Ball v. Townsend

• Decision Date: 25 April 1924
• Docket Number: 22.
• Citation: Ball v. Townsend, 145 Md. 589, 125 A. 758 (Md. 1924)
• Parties: BALL v. TOWNSEND ET AL.
• Court: Maryland Court of Appeals

125 A. 758

145 Md. 589

BALL v. TOWNSEND ET AL.

No. 22.

Court of Appeals of Maryland

April 25, 1924

Appeal from Circuit Court of Baltimore City; Henry Duffy, Judge.

"To be officially reported."

Bill by William S. Townsend and others, executors and trustees under the will of John W. Grace, deceased, against Fannie R. Ball and others, to construe items of the will. From decree, the named defendant appeals. Affirmed.

Argued before THOMAS, PATTISON, URNER, ADKINS, OFFUTT, and DIGGES JJ.

G Elbert Marshall and Wm. Mason Shehan, both of Easton (Seth Shehan & Marshall, of Easton, on the brief), for appellant.

Chester F. Morrow, Charles McH. Howard, and Alfred S. Niles, all of Baltimore (Niles, Wolff, Barton & Morrow, of Baltimore, on the brief), for appellees.

PATTISON J.

The bill in this case was filed by the executors and trustees under the will of John W. Grace, deceased, in the circuit court of Baltimore city to have construed certain items of said will.

John W Grace of Baltimore city died, after the death of his wife, on or about the 26th day of May, 1919, leaving no father or mother, children or descendants surviving him, but leaving surviving him one brother of the whole blood and children of a brother and three sisters of the half blood, who are named in the bill as his next of kin.

John W. Grace, as the bill alleges, died testate. He, after bequeathing certain legacies and devising property to those mentioned in the will, including some of his next of kin, business associates and others, gave, bequeathed, and devised by item 11 of his will "all the rest and residue" of his estate to the appellees, in trust, with full powers to change the investments and to invest and reinvest the same in securities thought by them to be safe and proper; and to collect and receive the rents, issues, and profits thereof, and, after paying therefrom the taxes, insurance, and expenses therein named, they were directed to apply the balance, being "the net annual income" from the trust estate, as follows:

"(1) To pay unto my brother, Luther Grace, in half-yearly installments, so long as he shall live, the annual sum of twenty-five hundred ($2,500), into his hands and into the hands of no other person whomsoever.

(2) Unto Daisy Hughes, daughter of my brother, in half-yearly installments, so long as she may live, into her hands and into the hands of no other person whomsoever, the annual sum of twenty-five hundred dollars ($2,500), and at her death I direct my trustees to pay from the corpus of my trust estate unto the daughter of Daisy Hughes, if she be living at that time, the sum of twenty-five thousand dollars ($25,000).

(3) Unto Mattie Grace Parlett, wife of Benjamin F. Parlett, in equal half-yearly installments, and so long as she may live, into her hands and into the hands of no other person whomsoever, the annual sum of twenty-five hundred dollars ($2,500).

(4) Unto Annie W. Pennington and Minnie E. Pennington, daughters of Andrew Pennington, in equal half-yearly installments, as long as they shall live, into their hands and into the hands of no other person whomsoever, each the annual sum of twenty-five hundred dollars ($2,500); upon the death of either of them the survivor shall be paid by my trustees the annual sum of five thousand dollars ($5,000) so long as the survivor shall live.

(5) Unto Benjamin F. Parlett, Junior, Neva Parlett, Mattie Parlett and Hazel Parlett, children of Benjamin F. Parlett, so long as they may live, into their hands and into the hands of no other person whomsoever, each the annual sum of five hundred dollars ($500)."

Then immediately follow items 12 and 13 of the will:

"Item 12. In the event of the net annual income from my trust estate being more than sufficient to pay the above mentioned annuities, such excess of net income shall be by my trustees divided among the annuitants above mentioned ratably; but before any such division of income shall be made, my trustees, their survivors or survivor of them, or their successors or successor, shall be satisfied that the value of the corpus of my trust estate has not been depreciated in value, from any cause whatsoever.

