Central Trust Co. v. Watt 139 Ohio St. (n.s.) 50

*58Hart, J.

This case presents, for determination substantially the following questions: (1) Does the so-called trust instrument create a valid trust? (2) May one person give a power to another by a trust instrument which is not executed or intended to operate as a will and which enables the donee, after the donor’s death, to name the beneficiary who shall receive the trust fund? (3) Assuming that a power can be created by a trust instrument vesting the right in the donee to select the beneficiary who shall receive the trust fund by action of the donee taken after the donor’s death, may such donee under the terms of the trust instrument involved in this case select one beneficiary and later revoke the designation and appoint another?

The suggestion was made during the hearing of this case that the so-called trust involved herein was void because it amounted to a mere agency, rather than a trust, that it was an attempted testamentary disposition of the donor’s property after his death without the formalities of a will, and that the power granted under the trust instrument was too informal, vague and indefinite with the result that the donee of the power was called upon to make a disposition of the property of the donor rather than to exercise a power.

The trust instrument gave wide control to the donor over the fund during his lifetime. But the legal title passed to the trustee and the fact that a donor retains the income for life and the right to revoke the trust in his lifetime does not render it void. Cleveland Trust Co., Trustee, v. White, 134 Ohio St., 1, 15 N. E. (2d), 627, 118 A. L. R., 475, and annotation 482; Schofield, Trustee, v. Cleveland Trust Co., 135 Ohio St., 328, 21 N. E. (2d), 119; City Bank Farmers Trust Co., Trustee, v. Charity Organisation Society of City of New York, 238 App. Div., 720, 265 N. Y. Supp., 267, affirmed 264 N. Y., 441, 191 N. E., 504; Goodrich v. City Natl. Bank & Trust Co., 270 Mich.; 222; 258 N. W.; 253,

*59On this subject, 1 Restatement of Law of Trusts, 174, Section 57, says:

“(1) Where by the terms of the trust an interest passes to the beneficiary during the life of the settlor, the trust is not testamentary merely because the settlor reserves a beneficial life estate or because he reserves in addition a power to revoke the trust in whole or in part and a power to modify the trust.”

The right of revocation standing alone, is not tantamount to a property right in the settlor; it has none of the attributes of property; and, when the founder of .a trust, who reserves the power of revocation dies without having exercised that power, there is nothing else to do to complete the creation of the trust, as the right of revocation is not an estate or property that can pass at death, but is merely analogous to a power of appointment. Dolan’s Estate, 279 Pa., 582, 124 A., 176, 49 A. L. R, 858.

Claim is made that Judge Conner, in reserving the right to direct the trustee as to the manner of reinvesting funds of the trust, ipso facto, created an agency and not a trust. This claim is not supported by the authorities and has no basis in reason. Solicitude on the part of the donor for the safety and integrity of trust funds does not per se indicate that he is dealing with his own property. “By the weight of authority, a trust, otherwise effective, is not rendered nugatory because the settlor reserves to himself the following rights and powers: (1) The use of the property and the income therefrom for life; (2) the supervision and direction of investments and reinvestments; (3) the amendment or modification of the trust agreement; (4) the revocation of the trust in whole or in part; (5) the consumption of the principal.” (Italics ours.) Cleveland Trust Co., Trustee, v. White, supra, at page 6. See, also, Houston’s Estate, 276 Pa., 330, 120 A., 267; Jones, Admr., v. Old Colony Trust Co., *60251 Mass., 309, 146 N. E., 716; 3 Cincinnati Law Review, 361; 43 Harvard Law Review, 521, 533.

The owner of property may declare himself trustee thereof instead of transferring the property to another person in trust. In such case the settlor, since he is trustee, necessarily controls the administration of the trust. Of course he does not have an unlimited power of control since it can properly be exercised only in accordance with the terms of the trust. 1 Restatement of Law of Trusts, 176, Section 57, subsection (1), comment b. 1 Restatement of Law of Trusts, 120, Section 37, comment a, says:

“There is no specific limit to the nature or extent of the powers which the settlor may reserve. He may reserve a power to revoke the trust, or a power to alter or amend the trust, either in addition to the power to revoke or in exclusion of such a power. He may reserve the power to control the trustee in making investments or in disposing of investments, or to veto a particular investment. ’ ’

All that is necessary is that such control be exercised by the settlor for the benefit of the trust and its beneficiaries, and not for his own individual interest as owner of the fund.

