Abell v. Abell

75 Md. 44 | Md. | 1891

Lead Opinion

Fowler, J.,

delivered the opinion of the Court.

The hill in this case was filed by the executors and trustees of the late Arunah S. Abell for the purpose of obtaining a judicial construction of his will, and to secure the aid and direction of a Court of equity in the administration of his large and valuable estate.

Counsel have exhibited much learning and great research both in their exhaustive briefs and elaborate oral arguments. It has become a trite observation that the citation of authorities in cases involving the construction of wills gives but little, if any, assistance to the Court. But this rule, which seems to be so well settled is “more honored in the breach than the observance. ’ ’ ■

A number of interesting and important questions have been presented, supported by numerous authorities; but there are only two of these questions about which there has been any serious contention.

The first is as to the period of time during which the trusts created by the will are to continue, and the second relates to the disposition of the income of the trust estate for the first year, that is to say, whether such income from the real estate can be properly applied to the construction of new buildings and other permanent improvements, and whether any of the income from the trust estate accrued since the death of the testator can be applied to the payment of funeral expenses, debts or legacies.

These questions, arising as they do upon a bill filed for the construction of a will, must depend for their solution upon the intention of the testator, and that intention if not contrary to public policy, the law against perpetuities, or any other settled rule of law or statute regulating the disposition of property by last will and testament, must have full force and effect.

It will not do to say that the intention must govern, and then by some strained or artificial course of reasoning, attempt to place upon the will a construction plainly repugnant to the language used therein by the testator. In other words, we must be governed not by what we may suppose the testator wished, but by what he says. And arguments based upon the supposed or known wishes of a testator in respect to the disposition of his property are not to be considered, unless such wishes are expressed in his will. The short answer, says Chancellor Kent, which Courts are so often compelled to make to such arguments, is, “voluit, sed non dixit.”

. Referring, then, to the will in ■ order to ascertain the testator’s wishes and intentions, we find that after making a number.of bequests and devises to relatives, employes, and charitable institutions, about which there is no question in this case, we come to the sixteenth clause-by which the testator disposes of all the rest, residue, and remainder of his estate.

It is upon the construction of the latter part of this elairse, in connection with other parts of the will, that one of the questions here arises — that relating to the duration of the trusts. By this clause he devises and bequeaths to his three sons, and the survivor of them, and the heirs, executors, administrators and assigns of the survivor, all his residuary estate of every kind, in trust, to value the same within a reasonable time after his death, to set apart five-eighths parts thereof, and to hold in trust said five-eighths so set apart and converted and invested as directed in this clause; and to collect the rents, issues and profits thereof — and after paying all necessary expenses of the management thereof, and all charges, taxes and repairs thereon, then “in trust, to pay semi-annually, and not by way of anticipation, the net income'accruing from the said five-eighths parts of the said residue and remainder, and of any accretions thereto, in equal parts to each one of my five daughters, Mary L. Abell, Fannie A. Abell, Annie F. Abell, Helen M. Baughman and Margaret Abell, upon the separate receipts of each of said daughters, to whom the same may be payable for the separate use of each of my said daughters, as an inalienable personal provision, free from the control, debts, or engagements of any husband whom the said daughter may have at the date of my death, or may hereafter have, for the period of her natural life, and after the death of any one of my said daughters, in trust, to hold one-fifth part of the said five-eighths parts of the said residue and remainder of my estate, for the child, if only one, of the said daughter so dying, or for the children, if more .than one,, of the said daughter so dying, share and share alike.”

Erom the language here used, together with the clauses following it in the will, the appellees and appellants have drawn very different conclusions. They are concisely stated by the learned Judge of the Circuit Court as follows: “According to one theory the trust here was created for the benefit of the five daughters only, and by the opposite view the trust was intended for the benefit of the five daughters and their respective children. In the former is involved the conception of five separate trusts, terminating- separately upon the death of each daughter, while the latter contemplates the aggregate five-eighths held together in mass as the corpus of a single trust of indefinite duration.”

The former view was adopted by the Court below.

It would unduly lengthen this opinion if we should discuss the various positions taken by the respective parties, and refer to the numerous authorities cited in support of them. It is sufficient, however, to say that we cannot agree to either of these views — both of which were so earnestly and ably presented.

We will proceed, as briefly as possible, to state the conclusions we have arrived at, and the grounds upon which we base them.

