
    In the Matter of the Judicial Settlement of the Account of Robert Willetts and Others as Trustees under the Will of Samuel Willets of the Annuity Fund therein provided.
    
    
      (Court of Appeals,
    
    
      Filed January 22, 1889.)
    
    1. Will—Construction of.
    The testator by his will bequeathéd certain annuities and directed Ms executors to set apart and invest a fund sufficient to produce said annuities, which fund and the'unappropriated income thereof was on the decease of the annuitants as they respectively died, to be divided among his grandchildren, who should be living at the time of the death of the respective annuitants' per capita and not per stirpes, only retaining an amount sufficient to produce the required amount for the remaining annuitants. By a later clause in his will the testator devised all the rest, residue and remainder of his estate, real and personal, unto his executors, etc., in trust to sell, etc., and divide the net proceeds thereof, into as many shares as there should be, of his grandchildren, and he directed his executors to invest the said shares and apply the income of said shares to the use of certain of his grandchildren, : nd upon the death of each of said grandchildren to pay over the principal and accumulations of the share set apiart to siicli grandchild to his or her lawful heirs. By a codicil to his will he revoked “ all the provisions and bequests in favor of and given to Ms grandchild Amelia and to her issue in the residuary clause,” of his will, and gave directions as to the disposition of her share therein. Held, that the revocation applied only to the latter of the clauses of the will referred to above. That Amelia was entitled to a share in the annuity fund when distributed.'
    
      2. Executors and trustees—Manner on keeping accounts.
    Where there are several distinct and separate trusts the more orderly-way is for the trustees to keep an account with each one of the trusts. And on an accounting there should be a separate one instituted for each, trust.
    3. 'Same—When entitled to commissions both as executor and-TRUSTEE.
    When an executor has terminated his duty as such and the fund is-ordered to be paid over to himself as trustee, the trust fund to be held and managed by him as trustee, he is entitled to his full commissions asexeeutor, and is entitled to one-half of the full commissions on the trust fund for receiving the same, and the other half upon paying out the same.
    4. Same—When trustees not entitled to more than one commission on income under Code Civ. Pro., § 2736.
    When trustees account in reference to income which they are required annually to pay over and account for, no matter how much the principal may he or how much the estate of the decedent may have been, Code Civ. Pro., § 2738 does not apply unless the inc.' me exceeds $100,000, and more than one commission can be allowed only in case the sum upon, which commissions are computed amounts to at least $100,000.
    Appeal from a judgment of the supreme court, general term, first department, affirming a decree of the surrogate of New York county, settling the accounts of the trustee of Samuel Willets, deceased.
    Sometime before February 28, 1883, Samuel Willets, of the city of New York, died, leaving a last will and testament with two codicils thereto which, on that day, were admitted to probate, by the surrogate of the city of New York. The testator, by his will, devised and disposed of property amounting to about $2,600,000. He created various trusts, and provided for annuities to thirteen different persons, one of whom died in his lifetime, and he directed that his executors should “ set apart and invest a fund sufficient to produce the above annuities, or a sufficient amount of stocks to be held for that purpose, or a part of each, which fund and the unappropriated income thereof is on the decease of the annuitants as they respectively die, to be divided among my grandchildren who shall be living at the time of the death of the respective annuitants per capita and not per stirpes, only retaining an amount sufficient to produce the required amount for the remaining annuitants.”
    And he disposed of his residuary estate as follows: “I do give, devise and bequeath all the rest, residue and remainder of my estate, real and personal, wheresoever and whatsoever, and such as I may die seized and possessed of, unto my executors hereinafter named, the survivors and survivor of them, in trust for the following purposes: And I do order and direct my said executors, the survivors and survivor of them, or such of them as shall act, to sell, dispose of and convert into cash, the said residue of my estate, and to execute and deliver to the purchasers of such real estate, good and sufficient deeds of conveyance therefor in fee simple; such sales of .real estate to be made at public auction or private sale, and at such times and on such terms as they shall deem best, and I hereby give them full power and authority to make such sales and conveyances as aforesaid; and I order and direct that the net proceeds thereof shall be divided by my executors into as many shares as there shall be of my grandchildren; and I direct that my executors do invest and keep at interest on bond and mortgage upon real estate, or in stocks of a permanent and productive nature, all of said shares, and apply the interest, income and dividends of one of said shares, as the same shall be received, to the use of Caroline W. Frame, one of my said grandchildren, during her natural life, and from and after her death, that they pay over the principal and accumulations, if any, to her lawful heirs.” And there was a similar provision as to each of his four other grandchildren, one of whom was Amelia W. Leavitt.
    It was further provided that, “in case it shall happen that either of my said grandchildren shall leave no issue as aforesaid him or her surviving, then the share of the one so dying shall be paid over to the survivors. And in case of the death of either of said grandchildren, and he or she shall have left grandchildren, children of any deceased child who shall have died leaving issue, such issue shall take by representation the share of the parent.”
    The second codicil to his will contained the following provision: “In consequence of having made large and sufficient provisions, bequests and devises to my granddaughter, Amelia W. Leavitt, and her issue in the other .portions of my said will, I hereby annul and revoke all of the provisions and bequests in favor of and given to her and her issue in the residuary clause thereof ; and I hereby will and direct that my executors divide the residuary fund therein provided for into as many shares as there shall be of my grandchildren, exclusive of the said Amelia W. Leavitt, and pay over the income of said shares, and dispose of the principal thereof, respectively, to my said several grandchildren and their issue, as is therein provided, exclusive of the said Amelia W. Leavitt and her issue.”
    He appointed seven persons to be executors of his will, six of whom qualified and have acted as such.
    Some time prior, to the 29th day of April, 1885, the executors instituted proceedings before the surrogate for the settlement of their accounts as such, and those proceedings resulted in a decree of the surrogate made and entered on that day, by which he settled the accounts of the executors and adjudged the disposition to be made of the funds and property in their hands; and, among other things, he ordered, adjudged and decreed ‘‘ that the said executors, ■out of the said balance of principal, pay to themselves, as trustees, the sum of $400,000 as a fund sufficient to produce the several annuities provided for in said will (with the exception of the annuity to Joseph Hicks, who having died prior to the death of the testator, said annuity never took effect, but lapsed), and that out of said balance of income they pay to themselves, as such trustees, the interest on said sum of $400,000, from February 28, 1885 (the date up to which said annuities have been paid), to said April 29, 1885, at the rate of five per cent per annum, amounting to the sum of $3,388.89, making in all of principal and interest to be so paid over the sum of $403,388.89, to be held and applied by them under the provisions of said will relating to said fund.” And that they pay to themselves, as trustees, the residuary estate, to be divided and held by them in the manner provided in the will. Thereafter the executors, acting as trustees, received the funds directed to be paid to and held by them as trustees under the will, and they set up twelve different trusts. There was one trust called the annuity trust, consisting of the $400,000 above mentioned, and the residuary estate was divided into four trusts, to wit: One for Caroline W. Frame, one for Edward Willetts, one for Frederick Willets and one for Walter R. Willetts. In December, 1885, the trustees filed twelve petitions and obtained twelve citations for the judicial settlement of their accounts as trustees. Upon such petitions citations were issued and served upon the proper pai’ties, and a final decree was made by the surrogate, from which decree Caroline W. Frame, Edward Willets, Frederick, Willets and Walter R. Willets appealed to the general term, arid from affirmance there to this court.
    