In this connection, 1 Restatement of Law of Trusts, Section 57, subsection (2), says:

“(2) Where the settlor transfers property in trust and reserves not only a beneficial life estate and a power to revoke and modify the trust but also such power to control the trustee as to the details of the administration of the trust that the trustee is the agent of the settlor, the disposition so far as it is intended to take effect after his death is testamentary and is invalid unless the requirements of the statutes relating to the validity of wills are complied with.”

This rule, however, furnishes no test or statement of fact as to what quantum of control as to details of administration will make the trustee the agent of the *61settlor. It simply says, in effect, that when the situation is such that the trustee is the agent of the settlor, an agency is created.

Commenting on subsection (2), above quoted, 1 Restatement of Law of Trusts, 179, comment g, says:

“The rule stated in subsection (2) is applicable, however, only whére the settlor reserves such power of control that the transferee is his agent. The intended trust is not testamentary merely because the settlor reserves power to direct the trustee as to the making of investments or the exercise of other particular powers, or power to appoint a substituted trustee.”

The donor in his lifetime did not revoke the trust, did not withdraw any of the principal trust funds except to replace weak securities with sound ones or with equivalents under reorganization plans. In fact, in each such instance he added additional funds of his own to the trust fund. Furthermore, he created this trust partially, if not primarily, for the protection of his wife and daughter for whose security he apparently exhibited the deepest concern. To deny the integrity of the trust or to create the relationship solely for his own benefit would be to defeat the rights not only of the ultimate beneficiary but of the wife and daughter as well, a result which, judged from all the circumstances, was foreign to his mind. In truth, there does not appear in this record a single act on the part of the donor which was inconsistent with the creation of a bona fide express trust which became effective in the lifetime of the donor and which vested a present interest in the beneficiaries. Such interest, it is true, might have been divested by the donor in his lifetime, but that right of divestiture died with him unexercised.

The record clearly discloses the settled intent and purpose of Judge Conner to divest himself of this property for the benefit of persons and institutions which were dear to his heart. The observation once made by Mr. Justice Holmes concerning the interpreta*62tion of written instruments to the effect that “a page of history is worth a volume of logic, ’ ’ has peculiar and forceful application to the situation here presented.

The statement in the trust instrument to the effect that at the donor’s death the trust should become absolute, does not, in the opinion of the court, mean that title did not pass to the trustee or that the transfer to the trustee was not to become a trust until after his death. It undoubtedly means that the conditions subsequent, attached to the trust, such as his power to revoke or designate another beneficiary, came to an end at the donor’s death and that the other provisions of the trust which were to take effect at his death were then to become operative.

The. third paragraph of the trust instrument provides that in the event of the donor’s death without his having designated the ultimate beneficiary, the accumulated trust fund should be transferred and delivered “to such institution, charity, corporation, individual, or individuals, as my said wife shall, before her death, designate in a writing addressed to and delivered to said trust company.” It is claimed that this attempted grant of a power to his wife to designate an ultimate beneficiary without granting such power through a will or without requiring it to be exercised by her through the medium of a will, renders such attempt void; and that since the exercise of the power was not limited to the designation of a charity as the beneficiary, the grant of power in effect attempted to authorize the wife to make a will for the donor, which the law will not permit.

If the exercise of a power created by a living trust instrument is invalid, it must be on the theory that it authorizes the donee of the power to make a will for the donor in violation of the Statute of Wills. It is true that until recent times powers were generally granted to the donee of the power through the medium of a will, but there can be no good reason why modern *63business usage may not be employed to accomplish ordinary business objectives. Here no title to real estate is involved. The provisions of the recording laws are, therefore, not called into operation. Since title to the securities passed to the trustee in the lifetime of the donor, there is no jurisdiction in the Probate Court to administer the property of the trust as a part of the donor’s estate. Here the trust instrument which conveyed the title of the securities to the trustee, like a bill of sale, clearly designated the manner in which the power should be exercised, namely, through the delivery of a letter by the donee of the power to the trustee designating the so-called ultimate beneficiary, and if the designation had been clearly and unequivocally made as provided in the instrument itself, the question of its legality, doubtless, would not have arisen. The fact that a power of appointment is made in a trust deed, to be exercised after the donor’s death, does not make it testamentary in character or void.

