168 Iowa 677 | Iowa | 1915
Deceased, J. J. Tolerton, was a widower. On May 24, 1911, he executed the trust deed in question, which will be set out later. On March 27, 1912, he executed his will. He died June 8, 1912. The trust was accepted in
The trial court decreed that the heirs are the unqualified owners of all the property covered by the trust deed; that the college has no interest therein or thereto; that the administrators are not entitled to said property, or the possession thereof, and directed the administrators to turn the property over to the heirs. It provided, however, that the property not covered by the trust conveyance, belonging to the estate of deceased, now in the possession of the administrators, should not be affected. As to the remedy, no question is raised as to the right of the court to direct the administrators to deliver the property to the heirs. The trust deed is as follows:
“EXHIBIT ‘A’.
“Whereas the grantor herein is the owner of certain real and personal property which requires considerable time and attention for its proper management and conduct, and,
“Whereas, said grantor by reason of his age and the condition of his health desires to be free from the burden of such affairs, and,
“Whereas, said grantor further desires at this time to make provision for the disposition of his estate • Now, Therefore,
“Know All Men by These Presents: That, I, J. J. Tolerton of the City of Cedar Fails, in the County of Black Hawk, and State of Iowa, for and in consideration of one Dollar ($1.00) and other good and valuable consideration in hand paid, the receipt whereof is hereby acknowledged, do hereby sell, assign, transfer, and convey unto the Cedar Falls Trust Company of Cedar Falls, Iowa, a corporation duly organized and existing under and by virtue of the laws of the State of Iowa, ‘Trustee’ and its successors in trust, the following described real and personal property, to wit:
“The South One-half (%) of a certain Lot or Block of
“In Trust, however, for the persons and purposes hereinafter named, and appointed, and with the powers and duties hereinafter enumerated and set forth, and none other.
“To Have and to Hold, the same unto the said Cedar Falls Trust Company and to its successors in trust for and during the whole of the period hereinafter described and designated as ‘the trust period.’
“Article 1. The trust period above referred to is described and designated as follows: It shall commence upon the execution of these presents and shall continue 'and exist during the life of this grantor and until an executor or- administrator shall have been duly appointed, and shall háve qualified as provided by law, as the executor or administrator of the estate of this grantor, and no longer.
“Article 2. (a) During the whole of the trust period
“(b) To bring, maintain and defend actions at law, in equity or otherwise involving, growing out of, or in any manner affecting said property or property rights.
“ (c) To maintain and improve said property as may be to the best advantage of the trust estate and of the remainder in fee.
“(d) To pay all taxes, liens, incumbrances, and claims upon and against said property, or any of it, whether now existing or hereinafter arising or created.
“(e) To keep and maintain fire insurance on the buildings on said real estate in a sum equal to Sixty-five (65) per cent of the value of such buildings.
“(f) To do any and all acts and things essential and proper in the careful, frugal and businesslike management and conduct of said property.
“Article 3. For and during the life of this grantor the net income from said trust property shall be paid out and disbursed by said trustee as follows:
“(a) For the support, maintenance and care of this grantor and to provide him with a reasonable and proper amount of money for his personal needs and for his current religious contributions.
“(b) The residue and remainder of such rents, issues, dividends and profits shall be invested by the trustee as authorized and provided by the statutes of the State of Iowa for the investment of trust funds at the best and most advantageous rate of interest obtainable.
“Article 4. At and after my death said trust property shall vest in and become the absolute property of my legal
“Article 5. Before entering upon the discharge of the duties of trustee provided in this instrument the trustee herein named and its successor or successors in trust, shall give and furnish a good and sufficient bond in the penal sum of Twenty Thousand Dollars ($20,000.00) for the use and benefit of this grantor and the cestuis que trustent under this instrument, with the usual and ordinary covenants for the faithful discharge of the duties and obligations of such trustee, the expense of such bond in the event a surety company bond is given, to be borne and paid as an expense of the trust estate.
