
    Isaac L. Kip et al., Ex’rs, etc., v. Edward Hirsh, Resp’t.
    
    
      Court of Appeals,
    
    
      Filed December 7, 1886.)
    
    1. Specific performance—Assignment for the benefit of creditors —Expiration of trust by lapse of time—Laws 1875, chap. 545— Mortgage foreclosure—Assignee not a party.
    Plaintiff’s testator, in June, 1835, was owner of the lots of land in controversy, and in that month he conveyed them, D. taking from him a purchase-money mortgage. The deed and mortgage were in the same month recorded. In May, 1840, D made a general assignment to S, conveying, among other things, the lots in question; the assignment was recorded in June of the same year. In August, 1840, the testator commenced a suit for the foreclosure of the mortgage, making D. a party, but not the assignee. The foreclosure was completed and the premises sold under the decree and bought in by the testator, and a master’s deed executed to him which was recorded January, 1841. The lots remained vacant and unproductive until the death of the testator. He left a will, of which the plaintiffs are the surviving executors, directing, among other things, that they should sell all vacant and unproductive lots. It does not appear that any of the property embraced in the assignment was ever sold, or the assignment in any way acted upon. In 1885 the plaintiffs and defendant entered into a written agreement whereby the plaintiffs agreed to sell and the defendant agreed to purchase the premises. In an action brought to compel specific performance of the contract: Held, that this assignment was subject to Laws 1875, chapter 545, providing, “And where an estate has been conveyed to trustees for the benefit of creditors, and no different limitation is contained in the instrum-nt creating the trust, such trust shall be deemed discharged at the end of twenty-five years from the creation of the same; and the estate conveyed to trustee or trustees, and not granted by him or them, shall revert to the grantor or grantors, his or their heirs or devisees, or persons claiming under them, to the same effect as though such trust had not been created.”
    2. Same—Validity of title.
    
      Held, that the plaintiffs were entitled to the specific performance of the contract, that they could convey a valid title.
    Appeal from an order of New York superior court, general term, reversing a judgment of the special term in favor of plaintiffs in an action to compel the specific performance of a contract for the purchase of land.
    
      Isaac L. Miller, for app’lts; John H. V. Arnold, for resp’t.
    
      
       Reversing 53 N. Y. Superior Ct. (21 J. & S.), 1.
    
   Rapadlo, J.

In June, 1835, Leonard W„ Kip, the plaintiffs’ testator, was the owner of the lots of land in controversy, and in that month he conveyed them to Daniel E. Delavan, taking from him a mortgage on the same lots to secure §1,500, part of the purchase money. The deed and the mortgage were recorded on the 29th of June, 1835. On the 16th of May, 1840, Delavan made a general assignment to Walter J. Smith, conveying the lots in question, together with a very large amount of other real estate and personal property, in trust, to sell the real estate with all convenient speed, and apply the proceeds of the real and. personal estate to the payment, first, of certain specified debts of the assignor ; next, to the payment of all the other-debts ; and, when the trust was fully executed, to return the surplus, if any, to the assignor. This assignment was-recorded June 6, 1840. In August, 1840, Leonard W Kip commenced a suit for the foreclosure for the above-mentioned mortgage, making Delavan a party defendant, but his assignee, Smith, was not made a party. This foreclosure suit proceeded to a decree, and the mortgaged premises were sold under the decree, and bought in by Leonard W. Kip, and a master’s deed was executed to him, December 30, 1840, and recorded February 23, 1841.

The mortgaged premises consisted of three lots on the easterly side of Fourth avenue, between 120th and 121st streets, in the city of New York. They were vacant and unproductive, and so continued until the death of Leonard W. Kip, which took place in 1863. He left a will, of which the plaintiffs in this action are the surviving executors. By this will, after1 making certain bequests, -he devised the residue of his real and personal estate to his executors, in trust for the benefit of his wife during her fife; directing them to let and lease all his productive real and leasehold estates, and empowering them, at any time after his decease, to sell all vacant and unproductive lots, and divide the proceeds among his children. On the 15th of April, 1867, the plaintiffs, as executors of the will, leased the lots in question to John I. Reeber for the term of nine months, from the date of the lease ; he agreeing to pay, as rent, the taxes on said lots as soon as due and payable. Reeber took possession of the lots under this lease, and inclosed the same with a fence on all four sides, and occupied them for storing lumber, from April 15, 1867, until about the year 1883, when he relinquished his business to his sons, who have since then carried on the same business on the premises as his successors.

On the 17th of March, 1885, the plaintiffs and defendant entered into an agreement in writing, whereby the plaintiffs agreed to sell, and the defendant agreed to purchase, the premises for the sum of $12,750, payable as set forth in the agreement. But the defendant now refuses to complete the purchase, claiming that the plaintiffs’ title is defective by reason of the omission to make Walter J. Smith, the assignee of Delavan, a party to the foreclosure suit through which the plaintiffs’ testator derived his title. If the assignment and the title of the assignee were still subsisting, and the trusts unexecuted, the objection would be unanswerable; but we think that the circumstances of the case are such as to create a legal presumption that the purposes for which the trusts were created have ceased, and that consequently the estate of the trustee has ceased, and the title reverted to Delavan, the grantor of the plaintiffs, or those claiming under him. 1 Rev. St., 730, § 67. His title was, of course, transferred to the plaintiffs’ testator by the sale under the decree ; Delavan, the mortgagor, having been a party to the foreclosure. The assignment to Smith was made in 1840, more than forty-five years before the trial of this action, and nearly forty-five years before the making of the contract of sale, and although the trust was to sell the real estate with all convenient speed, for the purpose of paying the debts, it is found as a fact that no sale was ever made by the assignee of the property in question, or any part thereof. It does not appear that any of the property embraced in the assignment was ever sold, or that the assignment was ever acted upon in any manner. Walter J„ Smith, the assignee, lived twenty-five years, and.Daniel E. Delavan thirty years, after the making of the assignment.

