Carr v. Stradley, s. 77-6

• Decision Date: 28 December 1977
• Docket Number: Nos. 77-6,77-13,s. 77-6
• Parties: , 6 O.O.3d 469 CARR, Exr., v. STRADLEY, Trustee, et al., Appellees, Canning et al., Appellants. CARR, Exr., v. STRADLEY, Trustee, Appellant, The Columbus Foundation et al., Appellees.
• Court: Ohio Supreme Court

Page 220

52 Ohio St.2d 220

371 N.E.2d 540, 6 O.O.3d 469

CARR, Exr., v. STRADLEY, Trustee, et al., Appellees, Canning et al., Appellants.

CARR, Exr., v. STRADLEY, Trustee, Appellant, The Columbus Foundation et al., Appellees.

Nos. 77-6, 77-13.

Supreme Court of Ohio.

Dec. 28, 1977.

Syllabus by the Court

1. In the construction of a will, the sole purpose of the court should be to ascertain and carry out the intention of the testator. Such intention must be ascertained from the words contained in the will. (Paragraphs one and two of the syllabus in Townsend's Exrs. v. Townsend, 25 Ohio St. 477, approved and followed.)

2. A testator is never presumed to have died intestate as to any part of his estate to which his attention was seemingly directed, and a court will put such a construction upon equivocal words as to prevent such a result.

3. Where property is held in a testamentary trust, and the income produced therefrom is in excess of the sums which the trustee is instructed to disburse, such surplus income may be held in the trust and accumulated until it can be paid out at the termination of the trust in accordance with the directions of the testator.

Robert B. Hurst died on December 18, 1967, without having begotten any children. He was predeceased by his wife, Alta S. Hurst, and survived by three siblings, Thomas A. Hurst, Mae C. Canning and Hazel C. Carr.

On December 27, 1967, Hurst's last will and testament was admitted to probate by the Probate Court of Franklin County. David C. Stradley and The City National Bank & Trust Company of Columbus were subsequently appointed trustees of a testamentary trust created in Item IV of the will.

The language of Item IV has been the subject of a great deal of controversy, and reads as follows:

"I give, devise and bequeath all the rest, residue and remainder of the property I may own or have an interest in at the time of my death, real, personal or mixed, wherever situate, including legacies, if any, which may fail or lapse for any reason, to David C. Stradley of Columbus, Ohio, and The City National Bank & Trust Company of Columbus, Ohio, its successor and assigns IN TRUST, NEVERTHELESS, for the uses and purposes hereinafter set forth.

"Said trust shall be known as the 'Residuary Trust' and shall be held and administered as follows:

"(a) Beginning at my death, the trustees shall pay the sum of Four Hundred Dollars ($400.00) per month to each of the following: my brother, Thomas A. Hurst; my sister, Mae C. Canning; and my sister, Hazel C. Carr.

"Such payments shall continue to each of such individuals during their respective lifetimes, and if any of such individuals shall die leaving a minor child or children surviving, the monthly payments that the deceased parent would have received if living shall be paid to such minor child or children. When any such minor child reaches the age of twenty-one (21) years, payments to him or her shall cease and such monthly payments shall be divided between his or her remaining minor brothers or sisters, if any.

"At the death of my said sisters or brother, or upon the termination of the rights hereunder of any child or children of said sisters or brother, the trustees shall accumulate the income to which such beneficiary or beneficiaries were entitled and add the same to the principal of the trust and shall continue to so accumulate income and add the same to principal as each right to income is terminated by death or otherwise, and upon the termination of the last of such rights the trustees shall hold the entire principal and accumulated income and shall administer, manage, control, and invest and disburse the balance of the trust estate and net income therefrom for the sole benefit of and in accordance with the provisions of the Declaration of Trust of THE COLUMBUS FOUNDATION of Columbus, Ohio, and any amendments or additions thereto at anytime made.

"In the event said Foundation is no longer in existence at the time of my death, or in the event of the termination of the existence of said Foundation thereafter, the trustees shall hold and disburse the Residuary Trust as nearly as practicable in accordance with the terms of the most recent Declaration of Trust of said Foundation."

