 v. Smith. . §§ 57-74. — The beneficiary may have a sub- poena against the trustee wherever he can find him. 2 Allen. Infra. 131 Mass. 156 Mass. Cooley v. 267 Kildare v. Rights against Trustee. 355. he is considered to be peculiarly — under the care of the court. Hooper. 160. Foster v. 7 So also. then the gift over becomes void. . 6 Cranch. Fisher v. Mandlebaum St. unless ancillary trusteeship be also taken out in the ju- where suit is brought. 65 . 29 Mich. Lester. 119 Mass. 1 A provision attached to a gift that so shall much as shall not be used or alienated go to another is void. 3 As the whole estate of III. 4 irrespective of the situation of the trust property. Desmond. Marshall. 405. 60 Barb. 78. 8 Felch v. although both the trustee and beneficiary are out of the jurisdiction. but if the estate vests. McDonell.. 2 A limitation of the income to the sole and separate use of a married woman. and there is a statute vesting the property in a trustee appointed by the court. 1 Vernon. Gray. Eustace. Watts. 5 unless the trust be created by the decree of a court of another State. 100 Mass. 2d ed. 38 111. Lothrop. Chase. is not a restraint on alienation. Restraints on Alienation. 523. but the trust property is within the jurisdiction of the court. the courts of that State have jurisdiction to regulate the trust. if the trustee is not risdiction within the jurisdiction. 9. in which case the trustee can onry be sued there. 137 Mass. Scarlett. J. 148. 52. Where Enforced. of the fund is valid so long as the estate remains contingent. 6 And where the trust is established by the decree of a court of one State. Wister. since they can remove the trustee and appoint one to act in his place. 155 7 Chase v.

Hawley v. and lose his . may apply to the court in the matter of removing or appointing a trustee. DeG. however. Kansas Pacific Railroad. Randall. p. p. 134. the court is powerless. Smith. 81 . the beneficiary may sue or defend in the but the trustee's name by getting leave of court to do so 4 trustee must be shown to be in default. where it instrument. 8 Can Compel What. and any person interested in the trust. there is no statute to transfer the title to the property. 74. and indemnified . 141 court can appoint a trustee to execute the trusts. 2 The beneficiary is entitled to have proper persons and a proper number of trustees. 213. 81. 5 The beneficiary has no right to advise or direct his trustee unless the right be expressly conferred by the trust if his advice be asked and followed. 21 Blatch. Whitchurch. Siddel. 6 If an express power be given by the trust instrument. it applicable to such powers. p. See supra.THE BENEFICIARY. St. pp. 147 Mass. on the whole. 58. the trustees will hold the property on a resulting trust for the heirs. and infra. he remedy against the trustee should the acmay therefore. 7 Paige. 8. 6 and 4 « 6 Morgan v. v. Life Ass'n Scotland v. — The beneficiary can compel the trustee to perform his duties. W. 120. unless it have jurisdiction over the trustee in whom the title is vested. 11 Pa. 3 Bradby v. & J. 8. 1 it is If the trust is illegal in the jurisdiction where sought to be enforced. James. Ins. is governed by the general rules He can have the trustee enjoined from committing a 1 2 8 McCann v. P. it is better tion be injudicious to leave the full responsibility on the trustee. Co. for costs. . and if the trustee refuses to sue or defend.. even though the interest is contingent on the mere possibility of receiving a payment at the discretion of the trustee. 1868. N. If. Supra. 155. belongs.

He may have a receiver appointed to hold the property if it is imperilled by remaining in the hands of the trustee. or the interest. he must return the the funds have been converted. 2 3 TJnderhill. supra.142 A trustee's handbook. the benefi- ciary may either sue in equity for his in testamentary trusts court. (1895). Barker. Laws Dak. pp. Hill. 7 In general. 6 and . 366 Dougherty. 417. § 2237. Dak. § 4273 . v. Barker Code 6 ' Yeackel Litchfield. the court will order whichever remedy it thinks best under the circumstances. 4 5 Supra. Code N. v. (1885). Rev. 273. or voting against his wishes 1 would cause him irreparable injury. . p. Jones 276. Civ. Morse v. and pending his removal and the appointment of a new if it trustee. (1887). or erty consideration in absence of fraud. 127. n. §§3183. and 440. 3184. or bond given to the If the trustee has been guilty of a breach of trust in investing or using the funds of the trust. he may . 136 Mass. See trustee's 127. it is insufficient. 10 Ga. 2 In England he may have the estate administered court. 8 If the trustee commits a breach of trust. §3930. If he follows the propprove his claim for balance but if the beneficiaries are not agreed. CodeGa. with simple interest for the life tenant but compound interest is allowed when the income was to be added to the principal periodically. p. and cannot pursue both remedies 6 and if he disaffirms a sale. the beneficiary may elect whether he will take the property into which amount taken with But he must choose. Cal. 1 Ames. 2. liabilities to beneficiary. 60. v. p. Supra. 6. Comp. the damage recoverable is the amount of the loss for the remainderman. § 470 (3). but such receivership suits are not in by the vogue in this country in trust estates. 14 Wis. Perry. (1895). 4 . contemplated breach of trust. 131 . 13 Allen. may sue on the damage or loss.

D. 478. as a condition precedent. 65 . he must show his interest. usually once a year. He can examsulted ine the books of accounts and securities at times. 2 but.THE BENEFICIARY. n. what . He can examine the deeds or opinions of counsel con- — by the trustee in respect to the trust affairs. 77. income means net income after deducting the taxes and repairs and ordinary current expenses attending the estate. 470. 6 So the trustee is entitled to collect it. In such cases. The beneficiary has a right to information about the concerns of the trust at all reasonable times. p. and make the necessary deductions before paying it over. 104 et seq. v. 82. where there is 143 a presumption that more was earned. L. for instance. the income as it accrues belongs to B immediately. 3 Ch. 1891. pp. nor can a stranger acting under his authority require the trustee to answer. the net income can only be ascertained yearly. v. It. Howard. 1 Eq. see supra. 1 full Right to Information. Adm. 8 * 8 « As As to accounts. 4 inquiries as to Right to Income. is income. all reasonable and is entitled to an accounting at reasonable inter- vals. Ames. to Bourerie. 127. 8 assist But he has no right to demand that the trustee shall him in encumbering his interest by answering the how his interest is already encumbered. but in the case of an ordinary trust. Barnes. where A holds property in trust to permit B to enjoy the income. 7 Met. and may not examine them to establish an interest. as. and therefore would seem to be payable only on 1 — 2 Smith Supra. 8 In a simple trust. Adm. or the breach was wilful. p. p. Watts.. and he may require the trustee to give him a power of attorney to collect it for himself. Low v. see supra.

2 but the intention of the settlement. 303. Williamson. Supra. if it can be discovered. Keith v. Right to Support. Code of Ga. infra. the settlement of the yearly account which provision would govern in all cases. page 105. Supra. 3 The trustee may withhold income to reimburse himself for money erroneously paid to the beneficiary.4 As to what constitutes income. 154. . 6 1 2 8 may con- * 6 6 Lewin. see pages 1 04 et seq. 321 et seq. will govern. p. by statute the life beneficiary is entitled to the income on the fund given for his use from the date of the testator's death. 6 of the beneficiary's In Georgia an unusual statutory provision. 1 In Massachusetts. but cannot reimburse himself in this manner for an individual loan made before he became trustee. 298. Lewin. There has been much discussion in England as to the beneficiary's share of the first year's income. . p. on the conversion of the property the proceeds are divided into income and principal so as to give the tions. the latter tract debts binding the trust property. (1895). that where the trustee fails to support the beneficiary. § 3187. Most trust instruments have an express provision that the net income shall be paid quarterly or semiannually. in the life beneficiary the usual rate of In other jurisdicabsence of statute the beneficiary only gets the actual income that accrues on the fund. there is income as explained. Williamson v. and where the whole or a part of the fund does not produce income. the court would probably not allow a large amount to lie in the hands of the trustee for such a long period if the beneficiary needed it. 6 Paige. 134.144 A TKUSTEE'S HANDBOOK. but as the income belongs to the beneficiary. pp. 138 Mass. 65 and 69. — The question right to support has been treated alread}-. Copeland. and the decisions have been classified by Mr. express or implied. pp. supra.

all the beneficiaries. THE BENEFICIARY. Ellisson. Hutchison's App. 5 6 Saunders v. f » Seamans Claflin v. 774. and have the whole estate. 15 Phila. Right to a Conveyance. under the English rule A may call for a conveyance on becoming of age. Ibid. v. 4 The English lutely rule. . 598. Khoads. Claflin.. that is to say. if — If the trust A is given property continued. v. 169. Gibbs. Wetraore. . and order the shares of the others to be conveyed 3 but as a general rule. although the beneficiary be sui juris. 115 Lewin. Eq. 239. Ames. in statute in New York the court may in its cretion refuse to order a conveyance.. Howard. 43 111. Vautier. 18. 5 but the American rule prevailing in most States is. the beneficial estate having vested abso- and entirely in the beneficiary. 239 . p. ubi supra. Walker Goodson v. 2 such case. 82 Pa. 6 Thus. Gunn v. Beal. Henderson's Est. 19. 63 Md. . Y. 10 . 109 Ellisson. which also prevails in some of the States. Zabriskie v. 509. 149 Mass. Bhoads it. 26 N. one of the beneficiaries objects. or if the purposes of the trust have been accomplished. being sui juris. 4 Bear. 96. and it. 1 2 3 * Goodson v. while under the American rule the trust continues until he becomes 7 though it is not definitely decided that thirty years old the estate might not be taken by a creditor. 132 Mass. 19. 106 Mass. is that. Brown. 1 dis- Though by If. 149 Mass. that. 89 N. desire the trust may be terminated or modified in any waj'. the trustee may say may that he will convey all or none. 8 still it would seem that he would have no greater right than his debtor . n. the court sever the trust. 145 is merely a dry simply to hold in trust for B. and there is no reason why it should be trust. . he cannot call for a conveyance if it would defeat the intention of the settlor.. J. as in such a case the purpose of the trust has not been accomplished. 3 Russell. 452. Claflin v. he may call for a conveyance if he be sui juris . Claflin. where property is left in trust for A until he reaches the age of thirty years. 583 Lent v.

