I am not in accord with the decision about to be made in so far as it disapproves the items surcharged.against the trustee by reason of his failure in 1925 to divide equitably between Gertrude H. Blodgett and the Gertrude H. Blodgett trust the cash and securities comprising the corpus of the Harry. C. Blodgett trust.
Upon the death of the testatrix’s son, Harry C. Blodgett, the trust created in his favor terminated. (Real Prop. Law, § 109, made applicable to personal property by Pers. Prop. Law, § 11: *333Matter of Thomas, 228 App. Div. 203, 207; revd. on other grounds, 254 N. Y. 292.) Thereafter, the only duty remaining to be performed by the appellant as trustee of that particular trust was to pay over its principal to those entitled thereto under the provisions of the will. (Matter of Miller, 257 N. Y. 349, 355.) At that time the estate was in the process of administration; its assets were in the appellant’s hands as executor, subject to the claims of creditors and expenses of administration, after which the residue was to be divided “ into two parts, equal as nearly may be ” for the purpose of setting up the two trusts. When the residuary estate was turned over to the appellant as testamentary trustee several months later, he took title to half thereof as trustee of the Gertrude H. Blodgett trust. As to the remaining half — which would have become the principal of the Harry C. Blodgett trust if the son had survived — the trustee’s only duty was to pay to the widow, Beatrice D. Blodgett, her bequest of $10,000 and deliver the balance to Gertrude H. Blodgett as remainderman. (Matter of Miller, supra, p. 355.)
I differ with the view of a majority of the court as to the propriety of the manner in which the division was made. Instead of distributing in kind the stocks, bonds and cash which comprised the residuary estate — one-half of each to Gertrude H. Blodgett as remainderman and one-half to the Gertrude H. Blodgett trust — • the trustee chose to pay Gertrude H. Blodgett in full in cash. To accomplish that end he sold substantially all of the readily marketable securities included within the total undivided residuary assets and from the proceeds paid to Gertrude H. Blodgett $193,198.24. Having thus favored Gertrude H. Blodgett by cashing those assets of the estate which were quickly marketable,' there remained in his hands as trustee only a comparatively small amount of cash and certain securities which consisted largely of local stocks having a restricted market. It was from these less favored assets that the trustee set up the Gertrude H. Blodgett trust in which lodged the contingent interests of the ultimate remaindermen and in which they were to share ten years later.
These facts and others disclosed by the record indicate a sustained effort by the trustee to favor the interests of Gertrude H. Blodgett but with less regard for the contingent interests of the ultimate remaindermen whose rights were also within his care. Neither courts nor text writers approve such conduct by a trustee. Their emphasis is upon conduct which in the end brings about equality in the distribution of the corpus of a trust among its beneficiaries; they condemn an exercise of discretion which results in inequality. (Matter of Harden, 177 App. Div. 831, 835, 836; affd., 221 N. Y. *334643. See, also, 2 Perry on Trusts and Trustees [7th ed.], § 511-b; 4 Schouler on Wills, Executors and Administrators [6th ed.], § 3137.)
A majority of the court find the trustee’s acts justified by the fact that in the will which created the trust the testatrix provided: “ (d) Whenever by any of the terms hereof my said trustee is required to divide property into parts or shares or to make payment of any sum to- any person, he shall have power and authority to make such division or payment in money, or in kind, or partly in money and partly in kind; and for the purpose of allotment of property to such division or payment, the judgment of my said trustee as to the propriety of such allotment or the value of any property so allotted, shall be binding and conclusive upon all concerned.”
Concededly the authority thus given to the trustee is broad, but “ however broad [it] did not relieve him [the trustee] from obedience to the great principles of equity which are the life of every trust.” (Carrier v. Carrier, 226 N. Y. 114, 125, 126.) He was trustee, not alone for Gertrude H. Blodgett, but also for the ultimate remaindermen whose interests in the principal of her trust might become substantial if she died before attaining the age of sixty —• which eventually occurred.
Moreover, the discretionary power granted by the clause upon which the appellant relies must be construed with another clause of the will which was employed by the testatrix in creating the two trusts. After providing that her residuary estate should be held in trust “ for and upon the following uses and purposes and subject to the terms, conditions and powers hereinafter set forth,” she directed her trustee, “ First. To divide the corpus or principal sum of the said residue of my property into two parts, equal as nearly may be.” I find in this direction a peculiar phrasing which makes emphatic the desire of the testatrix for equality in the distribution of assets to be made between the two trusts. Not only was the residue to be divided into “ two parts ” but those parts were to be “ equal as nearly may be ”— a phrase which I believe should be considered as we fix the standard by which the reasonableness of the trustee’s conduct is to be tested.
The view taken by a majority of the court seems to disregard the first direction by the testatrix as to equal distribution of the residue. The decision is to rest upon the discretionary power given elsewhere in the will to the trustee leaving in my mind the quaere: May we thus disregard the reasonable implications to be drawn from this first direction? Should not our decision reflect a consideration of the entire will; should it not be responsive to the desire — clearly expressed by the testatrix — for equality in dis*335tribution of the residuary estate? Or should we give heed to that paragraph alone which endows the trustee with a broad discretion?
Viewing the manner of distribution chosen by the trustee in the light of the definite direction by the testatrix for an equal division of residuary assets between the two trusts, I believe that principles of equity and common fairness dictate that there should have been at least some reasonable proportion between cash and securities —• between the best and the worst securities in the trustee’s portfolio.
The broad discretion vested in the trustee did not give him an absolute and uncontrolled power. When our courts had occasion to consider a trust instrument which gave to a trustee discretion “ absolute and uncontrolled'” it was said: “ That does not mean, however, that it might be recklessly or willfully abused.” (Carrier v. Carrier, supra, p. 125; Cf. Ireland v. Ireland, 84 N. Y. 321, 326 et seq.; 2 Schouler on Wills, Executors and Administrators [6th ed.], § 1379.)
Inasmuch as the same instrument which made the appellant trustee of the rights of Gertrude H. Blodgett also extended that trusteeship to the rights of the ultimate remaindermen, and in view of the provisions of the will to which reference has been made, it impresses me as manifestly unjust and inequitable that the trustee should have so distributed the residuary estate that the continuing trust was required to bear the risk and subsequent loss which attended the retention of unmarketable securities while Gertrude H. Blodgett, as remainderman of the terminated trust, was paid with cash in full.
Decree so far as appealed from (there being no appeal from the fourth and fifth ordering paragraphs), reversed on the law, except the parts thereof contained in the first, second, third and eighth ordering paragraphs and the third ordering paragraph after the summary statement, and a new trial granted as to the matters included in the parts of the decree reversed, without costs, and the decree so far as appealed from otherwise affirmed, without costs.