N.Y. Real Property Actions & Proceedings Law § 1641: Executors', fiduciaries' and trustees' conveyances to certain corporations in exchange for certain stocks and bonds authorized and regulated

§ 1641. Executors', fiduciaries' and trustees' conveyances to certain

corporations in exchange for certain stocks and bonds authorized and

regulated. 1. Whenever an executor, trustee, guardian of an infant,

committee of a person incompetent to manage himself or his affairs,

conservator of a person unable to care for his affairs, or other person

or persons acting in a fiduciary capacity, or a life tenant, is

authorized to sell any real property or any interest therein pursuant to

a power contained in a deed or will, or pursuant to a judgment or order

of the supreme court in an action or special proceeding pursuant to any

provision of law, or pursuant to a statutory power to sell or exchange

any real property, or any interest therein, or whenever a trustee of an

express trust is seized of a legal title to an undivided share or

interest in any real property, and the said property has been or is

about to be conveyed to a corporation formed or to be formed for such

purpose, and two-thirds in number and amount of interest of the adult

beneficiaries and also two-thirds in number and amount of interest of

the adult persons having a vested interest or estate in possession,

reversion or remainder in such real property have agreed, or desire to

agree that their interests and estates shall be exchanged for the stock

and bonds or either the stock or bonds of such corporation, then the

said executor, trustee, guardian, committee, conservator or other person

or persons acting in a fiduciary capacity, or the life tenant or

tenants, may, with the approval of the supreme court, convey such real

property or interest to such corporation in exchange for the stock or

bonds of such corporation, or a proportionate amount thereof, provided,

however, that such corporation shall be prohibited by its certificate of

incorporation from investing in any stocks, bonds or other securities

other than real property which are not under the laws of this state a

proper subject for the investment of trust funds, and provided further

that if the interest of a trust estate in any real property to be so

exchanged is an undivided part or share therein, such undivided part or

share of the trust estate may be so exchanged if it shall appear to the

court to be for the best interest of such estate.

2. The supreme court shall not grant an order permitting such an

exchange and conveyance unless it appears to the satisfaction of such

court that a written notice stating the time and place of the

application for such leave has been served upon every beneficiary and

also upon every person in being having a vested interest or estate in

possession, reversion or remainder, in such real property at least eight

days before the making thereof, if such beneficiary or other person is

an adult within the state; or if a minor, incompetent, conservatee, or

absentee, until proof of the service on such beneficiary or other person

of such notice as the court or a justice thereof prescribes.

3. The court shall appoint a guardian for any minor and for any person

unable to manage himself or his affairs who shall not be represented by

a committee or conservator duly appointed.

4. The application must be by petition duly verified, must be made by

the executor, trustee, guardian of an infant, committee, conservator, or

such other person or persons acting in a fiduciary capacity, or a life

tenant who has been so authorized to sell or exchange, or by the trustee

of an express trust seized of a legal title to an undivided share or

interest in real property; and shall set forth the reasons for such

exchange and conveyance and the nature thereof and the peculiar facts

which make it proper that the application shall be granted, but when the

interest of a trust estate in any real property is an undivided part or

share thereof, it shall be sufficient to show by such petition that the

exchange will be for the best interests of such estate. After taking

proof of the facts either before the court or a referee, and hearing the

parties and fully examining into the matter, the court must direct

judgment upon the application. In case the application is granted, the

judgment must authorize the said executor, trustee, guardian of an

infant, committee, conservator, or other person or persons acting in a

fiduciary capacity or life tenant, to make such exchange and conveyance

upon such terms and conditions as the court may therein prescribe.

5. Whenever it shall appear from the papers submitted upon the

application that there are conflicting claims in respect to the

ownership of or the right to sell and convey such real property or any

interest therein, the court may, within the demand for relief as

evidenced by the notice of application, and if all adult beneficiaries,

and also all adult persons having a vested interest or estate in

possession, reversion or remainder in such real property under such

conflicting claims consent thereto, direct that the stock and bonds or

either the stock or bonds to be given by the corporation in exchange for

such real property or interest therein shall be issued to and held by a

trust company authorized to hold moneys paid into court upon such terms

and conditions and with such powers as the court shall prescribe until

the further order of the court.