Hoffman v. Chester , 201 Ga. 447 ( 1946 )

The court did err in the construction of the will, nor in the decree rendered in accordance therewith, in so far as complaint is made in the case before this court.

No. 15546. SEPTEMBER 6, 1946. REHEARING DENIED OCTOBER 11, 1946. John D. Hoffman, as administrator cum testamento annexo, filed a petition, seeking the construction of a will. He named as respondent James Chester, the principal legatee under the will.

The material portions of the will of Mrs. Bonnie B. Chester Mynatt provide:

"Item Two. I hereby direct that my mother, Nanie Lee, be paid from my estate the sum of seventy-five ($75.00) dollars per month so long as she may live, the same to be paid by my executor hereinafter named.

"Item Three. I further direct that my estate be held together and not distributed until after the death of my mother, it being my will that she have the sum of seventy-five ($75.00) dollars per month from my estate during her natural life.

"Item Four. I desire and direct that my property and business at 1266 West Peachtree Street be sole by my executor hereinafter named and the proceeds of said sale be divided equally between my son, James Chester, and my husband, William Mynatt.

"Item Five. I desire and direct that my former husband, William M. Chester, be left in charge of my boarding-house at 855 Peachtree Street, he to receive one hundred ($100) dollars per month with living privileges so long as he remains in active charge of said boarding-house business at said place.

"Item Six. I hereby will unto my beloved son James Chester all my property of every kind, both real and personal, with the exception of the special devises above mentioned, said estate, however, not to be delivered to him by my executor until after the death of my mother, and then not to be delivered to him in a lump sum; it being my desire and my executor hereinafter named is hereby directed to sell all my property, both real and personal, and convert it into cash, the same to be placed in some bank as a trust fund to be delivered to my said son in such amounts per month as my said executor may think necessary, it being my desire that my executor exercise a sound discretion in delivering said trust fund monthly to my said son.

"Item Seven. I hereby nominate, constitute and appoint my brother-in-law, Mr. John V. Puckett, executor of this my last will and testament. My executor herein named shall not be required to make or file any inventory or inventories of the estate or to have any appraisement made thereof or to make any returns to the Ordinary of Fulton County, Georgia, or to any court or to post any bond of any kind for his official acts as executor herein. My executor is hereby authorized to sell any of my property, either real or personal, public or private sale, without any order of the court."

The plaintiff sought a construction of the will on various questions, principally: (a) Whether the administrator has the power to sell the real estate and personal property, and if so, when such power may be exercised; (b) Whether the principal legatee, James Chester, is entitled to a monthly allowance and part distribution of the estate before the death of the testatrix's mother; (c) whether the administrator has the right to operate, as a going boarding-house business, either or both of the boarding-houses described in the will.

The respondent answered, alleging, in part: That he is "twenty-six years of age, has attended Crichton's Business College, graduated from Tennessee School for the Deaf, has been regularly employed until the death of his mother and is capable of handling his own affairs;" that there are no debts of the estate and there is no need or necessity to sell the property for the payment of debts; and that the boarding house located at 1266 West Peachtree Street has been sold. He, too, sought a construction of the will, principally in the following particulars: (a) Whether the respondent is entitled to a distributive share from the sale of the property at 1266 West Peachtree Street; (b) whether the fee-simple title to other property is vested in the respondent; (c) whether the respondent is entitled to the entire income from other property, after payment of $75 per month to the testatrix's mother; (d) whether the respondent is entitled to have possession of the real and personal property of the estate, subject to the payment of $75 per month to the testatrix's mother; (e) whether the respondent is entitled to act as administrator of the estate.