“Article 6. All personal property coming into the hands of the trustee of the trust estate hereby created shall be receipted for by the trustee on receiving such property, and the trustee shall, when requested by this grantor or either of his children, furnish a full and complete inventory of all the personal property belonging to this estate then in the hands, custody, or control of the trustee, and in addition thereto, the trustee shall, at all times, keep or cause to be kept, full, complete, and perfect books of account in which shall be recorded at the time different transactions take place in a businesslike manner, and so as to disclose the nature of each item thereof, all of his receipts and disbursements, and all of his accounts and transactions in connection with the trust property belonging to the trust estate hereby created, and such books of account shall, at all times during business hours, be open to the inspection of this grantor and each of his children and to the accredited agent or representative of each or any of said persons.
“Article 7. It shall be the duty of the trustee to maintain, protect, sustain and enhance, to the best advantage of the trust estate, and of the remainder in fee, the trust estate and remainder in fee hereby created.
“Article 8. The trustee of the estate hereby created shall receive as compensation for services rendered as such trustee,
“Article 9. After the execution of this instrument, the trustee herein named shall have a reasonable period of time within which to accept or reject the trust hereby created, and if it accepts such trust a reasonable period of time within which to qualify as such trustee, and in the event of its neglect or refusal to accept such trust, another trustee shall then be selected in the manner provided herein, and such trustee or any other trustee so selected shall in turn have a reasonable period of time within which to accept or reject such trust, and if he or it accepts a reasonable period of time within which to qualify as such trustee.
“Article 10. . In the event of a vacancy in the trusteeship provided for herein, such vacancy shall be filled by myself and my two daughters, namely: Mary Elizabeth Aldrich and Margaret Ernestine Thompson, or those surviving, each having an equal voice therein.
“Article 11. In view of the execution of this instrument which covers and disposes of the property mentioned and described in a certain power of attorney made, executed and delivered by me to the Cedar Falls Trust Company of the City of Cedar Falls, County of Black Hawk, and State of Iowa, the trustee herein named on or about the Twelfth day of December, A. D. 1910, and also of certain other property in addition thereto, I now hereby revoke, cancel, annul, and set aside said power of attorney as of the date and time of the execution and completion of this trust conveyance.
‘ ‘ In Witness Whereof, the grantor above named has here
“(Signed) J. J. Tolerton.”
In Triplicate.
(Certificate of acknowledgment in due form.)
“ACCEPTANCE OF TRUST.
“Now on this 29th day of May, A. D. 1911, the Cedar Falls Trust Company of the City of Cedar Falls, in the County of Black Hawk, and State of Iowa, in pursuance of a resolution of its Board of Directors regularly convened for said purpose, hereby accepts the trust created by the above and foregoing trust conveyance.
“In Witness Whereof, the said Cedar Falls Trust Company has caused this instrument to be executed in its behalf by its President and to be attested by its Secretary with its corporate seal on the day and date last above written.
“ (Signed) Cedar Falls Trust Co. “Attest: By H. S. Gilkey, President.
“(Signed) F. B. Miller,
‘ ‘ Secretary. ’ ’
The will of deceased recites:
‘11 have heretofore conveyed to the said The Cedar Falls Trust Company all my property, both real and personal, for the purpose of relieving myself from the care thereof, and I now hereby revoke and annul said trust and direct that said The Cedar Falls Trust Company shall hold said property under appointment herein as executors and under that of the court for the purpose of closing up my said estate.”
It gives $1,500.00 to the Cedar Falls Trust Company in trust for the Methodist Episcopal Church, of Cedar Falls, Iowa, for certain purposes, and to one daughter a one hundred and fifty-seven-acre farm in Black Hawk County, and to the
The case has been well presented. The arguments are elaborate and many cases cited from this and other states. The eases cited from other states are not very helpful because of our statutes and our own decisions on the subject.
