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Shannon v. Irving Trust Co.
New York Court of Appeals
275 N.Y. 95, 9 N.E.2d 792 (1937)
Joseph G. Shannon set up a trust to benefit his wife, Goewey F. Shannon, and his son, John Shannon, all of whom were domiciled in New Jersey. The trust provided fixed incomes for Goewey and John during their lifetimes with provisions that excess income should accumulate and become part of the trust’s principal. The trust named a New York trustee and provided that the trustee should be paid according to laws of New York but that for all other trust matters, the law of New Jersey should govern. After Goewey died, John challenged the validity of the trust’s terms regarding the accumulation of income under New York law, which would have found them invalid and paid the balance over to John. The trustee asserted that New Jersey law applied, and under New Jersey law, the income-accumulation provisions were valid. A New York trial court found that the trust was valid but certified the question of which state’s law applied to the New York Court of Appeals.
Rule of Law
Holding and Reasoning (Rippey, J.)
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