Opinion
23566.
ARGUED JULY 13, 1966.
DECIDED SEPTEMBER 8, 1966.
Construction of will. Fulton Superior Court. Before Judge Wood, Emeritus.
Frank A. Holden, Robert Lee Avary, Jr., for appellant.
Edwin W. Fortson, Hansell, Post, Brandon Dorsey, Charles T. Zink, McChesney H. Jeffries, Smith, Ringel, Martin Lowe, Alex W. Smith, Alex W. Smith, Jr., Robert W. Beynart, for appellees.
Frank A. Holden, Robert Lee Avary, Jr., for party at interest not party to record.
1. The petition set forth cause for a declaratory judgment construing the will of the testatrix.
2. Where, as in the present case, the personal power conferred upon the original trustee is not of such nature that it must continue of force in order that the purposes of the trust may be carried out according to the terms of the trust instrument, the death of the trustee who is given the personal power does not serve to execute the trust but simply to terminate the power.
3. Where the entire beneficial interest is devised to a named beneficiary, no remainder estate is created, and there is no language contained in the will to indicate a contrary intention, the beneficiary takes a fee simple estate. However, since there are still duties for the trustee to perform, the trust is not executed but remains executory.
ARGUED JULY 13, 1966 — DECIDED SEPTEMBER 8, 1966.
The First National Bank of Atlanta as executor and trustee of the estate of John C. Allen, deceased, brought this suit for construction of and declaratory judgment as to the will of John Allen's wife, Emma Belle Stephens Allen, who died in 1951. Under Mrs. Allen's will John Allen had been named, and had been acting as, executor and trustee of a one-half undivided interest in certain assets left under the provisions of that will. The petition alleged that upon discovering these assets and being in doubt as to the legal effect of the entity created by the testatrix's will and not knowing what course to follow as to such assets, the bank seeks guidance as to their disposition.
The provision of the will sought to be construed reads as follows: "I give, devise and bequeath the other share of my estate above provided for to my devoted husband, John C. Allen, as trustee in trust for the following uses and purposes:
"1. The trustee shall manage preserve, protect and control said property in his discretion. Power is given him to make investments and to change same to other investments, as often as he may think necessary. The net income from said trust estate shall be applied to the support and maintenance of my daughter, Emma Belle Allen. If, however, the net income is insufficient to provide for the support and maintenance of my said daughter, then the trustee is authorized to encroach upon the corpus of the trust to such an extent and as often as may be necessary in his uncontrolled discretion, to provide ample funds for such purpose.
"2. If and when my said trustee, in his uncontrolled discretion, deems it advisable and proper to deliver to my daughter the part of my estate herein bequeathed and devised in trust for her, he is hereby authorized, empowered and directed to do so."
Marie Stephens, an heir at law of the testatrix, filed demurrers to the petition and the case came on for a hearing upon an agreed stipulation of fact and sworn pleadings. The trial judge overruled the demurrers and held that the First National Bank is appointed successor trustee to John Allen, the original trustee, with the same rights, privileges and duties as its predecessor, John Allen, except that it would not have the right, in its uncontrolled discretion, to deliver to the beneficiary of the trust any part of the corpus of the trust estate without further order of the court; that, under the provisions of the will, Emma Belle Allen is vested with fee simple title to the assets of the trust, subject only to the carrying out of the trust by and under its terms until its termination.
From the judgment overruling her demurrers and construing the provisions of Emma Belle Stephens Allen's will, Marie Stephens appeals to this court. Several grounds are contained in the enumeration of errors, but for the purpose of this appeal we consider three principal questions.
1. Whether the general demurrers to the petition asserting that no cause for construction of the will or declaratory judgment pertaining thereto was set forth should have been overruled, the appellant contending there is no present need to construe the will of the testatrix.
2. Whether a valid subsisting trust exists and, in this connection, what was the effect of the provisions regarding the right of the original trustee to terminate the trust.
3. Under the will's provisions, in whom would the right to the trust res vest?
1. The averments of the petition were that the plaintiff, appellee here, was entitled to have guidance as to whether a trust existed at all and as to whether the plaintiff's testator, John C. Allen, had any interest in the trust property that would constitute a part of his estate. In such circumstances, the petition was not subject to general demurrer and set forth cause for a declaratory judgment construing the will of Emma Belle Stephens Allen. Ga. L. 1945, pp. 137, 138 ( Code Ann. § 110-1107); Cohen v. Reisman, 203 Ga. 684 ( 48 S.E.2d 113). See Rowan v. Herring, 214 Ga. 370, 374 ( 105 S.E.2d 29). This conclusion rests upon the sound premise that every executor is entitled to judicial guidance as to what property he is called upon to administer as that of his testator when the question is subject to doubt and plausible contrary contentions of the parties at interest.
There is a particularly imperative need of the executor when as in this case the estate he is to administer is subject to inheritance tax, and reasonable accurate knowledge of the estate's value is essential in arriving at the amount of the taxes that the executor has the duty to compute and pay.
2. We now consider the validity of the trust as affected by the provision granting John Allen, the original trustee, in his unlimited discretion, the power to terminate the trust by turning over the assets to the named beneficiary. The language of this provision impels us to the conclusion that the testatrix intended such power to be exercised solely by the trustee named in her will and none other. While ordinarily a successor trustee is clothed with all the rights, duties and obligations of his predecessor, yet where the power is given personally to a named individual, the original trustee, in his unlimited discretion, then such power is not delegable and may not be exercised by a successor trustee. "It is the established law of this State that, where the powers conferred by deed or will upon a trustee in the management and control of property for named beneficiaries are personal and discretionary to the trustee, such powers can not be exercised by a successor ..." Gilmore v. Gilmore, 201 Ga. 770, 776 ( 41 S.E.2d 229), and cases cited therein. Luquire v. Lee, 121 Ga. 624, 629 ( 49 S.E. 834). In such case, the provision or power fails, but the entire trust does not, unless the power is so vital and indispensable to the purposes of the trust that its absence creates an insuperable vacancy which renders the trust nugatory. In other words, when the execution of the power is paramount to the accomplishment of the purposes for which the trust is created, the power and the trust must survive or fall together. 54 AmJur 39, Trusts, § 24.
Here the provisions granting the personal power were not so interwoven with the other trust provisions, but were entirely separable and divisible. It should be pointed out that the clear intent of the testatrix was to create a trust for the sole benefit of the named beneficiary, which was in no way interdependent upon the power to exercise the discretion given to the original trustee. Hence, while the discretion could not be exercised by a successor trustee, the conclusion seems inescapable that the settlor intended the trust to survive the original trustee if necessary to accomplish the purposes of the trust.
3. The final matter for our determination is to ascertain in whom the trust corpus vested or will vest.
In construing Mrs. Allen's will we follow the statute, Code § 113-805, and the uniform holdings of this court that where the entire beneficial interest is devised to a named beneficiary, no remainder estate is created, and there is no language contained in the will to indicate a contrary intention, the beneficiary takes a fee simple estate. Smith v. Dunwoody, 19 Ga. 237; Munford v. Peeples, 152 Ga. 31 ( 108 S.E. 454). However, under Code Ann. § 108-111.1 (Ga. L. 1950, pp. 310, 311), since there are still duties for the trustee to perform, the trust is not executed but remains executory. Thus, the beneficiary has her fee simple title subject to the uses of the trust and upon her death the res would go to her heirs if she died intestate or to those to whom she devised such property by will.
The trial judge did not err in his construction of the will of Emma Belle Stephens Allen.
Judgment affirmed. All the Justices concur.