Central Carolina Bank & Trust Co. v. Bass, 768

• Decision Date: 27 August 1965
• Docket Number: No. 768,768
• Citation: 265 N.C. 218,143 S.E.2d 689
• Court: North Carolina Supreme Court
• Parties: CENTRAL CAROLINA BANK & TRUST COMPANY, Trustee of the 'Thomas L. Shepherd Fund' under the Last Will and Testament of W. T. Shepherd, Deceased, Petitioner, v. Elizabeth O'Kelly BASS et al., Respondents.

Page 689

143 S.E.2d 689

265 N.C. 218

CENTRAL CAROLINA BANK & TRUST COMPANY, Trustee of the 'Thomas L. Shepherd Fund' under the Last Will and Testament of W. T. Shepherd, Deceased, Petitioner, v. Elizabeth O'Kelly BASS et al., Respondents.

No. 768.

Supreme Court of North Carolina.

Aug. 27, 1965.

Hofler, Mount & White, William O. King, Durham, for Elizabeth O'Kelly Bass, Gaynelle O'Kelly Bunting, Naomi S. Tillett and Cornelia S. Shepherd, executrix of the estate of John H. Shepherd, Jr., respondents, appellants.

Haywood, Denny & Miller, Durham, for Sallie Beavers, Ella Mae Beavers Belvin, Theodore Campbell, Thelma C. Hall, and H. Raymond, Weeks, Jr., executor of the estate of Elsie Beavers Weeks, respondents, appellants.

Nye, Winders & Mitchell, Durham, for Annie Moore Shepherd Dennis, respondent, appellant.

Nick Galifianakis and Roger S. Upchurch, Durham, for Arthur Earl Lucas, individually and as executor of the estate of Thomas L. Shepherd, respondent, appellant.

SHARP, Justice.

The disposition of the remainder of the Thomas L. Shepherd Fund after the death of the life beneficiary depends upon the answer to three questions: (1) When testator directed the trustee to distribute the remainder as then constituted 'to my next of kin,' did he mean his nearest of kin or those who would take from him under the statute of distributions? (1) Did testator intend to include Annie Moore Shepherd Dennis, whom he described in his will as 'my granddaughter,' in the class he designated as 'my next of kin'? (3) Are 'my next of kin' to be ascertained at the death of testator or at the death of Thomas L. Shepherd, the life beneficiary?

First. The answer to the first question must be found in a canon of construction. It is the rule in this jurisdiction, as well as in England and a substantial number of the other American jurisdictions, that the words next of kin 'mean 'nearest of kin,' and that in the construction of deeds and wills, unless there are terms in the instrument showing a contrary intent, the words 'next of kin' without more do not recognize or permit the principle of representation.' Wallace v. Wallace, 181 N.C. 158, 163, 106 S.E. 501, 504; accord, Williams v. Johnson, 228 N.C. 732, 47 S.E.2d 24; Williamson v. Cox, 218 N.C. 177, 10 S.E.2d 662; Knox v. Knox, 208 N.C. 141, 179 S.E. 610; Redmond v. Burroughs, 63 N.C. 242, 245; Jones v. Oliver, 38 N.C. 369; Annot., Term 'next of kin' used in will, as referring to those who would take in cases of intestacy under distribution statutes, or to nearest blood relatives of designated person or persons, 32 A.L.R.2d 296, 303; 57 Am.Jur., Wills § 1375 (1948). This rule of construction, like many another of our rules, both of construction and of property, 'is grown reverend by age, and is not now to be broken in upon.' Kenyon, M. R., in Jee v. Audley, 1 Cox 324, 325, 29 Eng.Rep. 1186, 1187 (Ch. 1787).

We perceive nothing in the will of W. T. Shepherd which suggests that he used the words my next of kin in any but the usual acceptation of that phrase. We hold, therefore, that they mean his nearest of kin and not his heirs or distributees generally.

Second. The second question, whether testator intended to include Annie Moore Shepherd (Dennis) in the class of his next of kin, is not answered by the 1942 judgment in Case No. 8097. That judgment established that she was not a relative of testator but that he had given her 2/5 of his residuary estate as a beloved individual and not merely as his supposed granddaughter. See Howell v. Troutman, 53 N.C. 304; Annot., Fraud or mistake as to relationship or status of legatee or devisee as affecting will, 17 A.L.R. 247. Thus, once again, we face the ever-recurring problem of determining a testator's intent from a consideration of the will itself and the circumstances confronting him. To ascertain such intent, 'we must consider the instrument as a whole and give effect to such intent unless it is contrary to some rule of law or at variance with public policy.' Wachovia Bank & Trust Co. v. Taliaferro, 246 N.C. 121, 127, 97 S.E.2d 776, 780.