It is apparent that the will before us was drawn by a professional hand, and that the testator intended to distribute his large estate equally among all his children— giving to his sons absolute estates, and to his daughters equitable life estates, with remainder to their respective children. To his three sons, in whose good judgment and business capacity he appears to have had great confidence, he devised and bequeathed his residuary estate in trust; and by the seventeenth clause he declares that three-eighths thereof shall devolve upon and vest in them absolutely, in equal parts and proportions, as tenants in common, when set apart and valued.

The remaining five-eighths — the estate having been first valued, set apart, converted, and invested as directed in said sixteenth clause, the testator directs shall be held by his trustees, to collect the rents, issues, and profits, and apply the same, among other things “to the payment of all charges and taxes upon, or repairs of, or outlays connected with, any part of the property in said five-eighths.” There does not seem to be any thing in this clause which would imply that any of the powers or active duties therein mentioned, are to he exercised or performed after the death of all the life tenants. The valuation and setting apart were to be effected within a reasonable time after the testator’s death, and he might very reasonably have expected that both would have been completed before the death of any of his children.

The conversion into mortgages and municipal bonds was to be done as rapidly as it could be effected with advantage, and the rents, issues, and profits were to he collected, and the net income paid in equal parts to the testator’s daughters during their respective lives.

All the powers given to, and duties imposed upon, the trustees in this clause appear clearly to relate to the five-eighths as a whole.

The whole estate is directed to be valued and set apart, devising three-eighths thereof to his sons absolutely as tenants in common, the other five-eighths, as a whole, to be converted and invested, and it is the income that is to be divided from time to time as it accrues, and paid in equal parts to the daughters during life.

An examination of the other clauses will, we think, show that all the remaining powers and duties of the trustees relate exclusively to the five-eighths as a whole.

By the eighteenth clause, power is given the trustees to mortgage the whole or any part, and it is declared that such mortgage shall he a lien not only on that part of the trust estate so mortgaged, hut in case of deficiency, upon all the property so set apart in trust for the benefit of his daughters. And so the ' nineteenth clause authorizes the trustees to lease, and the twentieth clause to sell, any portion of the trust estate.

So long, therefore, as the daughters or any one of them shall live, this trust estate must be preserved in sólido, for otherwise it would not be possible for the trustees to exercise the ample powers given them to charge, sell, or lease the whole or any part of it. For, if upon the death of a daughter, as contended by the appellees, her share should devolve upon her children, the trustees would, of course, have no further control of that part of the trust estate.

But whence comes the supposed power to subdivide the trust estate upon the death of each daughter ? It is certainly not given in terms in the will, nor, as we have' seen, can it be implied from any of its provisions.

On the contrary, as we have shown, the only division contemplated during the lives of th.e daughters was to be made for the purpose of giving to the sons three-eighths of the' residuary estate absolutely, and the remaining five-eighths to them in trust to pay the income to the daughters — the trust estate to be kept in sólido, and the net income divided equally among them.

While it seems to us clear that it was the intention of the testator that his trustees were to manage and control the trust estate so long as any one of his daughters should live, we think it is equally clear-that upon the death of his last surviving daughter the trust created by the will must terminate, because then the trustees will no longer hold any estate for the daughters, and will, of course, have no active duties to perform. Under such circumstances, it is well settled that the Statute of Uses will execute the use, and the remainder-men would take absolute titles freed from the trust. Hill on Trustees, 235; 3 Jarman on Wills, ch. 34, sec. 71; 3 Redfield on Wills, ch. 32, sec. 77; Ware, et al. vs. Richardson, 3 Md., 542; Stonebraker vs. Zollickoffer, et al., 52 Md., 162.

It was urged, however, by the appellants, that, by a fair construction of the w-ill we should read into the latter part of the sixteenth clause, which, in terms, devised to the trustees a naked trust for the benefit of the grandchildren of the testator, all that he has said when giving powers to he exercised in regard to the trust estate held for his .daughters. But why should this be done? We can see neither reason nor necessity for such a course. If the testator intended to extend the trust beyond the time we have indicated, he would have said so in definite terms, especially as the will, in other respects, appears to have been drawn with an evident desire to express with care and perspicuity the wishes of the testator.

If, as is contended, he intended to create the same trust as to his grandchildren which he provided for his children, it- is difficult to understand why he did not say so. It was attempted, also, to extend the trust by showing that the active duties to be performed by the trustees continued indefinitely, but in this attempt we think the appellants failed.

If the trust does not terminate at the period indicated .by us it would by the terms of the will continue to some time which the appellants did not seem willing or able to designate.