title if he is his landlord. however. 105 Mass. McComas. 4 than the whole of an absolute estate will a conveyance. as no one else is interested. Walton Lemen Young Snow. 425. 9 p. Russell v. "Willard. Thorndike. 139 Mass. and there is no one who can object even under the American rule. 8 but if the aid of the court is sought it will not be given. Sise v. the interest of the beneficiary is vested subject merely to some simple duty. such as the payment of an annuity. against the estate. he claims. 38. or taken for his But where the estate is absoand can be alienated debts. Rep. 167 Mass. with power of disposition by will. and he desires it. 2 If. by making a small provision for some person unascertained. v. 146 Mass. 395. But obviously the maker of the trust can prevent the beneficiary's calling for a conveyance even under the English rule. the beneficiary may have a conveyance by securing the annuity properly. 63 Md. 69 Tex. Grinnell. v. he may have a conveyance. 9 Young Sears 2 8 4 6 v. Snow. ubi supra. 102. 332. Bendy. Follansbee (111. or for the trustee himself.146 through lute A whom and tbtjstee's handbook. Brandenburg v. all the beneficiaries and the trustee agree to terminate the trusts in such a case. has not such an absolute estate as entitles him to a conveyance 6 nor could he call for one if the trustee has discretion as to the application of the income. Therefore. nor can the beneficiary it buy in a tax 1 title and hold v. 6 7 8 23 N. The trustee cannot set up superior title in a suit for a conveyance.). 1 unqualified in the beneficiary . v. 711. however. 7 If. Neyland Supra. . 287. B. 5 And a beneficiary who has a life estate. 153. 48. the trust can be determined without a decree. even under the English rule. Choate. 8 Nor can the beneficiary deny the trustee's Nothing less entitle the beneficiary to . if there are contingent or unascertained interests there can be no agreement. 164 Mass. v.

and the Running of the 6 If the beneficiary is sui juris. and may "Walker v. * 5 A Wadsworth. 147 Right to Possession. p. Wainwright. 13 Pick. Acquiescence. . but a married woman Fyler v. — estate. The Beneficiary may lose by — 1 2 8 Dorr v. and neither he nor the trustee will be required to replace it and unless they are heirlooms or the appurtenances of . where he is intended to reside in a house and use the furniture. the beneficiary has no such right. pp. If he is given the use of personal property he may wear it out. 768. though . n. Jr. he may use them wherever he pleases. 91. beneficiary has trust securities specific but where he stocks. Supra. 19. Supra. tee his Rights against the TrusRelease. and has a full knowledge and appreand fully informed. 106 Mass. 38 and 86. 8 Where the instrument has no specific directions. 3 Bear. without power of anticipation cannot release. 563. 2. Fyler. married woman is sui juris. 2 As. the trustee may do . Statute of Limitations.THE BENEFICIARY. such as the tools on a farm or the furniture of a furnished house. and by statute in England the right of possession is in the beneficiary. But where the personal property is likely to be injured or lost in his possession. no right to the possession of the is given the dividends on or the rents of certain specific he can require the trustee to give him a power of attorney to collect but where the trustee has the duty to manage the estate and pay over the net income. for instance. . Ames. Ordinarily in America the right of possession of the real estate and chattels belongs to the trustee x but if the instrument intends that the beneficiary is to enjoy them in specie. 328. 108 Schaffer v. release as to her separate estate. 550. Shore. he may be required to give security for it. Lewin. 467. 387. . . 19 Yes. pp. the trustee will be justified in putting the beneficiary in posses- an sion of a dwelling-house or farm as a ficiary home but the benecannot compel him to buy him a residence. 4 The certain estates. so. he will be entitled to possession.

or mistake. 539. 10 : Denholm . 4 who is sui juris assents to a breach of trust. Badger. 74 N. 6 even though the transaction has been set forth in an account settled in court. if he was fully informed but the assent to one improper investment will not authorize a If the beneficiary . Gratz. 146 Mass. Badger v. . v. . Story. McKay. Henrici. 724. second of the same character. 7 So. 498. 8 or does not make it for an unreasonable time. he cannot subsequently recover the loss. transfer of shares after 60 years held barred Halsey v. Generally. but by statute in England Adair v. the beneficiary has come of age lately. 524 . as his inexperience may form a ground to invalidate his Nor will a beneficiary be bound bj' his release if action. 2 Perry. Nichols. & G. Y. 441. 2 Wall. J. Ridehalgh. St. ciation of the facts. 8 even though the beneficiary be a married woman without power of anticipation. 157 Mass. 6 Wheat. Prevost v. Brice v. 8 4 Raby v. p. 311 Iverson v. 377. Saulsbury. 3 Ch. 104. 120 U. Speidel v. v. 1 If. 9 he will be taken to have assented. 481. 136 Mass. there was fraud. and neglects to make any claim. M. Jr. 15 Beav. 339 . Hill. 65 Ga. 1892. Brimmer. 2 If the beneficiary knew and urged a breach of trust. 124. 434. 105. also. 6 If he has been misled by the trustee his assent will not conclude him.. Appellant. see Griffith p.. 319. 7 DeG. and so cannot complain but time will not deprive a beneficiary of his remedy unless he has been guilty of laches 10 a remainderman will . he release of may make a valid and binding any claim he has against the trustee for a breach of trust or otherwise. but is liable to contribution. he not only cannot recover. Leith. 11 Ves. he should be advised by counsel. 20. Hughes. 87. 325. 52 Pa. 6 6 7 Mant v. S. such as an improper investment. and he may disaffirm the transaction on learning the truth. See supra. D. accident. if the beneficiary who is sui juris knows of a breach of trust. 60. 1 Pope v. § 922. Tate. Farnsworth. 148 Mass. however. 148 a trustee's handbook. 8 9 Morse v. Stokes.

v. 237. S. 115 U. S. Hill. 14 Beav. Coburn. Lange. Y. 553. Preceding page. Latham. Third National Bank v. but see Browne 2 8 4 6 Cross. v. . . 105. WhitehiU. & K. 2 Myl. 377 Riddle v. 120 U. Am. Henrici. a bank which has received for him. and brings the matter home to the beneficiary so that he is compelled to take action. 5 Sim. Davis Hubbell v. 8 stocks and bonds. 6 he may take the benefit of the statute and the time will run from the date when he brought his adverse claim distinctly to the beneficiary's notice but the statute will not begin to run against the remainderman until his nor will it begin to run so long estate vests in possession as the beneficiary is under the control of the trustee. no claim to the property itself. Colley. 6 377 7 8 v. 60. C. p. 66. in order to see whether the property will rise or fall. cannot elect at a later time. S. 3. 143 TJ. 149 not be bound until his estate falls into possession.THE BENEFICIAKY. 8 But a beneficiary who has delayed electing whether or not to confirm a sale. 138. . The beneficiary has IV. 7 but he may constitute any person into whose hands it has come wrongfully a trustee As. 1 But a minor may cut himself off by inducing the trustee to act by fraud. v. Hoyt v. 65. 128 Mass. Statute Law. 136 Mass. repudiates the trust. which it knows to belong to the trust i — Bennett v. S. Morse v. Rights against Strangers. S. 98. 51 Md. Phillippe. 181 n. 53 N. Medbury. but as a general rule mere lapse of time itself will not bar the beneficiary where the position of others has not been changed. Stimpson. 2 What constitutes laches depends on the circumstances of each case. . 225 . . 135 U. 6 since the possession of the trustee is in the interest of the beneficiary but if the trustee takes an adverse position. 151 . for instance. 4 Ordinarily the statute of limitations will not run against the beneficiary. Speidel Philippi . 621. .

if he denies can avail himself of statute. . Soc. 92 N. . v. Molton v. that is to say. 471 Hall v. First Presb. 76. v. then he in a court of equity is equally meritorious with the beneficiary. 111 Ind. and it begin to run from the time when the beneficiary is in possession and not under disability and in case of fraud. . 12 S. v. 5 6 McCoy Poor. 478 Rep. 453. . Harvey. 134 Masa.150 a trustee's handbook. 6 is good against the benefi- Aside from those who claim by a superior or adverse the beneficiary may follow the property as long as it can be identified ' and if it can be clearly shown that other property has been substituted for the trust property. Henderson. 516. v. .. . Y. 56 Md. from the discovery of the fraud. period of adverse possession ciary. Hassam. although he claims under the trustee. W. 426 Williams v. See purchaser for value. Supra. estate. and so he may keep his legal title. 197. Where the title. as security for a personal loan to the trustee. 1 A . . 7 etc. supra. 39. without notice of the trust. Ward v. 1 Ohio St. 14 Allen. or when it might have been discovered with reasonable diligence 6 and the usual title. 1 2 8 4 Loring Supra. Gen. 4 A purchaser with the beneficiary's will notice from the trustee. p. if the transferee bought the estate for value. 62 Ala. Wetmore Brodie. it as trustee. and will not be compelled to hold the stocks and bonds in trust for the beneficiaries. 39. holds Although the beneficiary must sue in the name of the trustee. Ditto. Proprietors. 3 Gray. p. p. 941 (Ky. the substituted property can be followed. 520 Atty. . . Porter. 24. and the court will not help the beneficial against him. the defendant cannot set up the defence that the trustee was a joint wrongdoer in pari delicto. 1. 2 disseisor will not be held a trustee since he claims the property by a title which supersedes that of the trustee 8 and a purchaser for value without notice takes the property free of trust.) Merriam v.