Counsel for Dartmouth College urgently insist that John S. Conner had no right by instrument inter vivos to give his wife the power to act on his behalf, after his death, in selecting a beneficiary who should receive his property, because such a provision was testamentary in character and void. This doctrine, if valid, would redound to the benefit of Dartmouth College, since, if the power attempted to be given is invalid, the designation of Dartmouth College by the donor in the trust instrument before his death would control. More specifically, it is claimed that an estate created by the exercise of a power of appointment, takes effect as if created by the instrument conferring the power and that the beneficiary takes title under the donor and not under the donee (49 Corpus Juris, 1305, Section 150; Wills v. Cowper, 2 Ohio, 124; 32 Ohio Jurisprudence, 121, Section 20), and that since the property comes from the donor and not from the donee it can be transferred by the former only in accordance with *64the laws of Ohio requiring either a deed designating the grantee or a will designating the beneficiary. Phipps v. Hope, Admr., 16 Ohio St., 586; Union Trust Co. v. Hawkins, Admr., 121 Ohio St., 159, 167 N. E. 389, 73 A. L. R., 190.

In the opinion of this court, the trust instrument executed by John S. Conner does not offend against this rule. The trust instrument provides for certain life interests or estates, and then provides that in default of a different designation by the donor himself in his lifetime, or by his wife as donee of the power during her lifetime, Dartmouth College should be the ultimate beneficiary. Thus the interest of Dartmouth College in the fund became a vested remainder following the life estates, subject to be divested by the donor during his lifetime or by his wife after his death by exercising the power granted to her. Kales on Estates —Future Interests — (2 Ed.), 355, Section 332; Doe d. Willis v. Martin, 4 T. R., 39, 100 Eng. Rep. (Rep.), 882, decided in 1790; Lambert v. Thwaites, 2 L. R. (Eq. Cas.), 151 (1866). See, also, 1 Simes on Law of Future Interests, 134, Section 80.

Some claim is made that a present power of appointment in the wife was not made by the trust instrument because Judge Conner reserved for his lifetime the right to name the ultimate beneficiary himself. It is admitted that a donee of a power properly delegated may exercise the power after the death of the donor, but it is claimed that'the delegation must be completed in the lifetime of the donor or it becomes a testamentary act.

A careful reading of item 3 of the trust instrument shows that the appointment of the wife to a power was created simultaneously with the execution of the trust instrument, and she expressed her “knowledge of the purpose and contents of this instrument, and of her acquiescence therein and consent thereto” by signing an acknowledgment at the foot of the original instru*65ment. It is true that the exercise of the power to which she was appointed was made conditional on the failure of Judge Conner to make a designation of the ultimate beneficiary in his lifetime, but this did not militate against her appointment in his lifetime with authority to act after his death in case the designation had'not already been made.

As above stated, however, if the attempt of Judge Conner to appoint his wife to a power failed for any reason, it follows that there was no designation of an ultimate beneficiary by written letter to the trustee. In that event the terms of the trust instrument would control to the effect that in case of failure of both himself and wife to make such designation, the ultimate beneficiary should be Dartmouth College.

This discussion also disposes of another objection made concerning the validity of the trust. This objection relates to the vagueness or uncertainty as to the character of the beneficiary which might be the recipient of the exercise of the power. Where, however, the remainder is created in a definite beneficiary subject to the exercise of a power of appointment, the donee having mere option to appoint another or not as he sees fit, the class of permissible appointees is not required to be definite and certain, provided a definite person is ultimately designated by the donee of the power. If the power is not exercised, the vested estate of the remainderman is unaffected. If it is exercised, a definite and certain remainderman is substituted in place of the divested remainderman. In this respect the courts make a distinction between a collateral power giving the donee the power of selection among numerous suggested beneficiaries which is held valid, and a fiduciary power in the trustee to select a beneficiary out of a class which is held to be indefinite, uncertain and invalid. Clark et al., Trustees, v. Camphell, 82 N. H., 281, 133 A., 166, 45 A. L. R., 1433; Tilden v. Green et al., Exrs., 130 N. Y., 29, 28 N. E., 880, 14 *66L. R. A., 33; In re Park (1932), 1 Ch., 580; 3 Restatement of Law of Property, 1842, Section 323, comment h; McKallip’s Estate, 324 Pa., 438, 188 A., 343, 108 A. L. R., 1095; Greenway v. Irvine, 235 Ky., 363, 31 S. W. (2d), 606; Stewart v. Morris, 202 Ala., 113, 79 So., 579.

