FUTURE INTERESTS - POWERS OF APPOINTMENT- EFFECT OF BANKRUPTCY OF DONEE OF GENERAL TESTAMENTARY POWER

By her will, X established a spendthrift trust, appointing Y and a trust company as co-trustees. In addition to receiving the income from the trust during his life, Y was given a general testamentary power to appoint the corpus; in default of appointment the corpus was to be divided equally among Y's issue. After X's death Y filed a voluntary petition in bankruptcy, listing the above interest as that of a beneficiary of a spendthrift trust, "value none." Before Y's death the trustee in bankruptcy purported to sell to plaintiff, who was not a creditor of Y, all of Y's right, title and interest in the trust. After Y's death the plaintiff petitioned for assignment of the trust corpus.

Held, plaintiff had no interest in the corpus. In re Peck's Estate, 320 Mich. 692, 32 N.W. (2d) 14 (1948).