Frensley v. Frensley , 177 Okla. 221 ( 1936 )

I am unable to agree with the views expressed in the majority opinion. I do not believe that a spendthrift trust is created by the will of decedent. This case was assigned by direction of the court to three members of the bar for a proposed opinion under a plan adopted by the court for the purpose of relieving the congested condition of the docket. These special masters prepared a proposed opinion, and it is my view that the court should have adopted that opinion. It is as follows:

"PER CURIAM. This is an action brought by May Frensley, plaintiff in the lower court, against Cecil Frensley and T.B. Frensley, defendants in the lower court. They will be referred to as they stood in the trial court.

"The original action is one for divorce, and the judgment of divorce was entered granting alimony to the plaintiff. Thereafter, on the 27th day of February, 1930, the judgment was entered based upon an agreement in open court, the pertinent part of which judgment is as follows:

" 'Judgment. " 'Now on this the 27th day of February, 1930, this matter coming on for hearing, the plaintiff appearing in person and by her attorney, Guy H. Sigler, and the defendant appearing in person and by his attorney, S.A. George, and the parties in open court entered into the following agreement, to wit:

" ' "Whereas, B.F. Frensley, the father of the defendant, having heretofore died and having by his last will and testament willed to the defendant the ten acres of land heretofore described in the original judgment in this case, and in said will the said B.F. Frensley conveyed to T.B. Frensley, trustee, certain property located in Carter county, Oklahoma, and described in the last will and testament of B.F. Frensley, and said last will and testament providing that said T.B. Frensley should collect the rents and revenues from said property for the period of twenty (20) years and pay the same to the children of said B.F. Frensley, deceased. And it appearing that the said defendant is entitled to one-sixth (1/6) of said income, now it is agreed that the judgment for alimony heretofore entered in this case shall be set aside and the parties agree that the plaintiff shall be the owner of an undivided one-half interest in the ten-acre tract of land, subject to the mortgage now upon the same, and that said plaintiff shall receive and said T.B. Frensley shall pay to the plaintiff one-half of all sums of money to which the defendant may be entitled under said will; and that she shall receive said money during her lifetime and so long as she remains unmarried, but if said plaintiff shall remarry or die, that all rights herein given her shall cease," and the court having approved said agreement in open court enters judgment for the plaintiff as in said agreement stated. * * *

" 'It is further ordered, adjudged and decreed by the court that the plaintiff shall receive and said T.B. Frensley shall pay to said plaintiff one-half of all the sums of money hereafter accruing to which the defendant may be entitled to under the will of his deceased father, B.F. Frensley, and said T.B. Frensley is hereby ordered and directed to pay said money to said plaintiff during the twenty (20) years which he is to act as trustee for said property and his successors in office and is hereby directed to pay said sum to the plaintiff during said period.

" 'It is further ordered and directed that if the plaintiff shall remarry or die during said term that all rights which she may have under this judgment shall cease. * * *'

"Thereafter, on January 3, 1935, plaintiff asked a citation against T.B. Frensley stating that he had failed to pay to her certain sums due to her under the judgment of February 27, 1930, it being undenied by either party that said sums had arisen from the sale of certain real estate held by the said T.B. Frensley as trustees, and the court on the 31st day of January, 1935, found that the plaintiff was entitled to the sum of $420.83 from the said T.B. Frensley.

"The defendants now attack the judgment of February 27, 1930, as being void:

"First. Because it was a judgment for alimony, void upon its face for the reason that the amount payable thereunder is indefinite and uncertain. It is here unnecessary to discuss this proposition further for the reason that it is hereinafter held that the agreement upon which the said judgment was entered amounted to an assignment of the benefits of the trust by the said Cecil Frensley.

"Second. They further attack the said judgment for the reason that it is void for the lack of jurisdiction of the trial court to enter the same, since there is no judgment against the defendant, Cecil Frensley, but merely one against the defendant, T.B. Frensley, stating that it amounts to the equivalent of a garnishment. This proposition will not be further discussed for the same reason as that set out in regard to the first proposition.

"Third. The defendants further attack said judgment upon the ground that it is violative of the trust provisions of the last will and testaments of B.F. Frensley, deceased, and we hold that the case turns upon that provision of the will creating the trust.

"The pertinent part of the will of B.F. Frensley, deceased is as follows:

" '* * * The whole net income or earnings accruing from said property after all taxes and necessary charges have been paid to be paid over to my said children share and share alike during the period of this trust as often as once a month, if desired upon their separate order or receipt and without being subject in any manner to the order or intervention, or control of any husband or wife of any or either of them may have, or of any creditor of any or either of them, or of their husband or wife aforesaid. My object being to secure to each of my children for twenty (20) years the use and enjoyment of all the income from said property beyond and without the intervention or control of any husband or wife of any, or either of them, or any creditors of them.* * *

" 'I do hereby authorize and empower my said trustees above named, or any successors, in said trust to sell and dispose of any property, real or personal, that I may have at the time of my death, except the business lots and buildings in Ardmore, Oklahoma, and to make good and valid instruments of transfer thereof of any part or any rights therein whenever in the judgment of said trustees any of said property is depreciating in value and to pay over to my said children share and share alike the proceeds of such sale.'

