278 Pa. 141 | Pa. | 1923
Opinion by
This is a proceeding in equity to set aside a trust. In 1903 Charles A. King and Rosie A. King, his wife, of York County, executed a trust deed of all the former’s property, real and personal, to Henry A. Ebert. The deed is one of general warranty, with the following recital: “Whereas, said Charles A. King is desirous of vesting all his estate, real, personal and mixed, voluntarily into the absolute control of a trustee feeling that he is not able to manage said estate and save it from loss, and to place his estate so that it shall be as free as the law can make it from creditors, both as to principal and
The decree cannot be sustained. The deed and declaration of thrust, being parts of the same transaction, must be considered together (Greenfield’s Est., 14 Pa. 489) and prima facie constitute an irrevocable active trust. Among the cases supporting this conclusion are Greenfield’s Est., supra; Potter v. Fid. Ins. Trust, etc., Co. (No. 1), 199 Pa. 360; Rynd v. Baker, 193 Pa. 486; Knowlson et ux. v. Fleming, 165 Pa. 10; Merriman v. Munson, 134 Pa. 114; Jones v. Jones, 252 Pa. 553; Wilson v. Anderson, 186 Pa. 531. The opinion by Mr. Justice Dean in the last case reviews many of the earlier decisions and sustains the irrevocability of such a trust. One reason for the rule is that the object, to place the property beyond the reach of future creditors of the settlor, can be accomplished only by complete divestiture of his ownership therein and a vesting of the equitable interest in the beneficiaries: see Benedict v. Benedict, 261 Pa. 117; Rienzi v. Goodin, 249 Pa. 546; Nolan v. Nolan, 218 Pa. 135. It was within King’s power as absolute owner to create such a trust (Russell’s App., 75 Pa. 269) and the presumption is the deed and declaration were intended to accomplish their avowed purpose. The beneficiaries thereunder take as purchasers, not as legatees, the instruments not being testamentary: see
Plaintiffs invoke the rule, applicable in many cases (see Stafford’s Est., 258 Pa. 595; Harrar’s Est., 244 Pa. 542; Wood’s Est., 261 Pa. 480), that a trust may be terminated by consent of all the beneficiaries, but here it is impossible to determine until the settlor’s death who the ultimate beneficiaries will be. Mr. and Mrs. King may have other children, or Mr. King may survive his wife, all of his children and the sister, in which case his other collateral relatives would be the beneficiaries; so it cannot be now determined that all the parties in interest are before the court: see Lewis’s Est., 231 Pa. 60; Shirk’s Est., 242 Pa. 95.
The only ground upon which the revocation is asked, as stated in the bill, is that the settlor has become competent to care for his own property, which fact is found by the chancellor. This might sustain the decree if the deed contained a power of revocation, but it does not, and, being in equity, the relief granted must be confined to the pleadings as well as to the proofs: Barnard et al. v. Kell et ux., 271 Pa. 80; Modern Baking Co. v. Orringer, 271 Pa. 152, 157. Here the chancellor and lower court fell into error, for the decree is based upon findings outside of the pleadings. For example, the chancellor finds the settlor did not know the nature of the transaction by which the trust was created, that he was without independent advice and, in effect, that a constructive fraud was perpetrated upon him; while the bill makes no such complaint. Moreover, in the face of the deed and declaration of trust, executed by the settlor and his wife in 1903, their deed of confirmation in 1910, their petition to the court for a new trustee in 1919, reciting the entire transaction, together with their receipt of the rents, income, etc., from the trustee for eighteen years, a finding that they did not know the nature of the transaction is untenable. Again, there is no suggestion anywhere of a confidential relation between King and the
The absence of a power of revocation does not tend to invalidate the trust, where as here the insertion of such power would defeat the object intended: Willard v. Integrity Tr. Co., 273 Pa. 24, 29; Neal v. Black, 177 Pa. 83; Reidy v. Small, 154 Pa. 505; and see Reese v. Ruth, 13 S. & R. 434, 435. There is some evidence that after the trust was created the trustee told the settlor when his sons came of age the property could be returned to him; but, if so, it was a mere expression of opinion and could not change the legal effect of the prior transaction, and there is nothing in the record to cause doubt as to the good faith of either trustee.
The decree is reversed and plaintiff’s bill is dismissed, the costs here and in the court below to be paid by defendant out of the funds of the trust estate.