and then (4) plainly state what is to be done, and (5) for whom.

The difference between the functions of an executor and a trustee is as follows: An executor's duties are to collect the assets, preserve from waste, pay debts and then legacies. A trustee's duties are to hold, invest, and care for the particular fund or property, and dispose of it or its income as directed by the instrument creating the trust.

An executor's duties as such are to settle and close up the estate. If part or all of the property is to be withheld from distribution, or if only the income is to be used, or be accumulated, then it is usually safest to leave it to a trustee.

It has been expressed by the Court of Appeals of New York as follows:

Ordinarily, the only duties resting on an executor or an administrator are to take possession, collect assets, pay debts and retain the estate for distribution—all of which the statute assumes can be done in eighteen months, except in special cases, when a longer period is required. They have nothing to do with the real estate. The duties of a trustee are usually more extensive, more onerous, more responsible, and cover a longer period, and to them when real estate is the subject of the trust, are committed its care, preservation and management.❜

It is common to appoint executors as trustees, so that the same persons settle the estate and then continue as trustees. In such case the parties execute two distinct functions.

§ 173. Executors Who Are Trustees

In a will where the executors named are also to act as trustees they should be expressly so appointed, the usual phrase being, "I appoint John K. Andrews and Walter Reynolds executors and trustees, under this will."

'O'Brien v. Jackson, 42 App. Div. (N. Y.) 171.

It happens, however, in many cases that the testator will name an executor or executors, and will then direct them to hold property and to pay the income to minor children; and by thus imposing the duties of a trustee he creates a trust and the law considers them as trustees.

It is a very familiar rule that the duties imposed upon a person rather than the name applied to him in the will should measure his office and position, and that when the duties of a trustee are imposed upon a person he will be regarded as a trustee rather than an executor.*

It is true that every executor and administrator is also held to the responsibility of a trustee-that is, it is a fiduciary relation; but an executor is not a trustee in the same sense that a testamentary trustee is.

One important difference is that when there are several executors any one of them can act alone. Trustees, however, must act jointly. They can do nothing except by united action.

A

Testamentary trustees are under the supervision of the courts of probate. The designation in the will would require appointment and issuance of letters by the probate court. person designated as executor and trustee who had qualified and taken out letters as executor could perform all the functions of executor without necessarily agreeing to act as trustee, though usually in such case it would be assumed that he accepted the trust as well.

§ 174. Trustee's Bond and Oath

A testamentary trustee is appointed by the testator and is not necessarily required to give bond. If the testator should specify that his trustee give bond, the court would require a bond. In New York anyone interested in the fund may file Mee v. Gordon, 187 N. Y. 400,

a verified petition setting forth his interest in the matter, and then some fact or facts that would be good ground for requiring a bond. These facts would be: (1) that the trustee's financial circumstances are such that they do not afford sufficient security for the beneficiaries, or (2) that he is not a resident of the state. In such case the trustee must qualify by furnishing an adequate bond. In one such case, the proposed trustee showed that he was worth $100,000 in excess of his liabilities, and the petition for bond was denied.5

When the judge of probate appoints a trustee to fill a vacancy, he may properly require security before acting. By a late New York statute an executor who is also a trustee shall, before taking the property over, file bond unless excused from bond by the will.

A testamentary trustee is required to take an official oath before some officer authorized to administer oaths to the effect that he will faithfully and honestly discharge the duties of his office, which will be described in the affidavit. This affidavit is filed with the court of probate before the trustee is permitted

to act.

6

In New York the statute provides:

A testamentary trustee named in a will or appointed by the surrogate shall, before exercising the duties of his office, qualify by taking and filing with the surrogate an oath of office and such bond as may be required by the surrogate.

A trust company or other trustee exempted by law from taking an oath of office and filing a bond, shall file a consent to accept such appointment duly executed and acknowledged.

§ 175. Resignation or Removal of Trustees

Strictly, a trustee cannot resign, but he for some failure of duty or breach of trust.

states been changed by statute.

may be removed This has in some

In these states, when the trust

Matter of Weil, 49 App. Div. (N. Y.) 52. N. X. Code Civ. Proc., § 2637.

fund is intact a trustee whose accounts are straight can resign for good reason, such as ill health, old age, or absence from the country. It would be necessary to investigate the procedure in the particular state in regard to this matter.

The probate courts generally have power to remove a trustee who is incompetent, dishonest, or delinquent in any matter pertaining to his trust. The statutes usually give the judge of probate somewhat autocratic powers in these matters.

If the conduct of a trustee is objectionable, the matter may be brought to the attention of the probate judge by petition of anyone affected in interest, and after citation the judge will, on due investigation and if the charges are sustained, make a decree revoking the authority of the trustee. In some situations, the trustee may resign and have his resignation accepted to avoid proceedings for removal and their probable termination.

In New York by statute a trustee may be removed without petition or citation, when he is absent from the state and fails to respond to citation, or evades service of citation, fails to obey the order of the court, has been convicted of a felony, or fails. to deposit the trust funds in a separate account as trustee, or when the will is declared invalid.

§ 176. Filling Vacancies

Testamentary trustees are, as the name implies, appointed by will. In cases where one or more of those appointed have died prior to the probate of the will, or where they renounce the appointment, or where a trust is created by will but no trustee is named, or where one or more die or are allowed to resign, or are removed and the trust remains unfulfilled, the probate court has power to fill the vacancy or vacancies. If one trustee of two or more remains, he may, until a successor is appointed to fill the vacancy, act alone in executing the trust.

In New York the statute gives the court of probate power to fill vacancies arising from: (1) death, (2) insanity, (3) removal, or (4) resignation.

In some states the probate courts have no jurisdiction over trustees, and it is necessary to go to a court of equity for relief in case of difficulty. The same general rules hold in regard to misfeasance or neglect of duty, removal, or filling of vacancies.

When the trustee or trustees have done all that they can do, they should pay over to the beneficiaries or legatees of the life interest what is due, turn in the accounts of their administration, and ask for a decree confirming the administration of the trust. All parties in interest should then be cited, and if the accounts are in proper shape and the trust has been fulfilled, the judge will make a decree that will declare the account judicially settled. Such a decree has all the effect of a judgment in any other court, and relieves the trustee from all claim or demand from the beneficiaries of the trust or from those to whom he may have transferred the trust property.

REVIEW QUESTIONS

1. What is a testamentary trustee? What is meant by a "trust”? What is a cestui que trust? What is a legal ownership? What is an equitable estate? What are the parties to a trust? 2. Who may be a trustee? What qualifications are essential? Why are financial corporations desirable as trustees?

3. How would you distinguish between a testamentary trustee and an executor? Would the expression of a wish create a trust? How would you use words in a will to create a trust? How do the duties of an executor differ from those of a trustee? 4. How may a testator directly appoint executors or trustees? How may he do the same thing indirectly? In what sense is every executor and administrator a trustee? May trustees act alone?