Summary
Appeal from a decree of the Court of Common Fleas No. 2, of Allegheny county: Of October and November Term 1881, No. 288.
This was an appeal by Mary Ann McAleer, trustee, from a decree of the said court, dismissing her exceptions to, and confirming the report of an auditor in the distribution of the proceeds of a sheriff’s sale of real estate.
The facts were as follows: By indenture dated January 27th 18(H), Daniel McAleer and wife conveyed certain real to John Callaghan, who immediately re-conveyed the same to the said Daniel McAleer upon the following trust, to wit: “ In trust, nevertheless, and for the uses following, and none other, that is to say, for the sole and separate use of Mary Ann McAleer, wife of the said Daniel McAleer, while she continues the wife of the said Daniel McAleer, and in the event of bis decease before her, while she remains bis widow and unmarried, so that she alone or such person as she shall appoint, shall take and receive the rents, issues and -profits thereof, to be used and appropriated as she many deem advisable for her maintenance and the maintenance and education of the children begotten and hereafter to be begotten by the said Daniel McAleer on the body of the said Mary Aim McAleer, and in the event of the decease of the said Mary Ann McAleer, before the said Daniel McAleer, or her marriage after the decease of the said Daniel McAleer, then in trust for the children of the said Daniel McAleer aud Mary Ann McAleer, begotten and to be begotten as aforesaid, and their heirs, to take and receive the rents, issues and profits thereof, to be used and appropriated during their minority for and to their maintenance and education, and upon tlieir arrival at the age of twenty-one years, to them and their heirs forever, with power, nevertheless, to the said Daniel McAleer, the natural guardian of his said children, at any time hereafter to sell and convey in fee simple the whole or any part of the aforesaid premises and appurtenances, to any person or persons, and for such sum or sums of money as he may deem best for the interests of his said children and their heirs. And, provided, nevertheless, that nothing herein contained shall be taken and construed to authorize the said Mary Ann McAleer to sell and convey said premises and appurtenances or any portion thereof, nor to sell and convey, or otherwise, than as herein mentioned, to dispose of the rents, issues and profits aforesaid, but the same to be used and disposed of as herein limited and appointed.”
The consideration named in said deeds was nominal, and it was admitted that the said Daniel McAleer at the time of making this voluntary settlement was possessed of considerable other estate, and was not indebted or contemplating indebtedness, so as to render it fraudulent as against creditors.
On August 25th 1869, the said Daniel McAleer and wife, mortgaged the premises in question to Samuel Roberts, Sr., for $1,100, and subsequently, in 1871, they executed a second mortgage to him thereof for $2,800.
Daniel McAleer died in 1873 and letters of administration upon his estate were granted to James P. Quinn. Mrs. Mary Ann McAleer was appointed by the court substituted trustee under the said trust deed.
In 1878, John C. Bindley obtained a judgment against Quinn, administrator of Daniel McAleer, deceased, for $914.90.
In 1879, the said first mortgage on said premises, for $1,100, was sued out, and the premises were sold at sheriff’s sale upon a levari facias for $8,000.
Before the auditor appointed to distribute this fund, John C. Bindley claimed payment of his judgment against Daniel McAleer’s estate, with interest. This claim was contested by Mary Ann McAleer, trustee, who claimed the entire fund as trustee.
The validity of the mortgage, under the power of sale contained in the deed of trust, w;as not questioned. But the contention arose upon the true construction to be given to the paid clause containing the power of sale — counsel for Bindley contending that the power of sale was reserved to Daniel McAleer for his own individual benefit, and counsel for the trustee claiming that the power of sale was part of the trust, and, if exercised, the proceeds were affected with the same trusts as attached to the original real estate.
The auditor reported on this question as follows: “ As before said, the deed must speak for itself, and any trust not found in its words or necessary implications does not exist. It will be observed that the trust in the first instance is that Mary McAleer shall £ take and receive the rents, issues and profits,’ and in case of her death in the lifetime of Daniel McAleer or re-marriage afterwards, to the children £ to take the rents, issues and profits.’ This language is applicable to real estate, and could not be construed to refer to the proceeds of the same. The deed does not pretend to dispose of the proceeds in case Daniel McAleer should choose to sell the property. There is no direct trust as to them, and the words used could not bo construed as applicable to such proceeds, aside from the difficulty of raising a trust as to this fund. From the inference that the proceeds were to stand in place of the property, it is a convincing argument that the power to sell was not in execution of the trust, but intended to be used by Daniel McAleer for his own benefit and at his own will. If such bo the case, it falls within the principles of Tobin v. Gregg, 10 Casey, 446.
“ I therefore find that J'. C. Bindley is entitled to the balance of the fund in court after paying the mortgages and costs, including costs of audit, and that the special return of the sheriff so amended should be confirmed.”
Mrs. McAleer, trustee, excepted “to the finding of the auditor that the power of sale given in the deed wras for the benefit of Daniel McAleer and to the award to J. C. Bindley of the amount due on his judgment against Daniel McAleer’s administrator. The court, after argument, dismissed the exceptions and confirmed the report of the auditor, from which decree Mrs. McAleer, trustee, took this appeal.
-Daniel McAleer’s purpose in making the voluntary settlement was to provide for his wife and children. There is nothing in the deed that intimates that the power of sale was to be exercised for bis own personal benefit. On tbe contrary, the power is vested in “ the said Daniel McAleer, the natural guardian of his said children,” to be exercised “ as he may deem best for the interest of said children and their heirs.” If Daniel McAleer in his lifetime had exercised the power of sale and endeavored to retain the proceeds as his own, a chancellor would have compelled him, under tbe terms of the trust deed, to account to the cestuis que trustcnt for the money.
The power of sale reserved in the trust deed is a general power, without any direct -trust expressed as to the proceeds. In such case, if the power be exercised, the proceeds form part of the assets of the settlor, subject to the demands of bis creditors: 2 Sugd. on Powers, 21; Mackason’s Appeal, 6 "Wr. 330; Tallmadge v. Sill, 21 Barb. 34; Johnson v. Cushing, 15 N. JET. 306; 4 Kent Comm. *319. There was no evidence to show that the money was raised by the mortgage for the purposes of the trust, or that Daniel McAleer used it otherwise than for his own personal benefit. He thus, by virtue of the power, exercised such acts of ownership over the property as to make the equity of redemption assets for the payment of his debts. He could not by any device put the estate beyond the reach of his creditors and still remain a beneficiary : Johnston <o. Harvy, 2 Penrose & Watts 82.
Syllabus and headnotes are prepared by the reporter or publisher, not the court, and are not part of the opinion.