The devise is to his sons and the survivor of them, and the heirs, personal representatives, and assigns of the survivor. But as was said by Alvey, O. J., in delivering the opinion of this. Court in the case of Long, et al. vs. Long, et al., 62 Md., 65: “Though the devise to the trustees was to them a.nd their heirs, and thus in terms giving them an estate of inheritance in the realty, yet the trust created was not required for any practical or useful purpose beyond the lives of the equitable life tenants; and it is not to be supposed that the testator intended that the trust should continue through all generations. ”

It was also urged that in the twenty-first clause there are no limitations as to the time placed upon the power therein given the trustees “to manage and direct all affairs and concerns relating’ to any property devised and bequeathed to them in trust.”

But if we are correct in what we have already said, that it was not the intention of the testator to extend the trust beyond the death of his last surviving daughter, the general language used in this clause must necessarily be limited to the time during which, he intended the trustees to hold the trust estate.

The testator provided carefully for the case of a daughter dying leaving a child or children, but he failed to provide for the contingency of a daughter dying without issue — and to this extent there is an intestacy.

And the fact of this intestacy, it was urged by the appellees, demonstrated the necessity of adopting their view as to the termination of the trust ás to one-fifth of the trust estate upon the death of each daughter, in order to avoid the most serious difficulties and complications in the further administration of the trust. But we think these fears are not well founded. The intestacy extends only to the equitable title. The legal title being in the ■trustees, they will, in the case supposed pay the income to the heirs and distributees of the testator during the continuance of the trust — for to them the undisposed of equitable estate will descend or be distributed as. the case may be. And it may well be that the testator preferred to leave something for the law to do, rather than encumber his will with provisions for cross-remainders, which would only increase, rather than diminish opportunities for misconstruction.

All apprehensions, if any exist, as to the arbitrary exercise of the very large discretionary powers given to the trustees, may now be dismissed. For the trustees themselves, recognizing the great difficulty and delicacy in performing some of the duties imposed upon them, have volixntarily subjected themselves to the jurisdiction of a Court of equity. And whatever their powers may be under the will, if the trusts created thereby are before such a Court, “and a decree has been made, the powers of the trustees are thenceforth so far changed that they must have the sanction of the Court for all their acts.” 2 Perry on Trusts, sec. 474, and authorities there cited.

The valuation, setting apart, or partition of the trust estate, which is yet to be made, as well as all other acts of the trustees in the administration of the trust estate will, therefore, be done under the direction and. with the assent of the Court in which they have filed their bill— and the cestuis que trust will always have an opportunity to be heard.

We fully agree with the conclusions of the learned Judge of the Circuit Court, for the reasons so clearly stated in his opinion:

1. That the conversion of the trust estate must be made as set forth in clause sixteen, that is to say, into “mortgages” or real or leasehold estate, or in 'State or municipal bonds of the most assured standing.

2. That the daughters — the devisees and legatees for life — are entitled to the net income, without any deduction for the pajunent of costs of administration, debts, and legacies;

3. And that,, they are properly chargeable only with the ordinary expenses and repairs, and that the cost of new buildings and such permanent improvements as may be called betterments, must be paid out of the corpus of the estate:

It follows that the decree appealed from must be reversed, in so far as it terminates the trust created by the will before the death of the last surviving daughter of the testator, and affirmed in all other respects.

(Decided 10th December, 1891.)

Decree reversed in part, and affirmed in part, and cause remanded; costs to be paid by the executors out of the corpus of the estate.

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Dissenting Opinion

McSherry, J.,

filed the following dissenting opinion:

It is with the profoundest deference that I venture to dissent from one of the conclusions reached by a majority of the Judges before whom this case was argued; and though in cases of this character a dissenting opinion is of little or no practical use, I think I ought to state briefly the grounds upon which my view is founded.

. The proceeding is an amicable one. It was instituted by the acting trustees named in the will of the late Mr. Abell. Its object was, not to strike down or destroy the will, but to obtain the aid of a Court of equity in the administration of the trusts and to procure a jxxdicial construction of some of the provisions contained in the will. The trustees were anxious to be under the pi-otection of a Coixrt of competent jurisdiction in performing their duties, and they were eqxxally desirous that the doubtful portions of the will should be judicially interpreted for their guidance. They accordingly filed the bill which inaugurated this proceeding.

