This action is brought to obtain a judgment establishing certain alleged claims against the defendants, the Count and Countess de Castellane, and applying in payment thereof a portion of the surplus income arising from a trust estate, created by the will and codicils thereto of the late' Jay Gould, in favor of his daughter Anna Gould, the Countess de Castellane.
The plaintiff, according to the allegations of the amended complaint, is the assignor of one Asher Wertheimer, of London, England, who, it is alleged, sold and delivered, prior to the commencement of the action, to the Count and Countess de Castellane, at Paris, France, personal property of large value, in payment of which they accepted drafts (copies of which are set out in the amended complaint), and payment having been refused the same were assigned to the plaintiff in this action; that since the maturity of the drafts the defendants Castellane have been and now are at Paris, France, where they expect to remain, and for that reason it is, and will be, impossible to serve either of them with the process of this court, or otherwise to acquire jurisdiction over them in any action which may be brought against them to establish such claim; that the plaintiff has no adequate remedy at law to secure the payment of the alleged indebtedness and the samé cannot be secured unless he can obtain the relief prayed for in the complaint in this
The judgment demanded is that so much of the- net income of the trust estate, over and above such sum as the court may determine to be necessary for the support of the countess and the support, maintenance and education of her children, be applied towards the payment of the sums due or to become due the plaintiff upon said claims, and that said defendant trustees be enjoined from receiving the rents, issues and profits of said trust estate, over and above such sum as shall be determined by the court to be necessary for the proper support of the countess and her. children, and that the said trustees account to a receiver to be appointed in the action to take charge of such excess.
The defendants, the Count and Countess de Castellane, were not served with the summons or complaint, and they have not appeared in the action. The other defendants were served and they have interposed an answer, in which they have denied substantially all of the material allegations of the complaint, and have also set up certain affirmative defenses.
Upon the complaint, answer and certain affidavits, an order, was made continuing a preliminary injunction enjoining the said trustees “ from paying over to the defendant Anna Gould, Countess de Castellane, or to any person acting for her or on her behalf, any part of the rents, issues, profits, income or avails, in the hands of said defendants or under their control, or that (of) any of them, as trustees under the last will and testament of Jay Gould, deceased, or otherwise, in so far as the same constitute any part of the trust fund or estate created by said will for the benefit of the defendant Anna Gould, now Countess de Castellane, or from applying any part of the said trust fund or of the income or avails thereof, to the
From this order the defendant trustees have appealed, and it is urged by them that the order should be reversed, principally upon the ground that, assuming all of the facj;s stated in the amended complaint to be true, the court has no jurisdiction over the subject-matter of the action or power to grant the relief asked.
There can be no doubt that a creditor now has the right to have the surplus income of a trust estate created for the support of his debtor applied towards the payment of his debts. This right is purely statutory. It did not formerly exist, even where the trust was created by the debtor himself. This, however, was changed by the Revised Statutes, and jurisdiction was by it given to the court to appropriate property held in trust or the avails of it, when such trust was created by the debtor. (Donovan v. Finn, Hopk. 59; Pettit v. Candler, 3 Wend. 618; Hadden v. Spader, 20 Johns. 554.) The provisions of the Revised Statutes (2 R. S. 173, 174, §§ 38, 39) were: “ § 38: Whenever an execution against the property of a defendant shall have been issued on a judgment at law and shall have been returned unsatisfied, in whole or in part, the party suing out such execution may file a bill in chancery against such defendant and any" other person to compel the discovery of any property or thing in action belonging to the defendant,- and of any property, money or thing in action due to him or held in trust for him ; and to prevent the transfer of any such property, money or thing in action, or the payment or delivery thereof to the defendant, except where such trust has been created by, or the fund so held in trust has proceeded from some person other than the defendant himself. § 39: The court shall have power to compel such discovery and to prevent such transfer, payment or delivery, and to decree satisfaction of the sum remaining due on such judgment out of any personal property, money or things in action belonging to the defendant, or held in trust for him, with the exception above stated, which shall be discovered, by the proceedings in chancery whether the same were originally liable to be taken in execution at law or not.” Both of these provisions of the