This trust has been in operation for more than 30 years, during which time no interested person has attacked it for invalidity, nor is there now made by the pleadings in this case any attack upon the validity of the trust instrument, or the trust sought to be created under it. The trust was not revoked by the donor in his lifetime and the power under it was exercised for a charitable purpose. The only question really presented by the record in this case is : What ultimate beneficiary has been designated by the donee of the power?

There is no dispute in the facts as to what was done by the donee of the power in her attempt to exercise it. The legal effect of her acts, in view of the authority granted by the trust instrument, is alone to be considered. The right of designation was “to such institution, charity, corporation, individual, or individuals, as my said wife shall, before her death, designate in a writing addressed to and delivered to said trust company. But in case both I and my wife should die before having so designated in writing the beneficiary of said property, then said trust company shall assign, transfer, make over, deliver, and pay over all of said property to Dartmouth College of Hanover, New Hampshire, the same to be forever kept separate from other funds and property of said college, and to be known and designated as the ‘John Sanborn Conner Fund,’ the income alone ever to be used, and that only in assisting worthy students to obtain their education at said college * * (Italics ours.)

The donor’s letter of December 24, 1910, six months after the execution of the trust instrument, addressed to his wife, was with reference to Dartmouth and what *67students of specified departments or colleges of Dartmouth should he preferred as recipients of the income on the basis of loans to such students. These students, it is clear, were not named as beneficiaries of the trust but of the income arising from the administration of the trust. On September 21, 1914, the donee-wife transmitted this letter to the trust company with one of her own designating Dartmouth as the ultimate beneficiary. Her letter, coupled with the letter of the donor, certainly made it clear that Dartmouth College was intended to be the real beneficiary and not the students .as indicated in the opinions of the Common Pleas Court and the Court of Appeals in this case. Since this expression with reference to students was in the same letter in which she had already designated Dartmouth College as the legal beneficiary, it does not support a claim that she regarded or made the students the beneficiaries except in the sense that they would be the' recipients of the benefit through Dartmouth College; furthermore, by all rules of law as to designation and identification of direct donees or beneficiaries of a fund, this indefinite designation of students as beneficiaries would be void for uncertainty for the reasons hereinbefore stated. Cope v. Cope, 45 Ohio St., 464, 15 N. E., 206; Dirlam, Exr., v. Morrow, 102 Ohio St., 279, 131 N. E., 365; Nichols v. Allen, 130 Mass., 211, 39 Am. Rep., 455.

Prom a study of the trust instrument we think it cannot be said that it gave the donee authority to make successive designations. The words of authority are “before her death,” not “from time to time,” as suggested, in the brief of counsel for Berea College. On the other hand, she did not, in her letter of September 21,1914, reserve the right of subsequent designation of a beneficiary, but attempted to reserve only a right to modify the order of preference among the students to be benefited by temporary loans from the income of the fund. This matter of preference as to students was *68suggested by the written expressions of Judge Conner on this subject in his letter of December 24, 1910', and it seems clear that no students but students of Dartmouth College were in the donee’s mind when she made this minor reservation which, in fact, had nothing to do with the designation of the ultimate beneficiary. That she had Dartmouth students in mind when she exercised the powers in 1914 is evident from the fact that she referred to “students and persons, who are to receive the benefit of the education provided for in the foregoing letter,” referring to Judge Conner’s letter which designated Dartmouth College students, and from the fact that she made no mention of students as beneficiaries when she later attempted to revoke the designation. Furthermore, Mrs. Conner’s second letter to the trust company exhibits a feeble attempt to interpret certain words in her first letter to amount to a reservation of a right to revoke.

