
    Dwight Woodbury and others v. Francis D. Parish, Trustee of Margaret A. Whitney and others.
    M., the wife of R., in January, 1845, was entitled to a fund as a legatee of her father. Before the fund was realized, M., R. and H. unite in an agreement to place the fund in the hands of H. as trustee, with directions, first, to loan the same and pay the interest to M. for her sole and separate use ; second, “whenever either the said R. or the said M. shall die, it shall be the duty of •the said H. to collect the interest as aforesaid, and pay the same either to the said M., if living, or to her children and legal representatives in the event of her decease ; and in three years.from the death of either party, as aforesaid, the said H. shall collect and pay over in the same manner, the principal sum ; provided, nevertheless, if the said M. shall be removed by death before her ■husband, it-shall be competent for her at anytime during her life, in the presence of two witnesses, to direct any other or different appropriation of said money, or any part thereof, after her death ; and the said H. shall hold said money after said M.’s death, subject to such appointment.” Held— That the agreement did not give the wife a right to dispose of the fund during the life of herself and her husband, but that the trustee was to retain the fund for the benefit of her children, in the contingency pointed out — her death before her husband, and her failure to appoint in the mode prescribed.
    Reserved in the district court of Erie county.
    The facts on which the action depends are as follows:
    1. The defendants, Joña. D. and E. Whitney, previous to 1853, for several years, and during a part of that year, and up to about the 15th day of October, were engaged in Sandusky, Ohio, in the dry goods business, under the firm name of J. D. & E. Whitney; and in the latter part of 1852, the said J. D. & E. Whitney became much embarrassed in their business, and finally failed in the fall of 1853.
    2. During the year 1852, and early part of 1853, the said J. D. & E. being embarrassed and unable to continue their business, applied to their mother, Margaret A. Whitney, to assist them in their said business.
    3. Margaret A. Whitney was, and is, the wife of the said Robert Whitney, and the mother of the said J. D. & E. Whitney.
    4. The said Margaret, in January, 1845, was entitled to receive from the executors of her father, James S. Dwight, and ander his last will and testament, the sum of about $10,000; ind thereupon she and her husband, said Robert, and one Burr Higgins, entered into the tripartite agreement, the parts of which material to this case are hereinafter set forth, constituting the said Higgins trustee to the said Margaret and of her property aforesaid.
    5. On the 26th day of June, 1850, the said Margaret, Robert, and Higgins, and the defendant, Erancis D. Parish, made and executed an agreement, substituting the said Parish as trustee of said Margaret and of her said property, in the place of said Higgins. .
    6. Higgins received from the executors of James S. thvight aforesaid, under said tripartite agreement, $9,494.90; and on the 11th day of April loaned the same to the said Robert, and to secure the same under the provisions of said tripartite agreement, received from the said Robert a bond, and from said Robert and Margaret a mortgage.
    7. The mortgage was duly left for record with the recorder of Erie county, where the lands were situate, and the same was recorded on the 14th day of April, 1845.
    8. On the 26th day of June, 1850, Higgins assigned to Parish said bond and mortgage, subject to the trusts mentioned in said tripartite agreement, and the said Margaret and Robert assented thereto, and united therein, and for a good consideration.
    9. On the 19th day of April, 1852, the said Robert and Margaret conveyed the premises mentioned in said mortgage to said Parish by warrantee deed, subject to the trusts mentioned in said tripartite agreement.
    10. The tripartite agreement, among other things, recites that "the said Robert having already received from the portion of his said wife, the sum of twelve thousand dollars, and recognizing what courts of chancery denominate 'the wife’s equity ’ to have such interests as are bequeathed to her, secured to her separate use, and being desirous to make some reasonable and competent provision for the said Margaret and her children.” And the part of said tripartite agreement which limits the estate of the said Margaret in and to said property and its uses, is in the words and figures following: "The said Higgins is authorized to permit the said Robert to use the said money during the life of the said Robert, by way of loan, on the terms following, viz :
    "First. The said Higgins shall annually, on the first day of March, collect from the said Robert the annual interest of said money, at the rate of six per cent, per annum, and pay the same when collected to the said Margaret, for her sole and separate use, of which her sole receipt shall be the sufficient and only discharge.
    
