4. The creditor of such a beneficiary acquires a lien upon the accrued and unexpended surplus income, or that subsequently arising from such fund, superior to the claims of general creditors or assignees of the cestui que trust, by the commencement of an action in equity to reach and appropriate it to the satisfaction of his judgment. Williams v. Thorn, supra.
The headnote of the case states that "what are necessaries is a mixed question of law and fact, and therefore the opinion of a witness as to what was a proper expenditure is not admissible." The trust fund in this case consisted of both real and personal property, and the will creating it expressly provided that the cestui que trust should have no power to anticipate the rents, income or profits thereof.
The cestui que trust, although served with process in the action, suffered default, so far as he was individually concerned, but is defending as one of the trustees of the fund from which the income in dispute is derived.
The following facts, among others, were found by the referee upon the trial, and so far as they are supported by evidence, must be regarded as conclusively established in the consideration of this appeal: That Silas Wood died prior to the year 1852, leaving a last will and testament, whereby he devised certain real and personal property to his executors in trust to pay the rents, income and profits thereof to his son Wilmer S., for his use, but without any power of anticipation on his part; that the defendants are now the trustees of the said fund, the said Wilmer S. Wood having been duly appointed as such, on the death of one of the original trustees on the 21st day of March, 1863; that said Wilmer S. for a long time previous to the trial had been entitled to and in the receipt of said income, and that the complaint in this action was served on said Wilmer S. on the 27th day of January, 1883; that the net income of said fund accruing to the said Wilmer S. between the said 27th January, and the date of said report, December 4th thereafter, was $4,159.86, and the amount paid personally to said beneficiary between said dates was $1,375; that during the same time the trustees paid, by the direction of the cestui que trust, $1,099.80 as interest upon a debt owing by him to one Robert Center, and the further sum of $708.82 for premiums upon life insurance policies held by said trustees upon the life of said Wilmer S. as security for an indebtedness of $27,000, owing by him to the trust fund, and they retained the further sum of $810 as interest upon such debt.
We are of the opinion that the judgment of the court below should be sustained upon the ground that there was an accumulated surplus in the hands of the defendants at the time of the rendition of the judgment which had accrued during the pendency of the action, and was applicable to the payment of the plaintiff's judgment, and was sufficient to discharge the same. The expenditure of that sum by them for the purposes, and under the circumstances found by the referee, was a violation of the rights secured by the plaintiff by the commencement of this action, and was unauthorized by any power vested in them. This sum was inalienable by the cestui que trust, and actual experiment had demonstrated that it was not needed for his support during the period of its accumulation. The amount of the accumulation would seem to be more than sufficient to discharge the obligations of the plaintiff, and if this should prove to be so, would render the provision in the decree for a further application of surplus income unnecessary.1
1 In another action against this same defendant and his trustees, Kilroy v. Wood, 42 Hun (N. Y.) 636 (1886), Brady, J., says: "The evidence establishes that the beneficiary is in receipt of a handsome income, which the learned justice in the court below thought was not more than sufficient to support him in the manner in which he had been accustomed to live, and was not beyond what his father intended to provide for him. * * * In determining what is a proper amount to be allowed for his expenditures, it seems to be regarded as proper to consider the manner in which he has been brought up, the habits acquired by him, and his ability to take care of his property. It was said in the case of Sillick v. Mason [2 Barb. Ch. 79]: ' It certainly was the misfortune of the defendant that he was brought up in idleness, under the idea that he was to inherit a large estate, and that it was unnecessary that he should acquire any business habits, so as to fit him to acquire property or to enable him to take care of it if given to him by others.' And in the same case the chancellor, after determining the amount which should be allowed the beneficiary, said: 'And they should not, upon a fair construction of the statute on this subject, be permitted to indulge in extravagant expenditures whilst the defendant's creditors remained unpaid.' The same observation applies in this case. But the difficulty in disturbing the judgment arises from the fact that there is not sufficient evidence to show, indeed it may be said that there is no evidence on the part of the plaintiff tending to show, what would be a proper amount to allow the beneficiary for his support. He is, as claimed in the defendant's points, a gentleman of high social standing, whose associations are chiefly with men of leisure, and is connected with a number of clubs, with the usages and customs of which he seems to be in harmony both in practice and expenditure, and it is insisted on his behalf that his income is not more than sufficient to maintain his position according to his education, habits and associations. And this may be so, yet it would seem that evidence might have been adduced which would establish his ability to live upon a smaller sum
(b.) Forfeiture for alienation.
14 New York, 41. - 1856.
Comstock. J. - If we assume, as the appellants contend, that the trust which the executors hold under the will in respect to the interest of Myron H. Ferris, is technical and passive merely, the conclusion does not follow that the plaintiffs are entitled to the relief they claim.2 By the express provisions of the will, reading the codicil as a part of it, his interest is to terminate on the event of a decree or judgment pronounced against him in a creditors' suit instituted for the purpose of obtaining the fund; and in that event the executors are directed to apply the income to the support of his family by paying the same to his wife, or in any other mode which they in their discretion may adopt. I know of nothing in the rules of law to prevent these provisions from taking effect according to the intention of the testator. It may and should be conceded, that if the bequest to Myron H. Ferris had been given to him absolutely than the whole income, and thus relieve himself from the burden of a debt which seems to have been justly contracted. But the evidence is wholly insufficient on this subject on behalf of the plaintiff." See also Stow v. Chapin, 4 N. Y. Supp. 496 (1889). Van Brunt, P. J., says: "There is another ground upon which the court was also justified in denying the motion, and that is that there is no proof whatever contained in these papers as to what would be a sufficient income for the defendant Osborne. It is to be borne in mind that the creditor is not seeking to reach any property of Howell Osborne's, but is endeavoring to reach the income of a fund which his father placed in the hands of trustees to be applied to his benefit. Under these circumstances he is entitled to have so much of said fund as may be necessary to support him in the style in which he had been accustomed to live, and in which he had been brought up by his father, and for the maintenance of which this provision was made in the will of the father. It is not for the creditor to say that his debtor should live on two dollars a day or one dollar; that such a sum will keep the debtor from starvation, or that it will prevent his being clothed in rags. There is no such rule in cases of this description. The testator has the right to do as he pleases with his money, and if he desires to make provision for the support of a profligate son in such a manner that he cannot reach or anticipate this fund, or the income thereof, he has the right to do so, and he has the right to afford him the means of living in the manner in which he has brought him up, and to which he has been accustomed, and the creditor can claim only that which is in excess of this amount; and that such excess exists must be established by allegation of fact." - Ed.