The situation of the donee of the power in this case is analogous to the authority of an agent to perform an act for his principal which confers a benefit on a third person to be specifically selected by the agent. When the agent once acts, the beneficiary has a vested interest in the beneficence of the principal and the authority of the agent is at an end unless the principal himself has specifically conferred further authority.

In our opinion, the trust instrument gave the donee no authority to revoke a designation once made, nor did she reserve a right to revoke her own designation of Dartmouth College, except possibly as to certain classes of students of that college as the recipients of loans. This was in no sense a reservation of the right to revoke the beneficiary generally. By her unequivocal act in designating Dartmouth College she exhausted the power given to her. The law is clear on this subject. The general rule is: If the donor merely gives to the donee the power to appoint, without expressly authorizing him to revoke an original appointment and *69make a new one, nevertheless, if the donee in making an appointment does reserve the right to revoke, he may thereafter exercise such right and make a new appointment. On the other hand, where the donor confers on the donee the power to appoint, with the right to revoke the initial or several successive appointments, and make new appointments, nevertheless, if the donee exercises the right by making an appoint • ment in the manner provided in the will or trust instrument, without reserving the right to revoke, he may not thereafter revoke and make a new appointment. 49 Corpus Juris, 1258 and 1307, Sections 29 and 157; 3 Restatement of Law of Property, 2026, Section 366.

Judgment reversed and final judgment for appellant.

Zimmerman and Bbttman, JJ., concur.

Williams, J., concurs in the syllabus and judgment.

Weygandt, C. J., Turner and Matthias, JJ., dissent.

Williams, J.,

concurring. The writer concurs in the syllabus and in the judgment. With respect to the validity of the trust there is a difference of opinion among the members of this court; but the question has not been raised by the pleadings or counsel. If the trust were declared invalid, the property included therein would pass to those entitled thereto under the statutes of descent and distribution, since as to that property the husband and father, John S. Conner, died intestate.

Under the statute then in force the widow was “entitled to one-half of the first four hundred dollars and to one-third of the remainder of the personal property subject to distribution” (Section 8592, General Code of 1910), and her dower interest in the real estate. *70The daughter would be entitled to the inheritance subject to the rights of her widowed mother.

The widow drew her benefits from the trust fund during her lifetime and died. She never complained and of course personally -she cannot complain now. Her personal representative, not being a party herein, would not be bound by a decree here and could still assert the rights of the deceased widow. The daughter, as a beneficiary under the trust, received a stipulated amount annually. She filed an answer in this case in which she prays that her interest as an annuitant may be protected. During the thirty years or more since the death of the settlor, her father, she has never taken any steps to set the trust aside either through her next friend during minority or in person after she became of age. During this lapse of time the trust has stood unchallenged. Presumptively it is valid. No issue has previously arisen as to its invalidity and none is made now. Should this court sua sponte create an issue as to the trust’s validity and declare the trust invalid, it would be granting relief that is not sought and that according to the plain principles of equity might be barred by laches if opportunity were given to set up that equitable defense. After all, what power has this court on review to determine an issue not made in the lower courts? The writer feels bound to treat the trust as valid.

Turner, J.,

dissenting. We dissent from the final judgment in this case. The vital paragraphs of the syllabus are not applicable to the facts of this ease.

The facts in this case fail to sustain either:

(a) The validity of the living trust, or

(b) The validity of the delegation of a conditional power of appointment which could become effective as a delegation only after the death of the donor of the power.

As to the validity of the living trust, the majority *71opinion excuses its infirmities by the lapse of time and the absence of objection. Unless a valid trust was created, no estate present or future was created and even a legally designated donee of a power of appointment would have nothing to appoint.

As to the validity of the delegation of the power of appointment, it is said in the majority opinion: “The fact that a power of appointment is made in a trust deed, to be exercised after the donor’s death, does not make it testamentary or void.” We agree with that statement as an abstract proposition of law, but it does not meet the facts of the instant case. Had a present power of appointment been delegated by the trust deed, the foregoing language in respect of the delegation of the power would be appropriate, but no power of appointment in praesenti was created or intended. Judge Conner reserved for his lifetime the right to name the ultimate beneficiary; but if, during his lifetime, he did not exercise such right, he provided that then, but not until then (which necessarily means upon his death), his widow would become the donee of the power. This is clearly a testamentary act.