It has been held that certain named persons described by a testator in his will as 'my cousins' took under the residuary clause directing distribution among 'my relatives hereinbefore named,' even though those persons were not legally his cousins. Seale-Hayne v. Jodrell, [1891] A.C. 304, affirming In re Jodrell, 44 Ch.D. 590 (1890). With reference to a somewhat similar situation in In re Wood, [1902] 2 Ch. 542, 546, Vaughan Williams, L. J., said, '(T)his is one of those cases in which the testator has created a dictionary for himself, and * * * we must read his will in the light of that dictionary.' See 2 Jarman, Wills 1611 (1910 Ed.); 1 Wiggins, North Carolina Wills and Administration of Estates § 134 (1st Ed. 1964).

It seems that those who framed the issues in Case No. 8097 assumed that W. T. Shepherd died in the belief that Annie Moore Shepherd was his grandchild. And here it is argued, on the one hand, that his frequent reference to her in the will as 'my granddaughter' is proof positive that testator died in the belief that Annie Moore Shepherd was his grandchild. On the other, it is contended that his will discloses to the discerning that he knew she was not his grandchild and that it reveals a skillful and subtle attempt to protect her status, to provide for her to the extent of 2/5 of his estate, and to insure that the balance after his son's death should go only to his blood kin. He could, of course, have accomplished this purpose in a more direct manner by saying, 'to my next of kin, excluding my granddaughter, Annie Moore Shepherd, and her issue, for whom I have heretofore made adequate provision.' Be that as it may, the question remains, did he intend to include her when he used the phrase 'my next of kin'? Judge Mallard held that testator intended to include in that classification neither her nor his only son. With his construction we agree.

At the time of testator's death, and for more than ten years before his son had been addicted to drink. Testator, not considering his son competent to manage his business affairs, created the Thomas L. Shepherd Trust. Although he empowered the trustee 'in its sole, absolute, and unfettered discretion' to pay to his son such portions of the principal as it might 'from time to time deem proper,' testator positively prohibited any such payment from the principal sooner than 5 years after his death. The wisdom of this precaution appears from information disclosed by the pleadings in Case No. 8097. In the 3-year period between the death of his mother and that of his father, Thomas L. Shepherd was in four different institutions for treatment for alcoholism. At the time suit No. 8097 was instituted, he had been committed by court order to an institution. Testator specifically stated that it was not his intent that the trustee allot him amounts which it believed, or might 'by experience find, likely to discourage a sober, upright and useful life.' That he did not trust his son to abide by his testamentary wishes is shown by the provision of the will which would forever revoke the power of the trustee to pay him any part of the corpus of his trust fund if the son or any one claiming through him should file a suit 'disputing' Article Fifth of the will or 'the result of the exercise of the trustee of its discretion' thereunder.

At the time testator made his will in 1937, Annie Moore Shepherd was approximately 12 years old. The corpus of her trust fund, which would be hers absolutely if she lived to age 25, was 2/5 of his entire estate, which, according to the inventory filed July 1, 1939, would then have been in excess of $70,000.00. If she died before, leaving no child or children, testator's direction was that the principal of the 'Annie Moore Shepherd Fund shall pass to my next of kin.' In such event, had Thomas L. Shepherd still been alive, he would have been not only testator's nearest of kin but the only representative of that class and thus, nothing else appearing, entitled to the entire corpus of the Annie Moore Shepherd Fund. Testator having made his son's access to any of the principal of his own trust fund dependent upon the trustee's discretion and having stated his desire that his son have no funds which would discourage a sober life, we entertain no notion that he intended ever to create the possibility that his son acquire such a sum of money in his own right to dissipate, all at one time, as he saw fit. Had testator intended his son to have the income from the corpus of the Annie Moore Shepherd Fund in the event she died before age 25, he would, we think, have added it to the son's own trust fund. Had he intended to give it to him outright, he would undoubtedly have said, 'in such event, the principal of this fund shall pass to my son if he then be living.' To give an individual the residuum of a trust by referring to him as 'my next of kin' instead of by name would indeed by clumsy draftsmanship.

If, when he gave the remainder of the Annie Moore Shepherd Fund to his next of kin in the event of her death before age 25 without children, testator meant to exclude his son, and if, as he did with reference to the remainder of the Thomas L. Shepherd Fund, testator subsequently used the same phrase, may we not assume that he used it with similar meaning, i. e., to exclude his supposed granddaughter? As Denny, J. (now C. J.), said in Wachovia Bank & Trust Co. v. Green, 239 N.C. 612, 619, 80 S.E.2d 771, 776:

'It is a well settled rule of testamentary construction that 'if it is apparent that in one use of word or phrase a particular significance is attached thereto by the testator, the same meaning will be presumed to be intended in all other instances of the use by him of the same word or phrase.' Carroll v. Herring, 180 N.C. 369, 104 S.E. 892, 894; Taylor v. Taylor, 174 N.C. 537, 94 S.E. 7; Grandy v. Sawyer, 62 N.C. 8; Lockhart v....