Arthur Rohman and Jevne Shepherd Rohman, as Co-Trustees of Ida S. Shepherd Trust v. United States

In 1907, 13 persons bought a piece of real estate from John Widney, who conveyed the property in trust to Title Insurance & Trust Company. The seller, purchasers, and trust company joined in a declaration of trust, which designated Widney as “payee”, the purchasers as “beneficiaries,” and the trust company as “trustee.” It recited that the balance of the purchase price in the amount of $45,000 was payable at the rate of $15,-000 a year for the succeeding three years, and provided in part:

The agreement provided that upon sale of the property, the trustee should receive %oth of one percent of the selling price, “which fee shall be for the first year of the life of this trust, and shall, in no event be less than $90.00. Should this trust not terminate within one year from the date hereof, then the said trustee shall receive an additional sum of $25.00 for each year, or fraction of year thereafter.” It further provided for “reasonable compensation for any extraordinary service performed” by the trustee.

After providing for disbursement of the “proceeds of the sale of the property”, the trust instrument prescribes in detail the procedure to be followed in the event of default in…