Monday v. Vance , 11 Tex. Civ. App. 374 ( 1895 )

The petition of appellee, who instituted this suit, alleges the execution of a deed to him by one J.P. Rice and his wife, M.F. Rice, conveying to him certain real and personal property in trust, to be managed and controlled by him, the rents and profits, if any, to be applied to the support of Mrs. Rice, and to the support and education of her children; that since the execution of the deed, Rice and wife had conveyed a half interest in a portion of the real and personal property to Robert and Newton Monday, who had sold to one Glenn Raymond, and H. Schultze; that the conveyances had cast a cloud upon the title of the trustee and interfered with an enforcement of the trust. The trustee prayed for the cancellation of the conveyances and for the personal property or its value. Appellants alleged fraud on the part of the trustee and Rice and wife, this being the only defense presented. The judge instructed a verdict for appellee.

It is presented as fundamental error, that Mrs. Rice and her children were necessary parties to the suit by the trustee. It is a general and well established rule that in suits by or against a trustee for the recovery or defense of property, the beneficiaries are necessary parties. Boles v. Linthicum,48 Tex. 221; Ebell v. Bursinger, 70 Tex. 120 [70 Tex. 120]; Preston v. Carter, 80 Tex. 388 [80 Tex. 388]; Story Eq., sec. 207.

There are exceptions to this rule, as where the numbers of the beneficiaries would render it inconvenient to make them parties, and where it may be presumed that it was the intention to invest the trustee with power to prosecute or defend suits in his own name. This case does not come within the exceptions. The deed does not clothe the trustee with authority to prosecute or defend suits for the property, and the circumstances do not raise a presumption that it was intended to give him such power. This was a proceeding in equity to cancel certain transfers and enforce a trust, and a chancery court will not entertain a bill unless all the parties in interest are before it. This is a wise and salutary rule, for without it the trustee might, by collusion, through the medium of a court, deprive the beneficiaries of the trust of valuable rights, when, if notified of the suit, they might protect themselves. It is clear from the face of the petition that Mrs. Rice and the children have equitable rights that would necessarily be affected by any judgment that might have been rendered. One object of the suit was to cancel a certain deed made by Rice and wife, and it is obvious that they should be notified of the pendency of the suit and be given an opportunity to appear. It is true that the judgment does not deprive the children, at least, of any right, but suppose the judgment had been rendered against the trustee, they would not be prevented from bringing a suit and having a readjudication of the whole matter. As before stated, it appears from the face of the petition that the beneficiaries were necessary parties, and the objection is good even when first made upon a writ of error or appeal. Anderson v. Chandler, 18 Tex. 436; Ebell v. Bursinger,70 Tex. 120.

It is suggested by appellant that the deed made by Rice and wife should not be cancelled, because it conveyed at least the equitable interest of Mrs. Rice, but we are of the opinion that the interest of Mrs. Rice is so intimately interwoven and connected with that of the children that a segregation of it would be impracticable, if not impossible. The legal title to the estate is vested in the trustee, the only interest retained by Mrs. Rice being one together with the children in the rents and profits, if any, arising from the property. Her interest is intangible, and could not be separated from that of the children in such a manner as to avail appellant. The court had the authority to compel the jury to return a verdict in consonance with the charge. The fact that the property was conveyed to appellee for the purpose of preventing the rents and profits being seized by the creditors of J.P. Rice did not constitute fraud. The property belonged to the wife, and she had the right to convey the land to a trustee so as to withdraw the rents from the community estate, and obtain therefrom a support for herself and children. Schepflin v. Small, 4 Texas Civ. App. 493[4 Tex. Civ. App. 493]. It is not contended that the rents would more than give a support. There was no evidence of fraud, and the court did not err in instructing a verdict for appellee.

For the reason that necessary parties were not before the court, the judgment will be reversed and the cause remanded.

Reversed and remanded.

ON MOTION FOR REHEARING.