"It is the claim herein of the defendants that the will of the said B.F. Frensley, deceased, sets up a spendthrift trust. We are unable to agree with this contention. It is unnecessary to decide at this time whether the plaintiff herein could have enforced against the income or the corpus of the trust her claim for alimony in the absence of an assignment from the defendant, Cecil Frensley.

"This court in the case In re Trusteeship of Vance,102 Okla. 129, 227 P. 881, held that the title to the income from a trust estate is in the beneficiary, and also held in the case of Flesner v. Cooper, 39 Okla. 133, 134 P. 379, that the beneficiary's interest in a resulting trust was an equitable estate which might be conveyed. The beneficiary of a trust may alienate or assign the income from a trust before it comes due, in the absence of statutory restrictions or restrictions in the instrument creating the trust (65 C. J. 551; Lamberton v. Pereles [Wis.] 58 N.W. 776) and we do not find it possible to read into the instrument a provision forbidding any such assignment, although such provision would be proper under section 11833, O. S. 1931.

"In regard to the right of a beneficiary to assign the income from a trust estate the leading case in the United States appears to be that of Nunn v. Titche-Goettinger Co. (Tex.) 245 S.W. 421, in which case the Supreme Court of Texas holds as follows:

" 'According to the great weight of authority, however, where the instrument creating the trust contains no express words of restraint and nothing in its face declaring that the purpose thereof is to provide a support for the beneficiary and to furnish him with the comforts of life, and where it requires that the revenue arising from such trust shall be paid directly to the beneficiary without any direction concerning its application and without any discretion being vested in the trustee as to the time or amount of such payments or the purpose to which they shall be applied, such revenue may be anticipated, or assigned by the beneficiary or by proper proceedings subjected to the payment of his debts. Kingman v. Winchell (Mo.) 20 S.W. 296; Sherman v. Havens, 94 Kan. 654, 146 P. 1030, Ann. Cas. 1917B, 394; Martin v. Davis, 82 Ind. 38; Caldwell v. Boyd, 109 Ind. 447, 9 N.E. 912; Forbes v. Lothrop,137 Mass. 523; Baker v. Keiser, 75 Md. 332, 23 A. 735; Farmers' Mechanics' Savings Bank v. Brewer, 27 Conn. 600; Pickens v. Dorris, 20 Mo. App. 1; Maynard v. Cleaves,149 Mass. 307, 21 N.E. 376; Wenzel v. Powder, 100 Md. 36, 59 A. 194, 108 Am. St. Rep. 380; Sears v. Choate, 146 Mass. 395, 15 N.E. 786, 4 Am. St. Rep. 320; O'Hare v. Johnston, 273 Ill. 458, 113 N.E. 127; Dieke v. Dieke, 182 Ill. App. 13; Huntington v. Jones, 72 Conn. 45, 43 A. 564; Girard Life Ins. Trust Co. v. Chambers, 46 Pa. 485, 86 Am. Dec. 513. * * *

" 'The restraints imposed by a spendthrift trust greatly hamper the beneficiary in the free use and enjoyment of the income therefrom and are necessarily humiliating to such beneficiary. A trust should not be construed to belong to that class unless it appears reasonably clear that such was the purpose of the donor or testator. 26 Am. Eng. Ency. Law (2d Ed.) pp. 141, 142; Dieke v. Dieke, 182 Ill. App. 13, 17; 25 Rawle C. L. p. 357, sec. 8.'

"There can be no other conclusion but that the agreement as entered into and as approved by the trial court in this case was an assignment of an undivided one-half interest in and to the interest of Cecil Frensley in the trust, and there can be no question under the record in this cause but that the trustee, T.B. Frensley, had full notice of such an assignment.

"The further question is raised by the defendants herein that the judgment of February 27, 1930, could in no event include the proceeds of the sale of nonproductive lands belonging to the estate of B.F. Frensley, deceased, the sale of which was discretionary and optional with the trustee thereof. Whether the plaintiff would be entitled to proceeds of such a sale depends upon the construction of that judgment. The terms and provisions of the judgment are not of such ambiguity as to properly require oral testimony to construe the same, and therefore the trial court properly sustained objections to proffered testimony as to the meaning of the term 'one-half of all sums of money to which the defendant may be entitled under said will.' This phrase can mean only one thing and that is that the plaintiff shall be entitled to an undivided one-half interest in the defendant's, Cecil Frensley's, interest in payments made by the trustee from whatsoever source."

The above quoted opinion was prepared by Harry Campbell, Jr., and concurred in by Floyd L. Rheam and Paul Avis, special masters, which opinion affirmed the judgment of the district court of Carter county.