Of course, a donee of a power properly delegated may act after the death of the donor. But to avoid the testamentary feature of such act, the delegation must be completed during the lifetime of the donor.

While a will is ambulatory in respect of its effective date, a trust deed is not. A will becomes effective at the testator’s death, while a living trust, if effective at all, becomes effective upon the execution of the trust agreement and the delivery to the trustee of the property. If it is intended in the trust agreement to delegate a power of appointment, such power must then and there be an accomplished fact, and not one to come into being after the death of the donor.

To bring out more clearly the grounds of our dissent, we find it necessary to restate the pertinent facts.

On June 22, 1910, Judge John S. Conner executed *72a written instrument whereby the title to certain personal property was transferred to appellee trust company in trust. This instrument was not executed in* accordance with the Statute of Wills.

Appellee trust company brought the agreement between itself and Judge Conner into court and asked instruction with respect to the administration and distribution of the property placed in its hands under such agreement. In order to give such instruction, the court must necessarily examine everything within the four corners of such instrument, and particularly determine the validity of the alleged trust settlement as well as the validity of the power of appointment. If a mere agency was created by such written instrument, a court may not now construe such instrument as creating a trust. Of course, a mere agency creates a trust relationship, but not a living trust. If the attempted power of appointment was a testamentary act, the court may not now hold otherwise. The lapse of time since the death of Judge Conner in no wise affects this situation. The trust company has had continuous possession of the property and is in court asking instruction as to the disposition thereof. Laches is not involved. It was specifically provided in the instrument of June 22, 1910, that if the daughter, or anyone on her behalf, took any step or made any effort to contest, interfere with or modify such instrument the daughter should forfeit her annuity.

In 1 Restatement of Trusts, 175, Section 57, it is said: “Where the settlor transfers property in trust and reserves not only a beneficial life estate and a power to revoke and modify the trust but also such power to control the trustee as to the details of the administration of the trust that the trustee is the agent of the settlor, the disposition so far as it is intended to tahe effect after his death is testamentary and is invalid unless the requirements of the statutes relating *73to the validity of wills are complied with.” (Italics ours.)

In the fourth paragraph of the syllabus in the case of Cleveland Trust Co., Trustee, v. White, 134 Ohio St., 1, 15 N. E. (2d), 627, 118 A. L. R., 475, this court held: “No valid trust is established when the settlor reserves powers which in their cumulative effect amount to ownership of the trust estate with such control over the administrative functions of the trustee as to make of him simply the settlor’s agent or representative.” In our opinion, this is a correct statement of the rule to be applied here.

The following provisions of the agreement between Judge Conner and appellee trust company cover all the powers of the trust company during the life of Judge Conner and show the arrangement to be one of mere agency, with the agent holding the naked title to the property but lacking the dominion necessary to create a true living trust. In other words, in this instrument there will be found no power respecting the supervision, management or control of the property in question that is not by .its express terms absolutely reserved to himself by the settlor:

“1st. During the lifetime of said John S. Conner said trust and safe deposit company shall hold all the above-named securities, hereby transferred to it, and the investments and reinvestments of the same, receive and collect all the income therefrom, and pay over to said John S. Conner, at the end of each month, all the net income therefrom; and hold, manage, sell, invest and reinvest said securities, and the reinvestments of same as said John S. Conner may, from time to time, in writing direct; and from time to time, re-transfer and deliver back to said John S. Conner any portion of said securities or said reinvestments as he, the said John 8. Conner, may, in writing, direct; and should said John S. Conner at any time, during his lifetime, *74desire to terminate this trust, and so notifies said trust and safe deposit company in writing, then said company, at once, shall re-transfer and deliver back to said Conner all of said securities and reinvestments, as well as net income therefrom, then in its hands.

“2nd. After the death of said John S. Conner said trust shall at once become absolute * * (Italics ours.)

