8 S.E.2d 23 | Ga. | 1940
1. Residuary legacies in trust, held invalid as violative of the rule against perpetuities.
2. Cause of action presented by petition to declare legacies void, held not barred by statutes of limitation and laches.
The petition alleged that all three of the residuary legacies were invalid as violating the rule against perpetuities. It was also alleged that the first-named beneficiary "has no interest under said will," because, under the terms of the gift made to it, there should be a "cancellation of the bequest" made to it if it should "forfeit [its] holdings" in the described lots of land, and because it had actually forfeited such holdings, on account of a sale of the property under foreclosure proceedings. The court overruled the demurrers of the defendants, on the grounds that the petition showed no cause of action, and that it showed a bar of any right of action under the statutes of limitation and laches; the testator having died in 1915, the suit not having been brought until 1938, but the petition not indicating any adverse claim by the defendant administrator with the will annexed, or the preceding executor while holding at interest the residuary assets involved. The petition alleged that the original sum of approximately $1700 with the interest thereon then amounted to approximately $3500.
McLaws, McLaws Brennan, A. Leopold Alexander, H. WileyJohnson, Lawton Cunningham, Spence M. Grayson, J. C. Hester, and Girard M. Cohen, for plaintiffs in error.
1. It is well settled in this State, that, not only in express or implied trusts but in other fiduciary relations, the statute of limitations will not begin to run so long as the trust or duty with regard to specific property continues and is acknowledged to subsist, and there is no change of status to show an adverse holding by the person in possession; that during such time the owner has the right to treat the possession of the other person as his own; and that the statute will not begin to run until such person has given the owner notice of his adverse claim, or there are *26
circumstances which would be the equivalent of such notice.Reynolds v. Dorsey,
2. Under the rule of the Code, "Limitations of estates may extend through any number of lives in being at the time when the limitations commence, and 21 years, and the usual period of gestation added thereafter," otherwise a perpetuity arises, which is forbidden. Code, §§ 85-707, 85-801; Robinson v. McDonald,
3. The early English rules as to charitable trusts have been almost fully adopted in Georgia (Code, §§ 108-201-108-204, 113-807, 113-815; Beall v. Fox,
4. Applying the principles set forth to the facts in this case, none of the residuary bequests in the will were valid. With respect to both the first bequest and the second bequest, there was no vested gift in proesenti or one vesting within the period required by the rule against perpetuities; but, on the contrary, the testamentary scheme necessarily implied that the purpose of the testator was to affix as a condition to the bequest of a small sum of money, approximately $1700, that it should be held in trust by the trustees *28 to accumulate for approximately two hundred years, in order that it might reach the amount of $600,000 in the first instance, and $450,000 in the second instance, before it was to be conveyed by the trustees to the respective beneficiaries. In the first instance, it was specified that approximately $100,000 should be expended to acquire land, and that other large sums were to be expended to erect extensive buildings. In the second instance, still larger sums were specified for acquiring land, erecting buildings, and other stated purposes. It is apparent that, since the will provided that the $1700 and its increment be withheld by the trustees in both instances until the required accumulation had been completed, before the funds could be conveyed by the trustees to either beneficiary, and since it is manifest that the purposes stated could in no wise be attempted until such accumulation had been effected, it follows that the accumulation by the trustees, provided for in the will, constituted a necessary condition precedent, which prevented either the first or the second bequest from vesting either immediately or within the period required by the perpetuity rule.
(a) With respect to the first beneficiary, it took no interest under the will, for the additional reason that its bequest was expressly made contingent upon its continuing to hold certain described realty, which under the allegations of the petition it had failed to do.
(b) As to the second beneficiary, it could take no vested interest under the will, for the additional reason that its bequest was expressly made contingent upon the failure of the bequest to the first beneficiary, because of its loss of the described realty, the vesting of which future interest might have been postponed beyond the period required by the perpetuity rule.
(c) While it is true that under the terms of the will the municipality, as the third beneficiary in the event the first two should fail, was to receive the fund from the trustees upon the determination of such fact, and the accumulation to the extent of the $600,000 was to be effected, not by the trustees, but by the municipality, nevertheless the bequest to the city as such contingent beneficiary was also invalid. This is true not only for the reason that the gift, not being one vested in proesenti or vesting within the period prescribed by the perpetuity rule, was contingent on the failure of the two preceding gifts, but for the reason that the gift was *29 also expressly made contingent "upon the determining of [the] fact" that neither of the first two beneficiaries would be "permitted to avail itself of the provisions of this bequest," before the trustees were directed to convey to the city the trust fund "as existing at that time." Since the right to question the existence of a perpetuity as to the first two beneficiaries was one which could be asserted only by "one having an interest in the property," and such a right is one which "may be lost upon the ordinary principles of estoppel" (48 C. J. 1036, §§ 171, 172), and since the right of the city to take depended, not on the invalidity itself, but upon a determination thereof, which might or might not occur within the perpetuity period, under any view as to the contingent nature of the city's rights it took no valid interest under the will.
5. Under the preceding holdings, the judge did not err in overruling the demurrers of all the defendants to the petition on the ground that it stated no cause of action.
Judgment affirmed. All the Justices concur.
ATKINSON, P. J., concurs in the conclusion, but not in all that is said in the opinion.