By the sixteenth clause of his will the late Mr. Abell gave the entire residuum of his large estate to his three sons and the survivors and survivor of them, and the heirs, execxxtors and administrators and assigns of the survivor, upon trust, to value the whole and then to set apart five-eighths thereof within a reasonable time after his death, and to invest the same in the manner designated by him, and then in further trust to collect the income and pay therefrom all proper charges a,nd expenses, and the residue, or net income, to pa.y over semiannually in equal parts to each of his five daughters (whom he mentioned by name) as an inalienable personal provision “for the period of her natural life; and after the death of any one of my said daughters, in trust to hold one-fifth of the said five-eighths parts of the said residue and remainder of my estate for the child, if only one, of the said daughters so dying, or for the children, if more than one, of the said daughters so dying, share and share alike.” The remaining three-eighths of the residuum he gave absolutely to his three sons.

How long did the testator intend the trusts created by the sixteenth clause to continue? Were they designed to be indefinite in duration ? Do they extend beyond the lives of the daughters and include the lives of their children? Or do they terminate as to each daughter’s one-fifth of the five-eighths upon her death ? There is no word or syllable in the whole will which can justify the inference that the testator intended the trusts to last forever. Nor is there any thing in the instrument, it seems to me — and with great submission I say it — which carries the trusts, as to any daughter’s one-eighth, a single hour beyond the expiration of her equitable life estate.

Whilst it is true that large discretionary powers are given to the trustees by the eighteenth, nineteenth, twentieth and twenty-first clauses of the will, with respect to the investment of the trust property, and in reference to the selling, mortgaging, leasing and encumbering thereof, those powers are subordinate to, and merely incidents of, the main and principal duties to preserve the estate and to collect the income and pay it over, in equal parts, to the daughters, for whose protection the testator was chiefly solicitous. These powers were intended to further and promote the trusts, and not to engraft additional trusts upon those created hy the sixteenth clause. It is against every settled rule of construction to treat these subsidiary powers as having the effect of stretching the trust beyond the limits marked hy the active duties assigned to the trustees; and consequently, such powers, of necessity, become extinct when the duties upon which they are dependent .are at an end. “Courts will abridge the estate when words of inheritance are used, if the execution of the trust does not require a fee; and so they will enlarge the estate if no words of inheritance are used.” Perry on Trusts, sec. 320. The duty to value the whole and set apart five-eighths in trust for the daughters is the first-duty imposed upon the trustees. When those five-eighths shall have been set apart that trust will he performed. The duty to preserve the corpus and to collect and then pay over the income to the daughters is a. distinct trust, and every power possessed hy the trustees is subordinate to these primary objects. These subsidiary powers cannot enlarge the active duties of the trustees without making the incidental powers, and not the prescribed duties, the measure of the trusts’ duration. The trustees are to pay over the income in equal parts to each one of the five daughters ‘ ‘ for the period of her natural life. ’ ’ But after the death of a daughter to whom, by ■the terms of the will, are the trustees to pay the income previously payable to the deceased daughter in her lifetime ? To her children ? The will does not say so. If she dies without having had children, then to whom is it payable ? The will is absolutely silent on that subject. The duty of collecting and paying over the income by the trustees, is confined in express terms hy the sixteenth clause, not to the period covered by the joint lives of all the daughters, and the life of the last survivor, hut distinctively, as to each “equal part” of the net income, to the period of the natural life of the particular daughter to whom that equal part is payable. Not another clause in the will relates to this active duty imposed upon the trustees, and in so far as the language used by the testator makes manifest his intention, the explicit declarations in several clauses following the sixteenth are quite sufficient to indicate that he designed the trusts as to each daughter’s one-fifth of the five-eighths to last no longer than the duration of the equitable life estate which he created for her. Thus in the eighteenth and nineteenth clauses he speaks of the trusts as created for the benefit of his daughters, and in the twentieth, for his daughters and each of them, and in the twenty-first clause, as “respective trusts',” without a. suggestion that the trusts were established for, or were believed by the testator to include, the daughter’s children, or any one else but the daughters themselves. The absence of a provision in the sixteenth clause or elsewhere carrying the active duties of the trustees as to each daughter’s one-fifth of the five-eighths beyond the period of her natural life, and the subsequent explanatory declarations, just alluded to, carefully and repeatedly defining the duration of the trusts by describing them as having been created for each of his daughters, make it morally certain that he intended to exclude from the scope of those trusts all other persons than those expressly named.