“So far as the title to this particular lot is concerned, the will of Mary McCash is quite foreign to the case. The will of Grace is still more so. The beneficiaries of the trust deed will take the title through the trust deed and through nothing else. In the trust deed before us the trust was fully declared and its conditions specified. No power of revocation was reserved, nor was any interest in the property retained. True, one contingency was specified wherein it would become the duty of the trustee to convey the property to the grantor, but such contingency never happened. Whichever of the specified contingencies should happen, the duty of the trustee was fixed and irrevocable by the terms of the deed itself, and was in no manner subject to the will or direction of the grantor. It is conceded of record that the grantor parted with possession of the property at the time of the conveyance of the life estate to Grace, and that she never exercised any dominion over the same thereafter. The effect of her trust
In the opinion in the McCash case a number of authorities are cited which are relied upon by both parties in the We shall refer to some of them later in the present case, opinion.
It will be observed from a reading of the trust deed that the grantor had previously given a power of attorney to the same company he later named as trustee, and for the same property. This was revoked in the trust deed, so that it would appear that it was his purpose to treat the trust deed as more than a power of attorney. It is possible, even probable, that because of his advanced age and weakened physical condition he had in mind that his mental faculties would become impaired and that he intended to dispose of his estate by the trust deed in question while he was still competent; but, to relieve himself from the care of the property, he appointed the trustee to manage it during his lifetime.
It is also contended by appellant that the instrument made provision for the disposition of his estate after his death by providing that at and after his death the property should vest in his legal heirs; that it conveyed no interest vesting until his death, conveyed no estate to any trustee for the claimants, was testamentary, and as such, revocable. And again they cite some of the cases referred to in the opinion
But it is contended by appellees, and it seems to be the rule, under Sec. 2914 of our Code, and our decisions, that it must appear from the instrument that there was an intention upon the part of the grantor to reserve the right of revocation; otherwise no such right remained in the grantor. Among the cases cited on this proposition are the following Iowa cases: Lewis v. Curnutt, 130 Iowa 423, 436; Schollmier v. Schoendelen, 78 Iowa 426; In re Podhajsky, 137 Iowa 742; Tucker v. Tucker, 138 Iowa 344; McCash v. Derby, 158 Iowa 371; Jones v. Nicholas, 151 Iowa 362, 367; Forney v. Remey, 77 Iowa 549, 552; Craven v. Winter, 38 Iowa 471, 479.
In determining the right to revoke a deed, the test is, whether any interest in the property itself has been retained, as distinguished from the mere use or enjoyment. Jones v. Nicholas, 151 Iowa 362, 368; Martin v. Martin, 170 Ill. 18; McNally v. McAndrews, 98 Wis. 62.
They also cite upon this proposition: Jones v. Nicholas, 151 Iowa 362; In re Podhajsky, 137 Iowa 742; and Lewis v. Curnutt, 130 Iowa 423; holding, as they say, that there was a delivery, or complete gift and trust for the benefit of the claimant. This is what appellees claim in this case, and they rely upon these cases.
Appellant also cites: Forney v. Remey, 77 Iowa 549; McCash v. Derby, 158 Iowa 371.
And, as appellant says, these last named cases are based upon absolute conveyance of the fee, wherein the trustee is required to make conveyance or distribute to the beneficiary; that the conveyance in each case was absolute; that the trust was for the benefit of the grantor during his lifetime, and for the benefit of the designated beneficiary of the remainder, and the gift was of a present beneficial estate in the trust, though the enjoyment was postponed.
It is the contention of appellees that there was a present vesting of the title or estate in the heirs upon the execution of the trust deed.
As to the Beedy and Prindle cases, supra, cited by ap
And in the Prmdle case, where the granting clause made no mention of a charitable institution, but conveyed all property to the grantee and his heirs, a subsequent provision in the habendum clause for a remainder over to the institution was held to be invalid. In that case the deed was to Thieron W. Prindle, his heirs, etc., following which there was a provision limiting the estate granted, but there was no provision for or creating any trust therein.