By agreement of counsel the case was submitted to the trial court on the pleadings. The court rendered the following decree:

"The court is of the opinion: That (a) it was the intent of the testatrix that her estate, including income, other than the property at 1266 West Peachtree Street, should be held together and not distributed until the death of her mother, Nanie Lee; (b) that the defendant is sui juris, mentally capable of handling his own property, and a valid trust can not be created for him (Code, § 108-112); (c) that, though it was the intent of the testatrix that the estate should be sold at the death of the testatrix's mother and that the proceeds be set up in a trust fund to be paid to the defendant in the discretion of the executor, the law will not permit this to be done, and, therefore, the provision of Item 6 which provides for setting up the trust fund is invalid, and only the first provision of Item 6, to wit, `I hereby will unto my beloved son, James Chester, all my property of every kind, both real and personal, with the exception of the special devises above mentioned,' is effective, and under such item upon the death of the mother a free and unencumbered fee-simple title vests in the defendant to all the property, real and personal, in the hands of the administrator with the will annexed; (d) that it was the intent of the testatrix (after eliminating the invalid portion of Item 6) that her estate be not converted into cash, but the property, real and personal, be delivered to the defendant upon the death of the testatrix's mother; (e) that the net income from the estate should be held together and delivered to the defendant upon the death of testatrix; (f) that the defendant is not entitled to any part of the income until delivery of the estate to him on the death of testatrix's mother; (g) that the administrator with will annexed and his successors are entitled to hold, control, and manage the estate of the testatrix until the death of the testatrix's mother, at which time the estate shall be delivered over to the defendant.

"Wherefore, the rights, interests, duties, and relations between the administrator with will annexed and the defendant, James Chester, are declared and decreed to be as follows: 1. The defendant is not entitled to have the real estate or personal property devised to him under the will until the death of the testatrix's mother. 2. The administrator with the will annexed does not have the power to sell the real estate except for purposes of paying debts. 3. Such administrator has power to sell at either public or private sale for the purpose of paying debts. 4. The defendant is not entitled to monthly allowances out of the estate as a part of his distributive share, but the net income should be held by the administrator and delivered to the defendant upon the death of the testatrix's mother. 5. The administrator is authorized to operate the boarding-houses as going concerns until the death of the testatrix's mother, at which time they should be delivered over to the defendant. 6. Except for the purpose of paying debts the real estate belonging to the estate must be held together and not sold, and on the death of the testatrix's mother delivered to the defendant. 7. Defendant is now entitled to have paid to him his one-half share of the net proceeds held by the administrator from the sale of 1266 West Peachtree Street, Atlanta. 8. The fee-simple title to the property at 94 Eleventh St., N.E., is now in the administrator with the will annexed, and upon the death of the testatrix's mother will vest in the defendant, and the administrator shall at that time, if all the debts of the estate are paid, execute an administrator's deed to the defendant. 9. The defendant is not entitled to have himself appointed as administrator of his mother's estate. It being made to appear that the defendant is unable to pay his counsel a fee for services rendered in this case, and it appearing that such attorney is entitled to reasonable compensation, it is ordered that the administrator pay to E. A. Wright, as attorney for the defendant, the sum of $300 as a fee for services in this case and the same be charged against the distributive share of the defendant in the estate of his mother."

The plaintiff excepted to this judgment, assigning error no several of the rulings of the court. 1. The contentions urged by counsel for the plaintiff in error may be disposed of by answering two questions: (1) Whether that portion of Item 6 of the will attempting to create a trust for James Chester is valid and operative; and (2) whether the administrator, under the terms of the will, has an unlimited power of sale.

A trust estate can not ordinarily be created in property for the benefit of a person sui juris. Code, § 108-114; ArmourFertilizer Works v. Lacy, 146 Ga. 196 (2) (91 S.E. 12). "In an executed trust for the benefit of a person capable of taking and managing property in his own right, the legal title is merged immediately into the equitable interest, and the perfect title vests in the beneficiary according to the terms and limitations of the trust." Code, § 108-112.