It is found that no successor in the trust was ever appointed in place of Smith, and it does not appear that Smith ever claimed or asserted any title to the lots in question under the assignment, or that any creditor of Delavan, of any other person, has ever made any claim under the assignment, or attempted to enforce the trust, although the executors of Kipp have been in actual possession, through their tenants, for nearly twenty years. After such a great lapse of time since the making of the assignment and the sale under the foreclosure, we think the presumption that the debts of Delavan secured by the assignment have been paid, or in some manner discharged, is so strong that the fact that the assignment once existed is no longer a substantial objection to the title. So much time has elapsed that the presumption of payment would apply evento debts evidenced by specialty, or by judgment; and it cannot be conceived that, if the debts have not in fact been paid, there could be any now outstanding which would not be barred by the statute of limitations. We think there is no danger in holding that, independently of the act of 1875, chapter 545, the trusts created by the assignment should, under such a state of facts as exists in the present case, be decreed discharged, and that the estate of the trustee should be deemed to have ceased. No one but the successors of the trustee, if any should ever be appointed, can dispute the title which the defendant will acquire by the conveyance from the executors under the power contained in the will of the testator, and their right to redeem hap long been barred by the statute of limitations.

We think the lots in question are embraced in the power of sale. They were unquestionably vacant and unproductive at the time of the death of the testator, and nothing that has happened since has materially changed their condition. The putting of a fence around them, and the storing of lumber or building materials thereon, did not change their character of vacant lots, so long as they were not built upon. ¡Neither did the lease change their character of unproductive lots, as no rent was reserved, the only agreement on the part of the tenant being to pay the taxes. But we think the testator intended to include in the power the real estate which was vacant and unproductive at the time of his death. The title of Delavan, to which the testator succeeded by his purchase at the foreclosure, was subject only to the estate of the trustee. That was not an absolute estate, but only for the purposes of the trust. Whenever those purposes ceased, the trust ceased, and the assignor, or those who succeeded to ¡his right, were in by their original title.

We are inclined to the opinion, further, that the act of 1875, chapter 545, is applicable to this case. There is nothing in the act which confines its operations to assignments made after its passage, but, on the contrary, its language imports that it applies to trusts theretofore created It purports to amend section 67 of the statute of uses and trusts (1 Rev. St., 730), which provides that, “when the purposes for which an express trust shall have been created shall have ceased, the estate of the'trustee shall also cease ” by adding the following words: “And where an estate has been conveyed to trustees for the benefit of creditors, and-no different limitation is contained in the instrument creating the trust, such trust shall be deemed discharged at the end of twenty-five years from the creation of the same, and the estate conveyed to trustee or trustees, and not granted or conveyed by him or them, shall revert to the grantor or grantors, his or their heirs or devisees, or persons claiming under them, to the same effect as though such trust had not been created.” To construe this act as relating to assignments made after its passage would prevent its having any operation until the year 1900, which could not have been the intention of the legislature.

The intention to make it apply to past assignments appears clearly from its language, which is, “when an estate has been conveyed,” not “shallhave been,” of “shall be conveyed.”

It is in the nature of a statute of limitation, and, if necessary to sustain its constitutionality, it should be construed as making the lapse of time prima facie or presumptive evidence that the trusts have been discharged, and permitting this presumption to be .rebutted by evidence. In Bellinger v. Shafer (2 Sandf. Ch. 293, 296), and cases therein cited, section 67, as originally enacted, was held applicable to trusts created before its enactment as well as to those subquently created, and we are inclined to think that the same construction should be placed on the section as amended by the act of 1875.

In the case of McCahill v. Hamilton (20 Hun, 388), the supreme court held a similar outstanding assignment to constitute a valid objection to the title, and the act of 1875 not to remedy the defect. It must be observed, however, that in that case it appeared that the assignment had been acted upon, and some sales of real estate had been made under it, though the time when the last sale was made does not appear in the case as reported.

But it is not necessary now to finally decide this point as to the act of 1875, as in the present case nearly double the time prescribed by the act of 1875, has elapsed and no conveyance has ever been made by the trustee. The presumption of payment attaches to ah the debts, and it can hardly be conceived that any facts can exist which would entitle any person to enforce the trust.

Under these circumstances we think that the defendant will acquire a good and marketable title to the premises by a conveyance from the plaintiffs as executors, and he should be decreed to specifically perform his contract of purchase.

The order of the general term should be reversed and the judgment at special term affirmed but without costs on this appeal, the question being novel, and there having been one unreserved decision of the supreme court sustaining the views of the respondent.

All concur, except Miller, J., dissenting.  