the donor of the trust. A fresh res has been brought within the scope of the trust relation, and when that happens, the cestui que trust acquires a right in rem. as to that res by operation of law. Giving this argument its greatest force, it cannot apply to the conveyance of the old trust property made by the trustee, and yet it is to those very limitations that the objection of remoteness is commonly made. Mr. Gray's Views as to the Application of the Rule to Powers in a Trustee 3 419. Mr. Gray, however, objects to the reasoning advanced in the previous sections as unsound, and concludes that such powers are valid because the trusts to which they are attached must come to an end or be destroyed within the limits fixed by the rule against perpetuities; that they are unobjectionable because they are destructible, upon which it may be observed, (1) that a trust does not necessarily come to an end within the period fixed by the rule; (2) that the powers are indestructible during the continuance of the trust. Mr. Gray appears to draw no distinction between the powers of a trustee over the legal title and his powers over the equitable title. Author's Objection to the View of Mr. Gray Discussed in the Previous Section 420. A case may arise where the trust will not terminate within the period fixed by the rule against perpetuities. Thus, where there is a devise to A. in trust for B. for life, at his death in trust for the eldest grandchild of C., then living, for life, and after the grandchild's death, to X., a living person, and his heirs, with power in the trustee to sell at any time during the continuance of the trust. B. dies, living a grandchild of C. The life estate in this grandchild is good, and the trust must remain until his death. Mr. Gray" says that the power in such a case is void, because it may be exercised at a remote period. To say that the power is valid 3 Rule Perp., 2 ed. (1906), §488, et seq. 4 Rule Perp., 2 ed. (1906), §490, et seq. 5 Rule Perp., 2 ed. (1906), §482. The estate in the grandchild is good because it vests within the period prescribed by the rule. §374, ante, and the 6 7 fact that it extends into the remote period is immaterial, §345, ante. The ultimate limitation to X. and his heirs is vested and valid, and the trust must remain to support it. 7 Rule Perp., 2 ed. (1906), §500. because the trust must come to an end within the period fixed by the rule, and then, when faced with a case where the trust continues beyond the period, to say merely that the power is void, does not, it is submitted, meet the difficulties of the case. Application of Rule to Powers of Sale in Trustees for a Charity 9 8 421. Furthermore, if the period prescribed by the rule begins to run from the time of the creation of the trust, in considering the case of a power of sale in a trustee, this further point arises. In what respect, if any, is the case of a power of sale vested in the trustees of an indefinite trust for a charity an exception? An indefinite, or as it is sometimes called a perpetual, trust for a charity is valid. The power of a sale in the trustee is therefore indestructible by the cestui que trust. We have there another case to which Mr. Gray's reason 9 does not extend. If the court can authorize a disposition of the trust property free from the claim of the cestui que trust at any time in the future, no matter how remote, why should there be any objection to the trustee doing the same thing under an express power in the settlement? There is no necessity that the power should be valid in such a case of a charitable trust, as the trustees can sell under the order of the court at any time during the continuance of the trust or under the act of April 18, 1853.10 A reference to this instance of a power of sale is useful as illustrating a case where, if the rule against perpetuities applies, as it is commonly supposed, to a power of sale in a trustee, there must be an exception, whereas under the reasoning already submitted," the case is not an exception at all. The law in Pennsylvania will now be examined, and we shall first notice the few cases which have been found. Cresson v. Ferree 422. In Cresson v. Ferree1 there was a power of sale vested in trustees, unlimited as to time. A sale was made by the trustees under the power during the continuance of the trust, and the purchaser refused to take title. On a case stated, 8 See Chap. 26 on Charitable Gifts. 9 See $419, ante. 10 §2, P. L. 503. 11 See §417, 418, ante. it was held that the title was good, and that the exercise of the power by the trustee was valid. Sharswood, J., in the Supreme Court, said, "We may concede that a general power over an estate, without limitation of time, unless after an estate tail, would violate the rule against the creation of perpetuities. In this case, however, the power of sale is clearly limited to a period during which the trusts created by the will subsist, or some of them, and that cannot exceed a life or lives in being at the death of the testator." In this the learned judge seems to recognize the principle that the power may be exercised so long as the trust is valid, although he inaccurately states the period for which the trust may subsist.3 Wilkinson v. Buist 4 423. In Wilkinson v. Buist there was a power of sale in the trustees unlimited as to time. The court in an opinion by Clark, J., said that the other provisions of the will indicated that it was to be exercised only during the lifetime of the widow, and then the learned judge made use, by way of dictum, of the following language:5 "A power of sale without limit would doubtless be bad under the rule against perpetuities, and a testator will not be presumed to have intended anything so absurd." Marshall's Estate 424. In Marshall's Estate, No. 1, a testator gave his estate