HERBERT R. O'CONOR, GOVERNOR. 1161

lished with, or unless otherwise stated hereinafter, without
the interposition of a trust; except that in the establishment
of the principal provision may be made touching all matters
covered by this Article, and the person establishing the princi-
pal may so himself direct the manner of ascertainment of in-
come and principal and the apportionment of receipts and ex-
penses or grant discretion to the trustee or other person to do
so, and such provision and direction, where not otherwise con-
trary to law, shall control notwithstanding this Article.

3. (Income and Principal—Disposition. )

(1) All receipts of money or other property paid or deliv-
ered as rent of realty or hire of personalty or dividends on
corporate shares payable other than in shares of the corpora-
tion itself, or interest on money loaned, or interest on or the
rental or use value of property wrongfully withheld or tor-
tiously damaged, or otherwise in return for the use of princi-
pal, shall be deemed income unless otherwise expressly pro-
vided in this Article.

(2) All receipts of money or other property paid or deliv-
ered as the consideration for the sale or other transfer, not
a leasing or letting, of property forming a part of the princi-
pal, or as a repayment of loans, or in liquidation of the assets
of a corporation, or as the proceeds of property taken on
eminent domain proceedings where separate awards to tenant
and remainderman are not made, or as proceeds of insurance
upon property forming a part of the principal except where
such insurance has been issued for the benefit of either tenant
or remainderman alone, or otherwise as a refund or replace-
ment or change in form of principal, shall be deemed principal
unless otherwise expressly provided in this act. Any profit
or loss resulting upon any change in form of principal shall
enure to or fall upon principal.

(3) All income after payment of expenses properly charge-
able to it shall be paid and delivered to the tenant or retained
by him if already in his possession or held for accumulation
where legally so directed by the terms of the transaction by
which the principal was established; while the principal shall
be held for ultimate distribution as determined by the terms
of the transaction by which it was established or by law.

4. (Apportionment of Income. )

(1) Whenever a tenant shall have the right to income con-
sisting of periodic payments (and for the purpose of this Ar-
ticle periodic payments shall include rents, ground rents, in-
terest on bonds and loans, and annuities, but shall not include
dividends on corporate shares), and such right shall cease