4 DeG. I. 411.. 66 "Wis. Y.. 257. 372. p. D. Wayman v. Encyc. Deg. 109 Cavin v. . . 3d ed. 11 Barker v. Deffell. 24 S. nor is a repayment to him on the eve of bankruptcy a fraudulent preference 6 but a person who receives property from an unfaithful trustee cannot be held to be trustee of property which cannot be connected with the trust fund. vol. 1025. Wright. 13 Ch. Deffell. 458 n. 1 Important cases on tracing unmingled funds contra. C. 381. 6 Lewin. s Pennell v. Pay. 131 Hodges v. He may claim all that the trustee cannot identify. Knatchbull v. and Eng. and Pennell «. 4 Md. p. Chadwick. 595. . 2 P. Evans. THE BENEFICIARY. 6 Where the beneficiary has become a simple creditor. See Amer. Wins. 2 Ashmead.. Ch. Evans. M. 500 Clark v. Code (1895). 9 The beneficiary is not bound to follow the trust funds if be prefers to hold the trustee 10 but he may elect which he he cannot however hold both remedies. 526. . 71 Wis. the trust . 6 Howard v. 401 see Bowers v. Barker. 470 . Hallett. 151 trust funds form only part of the consideration of the sub- may be enforced to the exten of the trust property. 2 so if it becomes mingled with other money it cannot be followed 8 but the mere deposit of trust money with other money does not destroy its identity if the trust funds can be clearly shown as a sum added to another sum 4 and in such a case a beneficiary does not become a general creditor of the trustee who has mingled the trust funds with his own. supra. Jones. . 11 stituted property. Bullock. Law. . Underhill. and will pursue must elect one of them. 414. 1 Money is said to have no ear-mark. 696. 27. 2 Deg v. but generally a beneficiary has no preference on account of the nature of his claim. 15 R. « Re Hallett. . § 3189. 105 N. 592. 151 Mass. 7 Ga. 10 Evans's Estate. & G. 256. 9 Little v. 14 Wis. 133. . 104. § 590. he is preferred in Georgia 7 and Wisconsin 8 next to funeral expenses. 8 McLeod v. See Morse on Banks and Banking. 138 Mass. Gleason.

or have it converted and charge the trustee with loss. 8 Shaw v. Spencer. . South Sea Co. p. 382 Bayard v. 52 Pa. Barnardston. Stoneham. 2 8 1 . Bk. . T. Farmers & Mechanics' Bank. ubi supra. 18 Ch. Transfer of Stock. E 9 Mendes v. 363. § 66 Loring v. 88. 40. 7 Shaw v. 2 Johns. Spencer. ' ' . Supra. Dixon v. Div. Dixon. or where a corporation transferred stock improperly. & Hem. 382. Farmers & Mechanics' Bank. § 69. Gnedella. Albert v. pp. The fact that there is a usage to make transfers 8 is not an excuse nor can they rely on the power of sale which accom- — The . 127 and 142. p. Supra. v. . Supra. 68 L. * Magnus . If he elect to follow the property he may choose whether he take the trust property as it is. E. 159 Stockdale v. Div. or a tenant for life to whom he has paid or loaned part of the corpus of the estate. Salisbury Mills. 1 Right against Stranger aiding in Breach of Trust. 100 Mass. L. Cowper v. 125 Mass. 2 and this irrespective of the trustee's right to recover the payment. 100 Mass. in a manner which B it knew to be a violation of the trust. E. In such cases they will have notice T>f the trust if it is described on the face of the certificate. Transfer of Stock. So too he has a direct claim where a banker delivered up to one trustee the bonds * or money 4 which were confided to him by three trustees. Queensland N. Ch.. although the mere occurrence of the word trustee " has been held not to be notice ° but the general rule seems to be that the word " trustee " alone is a sufficient notice of a trust to put the purchaser or corporation on its inquiry as to the trustee's right to transfer 7 they must ascertain the right of the trustee to make the proposed transfer at their peril. City of Baltimore. beneficiary has an equitable suit against a person who aids in a breach of trust as for instance against a person to whom the trustee has made a wrongful payment in distributing the estate. 138 Bayard v. 2 Md.. 152 a tettstee's handbook. . 232. 37 L. 466. that is to say. 587. h Lowell. . 6 Lowell. 259.. St.

and not on the filing of copies. v. 317. it may the require the trustee making the transfer to supply the docuhis right to ments or other evidence showing make transfer. Co. I v. or some one claiming under him. 513. 5 and in Pennsylvania he might maintain an action for its recovery. 48 N. Miller v. 8 If the beneficiary is actually in possession of the trust property. 8 is the pos- name of the He cannot protect the property in equity any more than and could not. — The beneficiary incurs no liabilities through his beneficial ownership. Liabilities. St. 8 Supra. 2 they are liable. 125 Mass. 113 Pa. 32. 4 he may maintain any action for the property which any other bailee might maintain and no one but . the trustee. . 1 but must ascertain if he has If they know that the executor is acting in fact as it. the beneficiary has unusual Ordinarily. but in the absence of a by-law or statute requir- ing a deposit of the documents..THE BENEFICIARY. 149. 138. 141. 114 Mass. Bailey v. 6 where. Railroad.. 196. 7 courts. Zufall. Wheeler. Chicago. 189. nor sue in tort for an injury to it. Bird v. Eng. As this under the title of executor. 428. at law. § 73. St. owing to lack of equity privileges. 9 w Western Railroad Co. duty is placed upon the corporation. § 72. the "possession of the beneficiary session of the trustee. 7 Mass. 153 panies the office of executor. unless it be for taxation. Stearns v. 10 Met. 2 Ibid. Nolan. T. Newhall Fernstler v. Salisbury Mills. 177. L. Mut. Loring v. 137 Mass. Transfer of Stock. N. can set up his title against the beneficiary. Palmer. . it can only insist on inspection of them. for instance. Ins. i Lowell. Seibert. and he must sue in the trustee. 8 * » 6 i & N. p. trustee. V. restrain the assessors 9 10 from taxing the estate. 114 Pa.

cannot be sued for an accident caused by the blowing over of a resident. p. Townsend. If he obtains a wrongful advance of the principal. Y. 25.. 4 beneficiary who induces a trustee to commit breach A of trust is liable to the other beneficiaries. Poote. Abbott v. Hooper. 10 N. ch. § 15. 5 DeG. People v. Dillon. He may be liable for taxes where the trustee is a nonand such a tax is constitutional. and. Stat. and may be by his liable to the trustee. 338. but he becomes acts as an individual. Crocker v. 133 Mass. 2 He is property. 7 The trustee cannot withhold the income as against an assignee of the beneficiary's estate to reimburse himself for money lent the beneficiary before he was appointed trustee. 152. 479. Mass. Supra. but his liability is not affected by the liable fact that he is a beneficiary. M. Sup. Bate v. he may be liable for costs. p. supra. 97. for instance. 247. p. nor where a property qualification is needed does he gain a vote by his ownership. 168. & G. 1 2 8 i 6 6 7 8 Supra. In such cases the trustee's remedy does not go farther than the right to recoup out of the income 6 but his co-beneficiary may have a right to recover from him personally. 134. 91. fence. 3 Hill. the trustee may withhold his income to make up the deficit. 146 Mass. (1882). 1 He is not liable as an owner. Lewin. 3 not liable to indictment for a nuisance on the trust He does not become liable as a stockholder. . 154 a trustee's handbook. p. Pub. 6 but the court will not order him personally to refund a payment made by the trustee and dis- allowed in the trustee's account. Allee. and which the beneficiaiy took innocently. 333. Norling v. 8 If he litigates unnecessarily.

Curtis v. even though it concern land in another jurisdiction. since the court can commit the trustee for contempt if he refuses to obey its decree. INTERSTATE LAW. N. 140.. . Supra. 27 Tex. 131 Mass. 8. ed. trust is invalid if it is contrary to the law or policy of the jurisdiction where it is sought to enforce it. p. is established may regulate the trust. 316 . Stat. § 28 Jenkins v. p. §§ 1291 6 355 6 1 . 394. or can appoint a trustee in his place to execute it 4 but if the trust is established by the judicial decree of one State. (1882). C. Mass. C. Scarlett. 6 Cranch. 1 A trust can be enforced wherever the property is itself. although both the trustees and beneficiaries reside in other States. p. Massie v. 11th . 173. Pub. 38 111. Supra. p. Story. Watts. Gen. 160 Cooley v. 148. . 140. Supra. Thus a trust of land for a beneficiary in a jurisdiction where the beneficiary cannot hold land himself is invalid. Eq. 2 8 or wherever personal service can be got on the trustee.. p. 6 Blatch. it will not be enforced by the courts of another State unless it concern real estate in that other State. The courts of a State by whose decree a trust. 537. 141.. PART A IV. 8. ch. Juris. 5 and trusteeship be taken out there. 140. Stat. Or in New 6 a resident beneficiary desires it. (1895).' but a court Jersey if i 2 8 i Paschal v. J. Acklin. Supra. Lester. Smith. and p. § 112.

Dig. the court will not appoint a non-resident trustee. the court can in trustee. Pa. —When the trustee removes from the State or remains out of the jurisdiction. So. 6 sell The court can give a foreign trustee leave to land. ch. Stat. 680. S 2630. as in the case of personal property. If a non-resident trustee holds land and neglects his duty. (1891). Stat. . Rev. 8 In Pennsylvania. 140. some States by statute appoint a and order the land sold. Supra. the court may appoint a co-trustee for estate in the a non-resident trustee. (1883). 65. p. 20. CodeW. . Ohio (1890). p. they will appoint a foreign trustee. § 39 Code of Va. too. or if there is no statute vesting the new appointee. 1 Non-resident Trustee. Supra. p. p. § 5990. 2034. and the new trustee can sue him wherever he can find him. §4. (1894). and remove the proceeds to the jurisdiction of his original appointment. 2 If the property is within the jurisdiction and there is a statute vesting the estate in a new trustee. 9. p. (1 894 ). 16. (1887). § 52.. the matter will be terminated . § 30. and in some jurisdictions they are forbidden to do so 5 but in others. since Supra. 8 Brightly's Dig. See supra. p. 5 6 7 * Brightly's A singular remedy. where the beneficiary is a foreigner. p. can appoint a trustee to carry out the trusts established by a foreign will if it has the trust property in its jurisdiction. Pa. Va. a conveyance must be obtained from the former trustee. 156 A trustee's handbook. the court can order personal property 8 to be conveyed to a non-resident trustee where the beneficiaries 1 2 3 Rev. 4 As a rule. joint action of the trustees is indispensable. he may be removed. 2031. but if there is no personal service on the absent trustee and the property is with him. Me.

