Swanson v. Bates

• Decision Date: 01 November 1948
• Docket Number: No. 3662.,3662.
• Citation: 170 F.2d 648
• Parties: SWANSON v. BATES et al.
• Court: U.S. Court of Appeals — Tenth Circuit

170 F.2d 648 (1948)

SWANSON v. BATES et al.

No. 3662.

United States Court of Appeals Tenth Circuit.

November 1, 1948.

W. F. Semple, of Tulsa, Okl., and R. M. Rainey, of Oklahoma City, Okl. (Rainey, Flynn, Green & Anderson, of Oklahoma City, Okl., on the brief), for appellant.

R. M. Mountcastle, of Muskogee, Okl. (George W. Leopold, of Muskogee, Okl., on the brief), for appellees.

Before PHILLIPS, Chief Judge, and BRATTON and MURRAH, Circuit Judges.

PHILLIPS, Chief Judge.

Dorothy Evalyn Swanson brought this action against Carl K. Bates, Mary Kimmel, Mary Severs Owen, Muskogee Welfare Association, and the United States Fidelity and Guaranty Company¹ and prayed for the removal of Bates, as trustee of a testamentary trust created by the will of Annie S. Cook, deceased, for an accounting by Bates, as trustee, for a construction of the provisions of the will, and for the fixing of definite sums to be paid to Swanson as a beneficiary under the trust.

Cook died October 25, 1937, leaving a last will and testament. It was admitted to probate in the county court of Muskogee County, Oklahoma, November 16, 1937.

The will created a testamentary trust and named I. H. Mertz as trustee. Swanson is the sole surviving life tenant and beneficiary under the trust. Mary Kimmel, Mary Severs Owen, and the Muskogee Welfare Association are remaindermen. On April 27, 1940, an order was entered in a proceeding in the district court of Muskogee County, removing Mertz as trustee and appointing Bates as successor trustee. Bates thereafter qualified and since then has been the duly appointed, qualified, and acting trustee.

On October 6, 1942, the county court of Muskogee County approved the final report of the administrator with the will annexed, entered a final decree of distribution, and distributed all the assets of the estate to Bates, as trustee. Since October 7, 1942, Bates has been in possession and control of such assets.

Bates, as trustee, filed his annual reports on October 7, 1943, October 25, 1944, and March 20, 1946, respectively. He filed a supplemental report on August 8, 1945. All of such reports were set for hearing, due notice was given to all parties in interest, including Swanson, and, after a full and complete hearing, each report was approved by the district court of Muskogee County.

The fourth annual report of the trustee, covering his accounts and doings from January 1, 1946, to December 31, 1946, inclusive, application for audit of the trust account, petition for approval of report, and application for continuance of trustee's compensation and attorney's fees were filed in the district court of Muskogee County on April 3, 1947. On that date, the state court set the matters for hearing on May 28, 1947, and ordered that exceptions be filed on or before May 21, 1947. Notice thereof was duly served upon all the parties in interest, including Swanson. Thereafter, Swanson appeared by her counsel and filed a protest to the approval of the fourth annual report on the grounds (a) that the commission of the trustee for the year 1946, fixed at $12,000, was excessive; (b) that the amount paid by the trustee to his attorney for the year 1946, in the sum of $5,000, was excessive; (c) that the amount paid to the protestant as sole surviving beneficiary was an unfair and inequitable share of the income of the estate; and (d) that the amount paid for repairs and betterments of the estate was in excess of what should be a fair allocation for such purposes and operated to deprive the life beneficiary of current income to which she was entitled. The hearing on the fourth annual report and the other matters was continued from time to time to July 23, 1947. On that date, Swanson appeared and asked that the hearing be continued to September 17, 1947. The hearing was so continued. On the following day, July 24, Swanson commenced the instant action.

The fourth annual report and other matters came on for hearing in the state court. Counsel for Swanson withdrew the third and fourth grounds of protest. The state court took the matters under advisement, and the proceedings in the state court were pending at the time the instant case was heard and the judgment therein entered.

Bates and the Muskogee Welfare Association filed a motion to dismiss the instant action on the ground, among others, that the proceedings pending in the district court of Muskogee County gave that court exclusive jurisdiction of the subject-matter.

From a judgment sustaining the motion and dismissing the...