at an end. The Supreme Court held that the petition should be dismissed. The decision was clearly correct, as there were several cestuis que trustent, and the trust could not be terminated unless all united in the application. This ground of decision was overlooked by the Supreme Court, and Mr. Justice Elkin, in delivering the opinion, rested the case on grounds which tend to sustain the proposition that the cestui que trust cannot terminate a trust of property in which he alone has an absolute interest. The learned judge said that it was the unquestioned law of the state that a benefactor has power to restrict the enjoyment of his bounty through the medium of a trustee during the life of a beneficiary, citing Rife v. Geyer.2 Law in Pennsylvania as to the Validity of a Trust of an Absolute Interest 7 524. It appears, therefore, that the overwhelming weight of authority sustains the proposition that where the cestui que trust is the only person interested and is entitled to the entire property he can terminate any trust thereof which may have been created. There appears to have been a vague notion to the contrary cropping out in some of the cases as far back as 1853,5 and culminating in the dictum in Boies' Estate. In Krebs's Estate it was first decided that a trust of an absolute interest was valid as against the cestui que trust. In this case it is to be observed that the Supreme Court affirmed the opinion of the court below without discussion, and that the learned judge of the court below was unable to cite any authority in favor of the proposition which he laid down. Frantz v. Race, King's Estate and Spring's Estate,1o although tending to suport the principle laid down in Krebs's Estate, can all be explained on other grounds. Shower's Estate," however, reaffirms the doctrine of Krebs's Estate. In 8 none of these cases did the Supreme Court notice the earlier authorities in Pennsylvania and the court has obviously been influenced by an undue weight given to the self-evident proposition that a man may do with his own property anything which is lawful,' and also by the fallacy that putting an estate in trust indicates an intention to cut down the fee.2 However objectionable on principle, it must be concluded under these cases that it is the law in Pennsylvania that a donor may fetter an absolute gift with a trust, with the question open as to the period of time during which the trust may subsist. It is perhaps not too much to hope that the Supreme Court will overrule these unfortunate decisions and return to the sounder doctrine of the common law. 3 The Real Question Involved 525. It is of no importance that the settlor intended to create a trust of a fee, nor is it material that he vested active duties in the trustees. There is no room for controversy in these cases that such was the intention of the donor; the specific question is whether his intent can prevail as against the principle of law. The question is not whether the donor intended to create a valid trust, but whether the trust which he has created is valid; not whether the donor can create a trust of an absolute interest, but whether the trust of an absolute interest which he has created can remain as against the objection of the cestui que trust. The preliminary question is one of construction; it is necessary to determine what is the nature of the estate which is given to the cestui que trust, and it is important to remember that he can take only a fee, a life estate or an estate for years, and the court cannot by any course of reasoning give the gift any other effect. Consequences of Upholding the Trust of an Absolute Interest 526. If the court means to adhere to the doctrine that a trust of an absolute interest is valid as against the cestui que trust, the further question will arise: for how long will 1 Elkin, J., in Spring's Est., 216 Pa. 529 at 533 (1907). For a discusssion of this proposition, see §2, ante. 2 For a discussion of this fallacy, see §522, n. 7, ante. 3 Confer §§243, 254, ante. 4 See remarks of Hanna, P. J., in Wright's Est., 28 Pa. C. C. 540 at 541 (1903). the trust be upheld?" Will a period similar to that prescribed by the rule against perpetuities be adopted? If so, from what time will the prescribed period commence to run? These are questions of no small difficulty, and their solution will require litigation, which the court can easily save the people of the commonwealth by adhering to the safe path of the common law, and overruling Krebs's Estate and Shower's Estate at the first opportunity. 8 6 See 19 Harv. Law Rev. 598 at 603 (1906). 7 7184 Pa. 222 (1898), stated §519, ante. 8 211 Pa. 297 (1905), stated §522, ante. 530. A trustee is subject to the control of the chancellor in the exercise of the power which he possesses, whether inherent or special.1 A discretion, as we have seen,2 leaves the doing of the act to the personal judgment of the trustee, and to that extent liberates him from the control of the court. 1 See §153, ante, et seq., for a discussion of powers in a trustee. 2 See $158, ante. Discretionary powers as to the legal title have no effect on the interest of the cestui que trust. They fall when the trust terminates and are of no importance in the present discussion.3 Where, however, the discretion is as to the doing of an act affecting the equitable interest, a different question presents itself. If the exercise of the discretion involves the substitution of another equitable interest, it seems unobjectionable except in so far as the rule against perpetuities is concerned.* If no one else can have any benefit under the discretion, its exercise may be a restraint on the equitable estate of the cestui que trust, and void at his instance as violating the rule forbidding restraints on enjoyment. This is the particular point to be examined in this chapter. The matter has, however, been very little discussed by the text writers, and there is a great dearth of authority on the subject. Legal Discretion 531. The discretion is said to be legal when the trustee is authorized to exercise the discretion if certain specified circumstances exist. The court will judge whether the facts are in existence, and if they are, the trustee will be compelled to exercise the discretion. If the facts do not exist the chancellor ordinarily will not interfere. Absolute Discretion 532. An absolute discretion is said to exist when the doing of something with respect to the trust property is left to the sole discretion of the trustee, without reference to any extrinsic circumstances. In such case the discretion cannot be interfered with unless its exercise amounts to a restraint on the use and enjoyment by the cestui que trust of his equitable estate. Distinction Between Discretion as a Condition Precedent and Discretion as to a Vested Interest 533. One further distinction remains to be noticed: the exercise of the discretion may be a condition precedent to the 3 See 88415-436, ante, for a discussion of these powers and the application of the rule against perpetuities. For the application of the rule against perpetuities, see §§411-413, ante. |