Clymer v. Mayo

Citation393 Mass. 754,473 N.E.2d 1084
PartiesJohn H. CLYMER, administrator, v. James P. MAYO, Jr., et al. (and two companion cases). 1
Decision Date28 January 1985
CourtUnited States State Supreme Judicial Court of Massachusetts
1

Lawrence S. Elswit, Boston (Todd L.C. Klipp, Boston, with him), for trustees of Boston University.

Michael J. Michaeles, Worcester, for Clark University.

Peter L. Koff, Boston (Edward F. Lawson, Dedham, with him), for Joseph A. Weiss & another.

John H. Clymer, Boston, administrator, pro se.

George T. Shaw, Boston, guardian ad litem.

Peter A. Belmonte, Boston (Rita M. McGeary, Brookline, with him), for James P. Mayo, Jr.

Before HENNESSEY, C.J., and WILKINS, ABRAMS and NOLAN, JJ.

HENNESSEY, Chief Justice.

This consolidated appeal arises out of the administration of the estate of Clara A. Mayo (decedent). We summarize the findings of the judge of the Probate and Family Court incorporating the parties' agreed statement of uncontested facts.

At the time of her death in November, 1981, the decedent, then fifty years of age, was employed by Boston University as a professor of psychology. She was married to James P. Mayo, Jr. (Mayo), from 1953 to 1978. The couple had no children. The decedent was an only child and her sole heirs at law are her parents, Joseph A. and Maria Weiss.

In 1963, the decedent executed a will designating Mayo as principal beneficiary. In 1964, she named Mayo as the beneficiary of her group annuity contract with John Hancock Mutual Life Insurance Company; and in 1965, made him the beneficiary of her Boston University retirement annuity contracts with Teachers Insurance and Annuity Association (TIAA) and College Retirement Equities Fund (CREF). As a consequence of a $300,000 gift to the couple from the Weisses in 1971, the decedent and Mayo executed new wills and indentures of trust on February 2, 1973, wherein each spouse was made the other's principal beneficiary. Under the terms of the decedent's will, Mayo was to receive her personal property. The residue of her estate was to "pour over" into the inter vivos trust she created that same day.

The decedent's trust instrument named herself and John P. Hill as trustees. As the donor, the decedent retained the right to amend or revoke the trust at any time by written instrument delivered to the trustees. In the event that Mayo survived the decedent, the trust estate was to be divided into two parts. Trust A, the marital deduction trust, was to be funded with an amount "equal to fifty (50%) per cent of the value of the Donor's 'adjusted gross estate,' ... for the purpose of the United States Tax Law, less an amount equal to the value of all interest in property, if any, allowable as 'marital deductions' for the purposes of such law ...." Mayo was the income beneficiary of Trust A and was entitled to reach the principal at his request or in the trustee's discretion. The trust instrument also gave Mayo a general power of appointment over the assets in Trust A.

The balance of the decedent's estate, excluding personal property passing to Mayo by will, or the entire estate if Mayo did not survive her, composed Trust B. Trust B provided for the payment of five initial specific bequests totalling $45,000. After those gifts were satisfied, the remaining trust assets were to be held for the benefit of Mayo for life. Upon Mayo's death, the assets in Trust B were to be held for "the benefit of the nephews and nieces of the Donor" living at the time of her death. The trustee was given discretion to spend so much of the income and principal as necessary for their comfort, support, and education. When all of these nephews and nieces reached the age of thirty, the trust was to terminate and its remaining assets were to be divided equally between Clark University and Boston University to assist in graduate education of women.

On the same day she established her trust, the decedent changed the beneficiary of her Boston University group life insurance policy from Mayo to the trustees. One month later, in March, 1973, she also executed a change in her retirement annuity contracts to designate the trustees as beneficiaries. At the time of its creation in 1973, the trust was not funded. Its future assets were to consist solely of the proceeds of these policies and the property which would pour over under the will's residuary clause. The judge found that the remaining trustee has never received any property or held any funds subsequent to the execution of the trust nor has he paid any trust taxes or filed any trust tax returns.