Foreign Investments. Code W. 25. as. 78. 8 — The trustee will be taxed on real estate ch. 110 Mass. 141. for instance. (1882). §§ 4-6. however. (1888). Stat. and out of the jurisdiction. Generally. p. 680. (1895). 2 Where a trustee takes out ancillary trusteeship. . Code Va. 144. ch. (1887). 4 need not inventory or account for foreign real it. 468 Code Ala. . 1 Mass Pnb. . Blackington. 6 trustees. 339. for instance. p. where the beneficiary resides out of the State and needs a home 7 or where both trustee and beneficiary reside in another jurisdiction. 413. 1 and where they are satisfied that a proper bond has been given. 2 KV. and . Pa. 99 Orniston v. Pub. § 40. a court will not authorize foreign investments beyond its jurisdiction — As. or the rents of in the jurisdiction of his appoint- In order to control the land. 84 N. (1896). Taxation. (1891 ). 3685. Olcott. (1882). he must settle his account in the principal jurisdiction for any surplus funds in his hands after settling his account in the subsidiary jurisdiction. 13 Allen. Annot. Greene. Amorv v. N. p. Stat. 7. 369. Mich. . only come into the jurisdiction of the trust to account. § 4179 (1894). 2032. As a general rule. been more observed in the breach than in the compliance by control. Stat Conn. he must be appointed in the jurisdiction where the land lies. Supra. Stat. 8 A trustee ment. § 2632 . and Mass. live 157 out of the State. (1894). §5831. Y. p. p. §§ 4709-4711 §§ 3. Gen. 4 6 « " 8 Clark v. J. §§ 467. Brightly's Dig. p. 10. (1882). Stat.INTERSTATE LAW. 6 and if he sells by order of court it must be by the order of the court where the land lies. 8 Gen. estate. mortgages or real estate This rule has. § Supra. § 17. Va. Supra. There may be good reason why a foreign investment would be authorized. Stat. .

1 The trustee may be liable to taxation on the personal property where he resides. where the land lies. and the principle only 1 2 is stated. Such laws are not unconstitutional. if the beneficiary resides in another State. the latter may also be liable to an additional tax. .158 a trustee's handbook. and. Perry. Hunt v. 287. Supra. p. 2 The statutes are too numerous and varied to cite. and may be compelled to pay a tax on the income in his home State. 154. 165 Mass.

148. settlement in court. 118. trustee's lien until settled. 83. 14. 17. § iii. ACCOUNT. must keep accurate and separate. how made. 108. form of. in breach of trust estops beneficiary. 83. 77. 77. 132. corrected by one beneficiary all get benefit. 19. ends liability.3. 4. 82. 122. become principal. 128. . 85. duty to investigate trust deeds and property. expense of charged to whom. effect of. open to inspection of beneficiary. 5. 119. must account for any benefit received. See Table op Contents. fictitious 29. 77. 4. vii. 79. ACCUMULATIONS OF INCOME. 2. 6. refusal to is cause for removal. implied from not disclaiming seasonably. duty to examine predecessors'. beneficiary entitled to. account not proper method of getting instructions of court.INDEX. 77 to 80. 29. need not accept trust. p. should be settled periodically. 124. ABANDON. does not take place of decree of distribution. trustee cannot abandon trust. 80. implied from meddling in trust. generally. 79-80. ACQUIESCENCE. ACCEPTANCE OF TRUST. liable for joining in false account. 78. 82.

or exercise of general makes estate assets. 76. 40. APPEAL. ALTERATIONS. under general special power. APPOINTMENT OF TRUSTEE. tents. p. 74. ADVICE. conveyance. ALIEN. ADVERSE INTEREST. 64. may be employed when. 130. 59-60. See Table op Con- § iv. 136-139. 157. 38. beneficiary cannot acquire. ADMISSIONS. Accumulations. ACTIONS. ALIENATION BY TRUSTEE. . 2. 136. duty to maintain. 12. give. 64. 74. 130. See Alterations. 39. as trustee. attachment and execution. See Restraint on Alienation. restraint on. 114. 135. provisions against. APPOINTMENT. trusts for. effect of. beneficiary no right to AGENT. 73. set off. 126. 118. ANIMALS. 73. 42. See Suits. ACTIVE TRUSTEE. ANTICIPATION. by by one trustee. he acquires. ADDITIONS. ALIENATION BY BENEFICIARY. must resign if trustee cannot have. 141. See Managing Trustee. as beneficiary. ANCILLIARY TRUSTEESHIP. 134. 48. 39.160 INDEX. trustee of counsel excuses what. APPOINTEE. beneficiary. what title passes. 13. charge on principal. 134. may ask court. 41. ADMINISTRATOR. APPLICATION OF PURCHASE MONEY. who administers estate. 39-45. 81. cannot exercise trustee's powers. may disclaim trust. See Restraint effect of on Alienation. what passes. 73. 146. viii. See Executor. of equitable estate.

ATTORNEY OR AGENT. 136 et seg. of trust property for trust debts. trustee's general trust estate. AUGMENTATION. 141. 161 13. trustee 8. 113. 156. 145. beneficial estate belongs to principal. expense charged to trust fund. made by court when.. 140. 20. of interest. of beneficiary's estate. who may be appointed foreign appointment. 41. by beneficiary to breach ASSIGNMENT. 29. APPRECIATION OF PROPERTY. 64. power of. 156. on conversion of security. BANKER. 7. 8. at none of dividends. ASSENT. 41. to. 113. regularity not questioned in collateral proceedings. APPORTIONMENT. made in what place. See Gain and Loss. sometimes purchaser for value. assignment does not pass may be assigned. 40. what court has jurisdiction. 9. 6. 134. 152. 11 . 140. is unfit to be trustee. rule as to employing self as. incomplete without title to the property. 111. wrong person. 107. trustee payment 49. who are proper persons. 15. 133. temporary trustee may be appointed. of trust property for trustee's debts. 14. 28. 14. made when necessary or proper. 156. 7. may be appointed where property trustee. of coupons. 112.INDEX. 6-7. APPOINTMENT OF TRUSTEE. is ATTACHING CREDITOR 39. 9. 13-15. 16. is. 148. BANKRUPT TRUSTEE. 6. 9. ATTORNEY. how made. ATTACHMENT. liable for delivering securities to BANKRUPT. 16. 16. end of life estate. may act by when. of trust. 119. trustee may be for beneficiary. 134. not necessarily removed. 72. ARBITRATION. 104.

in spendthrift trust. 130. el. cannot deny trustee's title as landlord. does not affect trust estate. person who may receive income at trustee's pleasure not. 138. no claim on trust property. 132. 146. estate of will descend like other property. 147. beneficial estate passes BANKRUPTCY OF BENEFICIARY. 131. may be compelled to act jointly. 143. 140 23. 86. 66. who may who is a. 77. 132. 66. 72. support apportioned where several. 140. 128. 38. on alienation of estate. 63. 141. 138.162 INDEX. 156. rights as creditor. maintenance and support of. 153. 132. 77. 131. his estate. in possession of property may sue. 149. seq. 38. rights against trustee. 64. 152. discharges his liabilities. 143. 71. 68. allowed. 146. BENEFICIARY. . 40. 146. 133. expense of suit to protect. 24. gift over on. be. 139. 132. right to account. 69. can compel trustee to perform interests not joint. stranger aiding in breach of trust liable to. 145. not usually necessary parties to suit. 136. 151. 151. 23-24. BANKRUPTCY OF TRUSTEE. right to income. valid. trust. must elect whether to hold trustee or follow property. 23. 134. right to follow property. contracts with trustee. 133. enforced where. cannot acquire tax title. alienation of estate of. 144. right to possession of trust property. right to information. 131. right to support. right to conveyance. restraint admissions by do not bind trust. to assignee. is not stockholder in corporation. 65. 38. 66.

14S. payment no right of share to before end of trust. BONDSMEN. 10. purchase of bonds at discount to balance ones at premium improper. open to beneficiaries' inspection. See Sureties. 142. liabilities. 147. causing breach of trust liable for fraud. 112. not mortgage bonds. BONUS. 115.16. 154. AS INVESTMENTS. 19. BETTERMENTS. on executor's bonds liable for his acts as trustee. need not be converted. 124. BREACH OF TRUST. not apportioned. or accidental.INDEX. 88. liable. is cause for removal. 21. 147. BONDS. 153. trustee's liabilities to. 112. 154. 95. . . 141. expense of Surety Co. 11. liable for co-trustee if joint bond given. 82. 163 BENEFICIARY — continued. 72. loss of rights. may be notified of proposed action. to advise trustee. 95. need not refund payment. 21. See Commission. charged to what. 149. charged to whom. 98. BILL FOR INSTRUCTIONS. 121. 19. 77. unfit to be trustee. 81. interest apportioned when. 97. 14. selling at premium. when sureties required of trustees. BOOKS OF ACCOUNT. 27. refusal to give cause for removal. may be required. 12. care of. may disaffirm transaction. 118. BONDS. 10. discharge trustee. 122. 148. railroad bonds not real securities. but not if merely technical. amount sureties required. trustee can take none from trust. may may is choose damages or property. 106. BENEFIT. gifts to trustee. 90. 29.