      Second. Whenever either the said Robert or the said Mar garet shall die, it shall be the duty of the said Higgins to collect the interest, as aforesaid, and to pay the same either to the said Margaret, if living, or to her children and legal representatives in the event of her decease; and in'three years from the death of either party, as aforesaid, the said Higgins shall collect and pay over in the same manner the principal sum; provided, nevertheless, if the said Margaret shall be removed by death before her husband, it shall be competent for her, at any time during her life, by appointment in writing, signed by her in the presence of two witnesses, to direct any other or different appropriation of said money or any part thereof after her death; and the said Higgins shall hold said money after said Margaret’s death, subject to such appointment.”
    11. The covenants of the said Robert in said tripartite agreement, in so far as they are deemed essential to this action, are in the words following : “ The said Robert, for himself, his executors and administrators, doth hereby covenant with the said Higgins, his executors and administrators; . . .
    2. He will annually, on the first day of March, pay the lawful interest thereon, at the rate of six per cent., to the said Higgins, to be by him appropriated as trustee under this agreement ; 3. That within three years after the decease of eith.er the said Margaret or the said Robert, he, or his executors and administrators, shall pay the principal sum, so loaned, to the said Higgins, to be by him appropriated as trustee to the above specified trusts; 4. If any money, herein stipulated to be paid as interest, shall remain unpaid for the period of thirty days after the same shall .become due, the said Robert hereby declares the whole principal money shall become due and payable by such omission, and he hereby covenants to pay the same to said Higgins, and it shall be the duty of the said Higgins to collect the same and invest the same under the written directions of the said Margaret upon these trusts on adequate security.”
    12. Not only the interest had not been paid for a long time previous to the commencement of this action, but the principal itself had become reduced to four thousand dollars, by reason of the security having diminished in value, or never having been of sufficient value; and because the said Robert has become insolvent, and so still remains.
    13. After the commencement of this action on the 21st of December, 1844, by the consent of all the parties, all the trust property was sold for four thousand'dollars, and since then it has borne interest, part at six and part at ten per cent.
    14. Upon the application of the said J. D. and E. Whitney, as aforesaid, and at their request, the said Margaret made and delivered to them the several written instruments or re quests mentioned in the petition and the answers of the defend ants, Alexander Erear & Co., and Hubbard & Eoreman, and John Chapman, of one of which instruments the following is a copy:
    “ Sandusky City, June 7th, 1852.
    “ To F. P. Parish — Sir: You are hereby authorized and empowered to pledge the estate which you hold in trust for me, to aid and assist my sons, Joña. D. & E. Whitney, to continue their present business, either in securing the payments of their present debts, or those they may hereafter contract in the carrying on their said business, to any amount they may request from time to time, which shall at no time exceed in the aggregate the sum of two thousand dollars, in addition to the sums heretofore authorized to be pledged; and, if necessary, to appropriate the principal or interest, or dispose of the property of said estate to the final payment of such debts as you may have pledged said estate to secure; and should it become necessary, in your, judgment, to do so, sell and dispose of the whole or any part of said estate, and appropriate the proceeds to the payment of said debts.
    “ Margaret Whitney.”
    15. The defendant, Parish, in pursuance of said requests and authorities, made and delivered to the said Joña. D. & E. the pledges mentioned in the petition and said answers, of one of which the following is a copy:
    “Now I, Erancis D. Parish, of Sandusky City, Ohio, as trustee of Margaret A. Whitney, in compliance with the authority given me in and by the writing of which the above is a copy, do hereby pledge the said estate of Margaret A. Whitney, to secure the final payment of any debt or debts of said Joña. D. & E. Whitney already contracted, or hereafter to be contracted, in carrying on said business, to the amount of six hundred dollars, and part of the said two thousand dollars, and said debt or debts may be designated by said Joña. D. & F. Whitney, secured by this pledge. E. D. Parish.
    “ July 5th, 1852.”
    16. The above request and pledge are written on the same piece of paper, and all the other requests and pledges are in substance the same, only varying in amounts and dates. And the said Joña. D. & E. designated the several debts to which they should apply, and delivered the same to the said parties, as mentioned in the petition and said answers, to secure the debts which they contracted in carrying on their said business, and which are the same debts mentioned in the pleadings.
    17. The plaintiff holds five of those pledges, two of one thousand dollars each, bearing date April 8, 1852; two for six hundred dollars each, bearing date July 5, 1852, and one of seven hundred and fifty dollars, dated March 1,1852. And the amount of their claim, for which they hold them as security, is the sum set forth in the petition.
    18. Alexander Erear & Co. hold two of said pledges, one for $1,000, dated April 8, 1852, and one for $400, dated June 7, 1852, and their claim consists of a judgment recovered in the court of common pleas of Erie county, at the October term, 1853, for $152.57; two notes dated May 24, 1853, one due September 27, and the other October 27, 1853 — the first for $541.98, the other, $541.97, and all were debts designated by said J. D. and E. Whitney, to be secured by sai<l pledges.
    •19. Hubbard & Foreman hold one pledge for $400, dated July 5,1852; their claim is for goods purchased in April and May, 1843, amounting to $308.76, and cash $20.
    20. John Chapman holds two pledges, dated March 1,1853, for $375 each. His claims consist of two notes, one due June 25, 1853, for $377.15 ; the other due August 25,1853, for $378.25.
    This action is brought to enforce said pledges against said trust property, and to subject the same to. the payment of said claims against the said Joña. I). & E. Whitney.
    The case was reserved in the district court of Erie county for decision here.
    
