App. Div.] SECOND DEPARTMENT, JANUARY TERM, 1903. pass until the settlement of their accounts, that is but the formal relinquishment which may be required of them by the courts. In Mellen v. Mellen (139 N. Y. 210) the principle applied was that where by a will the money was directed to be laid out in the purchase of land for beneficiaries, or land is directed to be sold and the proceeds distributed, it is competent for the parties beneficially interested, if of full age and the gift is immediate and not in trust, to take the money in one case and the land in the other; and ANDREWS, Ch. J., says that the doctrine is founded on the presumption that such power is given by the testator for the benefit and convenience of the devisees and legatees, and, unless made so in terms, was not intended to prevent the beneficiaries from taking his bounty except in the precise form in which the property would exist after the conversion. I think that the reason for the rule is applicable in the case at bar, and may be applied (Cook v. Lowry, 95 N. Y. 103, 111), the essential fact being that the sole beneficiary, who is free to take, elects to take in specie, and so declares against a conversion, neither directed nor required under the terms of the will. (Craig v. Leslie, 3 Wheat. 563; Reed's Estate, 82 Penn. St. 428; Wood's Administrator v. Wood's Devisees, 1 Metc. [Ky.] 512; Hester v. Hester, 3 Ired. Eq. 9.) We are not without authority of statute. Shares of stock are personal property within the broad meaning of that term. (Weaver v. Barden, 49 N. Y. 286; Matter of Jones, 172 id. 575; Morawetz Corp. [2d ed.] § 225, and authorities cited.) Section 2744 of the Code of Civil Procedure provides: "In either of the following cases, the decree may direct the delivery of an unsold chattel or the assignment of an uncollected demand, or any other personal property to a party or parties entitled to payment or distribution, in lieu of the money value of the property: 1. Where all the parties interested, who have appeared, manifest their consent thereto by a writing filed in the surrogate's office. 2. Where it appears that a sale thereof, for the purpose of payment or distribution, would cause a loss to the parties entitled thereto. The value must be ascertained, if the consent does not fix it, by an appraisement under oath, made by one or more persons appointed by the surrogate for the purpose." Again, if it be necessary in such a case as this the court should be astute to find the intent of the testator that the legatee should take SECOND DEPARTMENT, JANUARY TERM, 1903. [Vol. 78. in specie. We have seen that the testator, after the specific bequests, leaves all the rest and residue of the estate to Mr. Albertson and that there is no direction for sale of the personalty, and, indeed, no power of sale over the personalty save "as may seem necessary." In a case where even the application of the rule of Howe v. Earl of Dartmouth (7 Ves. Jr. 138) was discussed (and the rule can have no application in this case for the reason that there is no estate or interest charged upon the residue) GRAY, J., says that a direction to sell only in the event of the necessity to pay debts was significant of an intent that the securities should be retained in specie. (Matter of James, 146 N. Y. 78.) Second. Are the executors bound to sell the stock pursuant to and in accord with article 9 of the association articles, or, to put the converse, is the residuary legatee prohibited from keeping the stock? Article 9 reads as follows: "No member of the association, nor his executors, administrators or other legal representatives, shall sell or transfer any of the capital stock of the association held by him or them, without first offering the same for sale to the association, or, if it decline the option, to a member thereof at a price not exceeding the appraised value of such stock at the time of such offer, determined and recorded as aforesaid." Lane Brothers Company is a joint stock association, organized under the laws of the State of New York. Such an association is well defined in Lindley on Partnership (Ewell, 2d Am. ed., § 6) as "consisting of many persons having transferable shares in a common fund," and the same writer says (Chap. 5) that the principal difference between a copartnership and a joint stock association is that there is in the latter, as a rule, no delectus personarum, and a transfer of the shares or the death of a member does not dissolve it. In People ex rel. Winchester v. Coleman (133 N. Y. 279) FINCH, J., says that People ex rel. Platt v. Wemple (117 id. 136) shows very forcibly how almost the full measure of corporate attributes has, by legislative enactment, been bestowed upon joint stock associations "until the difference, if there be one, is obscure, elusive and difficult to see and describe," and proceeds to point out that the essential difference lies in the fact that a corporation drowns the individual rights, while the association leaves the individual rights unimpaired in that the common-law liability for debts remains unchanged and unimpaired. App. Div.] SECOND DEPARTMENT, JANUARY TERM, 1903. * In the case referred to (People ex rel. Platt v. Wemple), the court, per DANFORTH, J., say: "Nor is the principal question altogether new. In Waterbury v. Merchants' Union Express Company (50 Barb. 158) the nature and legal character of the defendant, a joint stock association, created in like manner with the one before us, was held to have all the attributes of a corporation and all its incidents except a common seal. The statutes, from 1849 to 1867 (supra),* were examined and held to confer the qualities which distinguish a corporation from a partnership and to establish the relations of a member of the association as those of a stockholder in a corporation, and not those of an individual in a partnership, and that, in controversies affecting them, the analogies afforded by laws and jurisprudence in the case of corporations should be followed, and not those derived from a simple partnership." And in the Waterbury Case (supra) the court say: "Their property or capital is represented in shares and certificates of stock, differing in no respect from shares and stock certificates in corporations. * It may very well be that in a case of actual insolvency the shareholder, in view of his contingent