Hazel C. Carr died on August 1, 1972. ¹ Thereafter the executor of her estate, William W. Carr, instituted an action in the Probate Court of Franklin County, seeking a construction of Item IV of the Hurst will. In essence, he urged the Probate Court to hold that testator actually intended for the entire net income from the trust to be distributed, periodically, to the sibling beneficiaries, or their respective surviving minor children, since it was evident that the income from the residuary trust was substantially in excess of the sum required for the $400 monthly payments to testator's three siblings. ²

Three additional parties joined this action as party defendants. The Columbus Foundation, the sole remainderman named in Item IV, disagreed with the construction proposed by the executor. Therefore, by counterclaim and cross-claim, the foundation requested that the Probate Court construe the will to require distribution to it of all "excess income," described as that income in excess of the amount payable each month to the named beneficiaries. The Attorney General also joined in the action, and his position on the issues was, and continues to be, the same as that of The Columbus Foundation. The trustees filed a counterclaim and a cross-claim, requesting that the Probate Court construe the will as requiring accumulation of the excess income until such time as all the beneficiaries' rights to the $400 monthly payments terminate.

In an opinion filed on August 6, 1975, the Probate Court found that testator did not intend for the excess income to be paid to the life beneficiaries. The court also held that the excess income should be accumulated, with payment to The Columbus Foundation being delayed until the death of the last income beneficiary.

The executor, the surviving sibling beneficiaries, the remainderman and the trustees all filed notices of appeal from the judgment of the Probate Court. The Court of Appeals, by majority opinion rendered November 2, 1976, affirmed in part the judgment of the Probate Court, by rejecting the argument of the life beneficiaries that the Hurst will evidenced the intention that they receive all the income from the trust. A majority of the appellate court also reversed in part the judgment of the Probate Court, and ruled in favor of the charitable remainderman, offering the following rationale for so doing:

"We find that no useful purpose would be served in allowing the trustees herein to accumulate enormous excess income until the last of the rights of the annuitants had terminated. * * *

"In this case, we find nothing in his will which defines a definite intent on the part of the testator to accumulate large sums of money to sit needlessly idle when such could be currently applied to charitable programs." On April 8, 1977, motions to certify the record by the life beneficiaries (case No. 77-6) and by the trustees (case No. 77-13) ³ were allowed, pursuant to which the consolidated appeals are now before this court.

George, Greek, King, McMahon & McConnaughey, Edward F. Whipps and David C. Stradley, Columbus, for Stradley, Trustee, et al.

Power, Jones & Schneider and William H. Schneider, Columbus, for Canning et al.

Porter, Wright, Morris & Arthur, Samuel H. Porter and Allan E. Roth, Columbus, for The Columbus Foundation.

William J. Brown, Atty. Gen., and Lawrence D. Pratt, Asst. Atty. Gen., for appellee Attorney General in cases Nos. 77-6 and 77-13.

I.

CELEBREZZE, Justice.

Appellants Canning and Hurst, testator's surviving sibling beneficiaries, argue in case No. 77-6, that the language of Item IV expresses the testamentary intent for the entire income to be distributed to them, with the monthly payments of $400 each being minimum amounts only. In the alternative, they contend that there is no provision in the will relative to the disposition of the excess income, and such excess income should therefore pass to the siblings as intestate property.

In reviewing will construction cases this court has repeatedly observed the well-settled general rules set forth in Townsend's Exrs. v. Townsend (1874), 25 Ohio St. 477. Paragraphs one, two and four of the syllabus in Townsend provide as follows:

"1. In the construction of a will, the sole purpose of the court should be to ascertain and carry out the intention of the testator.

"2. Such intention must be ascertained from the words contained in the will."

"4. All the parts of the will must be construed together, and effect, if possible, given to every word contained in it."

It is undisputed that the testator was a highly successful businessman and accountant. In a preceding item of his will he demonstrated that he was capable of creating a gift of income payable in specific minimum monthly installments, with a lump sum payment of the remaining income to be disbursed on an annual basis. ⁴ Unlike the prior item alluded to above, Item IV is totally devoid of any indication that the $400 monthly payments are merely minimum amounts.

Had the testator intended for his sisters and brother to take the entire income from the trust he certainly would have said so, in precise terms. We discern no ambiguity in the actual language of the will in regard to the amount of interest to be paid monthly to the life beneficiaries. Thus, we will not thwart the evident intent of the testator so that the appellants be benefitted.

Appellants also contend, alternatively, that since there is no specific provision in Item IV for the disposition of the controverted excess income, such excess amounts should pass to them, the decedent's surviving siblings, under the laws of intestate succession.

This argument runs contrary to another investerate rule of will construction,...