Mayo moved out of the marital home in 1975. In June, 1977, the decedent changed the designation of beneficiary on her Boston University life insurance policy for a second time, substituting Marianne LaFrance for the trustees. 2 LaFrance had lived with the Mayos since 1972, and shared a close friendship with the decedent up until her death. Mayo filed for divorce on September 9, 1977, in New Hampshire. The divorce was decreed on January 3, 1978, and the court incorporated into the decree a permanent stipulation of the parties' property settlement. Under the terms of that settlement, Mayo waived any "right, title or interest" in the decedent's "securities, savings accounts, savings certificates, and retirement fund," as well as her "furniture, furnishings and art." Mayo remarried on August 28, 1978, and later executed a new will in favor of his new wife. The decedent died on November 21, 1981. Her will was allowed on November 18, 1982, and the court appointed John H. Clymer as administrator with the will annexed.

What is primarily at issue in these actions is the effect of the Mayos' divorce upon dispositions provided in the decedent's will and indenture of trust. In the first action, the court-appointed administrator of the decedent's estate petitioned for instructions with respect to the impact of the divorce on the estate's administration. Named as defendants were Mayo, the decedent's parents (the Weisses), and the trustee under the indenture of trust (John P. Hill).

The second case involved a complaint for declaratory and equitable relief filed by the Weisses. Named as defendants were Hill, Mayo, Clymer, the beneficiaries named in Trust B (Hill, Michael Z. Fleming, Renee N. Watkins, LaFrance, Mary Ann Mayo, Boston University, and Clark University), James Mayo's nephews and niece (John Chamberlain, Allan Chamberlain, and Mira Hinman), and the administrators of the Boston University Retirement Plan (TIAA/CREF). The Weisses sought a declaration that the divorce revoked all gifts to Mayo set forth in the will and indenture of trust, including the power of appointment conferred upon Mayo under the trust. The Weisses also alleged that the trust was unfunded, not lawfully created, or alternatively was revoked, and therefore any purported gift to the trust had lapsed. The Weisses asked the court to set aside the trust on the grounds that Mayo and his father allegedly had engaged in fraud, deceit, undue influence, and abuse of a fiduciary relationship in its creation. Additionally, the court was asked to construe the phrase "nephews and nieces" in connection with the trust, and to order that the terms of the Mayos' divorce stipulation precluded Mayo from receiving funds from the decedent's retirement plan. Finally, the plaintiffs sought to have Hill removed as trustee.

In the third action, the Weisses petitioned the court for removal of Clymer as administrator on the ground that he had failed to exercise impartiality in his fiduciary duties.

1. The Judge's Conclusions.

During the consolidated trial of these actions, the judge specifically dismissed count five of the Weisses' complaint charging that Mayo and his father had fraudulently procured the execution of the decedent's will and indenture of trust. Upon reviewing the record, we agree that the Weisses failed to present any evidence to substantiate this charge and affirm the dismissal.

On November 1, 1983, the judge issued his rulings of law and dismissed the Weisses' action. The rulings that have been challenged by one or more parties on appeal are as follows: (1) the decedent's inter vivos trust, executed contemporaneously with her will, is valid under G.L. c. 203, § 3B, despite the fact that the trust did not receive funding until the decedent's death; (2) Mayo does not take under Trust A because that transfer was intended to qualify for a marital deduction for Federal estate tax purposes and this objective became impossible after the Mayos' divorce; (3) Mayo is entitled to take under Trust B because the purpose of that trust was to create a life interest in him, the decedent failed to revoke the trust provisions benefiting Mayo, and G.L. c. 191, § 9, operates to revoke only testamentary dispositions in favor of a former spouse; (4) J. Chamberlain, A. Chamberlain, and Hinman, the decedent's nephews and niece by marriage at the time of the trust's creation, are entitled to take under Trust B as the decedent's intended beneficiaries; and (5) attorneys' fees totalling $43,500 are to be paid out of the decedent's estate to counsel for the petitioning parties. The Weisses also appeal the judge's November 16, 1983, dismissal of their petition to remove Clymer as administrator. The judge ruled, as a result of his earlier conclusion that the trust was valid and therefore no gift under the will had lapsed, that the Weisses lacked standing to bring a removal petition.

For the reasons to follow we affirm the judge's conclusions that: (1) the decedent established a valid trust under G.L. c. 203, § 3B; (2) Mayo's interest in Trust A was terminated as a result of the divorce; (3) the Chamberlains and Hinman are entitled to take as intended beneficiaries under Trust B, with the remainder interest to be divided equally between Clark University and Boston University; and (4) the Weisses lack standing to petition for removal of the estate's administrator. Howe...

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