liability, should have a quicker remedy to wind up and close the concern than the statute laws of this State allow in the case of corporations other than those organized for banking purposes. (See 2 Edmonds' Stat. 484.) Be this as it may, it is, nevertheless, true that the situation and relations of a shareholder in one of these associations are in other respects like, and very exactly like, those of a stockholder in a corporation." I think that in this case we should hold that so far as the interest of the testator in the association is concerned, it is analogous to that of a shareholder in a corporation. There is no contention that the testator did not have the power to dispose of his shares by will. Article 6 provides that the death of the stockholder or the transfer of his shares shall not work a dissolution, and article 9 expressly takes cognizance that the shares may either be held by a member or his executor or administrator. And if such contention had been made, it would, in my judgment, be against public policy, for the reason stated in the learned opinion of BARKER, J., in Fisher v. Bush (35 Hun, 641), that "The right of transfer is a right of property, and if another has the arbitrary power to forbid * Laws of 1849, chap. 258; Laws of 1851, chap. 455; Laws of 1853, chap. 153; Laws of 1854, chap. 245; Laws of 1867, chap. 289. -[REP. SECOND DEPARTMENT, JANUARY TERM, 1903. [Vol. 78. a transfer of property by the owner, that amounts to annihilation of property." It would be absurd to contend that the force of the 9th article is that Mr. Lane could not bequeath his shares by will without giving the association or its members an opportunity to buy them. It may be noted that the decision in Matter of Petition of Argus Co. (138 N. Y. 557, 572) proceeds without question upon the theory that the bequest of the shares by will was entirely within the power of the testator. The article does not require a sale, but if sale is made, that then the association or a member shall have the first opportunity to buy. The word "transfer" is not used in a technical sense of changing the name of the owner upon the books of the company, but in the sense of a change of ownership in the property. In Sands v. Hill (55 N. Y. 18, 22), FOLGER, J., says: "There is no meaning of the word transfer which carries the idea of an act of extinction; or any other idea than that of the bearing over of a right or title or property in a thing from one to another." (See, too, Robertson v. Wilcox, 36 Conn. 426.) Thus in article 6 the word is used in this sense, i. e., the death of a stockholder or "the transfer" of his stock shall not work a dissolution. The mere delivery of the stock to the residuary legatee by the executor is not a transfer within the meaning or intent of the provision, because the executors do not hold the stock in their own rights, but hold the legal title for administrative purposes for the benefit of the residuary legatee. (Steinway v. Steinway, supra; Blood v. Kane, supra; Schultz v. Pulver, 11 Wend. 363.) In Blood v. Kane (supra) the court, per FOLLETT, Ch. J., say: "It is a universal rule that when the purpose of a trust has been fully accomplished the title or estate of the trustee is at an end, and if he is also entitled to the beneficial estate, the two estates, meeting in the same person, are merged, and he becomes vested in his own right with the entire interest in the property." As the executors declared that all of the debts and all of the legacies (save, of course, as to this disputed claim of William J. Lane) have been paid, and the shares remain unadministered, their "administrative title" to the personalty is at end, and, therefore, the personalty which falls within the residue must be handed over to the residuary legatee. But this act is not a sale or a transfer by the executors to the residuary legatee in the sense that one App. Div.] SECOND DEPARTMENT, JANUARY TERM, 1903. acquires and the others relinquish a property right in the stock, for the property right of the legatee is derived from the will of the testator, and is not acquired from a transfer by the executors of the legal title vested in them for administrative purposes. The title vested in the executors is sufficient to make that sale to a third party valid, but does not give to a transfer of the legal title to their beneficiary the character of sale. The transfer referred to in the 9th article does not mean that there must be a sale, that is, a parting with her interest by the true owner, whose title was from the will, if she seeks to have her stock, when discharged from the administrative title of the exccutors, transferred to her on the books of the company, for if such be the construction of the article, it would require a sale when there was no intent to sell, but simply to take a step in further assurance of her title. The fact that the stock was transferable only on the books of the company, in person or by attorney, on the surrender of the certificate, if in accordance with the articles, merely "regulated the relation, * * * but did not operate to prevent the vesting of the legal title." (Matter of Petition of Argus Co., supra; Chemical National Bank v. Colwell, 132 N. Y. 250.) There is a discrimination to be made between the case at bar and Scruggs v. Cotterill (67 App. Div. 583). In the latter case the agreement provided for a sale from one party to another if either offered the stock for sale, and in case of the death of either party such a sale was provided for. The distinction is that a sale was required by the terms of the agreement, and that "the devolution of property by will is subject to the just obligations of the testator." In New England Trust Co. v. Abbott (162 Mass. 148) the decision turned upon a contract which the court construed to mean that whenever a stockholder desired to sell, he must sell to the association, and upon his death his executors should sell in the same fashion. * * * As to the dividends, the rule is (to ascertain the amount of a general residue) that all the income of the estate not otherwise disposed of must be added to the residue. In Matter of Accounting of Benson (96 N. Y. 499, 511) the court say: "Ordinarily this is not important as to the interest upon the residue, as both principal and interest go to the same parties. But whenever it is important to |