## Facts

- Mary F. Cox’s will created a residuary trust for her daughter, Dorothy Cox, for life.
- Mary’s will granted Dorothy a general testamentary power of appointment over the trust principal, but only if Dorothy exercised it “by her will specifically referring to the power herein given to her.”
- Mary’s will provided that if Dorothy did not effectively exercise the power, the trustee would pay the trust principal to New England Deaconess Hospital as the taker in default.
- Baybank Merrimack Valley, N.A. served as trustee (successor trustee) of Mary’s trust.
- Maurice Schwartz drafted Dorothy’s will and, until after Dorothy’s death, did not know about Mary’s trust or the specific-reference requirement for exercising the appointment power.
- Dorothy’s will made several specific bequests and then disposed of “the residue of my estate” by creating a trust: income to her niece for life, remainder to Beaver College.
- Dorothy’s will did not mention Mary’s trust, did not mention any power of appointment, and did not contain any language specifically referring to the appointment power granted in Mary’s will.
- Dorothy died with a probate estate that was insufficient to satisfy all the bequests in her will; Schwartz asserted that Dorothy expected “money in BayBank” to be available to carry out her plan.
- The Probate Court ruled that Dorothy had not exercised the power of appointment and that the trust principal therefore passed to New England Deaconess Hospital under Mary’s default clause. Schwartz, as executor and trustee under Dorothy’s will, appealed.

## Issues

1. Whether Dorothy Cox’s residuary clause disposing of “the residue of my estate,” without any specific reference to Mary Cox’s testamentary power of appointment, validly exercised a power conditioned on a will “specifically referring” to that power.
2. Whether evidence that Dorothy intended to control the Baybank-held trust property, or that her lawyer was unaware of the power and its conditions, could substitute for the donor-imposed specific-reference requirement.

## Decision

- The Appeals Court affirmed the Probate Court’s judgment.
- Dorothy’s will did not exercise the power of appointment because it neither referred to the power nor purported to exercise any power of appointment.
- The condition imposed by Mary’s will—exercise only by a will specifically referring to the power—was enforced as written.
- Testimony about Dorothy’s expectations and drafting counsel’s lack of knowledge did not cure the failure to include the required specific reference.
- Because the power was not exercised, the trust principal passed to New England Deaconess Hospital as taker in default under Mary’s will.

## Legal Principles

- The donor of a testamentary power of appointment may impose an express form requirement for its exercise, including a requirement that the donee’s will specifically refer to the power.
- When a power requires a “specific reference,” a general residuary clause disposing of “my estate,” without mention of the power, is not an effective exercise.
- A default gift stated by the donor controls when the donee fails to satisfy the donor’s stated condition for exercise of the power.
- Evidence of the donee’s intent or the drafter’s mistake does not override a clear, stated condition that limits how the power may be exercised.

## Conclusion

The Massachusetts Appeals Court held that Dorothy Cox failed to exercise the testamentary power of appointment created by Mary F. Cox’s will because Dorothy’s will did not specifically refer to the power as required; as a result, the trust principal held by Baybank passed to New England Deaconess Hospital under the donor’s default provision.


Schwartz v. Baybank Merrimack Valley, N.A., Trustee, 456 N.E.2d 1141 (1983)