As to the ultimate beneficiary of the fund, it was provided:

“3rd. After the death of my wife and also of my daughter (if my daughter shares in the income as aforesaid), then this whole trust shall at once cease and terminate; and said trust company shall then transfer, make over, deliver and pay over all the securities of every kind then in its hands, and the accrued and collected net income thereon, to such institution, charity, corporation, individual, or individuals, as I, in my lifetime, may in writing direct, which writing shall be addressed to and delivered to said trust company; or, if I should die, before executing and delivering said writing then (having full confidence in the judgment of my wife, and knowing her full sympathy with my views in the matter), to such institution, charity, corporation, individual, or individuals, as my said wife shall, before her death, designate in a writing addressed to and delivered to said trust company.

“But in case both I and my wife should die before having so designated in writing the beneficiary of said property, then said trust company shall assign, transfer, make over, deliver, and pay over all. of said property to Dartmouth College of Hanover, New Hampshire, the same to be forever kept separate from' the other funds and property of said college, and to be known and designated as the ‘John Sanborn Conner Fund, ’ the income alone ever to be used, and that only *75in assisting worthy students to obtain their education at said college; and the students receiving such aid shall, or shall not repay the same, as soon as they reasonably are able so to do, as the college authorities in each case may determine.”

To create a valid gift inter vivos, there must be a delivery in praesenti, or during the life of the donor, which takes effect immediately. The delivery must be complete and unconditional. 20 Ohio Jurisprudence, 19, 25.

While the mere fact that the settlor of a trust reserves to himself a beneficial life estate and/or the power to revoke the trust in whole or in part does not make a trust testamentary in character, yet where the settlor reserves powers which in their cumulative effect amount to ownership of the trust estate the trustee is simply the settlor’s agent or representative and such property in the hands of such trustee or agent is subject to administration through the Probate Court after the death of the settlor. The instrument of June 22, 1910, had the effect of making the trust company a mere depository or custodian.

The privilege to receive any property of a deceased person depends entirely upon statutory authorization.

The creation of a power of appointment to take effect only after the death of the settlor is testamentary and in such case the statute governing the execution of wills must be followed.

In the instant case, there was no such relinquishment of dominion over the property as would support a valid gift inter vivos. The entire management of the trust estate remained under the sole direction of the settlor; the trustee was authorized to do nothing but hold the naked title and collect and turn over the income to the settlor. When sales or reinvestments were to be made, these were not to be made by the trustee, but by Judge Conner himself. For instance, *76exhibit B contains the following recital by Judge Conner:

“Having heretofore withdrawn .from the operation of my trust deed of June 22, 1910, one hundred and thirty five (135) shares of The Merchants & Manufacturers Fire Insurance Company by reason of said company having gone into liquidation, and having invested the proceeds of said stock with additional funds of mine in ninety five (95) shares of fifty dollars ($50) each of the common stock of Dayton & Michigan Railroad Company:

“And also having heretofore withdrawn from the operation of said trust deed twenty-seven (27) shares of the preferred 6% stock of The Gribson Art Company, by reason of said company having made a new issue of preferred 8% stock to take the place of the old stock, and such new stock running for additional years: and having so exchanged said 27 shares of old stock for an equal amount of the new stock, and in addition purchased three (3) additional shares, making in all thirty (30) shares of said new preferred 8% stock of said The Gribson Art Company, which I wish to be covered by said trust deed:

“And also having ten (10) shares of the 4% preferred stock of The Cincinnati Inter-Terminal Railroad Company (guaranteed by The Chesapeake & Ohio Railway Company, The Louisville & Nashville Railroad Company and The Covington & Cincinnati Elevated Railroad & Transfer & Bridge Company), which I wish to be covered by said trust deed:

“And also desiring that the aforesaid stocks should go under said trust deed and replace the value of the old stocks withdrawn and also to be supplementary to and additional to the stocks now in said trust * * * .”

The attempted disposition of this property did not amount to a gift inter vivos, but was an attempt to make a testamentary disposition by a method which *77did not comply with, any statutory authorization. There was no' delivery to the trustee for the benefit of a named ultimate beneficiary. The naming of Dartmouth College in the instrument of June 22, 1910, was conditional, and could not become absolute until the death not only of the settlor but of the settlor’s wife. If both the settlor and his wife died without having named the beneficiary, then Dartmouth was to be the beneficiary. This was clearly testamentary and to be valid, the instrument must have been executed in accordance with the law applicable to the execution of a will.