The sections of the Code referred to do not give the right to a creditor to maintain an action to reach the avails of a trust estate created by any one other than the defendant. This right, however, is given by the Revised Statutes (1 R. S. 729, § 57). This section of the Revised Statutes provides that: “ § 57: Where a trust is created to receive the rents and profits of lands, and no valid direction for accumulation is given, the surplus of such rents and profits, beyond the sum that may be necessary for the education and support of the person for whose benefit the trust is created, shall be liable in equity to the claims of the creditors of such person m the same manner as other personal property which camnot he reached hy am, execution at lamo)'1 This provision, in terms, relates only to real estate, but it has been held to .apply equally to personal property. (Williams v. Thorn, 70 N. Y. 270; Tolles v. Wood, 99 id. 616; Wetmore v. Wetmore, 149 id. 520.) The words, “ in the same manner as other .personal property which cannot be reached by an execution,” obviously refer to the provisions of the Revised Statutes above quoted, and which were embodied in and now form the sections of the Code (§§ 1871-1879) hereinbefore referred to. In what manner, then, can other personal property be applied to the payment of a debt which cannot be reached by an execution at law ? The answer to this question is found in these sections, and it
The plaintiff here has not brought himself within the provisions of the statute. Indeed, it is conceded by his counsel in the brief submitted upon the argument before us that the action is not brought under the statute, but it is insisted, inasmuch as the defendants Castellano are outside of the jurisdiction of the court, and for that reason it is impossible to obtain a judgment against them upon the alleged claims, that the court has inherent jurisdiction to grant the relief asked, and in this connection our attention is called to a line of authorities in which compliance with the statute has been excused. (Shellington v. Howland, 53 N. Y. 371; Hirshfeld v. Bopp, 145 id. 84; National Tradesmen's Bank v. Wetmore, 124 id. 241; Lefevre v. Phillips, 81 Hun, 233; Patchen v. Rofkar, 12 App. Div. 475; S. C., 52 id. 369.)
These cases are not in point. The decision in each of them was placed upon the ground either that in actions to hold the defendants liable under the statute, as stockholders or directors of a corporartion, for the debts of a corporation where the performance of certain conditions becomes impossible by reason of the operation and effect of a statute, or becomes illegal, performance is excused and the rights of the parties will be preserved (Shellington v. Howland, supra; Hirshfeld v. Bopp, supra); or where there has been a fraudulent disposition or transfer of property, in which case the court has inherent jurisdiction. (National Tradesmen's Bank v. Wetmore, supra; Patchen v. Rofkar, supra; Lefevre v. Phillips, supra)
The case before us obviously does not fall within either class. The trust was not created in fraud of creditors. It was created long before the plaintiff’s claim came into existence, and so far as appears, before, the Countess de Castellane had any creditors whatever. The court, therefore, has no inherent jurisdiction, and not- a suggestion is made showing why the plaintiff should not comply with the statute, except that service of process cannot be made upon
What was said by Judge O’Brien in Ward v. Boyce (supra) is as applicable in this ease as it was in that. He said: “ A party cannot be deprived of property without due process of law, and that term in its application to judicial proceedings means a course of legal proceedings according to those rules and principles which have been established by' our jurisprudence for the protection and enforcement of private rights. If the proceedings involve the determination of the personal liability of .the defendant he must be brought within the jurisdiction by service of process within the state, or voluntary appearance. If it be a proceeding m rem, the res must have been seized or attached, or at least must be within the jurisdiction. * * * The action was in the nature of a creditor’s suit, hy a creditor at large against the debtor, and such third parties as had in their hands rights, credits or equities applicable to the payment of the claim- The debt against the principal defendant, and the fact that the other parties held some property in trust for him, were, by the scheme of this suit, to be established in the same action. The initiatory step was to prove the debt and establish it
Capital City Bank v. Parent (supra) is also in point. There the action was in the nature of a creditor’s bill upon a judgment recovered against a non-resident defendant, who had been served by publication. A warrant of attachment had been issued, and a levy under it was alleged to have been made. It appeared, however, on the trial that the levy was not, in fact, made, or if made, that it was thereafter abandoned. This fact having been made to appear, the court held that the action could not be maintained; that the service of the summons by publication did not give the court jurisdiction of the person of the debtor, and the failure to levy under the attachment deprived the court of jurisdiction to enforce any judgment there obtained against the debtor’s property.
Here, the. plaintiff, as already indicated, seeks to • have the indebtedness of the Countess de Castellano to him, or his assignor, first judicially determined without the court having any jurisdiction of said debtor, and after such claim has been established, that it then be judicially determined what portion of the surplus is • necessary for the support of herself and her children. Applying the principle announced in the foregoing authorities, it can readily be seen that this cannot be done, inasmuch as the court has no jurisdiction of the person of the debtor and the proceeding is not in rem, in which case judgment could be rendered against the property attached.
It follows from what has been said that the order appealed from must be reversed, with ten dollars costs and disbursements, and the motion to continue the injunction denied, with ten dollars costs.
Van Brunt, P. J., and Rumsey, J., concurred; O’Brien and Ingraham, JJ., dissented.