147. 113. court will appoint only capable trustee. See Principal is and Income. 95. CHARGES. who may support of. of. BUILDING. should be converted. 119. 89. not converted when. trustee may be for beneficiary. draw. 117. trusts for animals. See Incapable. CESSER. 121. trustee should be. 130. CHANGE OF INVESTMENTS. BUSINESS RISKS. contribution beneficiary among those liable. 85. when made. 15. 87. See Expenses. CAPITAL. CHOSE IN ACTION. CAPRICE. 62. commissions charged to trust fund. trustee not removed CAPRICIOUS TRUSTS. 127. 151.164 INDEX. 91. payment to father for. 71. remedy for lost how. 149. 70. liability for. 152. trustee's lien for. BROKER. 29. where parent living. CARE OF TRUST PROPERTY. . See Custody. gift over of beneficiaries' estate on condition valid. 96. commissions as between principal and income. BUILDING LEASES. CESTUI QUE TRUST. of testator carried on sometimes. 119. BREACH OF TRUST — continued. stranger aiding in liable. for. BUSINESS. 13. has right to possession 108. not discretion. loss by breach falls on principal. CHATTELS. CAPABLE. with personal property conversion. CHECKS. effect of notice. 20. 86. 72. 148. who CHILD. 147. 124. See Notice. 88. See Beneficiary. 92. damages for. 125. should notify obligor. 28. may elect to follow property or trustee. joint and several. CAPRICE OF BENEFICIARY. rule as to employing self as. 139. 52. 94.

with beneficiary may be set aside. from debtor to trust and self. expense of charged to whom. 16. COMPLETION OF DUTIES. 32. See Compensation. 27. 25. extra on principal. buy up. COMPOUND INTEREST. 71. 74. 119. trustee cannot come in. trustee's lien for. 30. for distribution of estate. 165 CLAIM. for sale not specifically enforced when breach of trust. COMPETITION. 56. 29. trustee binds himself personally. 73. COLLECTION. 30. trustee can take no commission from strangers. 64. 31-32. See Inteu-Statk law. of beneficiaries. discharges trustee. 59. 38. signing as "trustee " makes no difference. in appoint- CONTINGENT REMAINDER. trustee entitled what. 127. 30. purchaser must see that they are fulfilled. 73. when on which income to cease valid. 50. 65. sale of. 59. 31. 120. 28. of beneficiary as a condition. for expert services. but may follow it in hands of stranger. 24. must 142. rule as to.INDEX. between trustee and beneficiary. SUIT. . COMPROMISE OP CONDITION. 64. trustee cannot beneficiary cannot CLERK. 93. 33-36. 72. 120. 150-151. 141. 65. COMMISSIONS. 28. 31. from what fund paid. 50. 16. proper. CONSENT. power dependent on. 146. beneficiary has none to trust property. be returned where sale disaffirmed. 119. 32. as to compensation valid. buy up. must account for any received. CONFLICT OF LAWS. on termination of trust. 59. what are allowed. CONTINGENT INTEREST. 72. 142. CONTRACT. 23. to what extent the trustee can bind the estate. CONSIDERATION. but trustee liable for breach of. discharges trustee. at law. rule for various States. sufficient to intervene ment of trustee. apportioned. charged when. 94. 139. COMPENSATION.

43. 92. necessary when. 29 rule as to employing self as. CONTRIBUTION FOR MAKING GOOD BREACH OF TRUST. contribution from. 130. 145. beneficiaries' right to. may trusts for. on execution. CORPORATION. trustee liable as stockholder. liability for transfers of stock. 124. 72. 90. CONVEYANCE TO REMAINDERMEN. 91. to successor. 24. 74. none of property meant to be enjoyed in specie. CONVERSION OF SECURITIES. of real into personal may be authorized by court.166 INDEX. 119. 13. not of testator's good investments. apportionment between principal CONVERSION OF REAL INTO PERSONAL PROPERTY. 38. of infant's estate. 40. into trust investments. teer. and income. 90. may be for beneficiary. 91. CO-TRUSTEE. 42. beneficiary. 123. 105. implied authority. 146. COUNSEL. by one trustee void. CONVERSION OF FUND. on cy pres doctrine. 92. 24. improper. 24. be a trustee. 152-153. 122. 41. 124. liability for acts of. expenses charged to trust fund. 154. what title passes to volun- to purchaser for value. securities at premium not necessarily converted. trustee is stockholder in. 124. is beneficiary not. . 39. 28. from from co-trustee. See set-off. COUNTER CLAIM. to remainderman. 92. 90. 39-40. 91-92. 124. 93. trustee cannot delegate trust to. CONVEYANCE BY TRUSTEE. 89. to assignee. CONVEYANCE.

sale under. . against equitable beneficiary's rights as. 155.INDEX. trustee. 57. 127. 133. 63. when. 51. 92. in equitable estate. CRIMINAL LIABILITY. CREATOR OF TRUST. 123. CREDITOR. 8. 88. CURTESY IN TRUST ESTATE. on trust property. 89. 44. 167 COURT. trustee liable controls execution of powers when. 134-140. amount of loss and interest. 140. 25. 81. 86. COVENANTS. 41. See Settlor. 26. will not remove when. conversion under. estate. will appoint trustees when. of beneficiary in spendthrift trust. of non-negotiable securities. DAMAGES FOR BREACH OF TRUST. his rights may set off debt in equity. power See also Probate Courts. 120. 8. of person exercising general power of appointment takes. 120. 127. or deed. 82. of negotiable securities. 42. 88. 127. on in lease. remedy against remedy against for nuisance trust property. trustee. 56. for taking trust funds. 151. CREDITOR OF TRUST. degree of care required. usually measure of. may may itself administer trust. CREDITOR OF BENEFICIARY. 19. 6. CY PRES. will instruct trustee when. may order sale of trust property. of trust chattels. to appoint trustee what court has jurisdiction to remove will remove trustee when. 19. CUSTODY OF TRUST PROPERTY. cannot give to co-trustee. 139. 19-20. sometimes replace property and earnings. 135. exercise its discretion in removing a trustee. 108. 52. 6. 156. 87. 147. 20-21. 41. what court has jurisdiction to appoint trustees.

DEVISE. DEPRECIATION OF PROPERTY. 90. 17. 16. 46. 2. of legal estate. trustee liable for delay in investing. 44. new trustee 53. 49. DEATH OF SOLE TRUSTEE. of legal estate. collected 73. trust ending. 74. cannot delegate trust. of one trustee sufficient. may employ agent where there is necessity. general power to defend actions. liability ends at. 44. 118. when of sale must conform to statute. 90. appointing trustee should order transfer of DEED. 43. 10. 43. 121. 46. DAMAGES RECOVERED. office and title pass to survivor. DELEGATE. 75. trustee is liable on covenants. what become of office and title. ministerial acts may be delegated. by 16. 63. beneficiary may lose lights by. may be appointed. 17. by resignation. destroys power. DECREE. 17. 129. 120. DELAY. DEBT. DESCENT. of equitable estate. See Disclaimer. 49. set off. DEFEND. DEATH OF HOLDER OF POWER. 120. 43. 6. 17. 43. 25. of equitable estate. from individual and trust debtor apportioned. 106. 76. 64. 48. trustee cannot delegate powers. liable on recitals. DEATH OF TRUSTEE.168 INDEX.. 76. 42. after DEMAND. 44. title. beneficiary. 107. 55. 149. payment of one generally loss of principal. 2. ends trusteeship. what can be DECLINE. in converting. . 19-21. 133. DEVESTMENT OF OFFICE. title passes to title how whom. by death of trustee. by removal. not apportioned. 17. 128. 113. 133. passes to successor.

125. 71. defaulting trustee liable to. 24. 21. as to support of family. 28. DISCOUNT. 47. 17. at discount does not balance one at pre112. beneficiary can disaffirm transaction led. mium. by refusing effect of. cannot be delegated to agent or co-trustee. 2.INDEX. 66. 72. cannot be exercised by court. of trustee as to support of beneficiary. 21. 99. 20. in managing trust. the court. to give bond. 48. how made. •with beneficiary. 99. DISCRETIONARY POWERS. 47. heir or representative of deceased trustee cannot always. 148. 52. DISAFFIRM. 98. 85. 138. in spendthrift trusts. is eligible DIRECTOR. 169 DILIGENCE. with other trustees. what is sound in investing. 3. where mis- can disaffirm sale by trustee to self. DISABILITY OF TRUSTEE. trustee as stockholder in corporation. controlled by court when. amount necessary. 51. honest exercise of not cause of removal. 48. 24. 20. DISBARMENT. 51-52. 96. trust may be refused. form of. beneficiary is not. bond purchased DISCRETION. 138. whole trust must be refused. one of several trusts in same instrument. 58. court may exercise in removing trustee. if unreasonable cause for removal. required. 19. not cause for trustee's removal. 2. 3. if of one trustee blocks all action. 87. personal exercise of essential to execution of power. 48. 67. 90. 47. DISAGREEMENT. 4. 4. 121. trustee cannot profit by. " in his discretion " means little. 97. cannot be exercised by any one but trustee. unreasonable or prejudiced exercise is cause for removal. amount required in investing. effect of. 95. DISCLAIMER. execution not controlled by . 3. 3. 49. 125. 75.

examine trust property and documents. 118. DOWER. 126. 118. trustee may be. DRUNKARD. 147. 148. 82. reasons for execution need not be given. is all to the trust. DISCHARGE OF TRUSTEE. 73. DUTY. 118. 82. may in trust estate. compensation for. DISSEISOR. to exercise the trust personally. 109. 52. where trustee is in doubt. DIVISION OF TRUST. 117. 133. ignorance of no excuse. See Neglect. 73. office. 3. not to come in competition. ou wasting investments. not to aid adverse claimants. 133. 113. by beneficiary. 150. 83. execution set aside for fraud. by fictitious account improper. 109. 73. 81. 14. 16. 128-129. . 44. in equitable estate. DIVIDENDS. conveyance to remainderman necessary when. be removed from neglect of. 1. may notify beneficiary of in- tended action. to 74. payment of shares at different times. payment of part. not trustee. unfit trustee. of property. 119. 72. ordinary are income. to exercise utmost good faith. may get instructions of court. of trust fund at trustee's risk. 52. may have decree for. paying whole fund fraud. by end of trust. not liable for use of. See Devestment of Office. 4. 119. in various ways. extra or stock belong to not apportioned. 53. 118. cannot accept part. DISCHARGE OF ENCUMBRANCE. 20. 111. 69. whom. cannot disclaim part. cost apportioned.170 INDEX. DISCHARGE OF TRUSTEE. 81. DISCRETIONARY POWERS — continued. 125. DISTRIBUTION. 109-110.