The provisions of the will in the instant case do not expressly create a "spendthrift trust" for the testatrix's son. On the contrary, the testatrix by Item 3 of the will directs that the proceeds from the sale of certain property be equally divided between her son and husband. This property was devised to the son absolutely, it not appearing from the will that this specific property was included in the property later directed to be held in trust. This gift of property absolutely to the son negatives the idea of the testatrix's creating a "spendthrift trust." As stated in Munford v. Peeples, 152 Ga. 31, 45 (108 S.E. 454): "We know of no presumption in such circumstances in favor of a spendthrift trust; and if testator had so intended, it would have been an easy matter for him to have said so. But he has failed to say so expressly. It may be that he created the trust for an entirely different reasons, but that is left entirely to conjecture. Whatever the reason for creating this trust, if it is done contrary to law, and made for one sui juris, and contrary to public policy, the intention of the settler must yield to the rule of law which prohibits the creation of trusts for one sui juris."

Irrespective of whether the trust can be construed as a spendthrift trust, we think that the court committed no error in holding the trust provision of the will invalid.

It is urged by the plaintiff in error that a spendthrift trust is prima facie valid, and the burden was on the son to show that he was sui juris and capable of managing the property, that no evidence was offered on the trial, and therefore the son failed to carry the burden of proof, and the court was unauthorized to find that the son is sui juris and capable of managing the property.

The bill of exceptions recites that by consent of all parties the case came on regularly for trial before the trial court, without the intervention of a jury; that "there was attached to the original petition a copy of the will; that "there was no extraneous evidence introduced by either party, it being agreed by all parties that the copy of said will attached to said petition was a true and correct copy of the will in question; that upon consideration of said case and upon the pleadings therein (including a copy of said will attached to the petition as an exhibit) the court rendered . . a decree." Therefore it appears from the bill of exceptions that by consent of the parties the case was submitted to the trial court solely on the pleadings. The verified answer of the son contains allegations to the effect that he is sui juris and capable of managing the estate; that he is twenty-six years of age, attended a business college, and is a graduate of Tennessee School for the Deaf. The petition is silent on this point. For these reasons the court was authorized to find that the son was sui juris and capable of managing the estate.

2. The trial court did not err in holding that the administrator has no power to sell the real estate except for the purpose of paying debts. "The mere lodgment of a discretionary power of sale in an executor can not destroy an essential quality of the estate in fee of a devisee, where there are no debts or necessity of sale." Thomas v. Owens, 131 Ga. 248, 257 (62 S.E. 218). "This power of sale conferred upon the executrix is a naked one, and must be held to have been conferred for the purpose of enabling the executrix to sell . . for the payment of debts or for distribution among the devisees. It would be an abuse of discretion for the executrix to exercise this power at an inopportune time . . when this was in no wise necessary for the payment of debts or for distribution among the devisees." Calbeck v. Herrington,169 Ga. 869, 876 (152 S.E. 53).

Although the will in the instant case gives to the executor named therein a power of sale, at either public or private sale, without an order of the court, it is evident from the provisions of the will that it was the intention of the testatrix that the property (except the boarding-house located at 1266 West Peachtree Street, which has already been sold) should be held together and not sold until after the death of the testatrix's mother. A contrary construction of the will might have the effect of destroying Items 5 of the will, which directs that the testatrix's former husband be left in charge of the boarding-house at 855 Peachtree Street, and be paid the sum of "$100 per month with living privileges so long as he remains in active charge of said boarding-house business at said place." By Item 6 of the will it is made evident that the "sale" of the property contemplated by the testatrix was to occur after the death of the testatrix's mother, and then for the purposes of carrying out the trust provisions of the will, which the court held to be invalid.

For these reasons, the court did not err in the rulings relative to the power of sale conferred by the will.

3. The point is made that the court erred in directing in the decree that the administrator pay to the defendant's counsel $300, deducting this amount from the share of the estate going to the son. We deem it unnecessary to decide whether the court erred in this respect, for if it be error, it was not such error as was harmful to the plaintiff in error. The administrator holds in his hands the proceeds of the sale of a boarding-house, one half of which he was directed under the decree to pay immediately to the defendant. It would appear that it would be a simple matter for the administrator to deduct this attorney's fee from this share of the estate, which is immediately payable to the defendant.

Judgment affirmed. All the Justices concur.