The wife’s power of appointment under the instrument of June 22, 1910, as well as under the letter of December 24, 1910 (both relied upon by the court below in its decree), was not to become effective until after the death of the settlor.

In 1 Restatement of Law of Trusts, 167, Section 56, is to be found the following proposition: “Where the owner of property purports to create a trust inter vivos but no interest passes to the beneficiary before the death of the settlor, the intended trust is a testamentary trust and is invalid unless the requirements of the statutes relating to the validity of wills are complied with.”

In the comment on the foregoing proposition, it is said, at page 168: “ a. Where the settlor makes a conveyance of property in trust, the intended trust may fail on the ground that it is not created prior to his death. This is the case where the conveyance is ineffective to transfer the property during his lifetime, or where although the conveyance is effective to transfer the property the beneficiary is not designated during his lifetime.” (Italics ours.)

At page 169, still commenting on the proposition laid down in Section 56, it is said: “So also, if the owner of property delivers it or delivers a deed of conveyance *78to the intended trustee, but he manifests an intention that the conveyance shall not be effective until his death, the disposition is testamentary.”

At page 171, it is said: “Where the settlor makes a conveyance of property in trust, the intended trust may fail, although the conveyance is effective to transfer the property during his lifetime, because the beneficiary is not properly designated during his lifetime * * *. Thus, if the owner of property transfers it to another person in trust for such person as the transferor may designate by an act which is testamentary, the intended trust is testamentary and is invalid unless the requirements of the Statute of Wills are complied with.” (Italics ours.)

The distinction that is sought to be made is illustrated by the following language of the Restatement at page 172: “If by the terms of the trust an interest passes to the beneficiary during the life of the settlor, although the interest does not take effect in enjoyment or possession before the death of the settlor, the trust is not a testamentary trust * * (Italics ours.)

It is not to be inferred that a gift in praesenti may not be made to a trustee accompanied by a present' power of appointment to be exercised by a third party after the donor’s death. We do not have this situation in the instant case. It is our view that the gift was to become effective only upon the death of the settlor and was dependent upon the exercise or non-exercise of a power of appointment which was to be effective in a third party only after the death of the donor.

As said in 1 Restatement of Law of Trusts, 120, Section 37: “The settlor of a trust can reserve to himself any power which he desires with respect to the property, if the power is not illegal * * *, and the reservation of the power will not of itself make the trust invalid. Such a trust may, however, be testamentary, and therefore subject to the requirements of the Statute of Wills.” (Italics ours.)

*79Counsel for Dartmouth College admit that the attempted trust was invalid, but join counsel for Berea College in claiming that no one has the right to raise that question now. The position of counsel for Dartmouth is set forth in the following sentence in their brief: “However, we do believe that for the purposes of this case — since no one contends otherwise — the court must assume, without necessarily deciding, that so much of the trust as is not attacked is valid. The only part of the trust that is attacked is the power.” On this same subject counsel for Berea College say: “Dartmouth now concedes that the trust may be invalid, but agrees with us that no one has the right to raise that question. * * * Because Dartmouth contends that the power of appointment is invalid, that is no reason why the court should pass on the validity of the trust. ’ ’

We cannot agree with this position of counsel for the reason that if there was no valid trust, whether there was a valid power of appointment would be moot. If there was no valid delegation of a power of appointment, then necessarily the validity of the trust would have to be determined to give the instructions asked in the petition. Besides, as we have pointed out, the attempted delegation of a power of appointment was a testamentary act and void for lack of compliance with statutes.

It is our conclusion that no valid living trust was created by the instrument dated June 22, 1910; that no valid power of appointment was made by that instrument; and that the property in the hands of the trust company should be administered through the Probate Court of Hamilton county as a part of the estate of John S. Conner, deceased.

The conclusions here reached make it unnecessary to discuss other interesting questions argued by counsel on the assumption that a valid trust and a valid *80appointment were created by the instrument dated June 22, 1910.

The reference to this trust in Judge Conner’s will is not sufficient to require a discussion of the doctrine of incorporation by reference.

The decree of the Court of Appeals should be reversed and the cause remanded to that court for further proceedings.

Weygandt, C. J., and Matthias, J., concur in the foregoing dissenting opinion.