      Joseph H. Choate, for app’lts; Wilson M.- Powell, for resp’ts.
    
      
       Affirming 9 N. Y. State Rep., 321, except as to one point..
    
   Earl, J.

The questions involved on this appeal were so thoroughly examined in the opinions pronounced by the surrogate and at the general term that a lengthy statement of our views now is not needful, and we will content our-, selves with a brief consideration of the objections now made to the rulings and decree of the surrogate.

(1) It is claimed on the part of the appellants that by the second codicil, the bequest of the residue of the annuity fund to Mrs. Leavitt was revoked. The respondents claim that the revocation had reference to the provision made for her in the final residuary clause, and, we think, they are right. The language of the codicil is: “I hereby annul and revoke all of the provisions and bequests in favor of and given to her and her issue in the residuary clause thereof.”

This language cannot, with propriety, be applied to the clause in the will setting apart" the annuity fund, because that is not described as a residuary clause, and it is in no-sense a residuary disposition of property. In that clause the annuity fund remaining after the annuities have been provided for is not directed to be divided among the grandchildren and their issue, but simply among the grandchildren who shall be living at the time of the death of the respective annuitants. But the final residuary clause provides for the payment of the income to the grandchildren during life, and after death to their lawful issue. And the codicil also speaks of “the residuary fund provided for in the will.” No other residuary fund is expressly provided for in the will,' except by the final residuary clause, and the language used in the codicil is not appropriate to any other clause in the will.- Hence we think the surrogate was right in confining the effect of the revocation by the codicil to the final residuary clause, leaving all the other provisions of the will for Mrs. Leavitt untouched and in full force.