37. 84. 37. 134. 73. to keep accounts. 125. ESTOPPEL. to fence. ENCUMBRANCE. ESTATE OF TRUSTEE. as to testator's business. 133. to examine predecessor's accounts. 37. alienation of. to take possession of property. 120. incidents. by by receipting for securities. 38. ERRORS. 39. 132. ESCHEAT. 171 DUTY — continued. to pay taxes. in code states no title. EMPLOYMENT. 142. discharge of apportioned. 82-83. how ended. in real estate what is needed. liability for. 86. 86. to repair. EFFECT. ENFORCED. to support beneficiary. 122. END. ELECT. 93. trust may be where. ESTATE OF BENEFICIARY. to convert into trust investments. to insure. 43. not affected by statutes making tenants in common. trusteeship 82. 86. or trustee. in investing is what. of equitable estate. 95. passes to survivor. cannot be severed. 69. 4. beneficiary may elect to pursue property may elect damages or property. 77. 85. 38. 16. of disclaimer. 151. 149. 86. . 89-90. to prosecute suits. 140. as to class of investments. 132. laches. 22. in personal property absolute. 145. 121. to invest.INDEX. 96-100. See Estate op Beneficiary. 155. 113. is joint. 16. EQUITABLE ESTATE. of trust discharges trustee. of a person is not trust property. 39. 95. EMBEZZLEMENT.

2. 41. 84. see Parent. 53. 3. EXCHANGE. 15. need not accept trusts in same will. bondsmen for acts as trustee. 61. Personal Property. 29-30. 128. 150. FIT. 11-12. 14. 5. power to disclaim testator's trusts. 86. 46. when he becomes a trustee. 5. 63. of protecting beneficiary. 2. End op Trust. 115. 12. the trust property into hands of stranger. power to.172 INDEX. 151. does not take trust powers. EXTINCTION OF POWER. sale of. discharges See trustee. 117. 108. duty to. 30. FENCE. 46. FOLLOWING. EXECUTION. duty as to trust estate. what are chargeable to income and to trust fund. 5. of suit allowed. increase usually income. FARMING IMPLEMENTS. by settlement. See Unfit. principal. 17. EXECUTORY EXEMPTION. liability EXPENSES. 134. what may be charged of accounting. 63. may be used by whom. 17. 80. 50. 16. See See Chattels. EXTINCTION OF TRUST. from furnishing sureties on bond. from DEVISE. EXECUTOR. may inherit trust. 10. levy of does not affect trust estate. may be a trustee liability of in fact. fit court ordinarily will only appoint a trustee. equitable estate may be taken on. trust property may be taken for trust debts. 108. 56. 5. his duty as to testator's trusts. 41. FARMING STOCK. 29. EXECUTOR OF TRUSTEE. of power must be accurate. . 12. ends executorship and becomes trustee how. FATHER. a trustee should be fit. cost charged to what.

FOREIGN TRUSTEE. 173 FOREIGN INVESTMENTS. 124. rents from not part of account. See Chattels. may be used up when. 29. when income. trusteeship neces- need not be inventoried. 99. of lunatic or infant trustee. 154. 108. 106. 107.INDEX. appointment of. GIFTS. 124. 2. HEIR OF TRUSTEE. FOREIGN SECURITIES. does not take trustee's powers. 58. FURNITURE. improper investments. may be forced to contribute. 112. 73. contribution among parties to. on separate transactions not usually principal. 72. set off. to trustee. GUARDIAN. 156. payment required of trustee. GENERAL ASSIGNMENT. beneficiary liable for. 46. 157. 78. 126. protects when. 27. 126. 108. 44. 156. in contract between trustee and beneficiary. replaced from income. 72. See Assignment. at once draw whole fund needed. 126. 78. is under power to use principal if what is in sale. 43. to guardian. GRAVEL. 1. FORFEITURE FRAUD. 157. HONESTY. presumption of fraud if trustee gets any advantage. 13. 119. GOOD FAITH. 133. 16. ancillary sary. 79. . 71. 72. 157. 20. use of position fraud. 67. of equitable estates. title to trust estate. may have not enough alone. removal of. 53. 157. FOREIGN REAL ESTATE. 124. 121. in execution of power. GAIN AND LOSS. to of trustee's estate. effect of. 99. 157. 17. in account.

143. may HUSBAND. 120. HOUSE. may be withheld to reimburse trustee. beneficiary is entitled to. of infant's being trustee. be trustee for wife. 139. INJUNCTION. 64. See may be enjoined. " INCOMPETENCY. not proper trustee for wife. 125. INFANT. cannot be enforced. accumulated. 63. ILLEGAL TRUST. INSANE. 22. . strangers not entitled to. 120. court will instruct when. 143. 108. 23. 7. 70. may be collected by one trustee. 31. 155. 81. INCAPABLE TRUSTEE. anticipation of. 147. is net. 13.174 INDEX. commissions on. of legal estate. trustee in place of. need not give to stranger at beneficiary's request. may be on condition. 14. of ownership fall to trustee. beneficiaries' right to use. may effect infant trustee be a trustee. IGNORANCE. of beneficial estate. 108. 141. 92. 13. INCOME. no excuse. 119. 141. no excuse. payments to. 132. beneficiary's right to. 125. breach of trust INNOCENT PURCHASER. 95. 125. 143. 75. Purchaser for Value. becomes principal. 144. trustee may require. 144. payable when. investment should produce. 14. for. for first year. when new INCIDENTS. IMPLEMENTS. 144. INFORMATION. may be used by whom. may be removed. what See Principal and Income. INDEMNITY. no conversion in trust right to support. 115. 13. expense of suit to establish allowed. See Restraint on Alienation. of duties. See Support. See Chattels.

in discretion of trustee means what. 66. 95. 135. American rule. soundness determined by facts at time of investing. English rule. 175 INSANE PERSON. 131. 126. as to distribution. bill for lies when. for not investing. on bonds bought at premium apportioned when. of testator. 115. INTEREST. sound discretion must be used in. . allowed in various States. 131. INSOLVENCY. 100 to 103. See Bankruptcy. potential payee in spendthrift trust. not always to be converted. 99. 90-91. 98-99. INSTRUCTIONS. 155. 155. INTEREST ON INVESTMENTS. 81. 99. 98. improper ones. 141. 121. 10. premiums charged whom. simple and compound. 142. See Lunatic. duty to make. 112. 138. for breach of trust. INTER-STATE LAW. may get when. 112. who are. person who may receive income at trustee's pleasure not. proportion in one security. what are proper. IRREGULAR SALE. 121. holders of general power of appointment not. INTERESTED. 118. liable for neglect of. gain on one does not balance loss on another. INSURANCE. 141. 96. 59. 58. persons having possibility not. INVESTMENT. investments. 93. purchaser takes risk of. should be changed when. to 86. 131. 127. person may have trustee appointed. charged. 116. 93. INVALID TRUSTS. 93. fictitious account. duty to insure.INDEX. right to support. 112. 96. proceeds. apportioned. should not be sought by trustee See Support. INSANE PERSON. 95. 142. 82. 97. aided when. 99. 82. 66. 82. 94. apportioned how. must produce income and be safe. 131.

of JOINDER. 23. LEASE. . makes trustees liable JOINT TENANTS. 19. LACHES. 132. JOINT TRUSTEES. LIABILITIES. for allowing rent to fall in arrears. 64. jointly. 47. should be converted. whom as parties. 121. 48. LEGAL EXPENSES. 46. what court may remove a trustee. 63. 61-62. 83. VACANT. 43. 121 to 128. 122. excused from by trust instrument. charged to trust fund. must exercise must sue survivorship. when right to contribution. what may appoint trustees. 148. liability joint and several. building lease. trust jointly. 61. JOINT. 155. 121. rights of beneficiary lost by. for acts of predecessor. 149. for acts of co-trustee. 90. 121. LET. beneficiary cannot lord. 122. See Real Estate. 94. for co-trustee. 62. 48. 64. 80. 122. where trust can be enforced. beneficiaries are not. trustee must use good. 46. See Lease. deny trustee's title as land- LANDLORD. improper investments. 48. 115. 140. JUDGMENT. taxes on charged to principal. 124. 140. 8. joint 117. 126. 124.176 INDEX. JURISDICTION. office. liable for co-trustees. to beneficiary. See Estate op Trustee. 29. 122. for not investing in particular stock. 121. LEASEHOLDS. 38. execution of powers necessary. for neglect of duty. 98. JOINT BOND. 38. and several. 38. 25. 155. 121-129. power is what bind the general and incidental to estate. 123. trustee is liable on covenants. 132. 93. 123. courts 126. LEGAL ESTATE. LAND. trustees are. may be forced to act jointly. 146.

barred by statute there is no rem- edy. statute of. OF BENEFICIARY. 149. 84. trustee is liable as owner of property. 120. 88. on contract. 120. LIFE TENANT rights. 28. trustee is liable on covenants in deed. trustee's for expenses. 63. 118. trustee liable on contract of sale not enforceable in equity. LIABILITIES. 149. 124. 154. criminally. 149. 121. 30. when statute runs for trustee. 89. 153. 133. LIEN". statute runs after decree of distribution. for care of securities. for for payment of share to beneficiary. for taxes. 128. 87. trustee's for his charges. payment to wrong person. — for use of discretionary power. 98. 120. trustee is liable as stockholder in corporation. for errors. 117. 25. 125. trustee on covenants in lease. beneficiaries on trust property. on personal security not proper investment. 27-28. statute runs for breach of trust when. 26. 41. 154. 128. 119. 120. 59. 120. 26. 118. 24. 154. 12 or to relative or partner. 25. 24. cannot loan trust funds to self. discharges trustee's liabilities. mechanic's lien attaches when. 150. 120. to strangers. for fraud. 177 LIABILITIES continued. . for misrepresentations. LOAN. 120-124. 125. terminated.INDEX. 128. ends on death. if trustee for respective See Principal and Income. 95. criminal. inducing breach of trust. AND REMAINDERMAN. for distribution of fund. See Criminal Liability. trustee's duty to in investing. 126. LIMITATIONS. 69.

