In each of these cases, the trust agreement provided, in essence, that the trustees to whom the property had been conveyed were to pay the income to the settlor for life, and that, upon her death, the principal was to be paid over by the trustees to such persons as the settlor might appoint by will, or, in default of such appointment, to the settlor's heirs at law and next of kin as in intestacy. In addition, in Matter of Burchell, the settlor reserved to herself the right and power to approve and join in the execution of any conveyance or mortgage of the property, of any lease for a period of more than three years or of the appointment of a successor trustee or trustees.
The rule has long been established that "to transform into a remainder what would ordinarily be a reversion, the intention to work the transformation must be clearly expressed." (Doctor v.Hughes, 225 N.Y. 305, 312; see, also, Richardson v.Richardson, 298 N.Y. 135, 139; Matter of Scholtz v. CentralHanover Bank Trust Co., 295 N.Y. 488; City Bank Farmers TrustCo. v. Miller, 278 N.Y. 134.) *Page 362
Had the agreement not reserved to the settlor a power to appoint by will, no one would question or dispute that a reversion had been created. To find, in the retention of such a power — to appoint by will — the "clearly expressed" intention which is essential to transform a reversion into a remainder, impresses me as illogical and unreal. Even without such a reservation, the property would have passed, upon the settlor's death, to whomever she had designated by will or to her heirs and next of kin as upon intestacy (see, e.g., City Bank FarmersTrust Co. v. Miller, supra, 278 N.Y. at p. 145); the circumstance that the settlor specifically reserved a power to appoint a taker means, if it means anything, that she wanted to affirm and emphasize that she desired to retain control of her property up to the time of her death and to direct its devolution thereafter.
We carry form and the accident of language too far if we conclude that the insertion of such a power can accomplish the transformation of that reversion into a remainder. Certainly, nothing held or said in the Richardson case (298 N.Y. 135,supra) — wherein the settlor had provided for an intervening contingent remainder in fee to her mother — requires that result. I cannot believe that the court ever meant, in listing the criteria that usually attend the creation of a remainder (pp. 140, 144), to express an inflexible rule or an inexorable juridical formula by the use of which we would be able to derive an automatic answer in all cases. Just as before the Richardson case, so today — unless the court by its present decision is overruling what has long been settled law — the interest created depends upon the intention of the settlor as expressed in the trust indenture as a whole. In my view, the language employed in the agreements before us plainly points a reversion: entirely lacking is any "clear expression" to justify changing it into a remainder. (See Doctor v. Hughes, supra, 225 N.Y., at p. 312.)
Reversion or remainder, however, the volume of litigation on the subject, the diversity of opinion, not to mention the difficulty, frequently, of decision, point the advisability, if not the urgency, of clarifying legislation.
In my opinion, the determination in each case should be reversed.
LOUGHRAN, Ch. J., LEWIS, CONWAY, DESMOND and DYE, JJ., concur with BROMLEY, J.; FULD, J., dissents in opinion.
Order and judgment affirmed. *Page 363