In the deed involved in the instant case, there is no such conflict, being a full, complete and executed conveyance of the property from the grantor to the trustee, for the use and benefit of such persons as, at his death, should constitute his legal heirs then surviving, as provided by the laws of Iowa. The deed does not specifically name the heirs, and this could not be done for the reason that it was the intent and purpose of the maker that the beneficiaries should be such persons as at his death should be' ascertained by the probate court to constitute his legal heirs. It is not so much a question as to how such heirs should procure the property from the trustee. The trustee has already parted with the property and turned it over to the administrators.. If it had not done so, the law would afford a remedy as against the trustees to those legally entitled to the remainder. The important question is, rather, whether such trust deed is or is not revocable.
And in Beedy v. Finney, 118 Iowa 276, again construing this statute, the court held that a deed is to be construed as conveying all the interest of the grantor therein, unless a contrary intent can be reasonably inferred from the terms used, and that the modern rule requires the construction of a deed as a whole, and not in separate and distinct parts as was formerly done.
The trouble with appellant’s contention, it seems to us, is that they overlook the fact that from the time of the execution and delivery of the trust deed to the time that the trustee turned over and delivered the property to the administrators, all the property, both real and personal, covered by the trust deed, was vested in the trustee; and, as before shown, in one part of their argument they concede this to be so. In other parts of their argument they argue the case as though there were no provision in the trust deed for the vesting of the title to the property until after the death of the grantor. If the trust deed had not provided for the vesting of the property prior to the death of the grantor, and had simply provided that the property should then go to his legal heirs according to the laws of inheritance, a different proposition would be presented.
By the instrument, the legal title and possession of the property passed from the grantor to the trustee, to be held by it in trust during the remainder of the life of the grantor and until an administrator or executor of his estate should be appointed, when it might judicially ascertain who were his legal heirs, when the property covered by the trust deed was to be turned over to them, and his estate not covered by the trust deed administered according to the laws of the state. In the deed, the words “heirs, children and daughters,” were used interchangeably, and we think the daughters had a valid, subsisting, beneficial interest in the property covered by the deed from the time of its execution. The deed was executed in triplicate. The daughters were charged with some responsibility in the execution of the trust, in that the books of account to be kept by the trustee were to be open to their inspection, and a vacancy occurring in the office of trustee should be filled by the grantor, together with the daughters. We think the grantor intended that his daughters should have his estate if they survived, or, in the event that one of them survived and the other did not, but left legal heirs, such heirs should
The deed provides that the trust period shall continue and exist during the life of the grantor and until an executor or administrator should be appointed and qualified. Appellant points to this provision to show that the grantor intended the instrument to be testamentary.
The conveyance covered the major portion, but not all of the property of the deceased. An administrator or executor was necessary for the property not covered by the trust deed. The deed did not cover his wearing apparel or household effects, which would include his clothing and, doubtless, jewelry, keepsakes and the like.
There are eases holding that an instrument may be partly a deed and partly testamentary in character. Burlington University v. Barrett, 22 Iowa 60, 70. Tuttle v. Raish, 116 Iowa 331, cited by appellant, is distinguishable from the instant case, in that, in that case there was no conveyance of the property either in trust or otherwise, nor was it executed with the formalities required for a will, and it was held that the instrument there under consideration was neither a will nor a deed.
In Craven v. Winter, 38 Iowa 471, it was said that if the instrument passes a present interest, although the right to its possession and enjoyment may not occur until some future time, it is a deed or contract; but if the instrument does n'ot pass an interest or right until the death of the maker, it is a testamentary paper.
In Wilson v. Carter, 132 Iowa 442, it was held that whether the instrument passes a present or future interest is an important consideration in determining its character; that if it passes a present interest it should be considered a deed, while if it passes no present interest and is operative only at the death of the grantor’, then it is testamentary in character and of no effect unless executed with the formalities of a will.