Item 13. Upon the death of each and every annuitant above mentioned, a portion of the corpus of my trust estate, as the same may then be constituted, equal to the capitalization, on a basis of six per cent. (6%), of the annuity falling in by reason of the death of the annuitant, shall by my trustees, the survivor or survivors of them, and their or his successor or successors, be paid, free, cleared and discharged from the trust hereby thereon imposed, or any trust whatsoever, unto the Johns Hopkins Hospital, a corporation of the state of Maryland, to be used by said hospital for its corporate purposes; the intention of this gift, however, being to enable said hospital, by means of the net income derived from this bequest to receive in its pay wards persons of moderate means, who in the judgment of the trustees of the hospital may be unable to pay the full and regular charges in such pay wards, and to give therein to such persons paying according to their means, the same hospital care and attention as pay patients, paying the full and regular charges, receive in such pay wards."

The bill in this case was filed to have the above items, 12 and 13, construed by the court, and it was in respect to them that the court was asked certain questions, the answers to which are found in the decree of the court, from which the appeal in this case was taken. These questions, we think, are sufficiently indicated by the answers given thereto, and we need not lengthen this opinion by inserting them herein.

The court's construction of the will is in its decree above referred to, which is as follows:

"(1) That by the proper construction of the will of John W. Grace, filed as an exhibit in this case, the said John W Grace did not die intestate as to any part of his estate.

(2) That by item twelfth of said will the question whether or not the value of the trust estate created by said will and now in the hands of the trustees appointed thereby has been depreciated in value from any cause whatsoever is committed to the judgment of the trustees.

(3) That the meaning of the word 'depreciation,' as used in the said twelfth paragraph of said will, is something more than a fall in market value, unless such fall is enough to amount, in the opinion of the trustees, to a real and permanent loss of corpus, and does not refer to a temporary decrease in market value of said securities.

(4) That there being in this case no allegation of proof of any default on the corpus of any of the bonds included in said corpus of said estate, or of passing of the usual dividends on any of the stocks included in said estate to such extent that in the opinion of the said trustees there has been a permanent depreciation in the said securities according to the proper meaning of the word 'depreciation' as above herein given, the income derived from the securities included in the said trust estate should be paid out in its entirety to the persons designated in said clause as 'annuitants.'

(5) That if, in the opinion of the said trustees, depreciation as above defined in the value of said trust estate should occur, the trustees shall reserve a sufficient amount of income to make good, in their judgment, the said depreciation, and, if at a later date some change should occur in the value of the estate which would make it, in the judgment of the trustees, equitable that the amount so taken from income should be paid out to the annuitants, the said trustees may then apply to this court for direction, but until the condition as above described arises what action should be taken by the trustees in such case is a matter not ripe for the court's decision.

(6) That the general intent of the testator in said will can be gratified only by paying over to the Johns Hopkins Hospital at the death of each annuitant a proportion of the whole corpus of the trust estate equal to the proportion of income from said trust estate received by the said annuitant at the time of his or her death.

It is therefore, this 28th day of June, 1923, by the circuit court of Baltimore city, adjudged, ordered, and decreed:

First. That the standard or par on which 'depreciation' shall be calculated shall be the market value as of November 3, 1919.

Second. That such depreciation, however, shall not be calculated in reference to market value, unless, in the judgment of the said trustees, such difference in market value amounts to a real and permanent loss of corpus.

Third. That the calculation shall be made by the trustees at the end of each fiscal year.

Fourth. That all the net income received by the estate up to the date of the end of the last fiscal year shall be distributed to the annuitants, and all of said net income shall be so distributed at the end of every fiscal year hereafter, unless the trustees are satisfied that the corpus of the trust estate is really and permanently less in value than it was on November 3, 1919.

Fifth. At the death of each of the said annuitants, except Minnie E. Pennington, Annie W. Pennington, and Daisy Hughes, the said trustees shall

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