      J. G. Bigelow and B. P. Spalding, for plaintiffs.
    
      Samuel Lewis, for defendants.
   Gholson, J.

The first question presented by the counsel for the plaintiff, is, What estate did Margaret A. Whitney take in the property, under the agreement between herself, her husband, and the trustee ? This question, as well remarked by the counsel, “ involves the construction of the tripartite agreement — all other transactions between Margaret, Robert and her trustee, revolving around this, without altering or modifying it in the least.”

In construing that agreement, we have the advantage of being informed by the parties of its object. There is a recognition of what courts of chancery denominate the “wife’s equity.” And this, it is said, is to have an interest bequeathed to her, secured to her separate use. But, it is added, in immediate connection, that the husband is desirous to make some reasonable and competent provision for the wife and her children. To understand the intention of the parties, it is important to observe, that the “wife’s equity” was not to have the whole property to which she may have become entitled, and to obtain which, the aid of a court of equity became necessary. “ The equity, though called that of the wife, is effectuated by a settlement on her children also, as being, if the property is settled at all, the most proper mode of doing it; and the wife can not separate their interest from her own, or claim a settlement on herself, to their exclusion.” Adams’ Equity, 48.

It may be well assumed, not only from the language of the recital, but from the reference to the wife’s equity, that the parties had in view the well-understood limitation upon the right of the wife, and intended to make a substantial provision for the children. This will furnish a key to explain any doubtful expressions in the agreement, particularly that in reference to the power of the wife to dispose of the property by an appointment.

The agreement, undoubtedly, gives to the wife during her life, the interest on the money, for her sole and separate use. This is to be paid to her by the trustee, and her sole receipt is to be the sufficient and only discharge. The three years introduced into the next provision, was, probably, for the benefit of the husband, to whom the fund was to be loaned on mortgage, that time being given to enable him to raise the money. The substance of the provision is, that if the wife should survive the husband, she is to have the fund, but if she dies before the husband, it is to go to her children, provided, that during her life, she does not, by a testamentary paper, otherwise direct. It will be observed, that the separate use of the wife, so distinctly expressed as to the interest, is altogether omitted as to the fund itself. There is no provision generally, for a separate estate in the fund, but her right to it, and control over it, is distinctly limited and defined, and to say that during the life of the husband, she had absolute control and disposal of it, would deny to language used, its appropriate meaning. The right to the fund itself, if she survives her husband, and the power to direct who shall take it after her death, falls short of a right of absolute disposal. It is true, she may, by appointment, cut off the expectation of her children. A right to discriminate among children, might be regarded as reasonable, and it was probably supposed that maternal affection would prevent the disposition of the fund by a testamentary paper, in favor of strangers. If such a disposition, so little to be expected from a mother, is not made, the children are guarded against any other disposition during the joint lives of the father and mother, and should the father survive, they, and not he, become entitled to the fund.

We think that the parties intended to make a settlement of the property for the benefit of both wife and children, and that we have no right to reject terms in that settlement, which, in very probable contingencies, may operate for the benefit of the children. The terms of the settlement must control; and they exclude any power of disposition by the wife during the life of the husband, and any power of appointment to take effect after her death, not executed in the mode specified. ’ Such being our view of the proper construe tion of the agreement, the other questions presented by the counsel for the plaintiff become immaterial, the foundation ■for them failing. The judgment, therefore, will be for the deféndants.

Judgment for defendants.

Scott, C.J., and Sutliff, Peck and Brinkerhoff, JJ., concurred.  