Taylor v. Taylor, 118 Iowa 407, 413, is cited to show that no one can have heirs while living, which is, of course, technically true. In that case the court also said:
“ ‘A remainder is contingent when it is so limited as to take effect to a person not in esse, or not ascertained, or upon an event which may never happen, or may not happen until after the determination of the particular estate. ’ Robinson v. Palmer, 90 Me. 246 (38 Atl. Rep. 103). If the gift is immediate, though its enjoyment be postponed, it is vested; but if it is future, and is dependent on some dubious circumstance, through which it may be defeated, then it is contingent. Hence it has been said that the point which determines the vesting is not whether time is annexed to the gift, but whether it is
It was held that the words “or their heirs, as the law directs” meant such of decedent’s children “as might be living at the time of the distribution and the heirs of such as might have predeceased.”
In Forney v. Remey, 77 Iowa 549, there was a transfer of the property to the defendant, to be held in trust, as prescribed by the terms of the trust deed, and it was held that under the instrument the property passed to the defendant, who took it as trustee and held it subject to the terms of the trust; that the title passed to the defendant in praesenti, and did not wait until the death of the grantor; that the grantor lost ownership and control of the property by the execution of the trust deed, and by such instrument fixed the terms of the conveyance and its future disposition; that there was nothing in the conveyance, or in the facts connected with it, suggesting the idea of a future power of disposition retained by the grantor, and that the grantor could not revoke the grant nor in any way change its terms and conditions. Appellees contend that this ease fully sustained their contention, and we think it does.
Of the cases relied upon by appellees, we have already referred to the McCash case, in which other cases are cited, some of which have been referred to in this opinion. The case of Lewis v. Curnutt, supra, is an interesting and instructive ease, in which many of the contentions made by appellant in the instant ease are decided adversely to appellant’s con
“It needs no argument to support the proposition that the owner of land may sever the fee into a life estate and a remainder, and that he may reserve the former to himself and sell or give the latter to whomsoever he will. When he has done so, can it be said that the grantee of the remainder acquires no present interest in the land simply because he cannot come into possession and enjoyment of the property until after the grantor’s death? We think no lawyer will answer this inquiry in the affirmative. . . . Mrs. Crockett conveyed the property by an unconditional deed, and by an accompanying instrument provided that the trustee should not come into possession or control until after her death. The legal effect of this was to create a life estate in her and a remainder in the trustee for the benefit of the cestui que trust. . . . When a trust is executed by the delivery of a simple conveyance to the trustee, that act and instrument serve to pass an immediate present interest to the cestui que trust, no matter how far in the future the enjoyment of the benefit thus provided may be deferred. . . . It is next argued that a trust could not have been intended because the writings provide for the payment of the expenses and charges of settling of the grantor’s estate, thus rendering possible the entire exhaustion of the property to the exclusion of the persons named as the beneficiaries. It is sufficient to say of this point that it has no support in principle or authority. It is competent for the trustor to convey his property to the trustee absolutely and without reservation or condition for the benefil of the objects of his bounty. He is equally at liberty to make the gift subject to the payment of his debts, and in the latter
In the Podhajshy case, supra, the deceased executed a deed of conveyance to his wife, and at the same time, an instrument in writing by which he created a trust in another, as trustee, for the use and benefit of.certain persons therein named. The court held that the two instruments should be construed together and that they created a trust, and such trust was enforced by the court. In the opinion, the court said:
“It will not be disputed that it is entirely competent for a person, either by a duly acknowledged written instrument, or even by parol, to turn over personal property, moneys, securities or ehoses in action into the hands of another, to be held and used for the benefit of some designated beneficiary, and that, when this is done, such beneficiary obtains an immediate and vested interest in the subject of the trust, which the trustor cannot revoke or disaffirm unless such power of revocation has been reserved in express terms at the time the
In the instant ease, the personal property referred to in the deed of trust was turned over to the trustee.
Other questions are argued, but the opinion is already too long, and we shall not take further time or space to consider them.. The points referred to are controlling. It is our conclusion that the grantor in the deed of trust had no power to revoke, and that the trustee took the title to the property for the benefit of the daughters of deceased, who are now entitled to the same. Such was the conclusion of the district court, and its order is — Affirmed.