in trust for the benefit of his children. On petition by the 2 This is clearly a misapprehension. Twenty-one years may be added to the life in being, see §340, ante, and the trust may extend considerably beyond even that period in order to provide for equitable life estates which vest in time, but continue to a remote period; see §§345, 420, ante. 3 See remarks of Ashman, J., in Githens's Est., 24 Pa. C. C. 248 at 250 (1900), where an executor had a power of sale unlimited as to time, which it was argued, was invalid, and the learned judge said that the power of sale could not outlive the purpose it was meant to subserve, and as the period fixed for final distribution was not remote, the power 8 Dicta of Hare, P. J., in the court below, in Mifflin's App., 121 Pa. 205 at 215 (1888), and Stewart, P. J., in the court below in Johnston's Est., 185 Pa. 179 at 189 (1898), accord. 7 138 Pa. 260 (1890). 8 The same will was before the court in Marshall's Est., 147 Pa. 77 (1892), probably on an account of the proceeds of this sale, and it was held that the trust was terminable only in the discretion of the trustee. See this question discussed, $538, post. 9 trustees under the will, and decree thereon directing them to sell a portion of the real estate, some of the children being still living, the judge in the court below said, that although the will contained no limitation of time within which the sale should be made, the power was good; that it had been exercised frequently since the death of the testator, and the condition of the estate was such that the unsold portion of the real estate must be converted. No question as to remoteness seems to have occurred to either court or counsel. Affirmed by the Supreme Court on appeal without an opinion. 2 Cooper's Estate 425. In Cooper's Estate 10 the testatrix made a gift of all her property to her children absolutely, and then superimposed a trust in her executor to manage the trust property,' with a power to rent, mortgage or sell unlimited as to time. The property was to be sold, and the trust terminated when twothirds of those interested in the estate should so demand. On adjudication of the executor's account the court refused to award the share of one of the cestuis que trustent to him free of the trust. The court seemed to think it necessary to go on and say that the power of sale was valid, and that the fact that the power of sale could be exercised at any time did not of itself create a perpetuity, as it must be exercised within a reasonable time, and it was within the power of the Orphans' Court to control the exercise of discretion in such case upon the application of the parties in interest. As the trust would be valid without the power of sale, it is difficult to see how any question as to the validity of the power or the application of the rule against perpetuities was properly before the court. Summary of the Pennsylvania Cases on the Application of the Rule to Powers in a Trustee 426. No very definite conclusion can be drawn from these cases. In Cresson v. Ferree there is a distinct recognition of 3 9 Hawkins, P. J., in 138 Pa., at p. 262. 10 150 Pa. 576 (1892). 1 As to the validity of this, see §524, post. 2 The auditing judge, Hanna, P. J., upheld the trust. The court in banc sustained exceptions to his adjudication, and on appeal the Supreme Court reinstated the decree of the auditing judge. 370 Pa. 446 (1872), stated §422, ante. the principle, although by way of dictum, that the power, even though unlimited as to time, may be exercised so long as the trust lasts. Marshall's Estate, No. 1, seems to strongly sustain the validity of such a power, even when exercised at a remote period, although no question as to the application of the rule against perpetuities was raised in the case. The dicta in Wilkinson v. Buist and in Cooper's Estate are in favor of the proposition that the power must be expressly limited to be exercised within the period prescribed by the rule, apparently proceeding on the proposition that the period prescribed begins to run from the time of the creation of the trust. The question, therefore, may be said to be open in Pennsylvania, and there is room for the Supreme Court to reach the conclusion that the period prescribed by the rule begins to run from the time of the exercise of the power by the trustee, and therefore the circumstance that such a power is limited to be exercised within or without the period, dating from the time of the creation of the trust, is utterly immaterial. Effect of Control by a Court of Equity on the Application of the Rule to Powers in a Trustee 427. A power of sale vested in a trustee is subject to the control of a court of equity. The cestui que trust may apply for such orders as are necessary to protect his interests. The trustee may, for instance, attempt to sell at a great, undervaluation. It is sometimes said that since the power is subject to the control of the court, it may be valid even though unlimited as to the time of its exercise, if the circumstances are such that the chancellor will direct a sale within a reasonable time, and that reasonable time does not extend beyond the period prescribed by the rule, making the period begin to run from the time of the creation of the trust. This notion proceeds upon the fallacy that the power is subject to the rule. The only effect of the approval of the sale by the chancellor is to protect the legal title in the hands of the purchaser from future claims on behalf of the cestui que trust. That approval, therefore, cannot be affected by the application of legal rules to the legal interests vested by the trustee under the power. A trust may subsist for a period 138 Pa. 260 (1890), stated §424, ante. 5 124 Pa. 253 (1889), stated §423, ante. 150 Pa. 576 (1892), stated §425, ante. |