## Facts

- In 1916, William H. Donner, domiciled in New York, created an inter vivos trust of personal property, executed and initially administered in New York.
- The trust paid income to Donner’s wife and children and granted Donner’s children special powers of appointment over specified portions.
- A Delaware corporation, Wilmington Trust Company, later became successor trustee; the trust assets were transferred to Delaware and administered there under Delaware equity supervision.
- Donner’s son, Joseph W. Donner, held a special power of appointment and in 1929 executed an instrument appointing property into new trusts for his children and their issue.
- The 1929 appointment would be invalid under New York’s rule against remoteness of vesting but would be valid under Delaware law.
- The Court of Chancery held Delaware law governed the appointment’s validity and sustained the 1929 appointment; opponents appealed on choice-of-law grounds.

## Issues

1. Whether New York law or Delaware law governed the validity of Joseph Donner’s 1929 exercise of a special power of appointment contained in a trust of personalty created in New York but later administered in Delaware.
2. If Delaware law governed, whether the 1929 appointment creating further trusts for Joseph’s children and their issue was valid despite being invalid under New York perpetuities rules.

## Decision

- The Delaware Supreme Court affirmed the Court of Chancery.
- Delaware law governed the validity of the 1929 exercise of the power of appointment.
- Applying Delaware law, the court upheld the appointment and the trusts created by it as valid.

## Legal Principles

- For trusts of personal property, the governing law may turn on the situs of administration and the settlor’s intention, as implied from the instrument and the administration contemplated or permitted.
- A change in trustee and transfer of the trust res to another state, when authorized or contemplated by the trust arrangement, can support applying the law of the new place of administration to questions of trust administration, including the validity of an exercise of a power of appointment.
- Absent an explicit direction that the original state’s law must govern indefinitely, a court supervising a personalty trust administered within its jurisdiction may apply its own law to determine the validity of appointments under the trust.
- A disposition valid under the law governing the trust’s administration will not be invalidated solely because it would be void under the perpetuities policy of the state of original creation or settlor domicile.

## Conclusion

The court held that a personalty trust administered in Delaware was governed by Delaware law for purposes of evaluating a later exercise of a special power of appointment, and it sustained the appointment even though the same disposition would have failed under New York perpetuities rules.


Wilmington Tr. Co. v. Wilmington Tr. Co., 26 Del. Ch. 397, 24 A.2d 309 (Del. 1942)