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finding that, pursuant to the terms of the instrument in question, the trustee could have no liability so long as the trustee “acted bona fide to accomplish the purposes of the trust and in conformity with a reasonable discretion”
Summary of this case from Reliance Trust Co. v. CandlerOpinion
23251.
ARGUED DECEMBER 13, 1965.
DECIDED JANUARY 11, 1966.
Construction of will. Clayton Superior Court. Before Judge Banke.
Sheats, Parker Webb, John Tye Ferguson, for appellant.
Neill Leach, Edenfield, Heyman Sizemore, for appellee.
The trial judge erred in his construction of the terms of the will.
ARGUED DECEMBER 13, 1965 — DECIDED JANUARY 11, 1966.
This case involves the construction of a will. The pertinent portions of that instrument are as follows: the testator left all his property to his son, Leslie H. Cox, Jr., appellee here, in trust for the benefit of his son and his son's two daughters; Leslie Cox, Jr., was directed to take full charge of the estate and use it for the joint benefit of himself and the two named daughters "as in his discretion he deems best"; he was authorized to use the profits of the estate or to encroach upon the corpus. The will then provided the testator had complete confidence in his son's integrity and "because of this he may expend more of my estate for one of the beneficiaries herein named than for the others, without being responsible for his acting to any person or to any court"; should Leslie Cox, Jr., die leaving his (named) wife as his widow then she would take charge of the estate with the same powers as the son. Item 6 of the will provided that upon the younger of the two named daughters reaching the age of 21 she and her sister would be paid $3,000, which amount would not be chargeable against other benefits; however, if there was not available a sum sufficient to meet the bequests then the two daughters would share the balance or if none were left "then no one shall be chargeable for the lack."
There was also a provision (Item 7) in the will that should the testator's son be deceased and his named widow remarry then all interest the widow might have would terminate and the property should be divided equally between the two named granddaughters of the testator. The will further provided that after the death of testator's son and of his named widow or her remarriage then testator's estate would be divided equally between the two named granddaughters.
The case arose when Leslie Cox, Jr., as executor, brought a petition for construction of the will alleging: that the testator died in 1961 and his will was probated in solemn form in the same year; that he was endeavoring to sell a parcel of land of the estate and could not obtain title insurance unless his older daughter, Elizabeth Cox Springer, signed a quitclaim deed, which she refused to do. He prayed that the court determine whether he was authorized to sell all or any part of the estate and whether his daughter was entitled to one-third of the estate. Elizabeth Springer filed an answer in which she alleged that her father had appropriated the entire estate to his own use; as executor he had conveyed all property to himself; that he had sold some of the property, from which she had received no benefits, in fact, as a beneficiary she had received no part of the estate; that the plaintiff was unfit to act as trustee.
After a hearing before the trial court, the judge issued the following order construing the will: (1) that it was not the testator's intention to create a trust for the benefit of his son and his son's two daughters; (2) that the son, as executor and sole heir at law of the testator, is authorized to sell any part or all of the estate; (3) that under the terms of the will it is not necessary for the son to give an executor's bond; (4) that items 6 and 7 of the will did not create a legacy but were only a recommendation of the testator.
The appeal challenges each of the four holdings construing the will.
1. We can not sanction the construction placed on the will by the trial judge that the testator had no intention to create a trust. "In the construction of wills precedents are of but little or doubtful value, since no two wills are alike and each is a law unto itself. . . It is the duty of the court to ascertain the intention of the testator, and give effect thereto, unless it violates some fixed rule of law, and in ascertaining the intention of the testator, sentences may be transposed, connecting conjunctions changed, and omitted words supplied." Davant v. Shaw, 206 Ga. 843, 846 ( 59 S.E.2d 500). "In the construction of a will, the paramount object is the ascertainment of the intention of the testator by looking to 'Its four corners' and giving consideration to all of its parts." Lewis v. Mitchell, 216 Ga. 526 (3) ( 117 S.E.2d 901), and cases cited. See Code § 113-806. An examination of the will as a whole impels us to the conclusion that the testator did intend to create a trust.
Here all the requisites of a valid trust are present: a declaration of the trust, property to which the trust pertains, a trustee, beneficiaries, terms or purpose and remainder interest. See 89 CJS 734, Trusts, § 22, and 54 Am. Jur. 43, Trusts, § 30. As to the argument made concerning the effect of the trustee also being a beneficiary see Smith v. Francis, 221 Ga. 260 ( 144 S.E.2d 439), and cases cited.
The provision of the will conferring upon the trustee the very broad power to expend more of the estate for one of the beneficiaries than for the others, without being responsible to any person or court, was not intended to make him the sole beneficiary of the property of the estate but simply means that, in the faithful exercise of his discretion, he might distribute the moneys and property of the estate to meet the exigencies of the situation or the necessities of the three beneficiaries. "A discretionary power in a trustee is [not] beyond the reach of judicial inquiry. A court will interfere whenever the exercise of discretion by the trustee is infected with fraud, or bad faith, misbehavior, or misconduct, arbitrariness, abuse of authority or perversion of the trust, oppression of the beneficiary, or want of ordinary skill or judgment." Cates v. Cates, 217 Ga. 626, 632 ( 124 S.E.2d 375). Here, the trustee could encroach upon the corpus and could expend more of the estate for one of the beneficiaries than for the others so long as he acted bona fide to accomplish the purposes of the trust and in conformity with a reasonable discretion.
2. The trial judge held that Leslie Cox, Jr., as executor and sole heir at law of the testator could sell all or part of the estate. In view of what is held in Division 1 of this opinion, any action taken by Leslie Cox, Jr., would be in the capacity of trustee, not that of executor or sole heir at law. Since the will contained no express authority to sell the trust res, the general law would be applicable. See Code §§ 108-408 and 108-409.
3. There is evidence that Leslie Cox, Jr., had been discharged as executor of the estate. Thus, any question as to whether, in that capacity, he should be required to post bond is moot.
4. The bequest to the two granddaughters upon the arrival at majority by the younger, in our view, constituted more than a mere recommendation by the testator. The granddaughters were given a definite interest which, although it was subject to being divested through unforeseen vicissitudes or the necessity to encroach upon the estate, would entitle them to the full amount prescribed or such portion thereof as might remain upon the happening of the event, to wit, the younger granddaughter attaining the age of 21.
Judgment reversed. All the Justices concur.