Coolidge v. Loring

• Decision Date: 28 February 1920
• Citation: 235 Mass. 220
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court
• Parties: J. RANDOLPH COOLIDGE & another v. AUGUSTUS P. LORING, trustee, & others.

235 Mass. 220

J. RANDOLPH COOLIDGE & another v. AUGUSTUS P. LORING, trustee, & others.

Supreme Judicial Court of Massachusetts, Suffolk.

February 28, 1920

January 19, 1920.

Present: RUGG, C.

J., DE COURCY PIERCE, & JENNEY, JJ.

Trust, Reformation of instrument. Equity Jurisdiction, To reform instrument in writing, Mistake. Mistake. Equity Pleading and Practice Agreed statement of facts.

Misconception of the legal effect of the language used in a declaration of trust is not a "mistake of law" entitling the settlor to maintain a suit in equity to reform the instrument.

A statement, in an agreed statement of facts in a suit in equity brought by the settlors to reform a declaration of trust so that it would permit them to terminate it by a surrender of their interests to the remaindermen in their lifetime, that "there was no intention on their part to create interests which would prevent an immediate distribution in the event of such a surrender," falls short of indicating that the settlors had an intention not to create such interests.

An instrument will not be reformed on the ground of mistake except upon full clear and decisive proof of the mistake.

A declaration of trust which placed upon the trustees important contractual duties and responsibilities will not be reformed by reason of a mistake in which it is not shown that the trustees participated.

A declaration of trust by a husband and his wife provided for three trustees one of whom was one of the settlors, and that the income of the trust fund should be paid to the settlors and to the survivor of them for life and that upon the death of such survivor the trust fund should be distributed among such of the settlors' sons as were then living and the next of kin of such as should have died. It contained no provision for an earlier termination of the trust. The settlors brought a bill in equity to reform the instrument so that it would permit them to terminate the trust by a surrender of their life interests to the remaindermen, alleging that it was their intention that the contingent remainders should be subject to the condition that they should not vest if the interest of the settlors, previous to the death of the survivor of them, should have been released by them, and that appropriate language to express that intention was omitted from the instrument through mistake. All living persons of adult age interested in the trust assented to the granting of the prayer of the bill. A guardian ad litem represented the interests of minors and persons not in being. The suit was heard upon an agreed statement of facts, which recited that it was the belief of the settlors

"that they had the power to terminate the trust at any time by surrender of their life interests to the remaindermen, and there was no intention on their part to create interests which would prevent an immediate distribution in the event of such a surrender." Nothing appeared as to the intentions or beliefs of the trustees other than that of one of the settlors who also was a trustee. Held, that the suit could not be maintained.

BILL IN EQUITY, filed in the Supreme Judicial Court on December 10, 1919, and afterwards amended, by J. Randolph Coolidge and Julia Coolidge, his wife, settlors under a declaration of trust, against the trustees and all beneficiaries thereunder.

By an interlocutory decree, a guardian ad litem and next friend was appointed, to represent all of the defendants who were minors and all persons not ascertained or not in being who were or might become interested in the suit.

The material facts, which were agreed upon, are stated in the opinion. The suit was heard upon the pleadings and the agreed statement of facts by Carroll, J., who ordered a decree dismissing the bill and reported the case for determination by the full court.

J. Noble, (J.

R. Coolidge with him,) for the plaintiffs.

E. A. McLaughlin, Jr., for the defendant J.

Randolph Coolidge, Jr., and others.

H. W. Edgerton, for the guardian ad litem.

DE COURCY, J. This is a suit in equity to reform a declaration of trust. The plaintiffs are the settlors. The parties defendant are the trustees, the children, grandchildren and great-grandchildren of the settlors, and the wives of their four married sons. Together they constitute all the living persons who may be interested in the trust. The defendants who are minors, and persons not yet in being who may become interested, are represented by a guardian ad litem.

The trust was created in 1907 by the conveyance by the settlors of real estate and securities to the trustees, who executed, contemporaneously, the declaration of trust in question. This instrument declares that the property is to be held: "1st. In trust to pay the net income of the trust fund to the said J. Randolph Coolidge and the said Julia Coolidge four sevenths (4/7) and three sevenths (3/7) respectively to each so long as they both live, and to pay the whole of said net income to the survivor; and upon the death of the survivor to distribute equally the trust property among the following persons who are children of the said J. Randolph Coolidge and Julia Coolidge, viz: J. Randolph Coolidge Jr., John Gardner Coolidge, Archibald Cary Coolidge, Harold J. Coolidge and Julian L. Coolidge; and should any of said persons predecease the survivor of the said J. Randolph Coolidge and Julia Coolidge, to pay the share of the person so predeceasing to those who would be entitled to take his intestate property under the Statute of Distributions in effect at the time of the death of such survivor, provided that in no case shall a surviving widow take as distributee, more than one-half of said share."

The plaintiffs in 1917 assigned their life interests in the trust to their five sons, who shortly thereafter called upon the trustees for...