self. 60. 41. 29. trustee. can be followed. . See Support. MISREPRESENTATION. if honest. MECHANIC'S LIEN. 125. See INDEX. See Table of Contents. duty to. xvi. 136. 60. 71. 13. power implied. 60. 68. MEASURE OF DAMAGES. liability for. See Infant. power of. MARRIED WOMAN. beneficiary. not a cause for removal. of sale mortgage implied. 76. 19. xiv. account may be re-opened for. liability for. 140. cannot exercise settlement on 74. LUXURIES. 70. 124. 75. xv. MAINTENANCE. 149. liability for. MANAGING TRUSTEE. MINOR. 84. 82. See Settlor. 69. principal. may be a may be removed. restriction as to income. is cause for removal. 113. MAKER OF TRUST. MORTGAGE OF TRUST PROPERTY. status of. by LUNATIC. expense of declaring. 125. MONEY. of sale does not include. not general power. MANAGEMENT OF TRUST PROPERTY. See Damages. 151. court will not order. care single trustee may collect. 125. MISTAKE. 21. 147. 13. 139. powers. of. of trust. 79. 87. MISMANAGEMENT. allowed when. attaches to trust property when. 13. Gain and Loss. 61. all pp.178 LOSS. 19. 120. effect of lunatic's being trustee. 74. 75. power power 60. by breach of rights liability for.

second not proper investment. priorities in equitable estate. See Trusteeship. trustee is liable for nuisance on trust property. 152. railroad bonds not investment in. 132. in equity. trustee. of trust property does not belong to beneficiary. to examine. what 135. 150. 68. 60. should be given when. will not be appointed when. 67-68. of trust property belongs incidents of fall to trustee. 30. margin of bonds may not be. may not be removed. OFFICE OF TRUSTEE. NEED. NOTICE OF TRUST. MOTHER. 88. 85. 16. effect to obligor of chose. NEGLECT. 20. trustee liable for. court will not control discretion as to. 95. 154. to disclaim implies acceptance. . 134. required when. 135. 27. 179 MORTGAGES. drawing whole fund at once a fraud. See Parent. 143. 149. defined. NET INCOME. what is. See Single Trustee. 131-132. not beneficial to trustee. NEGOTIABLE SECURITIES. 26. trust securities. 22. word " purchaser with. beneficiary not liable for. security. may NOTICE. 99-100. care of. OWNERSHIP. 121. expense of charged to whom. 89. or See Foreign Trustees. to claim rights estops beneficiary. OFFICE. of prior equity.INDEX. 22. 40. 69. 95. 98. 152. 6. 26. ONE TRUSTEE. what is. considered to be in beneficiary. NON RESIDENT TRUSTEES. to trustee. on is. 115. 135. 23." 40. 122. NUISANCE. ascertained when.

180

INDEX.
unfit trustee, 14.
child, 70.

PARENT, is
payment

duty to support
support of child

may

include parent, 68, 70.

to for child, 70, 71, 119, 125.

PARTIES TO SUIT,
are sometimes, 23.

-who are necessary, 64.

beneficiaries generally not necessary parties, 23.
to suit for removal, 19. to suit for

appointment of

trustee, 8.

PARTITION,
power

estate of trustees is not subject to, 38.

to, 61.

PARTNERSHIP,

improper investment,

98.

should be converted, 89. may be authorized investment, 95.
profits partly principal

when, 105.
of, 38.

PASSIVE TRUSTEE,

duty

none at law, 74-75. PAYMENT, by debtor, to single trustee, 75. of share to beneficiary before end of trust, 118. by mistake beneficiary not required to refund, 154.
to infant, 70, 119, 125.

to attorney, 119.

wrong person, 117, 119, 125. wrong person, beneficiary may recover, 152. PERSON, of bad habits may be removed from office, 20. PERSONS, who are beneficially interested. See Interested.
to

to

PERSONAL,

PERSONAL LIABILITY. PERSONAL PROPERTY,
147.

a personal confidence, 74. See Liability. conversion into real, 91, 92. not converted when meant to be enjoyed in specie, 91, 108,
a trust
is

taking possession

of, 84, 85.

who

entitled to possession, 38, 86, 91, 108, 147.

PERSONAL REPRESENTATIVES OF SOLE TRUSTEE,
of deceased trustee

cannot disclaim decedent's trusts, 2, 17. may be invested with trust
43-44.

estate, 2, 17,

of deceased trustee does not succeed to trust powers, 17, 46. of deceased trustee, duty as to trust estate, 17, 46.

PLEDGE. See Mortgage. POSSESSION, of beneficiary

is

that of trustee, 38, 153.

INDEX.

181

POSSESSION OF PERSONAL PROPERTY,
the taking of, 84-85. who has right to, 38, 86, 147.

POSSESSION OF REAL ESTATE,
who has
right to, 38, 147.

taken how, 83.
trustee is entitled

POSSESSION OF TRUST PROPERTY,

to at law, 38. beneficiary may be entitled to in equity, 38. should be taken at once, 82-83.

POSSIBLE PAYEE,
66, 141.

interested in appointment of trustee, 10,
trust, 66, 131, 135, 138.

but has no interest in

POVERTY OF TRUSTEE, not always
POWERS,

cause for removal, 20.

general principles, 44. incidental to the office of trustee, 45-47. the court can grant, 45. the legislature can grant, 45. specially given by the instrument, 46. general and special, vesting when and when not, 46-47. must be exercised by all jointly, 47, 48. when lost by disclaimer of one trustee, 4. exercise of discretion is essential part of, 47.

execution must be joint, 48. exception as to collecting money, 48. to act by agent or attorney, 49. execution must be exact, 50. partial execution may not exhaust, 49. but may sometimes, 53-54. defective execution aided for purchaser, 50. defective sale confirmed, 58. substantial execution aided, 50. literal execution necessary when, 50. court controls execution when, 51, 52.

execution set aside for fraud, 52, 53.
of single trustee, 75.

pass to successors, 46. and survivors when, 46-47. of sole trustee, vest in successor not in heirs, 46.

fraud in execution of, 53. exhausted how, 53, 54.
extinction
of, 53.

182

INDEX.

POWERS — continued.
cease

when

trust

is

accomplished, 53.

liability for exceeding, 125.

not liable for use of discretionary, 126. of sale are not incidental, 45. of sale, 55. See Sale. of support, 65-66.
to contract, 64.

of compromise, 64.

of revocation, 69. of arbitration, 64.
to lease, 61.

of partition, 61.
to

mortgage or pledge,

60,

'61.

of exchange, 61.

to convert real into personal property, etc., 91, 92. to appoint new trustee when, 6, 7.
to appoint trustee in

whom,

7, 12.

POWER OF APPOINTMENT,
ciary, 131.
if

holder of

is

not a benefi-

general power exercised creditors of holder take, 135. otherwise where power is special, 135. who administers estate where general or special, 12.

POWER OF ATTORNEY, payment on invalid power,
trustee cannot give a general one, 49, 76. may give special power, 49, 76.

119.

PREJUDICED TRUSTEE, may be removed,

20.

PREMIUM ON BOND,
bond

reduced by sinking fund, 112.

selling at not necessarily converted, 90. purchase of bonds selling at premium and discount to balance improper, 112.

PREMIUMS. See Insurance. PRINCIPAL AND INCOME, what

is,

104-113.

importance of distinguishing, 104. gain and loss on securities, 106, 113. discharge of encumbrance, 113. accumulated income, 109. timber and gravel are what, 107. farming stock, 108. dividends are what, 109-111.
extra dividends, 109.

INDEX.

183

PRINCIPAL AND INCOME— continued.
stock dividends, 109-111.
interest apportioned interest
repairs, 114.

when, 112. on bonds bought at premium, 112.

alterations
taxes, 115.

and

additions, 114.

betterments, 115.
insurance, 115.

expenses, 117. broker's charges, 117. legal expenses, 117.

support of beneficiary, 66, 70.

apportionment on conversion, 104. apportionment at end of life estate, 113.
right of single trustee to handle, 48, 75, 87.

PRIORITY, among transferees PROBATE COURTS, proper
will, 3.

of equitable estate, 134.

place to
will, 7.

file

disclaimer under

appointment of trustee under

PROFIT, trustee cannot make PROMISE, to accept trust not

profit

from
2.

trust, 28.

binding,

PROPERTY,

what may be

trustee should examine, 1, 82, 83. trust property, 82.
9, 83, 84.

vests in trustee how,

the trustee's estate in, 37. trustee cannot take any benefit from, 27. ownership of trust property belongs to trustee not beneficiary, 22.
* no claim on, 131. follow into hands of stranger, 151. unproductive should be converted, 89-90.

beneficiary

may

but not property to be used in

specie, 91.

beneficiary's right to possession of, 38, 86, 91, 108, 147.

beneficiary's right to conveyance of, 145-146. passes to successor how, 43.

passes to remainderman how, 42. trustee cannot use trust property, 27.
care

and custody

of, 86.

of trust

may be

taken for trust debts, 41.

replaced when, 127.