But this is not all: “Where an estate is given to trustees and their heirs in trust to pay the income to A during her life, and at her decease to hold the same for the use of her children, or her heirs, or for the use of other persons named, the trust ceases upon the death of A, for the reason that it remains no longer an active trust; thé Statute of Uses immediately executes the use in those who are limited to take it after the death of A; and the trustees cease to have anything in the estate, not because the Court has abridged their estate to the extent of the trust, but because having the fee or legal estate, the Statute of Uses has executed it in the cestui que trust.” Perry on Trusts, sec. 320; Ware vs. Richardson, 3 Md., 542. The Statute of Uses is applicable to wills. 3 Jarman on Wills, 50; Ware vs. Richardson, supra. Now, upon the death of each daughter the sixteenth clause of the will gives that daughter’s one-fifth of the five-•eighths to the trustees “in trust to hold * * for the child, if only one, of said daughter so dying, or for the children, if more than one, of said daughter so dying, share and share alike. ” No duty is imposed upon the trustees to he discharged towards or in hehalf of the child •or children of a deceased daughter. There is no direction to pay over the income to such child, or to invest it; nor is there any authority given the trustees to collect the income after the death of the daughter. The property is given to the trustees “in trust to hold” for the child or children and nothing more. This is a mere naked trust without active duties of any kind. Under such circumstances the Statute of Uses, 27 Henry 8, ch. 10, transfers the use into possession by converting the •estate or interest of the cestui que trust into a legal estate and by destroying the intermediate estate of the trustee. In other words, the statute immediately executes the use in the child or children and upon the death of the mother, the estate of the trustee is at an end. When the purposes for which it was created are satisfied, “the estate of the trustee ceases to exist, and his title becomes extinct.” Doe vs. Considine, 6 Wall., 458; Young vs. Bradley, 101 U. S., 782; Long, et al. vs. Long, et al., 62 Md., 64; Doe dem. White vs. Simpson, 5 East, 163. As a consequence of these principles a deceased daughter’s one-eighth is freed and disengaged from any trust whatever. And if this be so, then the trust as to each daughter’s one-eighth must terminate when she dies and cannot, under established legal principles, be extended beyond that period. Whilst this conclusion would result, each time a daughter died, in separating her one-eighth from the rest of the trust property, and mightj therefore, occasion much inconvenience and expense, still, if that is what the testator meant, these considerations ought not to defeat his intention.

There is still another view of the subject. There is no provision made by the will for the event of a daughter dying without having had issue. Should such an event happen there would be an absolute intestacy as to that one-eighth of the residuum of the estate; and the property would devolve upon the heirs-at-law or next-of-kin of the deceased daughter. But would it devolve upon them subject to any trust? If so, what trust, and by virtue of ■which provision of the will? If the trusts continue as to all the daughters’ eighths until the death of the last survivor, then, without there being a single word in the will limiting over to any one, either in trust or otherwise, the eighth of a daughter dying without having had issue, that eighth would be kept in trust and withheld from the possession of those who would be entitled to it, and who, including the sons of the testator, would thereupon be treated as cestuis que trust, though no one of them was named, indicated, described or ever hinted at as occupying, or being ever intended to occupy that relation to that one-eighth. There is not a line in the will directing such an eighth to be held in trust longer than the life of the daughter for whom it was given. If this be so — and it seems to me that it is — then the testator has not fixed as to the daughters who may die without having had issue, any other period for the termination of the trusts as to their eighths, than their respective deaths. But he ha's joined all the daughters together in the very same sentence when he created the trusts, and has fixed no different limit for the expiration of the trusts as to those who may and those who may not have issue. Unless, then, he intended the trusts to continue under a condition which he has not named, to wit: the case of a daughter dying without having had issue, he manifestly did not intend them to continue in any event or as to any daughter’s interest beyond the duration of her equitable life estate. Either the share or interest of a daughter dying without having had issue must he kept in trust for a period which the testator has not fixed himself — and no one else has authority to fix it — or the share or interest of every daughter must be discharged from the trusts immediately upon her death. This seems to me to be inevitable.

Had the testator desired to carry the trusts beyond the life of each daughter as to her eighth, he could easily have said so — but he did not say so; and that he did not is apparent upon an inspection of his will, and is made overwhelmingly certain by the fact that the learned counsel for the trustees while suggesting in their arguments various periods for the termination of the trusts, were unable to select and agree upon any of them as the correct or even probable one. Ho one knew better than the distinguished lawyer who drew the will how to say in plain terms that the trusts should continue until the death of the last surviving daughter, if that had -been intended. But technical words were employed which for centuries have been held to execute the use in the cestui quetrust when no active duties are imposed, and thereby, to terminate the estate of the trustee upon the expiration or cessation of the active trusts; and the conclusion seems to me irresistible that such words were purposely and properly used to limit and define the duration of the trusts in respect to each daughter’s one-fifth of the five-eighths to the life of each daughter, respectively.

I agree full}- to the disposition made of the other questions involved in the case.

(Filed 12th January, 1892.)