(2) The appellants claim that the executors instead of instituting twelve different accountings for each fund should have instituted but one proceeding for an accounting as to all the funds and should have rendered but a single, account, and that the surrogate erred in not compelling them to consolidate all the accounts. We are of opinion that this claim is not well founded. It was quite appropriate that the trustees should constitute the several trusts and keep the accounts as to each trust separate. And so they-were in fact ordered to do by the decree upon their accounting as executors. We certainly can perceive no legal error on the part of the surrogate in entertaining a proceeding for a separate accounting as to each trust. Even if the trustees were not obliged in the discharge of their duties to set up the different trusts, it is certainly the most convenient and orderly way to manage the trust estates to keep them separate and deal with them as separate trusts.

(3) It is objected that the respondents were not entitled to commissions first as executors and afterwards as trustees upon the capital of the trust funds. We do not think that this is a case_ where the two functions of executors and trustees co-exist arid run from the death of the testator to-a final discharge, inseparably blended together. But from the language of the will we think the duties of the respondents as executors were to be first discharged, and that then they were to assume the duties of trustees, and as such, manage the trust funds to the final termination of the trusts. And so it was treated by the surrogate upon the accounting of the respondents as executors. He settled their accounts as executors and. ordered them to pay to themselves as trustees the several trust funds to be held and managed by them as trustees. In such a case, under the authorities of this court, the respondents, their functions as executors having terminated, are entitled to further commissions as trustees. Hurlburt v. Durant, 88 N. Y., 122; Johnson v. Lawrence, 95 id., 154; Laytin v. Davidson, id., 263; Matter of Accounting of Mason, 98 id., 527.

(4) The surrogate allowed to the respondents one-half commissions for receiving the trust funds from themselves as executors. And this is complained of. Being entitled to full commissions upon the trust funds were they entitled to one-half of the commissions for receiving the same? The statute provides the following commissions: “For receiving and paying out all sums of money not exceeding one thousand dollars, at the rate of five dollars per 'cent; for receiving and paying out any sums exceeding one thousand dollars, and not amounting to ten thousand dollars, at the rate of two dollars and fifty cents per cent; for all sums of above ten thousand dollars, at the rate of one dollar per cent.” This language received at a very, early date construction in the courts, and it was held that executors, administrators and trustees were entitled to one half of their commissions for the receipt of the funds and the other half for paying out the same. Morgan's Estate, 15 Abb. N. C., 198; Matter of Roosevelt, 5 Redf., 601. While the commissions are allowed for all the services of the trustee, yet in the administration of the statute they have .usually been divided upon the settlement of their accounts, as above indicated, and we think- the surrogate was justified in following the general usage as approved by the courts in such cases.

(5) It is further claimed that the $400,000 set apart to raise the annuities is too large a sum, and that a portion of it should be restored to the residuary fund. -It was the duty of the trustees to- set apart a sufficient sum to produce the annuities, and the fund should be so large as to provide against all reasonable contingencies, and to make sure that it would produce a sufficient sum to pay the annuities. The surrogate, on the accounting of the executors, determined that $400,000 should be-set aside for that purpose. That determination has never been appealed from, and cannot now be reviewed or reversed upon this appeal. But even if it could be we would feel indisposed to interfere with it. If experience shall, in the future, demonstrate that the fund is more than sufficient to produce the annuities, the trustees are still under the control of the courts, and may, by proper action of the surrogate or of some other court, be compelled to reduce the amount and restore a portion thereof to the residuary fund.

(6) Upon the settlement of the account it appeared that the trustees had received $13,287.69 income of the annuity fund, and upon that they were allowed three full commissions under section 2736 of the Code, which provides as follows:

‘ ‘ Where the value of the personal estate of the decedent amounts to $100,000 or more, over all his debts, each executor or administrator is entitled to the full compensation allowed by law to a sole executor or administrator, unless there are more than three, in which case the compensation to which three would be entitled shall be apportioned among them according to the services rendered by them respectively; and ja like apportionment shall be made in all cases where there shall be more than One executor or administrator.”

And by section 2811 that section is made applicable to testamentary trustees. It is true that in this case the personal estate of the decedent amo.unted.to more than $100,-000, and.hence, if this accounting had involved the whole of that estate, the trustees would have been entitled to three full commissions thereon to be apportioned among them. It is also true that the principal of the trust-fund is nearly $400,000,.and so far as that is concerned the commissions thereon are to be regulated by section 2736; but when trustees account in reference to income which they are required annually to pay over and account for, no matter how much the principal may be, or how much the estate of the decedent may have: been, section 2736 does hot apply unless, the income exceeds $100,000, and more than one commission can be allowed only in case the s.um.upon which commissions are computed amounts to at least $100,000.

Having thus noticed all the material objections argued, we are of opinion that the decree should be modified by allowing but one commission upon the income, and as thus modified, it should be affirmed without costs to either party.

All concur.  