80. 59. 60. unproductive improper investment. joint in equity. 60. 150. REGISTERING BONDS. 37. takes risks of regularity. alterations and additions charged to principal. for expenses of accounting. trustee title takes only necessary should stand in joint names. foreign. 83. RECEIPT. 78. for 29. 144. beneficiary need not. care and custody of. 122. See Disclaimer. . •who entitled to possession. 39. title in. 84. conversion into personal. PURCHASE MONEY. 29. repairs charged to what. from beneficiary. 48. 134. 91-92. 16. 95. 98. 86. PURCHASER FOR VALUE WITHOUT NOTICE. sufficient when. for expenses of suit. 63. 6. 83. 38. REFUSAL OF TRUST. PURCHASER.184 INDEX. 58. 59. 27. 123. 58. 86. REAL SECURITIES. beneficiary disaffirming sale must refund consideration. duty to improve. 95. 39-40. questioned when. deed should bfe recorded. must be trustee what are. payment to beneficiary. rights of. 90. trustee cannot buy trust property. REFUND. taking possession of. REAL ESTATE. who is and is not. 38. 59. not REIMBURSEMENT. 142. RECORD. 114. 128. unproductive should be converted. 48. bound by when. liability for joining in. RECEIVER. 88. 154. must see to application of purchase money when. 89. 142. 147. 157. of one trustee. REGULARITY OF TRUSTEE'S APPOINTMENT. 30. appointed when. 114. purchaser must see to when. railroad bonds not. when proper.

discharges liabilities. apportioned when. 120. married women. by using discretion to draw whole fund fraud. RESTRAINT. power of inserted See Devestment of in settlement in England 69. liability for misrepresentation. in discretion of court. 86. title vests in 1. 95. of absentee trustee. duty to. 2. 84. 14. 54. not in America. 18. 156. RELEASE. 20. not remove for what. 136-139. not valid in others. a necessary feature of investment. 69. RESIGNATION. by beneficiary. charged to REPRESENTATION. power usually specially given. remove for what. 185 RELATION. 67. 71. SALE of contingent remainders and executory devises. or by the court. 18. 138. 19. may resign independent trusts under same instrument. 19. REPAIRS. RETIREMENT OF TRUSTEE. infant trustee may be removed. 19-20. 55. . RELATIONSHIP. between trustee and beneficiary. power of implied from a given duty. 113. SAFETY. REMOVAL. 54. 148.INDEX. 121. REVOCATION. power of not incidental to office. must resign whole trust. 13. by spendthrift Office. 64. valid in on alienation. 147. liable for allowing to fall in arrears. 136. is income. of one trustee not binding. REMAINDERMAN. 13. some States. 56. 128. RENT. will will is without conveyance. trust. 119. 112. 18. 42. is not a fit trustee. 20-21. lunatic trustee may be removed. 138. what. 18. conveyance to when. must be accepted by all. 114. 137. REPAIR.

SETTLOR. handle income not principal. 74. damages. management irregular. may be a trustee. 87. may do what alone. bonds purchased at premium. 88. be entrusted with securities when. 87. 89. 75. 1. 88. care of negotiable and non negotiable. purchaser takes risk of regularity of. trustee can not set off private tor of trust. on should examine. 76. on death of trust vests in successor. 46. 27. SINGLE TRUSTEE. 58. on death of title whom. 15. SETTLEMENT. trustees' set off against beneficiary. 46. SIGNATURE " AS TRUSTEE." effect of. self. to trustee. by order of court. power under statutes. See Compensation. passes to 44. SALE — continued. 135. 43. must not release. of. 147. demand of sufficient. 128. cannot restrain self from alienation. 142. 56. 143. under cy prh doctrine. for SINKING FUND. 59. representation of not binding. 75. 60. disaffirmed consideration must be returned. 87. 59. may be ordered by special law. 112. 75. 13. cannot sell to relative or partner.186 INDEX. 64. 65. . trustee cannot purchase at. 43. 139. 56. 25. 44. right to possession of. 83. 58. 48. 128. 134. SECURITIES. 57. 2. 154. debts against credi- by whom and when. 139. 57. 55. 27. SET OFF. 57. may appoint unfit trustee. SERVICES. may may may collect money. 58. beneficiary duty to convert into trust investments. SOLE TRUSTEE. 27. 120. SOVEREIGN. unauthorized confirmed when. peculiarities of. 42. purchaser's responsibility for purchase money. 64. may examine.

141. with trust funds improper. 138. not bound to receive property tendered. 187 SPECIAL LAW. 55. SPENDTHRIFT TRUSTS. STATUTE. 140. 153. SPECULATION. provide for sale of trust property. certificate should stand in joint names. trustee is liable as. not. 85. 128. 64. dividends of belong to whom. not liable for acts of predecessor. 153. SUIT. STRANGER. 24. beneficiary is trustee is. cannot require information from trustee. 89. 83. investments should be converted. trustee has general press. See Limitations. may . SUCCESSOR. 66. 85. against trustee. 74. 154. may sue or defend in trustee's name. STOCK. power to sue and defend. admissions in are binding when. 10. 24. . 64. See Farming Stock. 98. 122. beneficiaries' rights in actions. 143. 129. investments improper. 63. aiding in breach of trust liable. 138.INDEX. effect of taking the property. 24. 23-24. sale under. 140. 56. trustee's liability to. duty to necessary parties to. 155. liability for transfer of. compromise of. 97. 43. 56. 73. 110. 23. beneficiary is not. 109. SUBPOENA. SPECULATIVE. of limitations. 99. 149. 151. 152. 85. 64. 23. in what jurisdiction. 150. should indicate trust on their face. 155. 66. STOCK. expense of allowed. 153. 153. interest of possible payees. 27. 83. 150. where had. See Liabilities. 85. 131. as an investment. 154. should examine predecessor's accounts. 98. property followed into hands of. gets title how. 89-90. beneficiary concerning trust property. 152. 24. what are speculative investments. 63. 90. STOCKHOLDER IN CORPORATION. 131.

63. appointed when. from principal and income. trusts for. trustee takes principal. 115. when others have duty. how apportioned among special power often given. 61. 69. 65. TENANTS IN COMMON. 130. 67. may be required on trustee's bond. TENANT. may vest by provisions of settlement. 67. TERM. 37. 158. 9. should attorn to new trustee. 38. 67. 144. 6. what estate is necessary in real estate. takes title passes to survivors. TEMPORARY TRUSTEE. TAXES. beneficiaries. 43. usually discretionary. office 5. liable for acts as trustee when. trustee's discretion as to quantity. 83. TERMINATION OF TRUST. duty to pay. THINGS. on bonds of executor.188 INDEX. 37. 70. 10. on disclaimer of one. vests in others. commissions on. 68. beneficiary may be liable how apportioned. none in code States. 37. 86. 10. where taxes are payable. on death of trustee. SURETIES. power and duty to support beneficiary. trustee takes to property necessary to complete appointment. trustee is personally liable. 62. 138. when income or TITLE. 66. 107. decree for conveyance to new trustee. 85. possible recipient not interested in trust. 66. 25. SURVIVING TRUSTEE. 4. 66. 32. 83. 154. of beneficiary or family in spendthrift trusts. TIMBER. 25. . 9. 38. 119. expense of surety company allowed. 145. SUPPORT. 146. 29. 12. trustee takes absolute to personal property. 84. for. by conveyance to beneficiary. 66. trustees are not. principal or income. of lease trustee may grant. 69. when court will review discretion. to property should stand in joint names. 16. 68.

TRUST TERMINATED. want cannot be delegated. 42. See Possession. 22-23. enforced where. See Estate and Title. 13-15. 152. differs from may be refused. how it passes to successor. may vest in to property. 119. remainderman. TRANSFER OF STOCK. 74-75. cannot abandon trust." agency. new trustee by statute. the estate of. to TRANSFER OF PROPERTY. 14. may resign. 16. may be a trustee. 26-27. 84. See Disclaim. See Alienation. 43. 10. is owner of trust property. right to possession of property. " on death of trustee. 13. Remainderman. 48. 26. of trustee. See to new trustee. can refuse. 74. 9. TRANSFER OF TRUST PROPERTY. 49. removal of. who of two sets of trustees who can be. trust property into hands of stranger. who is unfit to be. TRUST COMPANY. liability for.INDEX. must exercise trust himself. can take no benefit from ownership. See Resignation. passes to remainderman how. to act. 76. TRANSMISSION OF ESTATE. beneficiary not liable in. 10. 150. temporary trustee may be appointed. See Appointment. 145. 155. appointment of. 153. 120. 6. is entitled 11. TRUST. 140. 146. See Death. TORT. 23. 151. 74. managing and passive trustees. trustee liable in tort. 6. TRACING. 15. TRUST PROPERTY. TRUSTEE. 12. 17. See Property. advantages and disadvantages of. . executor performing such duties is a trustee. any person intermeddling is trustee. See Removal. 10. will not fail for See Disclaimer. 189 TITLE — continued. 13. 154. should be capable. 11.

duties.190 INDEX. be appointed by creator of trust. may act as counsel. TRUSTEE. signature " as trustee " effect. See Delegate. 152. 16-21. unfit to be a trustee. See Single Trustee. attorney or broker when. UNDUE INFLUENCE. good faith required. may lose UNFIT TRUSTEE. 20. 19-21. 72. UNFRIENDLY TRUSTEE. See Compensation. See Death and Executor. " is 120. cannot purchase at sale. 40. should be converted. may do what. 145. 71. may get instructions of court. 19-21. 73. 25. 72. pp. p. confirmed when. 17. UNAUTHORIZED SALE. not an agency. UNDIVIDED PROPERTY. . 1. removal from when. may be resigned. xvi. who may is UNFAITHFUL TRUSTEE. See Successor and Death. single trustee is death of. when and how. See Fraud. powers. passes to whom. may be removed. . contracts with beneficiary. 128. 57. 65. 23. cannot have adverse interest. See Table of Contents. 18. See Liabilities also Table of Contents. See Accounts. 90. See Instructions. 17. xi. not always desirable. gifts from beneficiary. 28. 74. cannot be abandoned. a relationship. TRUSTEE — continued. TRUSTEE." on certificate is notice. xiii to xvi. TRUSTEESHIP. xii. compensation. may be ended how. pp. 32. discharged how. See Expenses. 27. 72. 7. 1. trustee in place of. 58. 73. liabilities. 69. must keep accounts. 1. See Table of Contents. his expenses. 72. is a personal confidence. when new compensation. 15. 14.

cause for removal of trustee. 38. chargeable. 90. See Title. 86. is partly income. 108. converted. UNPRODUCTIVE PROPERTY. VESTING OF TITLE TO PROPERTY. 147. beneficiary not qualified to as owner. WASTE. beneficiary's right to use trust property. taxes on how should be converted. cause for removal. trustee votes as stockholder. 109. WILFUL BREACH OF TRUST. trustee enjoined 142. 90. may be trustee for husband. USE. 191 should be converted. WIFE. 105. WASTING INVESTMENT. dividends on apportioned. 132. 91.INDEX. from voting against beneficiary's interest. trustee cannot use. VACANT LAND. should be converted. . VOTE. 115. 27. 14. 89-90. 19. 24. 19.

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