Citizens & Southern Nat. Bank v. Howell

• Decision Date: 26 March 1938
• Docket Number: 12054.
• Citation: 196 S.E. 741,186 Ga. 47
• Parties: CITIZENS & SOUTHERN NAT. BANK v. HOWELL.
• Court: Georgia Supreme Court

196 S.E. 741

186 Ga. 47

CITIZENS & SOUTHERN NAT. BANK v. HOWELL.

No. 12054.

Supreme Court of Georgia

March 26, 1938

Rehearing Denied April 1, 1938.

Error from Superior Court, Chatham County; John Rourke, Jr., Judge.

Suit to set aside trust deeds by Hugh Comer Howell against the Citizens & Southern National Bank. To review a judgment overruling demurrer to the petition, defendant brings error.

Reversed.

HAWKINS Superior Judge, and RUSSELL, C.J., dissenting.

On Rehearing.

Syllabus by the Court.

A deed which seeks, first, to carve out of the grantor's property an estate for his own life, and create a trust therein for and in his behalf, he being sui juris, and second, to create a trust after his death for the benefit of the wife and child or children of the grantor, should he thereafter marry and leave a wife, child, or children, and in the absence of a wife or child, then in further trust for his right heirs as they may be at the time of his death cannot be successfully attacked by the grantor on the ground first, that it is void as against public policy, and, second, because of remoteness. The judge erred in overruling a general demurrer to the petition brought by the grantor against the trustee.

On May 15, 1937, Hugh Comer Howell brought his petition against the Citizens & Southern National Bank, seeking to have set aside two alleged trust deeds made by him to the bank, copies of which deeds are attached to the petition, and are as follows:

'Georgia, Fulton County. This indenture, made this 30th day of April, 1926, between Hugh Comer Howell, of Atlanta Georgia, party of the first part, and the Citizens & Southern Bank, a banking corporation of Savannah, Georgia, party of the second part, witnesseth:

'Whereas the said party of the first part, doing business as Comer Howell and Company, is indebted on the various transactions set forth on the nine typewritten pages headed 'Liquidated Balance Sheet of Comer Howell and Company, as of April 19, 1926, after giving effect of closing accounts,' and hereunto annexed and made a part of this indenture; and whereas the indebtedness of the said party of the first part aggregates the sum of one hundred sixty-seven thousand ($167,000.00) dollars, and the said banking corporation has agreed to advance sufficient money to pay off this indebtedness in consideration of this indenture, covering the conveyance and trans_____ therein:

'Now therefore the said party of the first part, in order to secure the said banking corporation as to any advances that it may make for the party of the first part, or on his account in order to pay off his indebtedness, or for costs and expenses, with interest on such advances, at the rate of six per cent. (6%) per annum, and in consideration of the said banking corporation making the said advances and the sum of one ($1.00) dollar, has transaferred, assigned, and set over and by these presents does transfer, assign and set over unto the said banking corporation and its successors, all of the assets mentioned or referred to in the annexed nine sheets, with full power and authority in the said banking corporation to dispose of the said assets, without obtaining any order of any court, on such terms and at such times as to the said banking corporation may seem proper and to settle up his indebtedness, the said Hugh Comer Howell giving to the said banking corporation as full and complete power and authority in the premises as he could personally have with reference to his affairs and the said assets and the said indebtedness.

'As further security and in consideration of the premises, the said Hugh Comer Howell has also transferred, assigned, and set over and by these presents does transfer, assign, and set over unto said banking corporation his life-insurance policy in the Mutual Benefit Life Insurance Company, in the sum of forty thousand ($40,000.00) dollars, and also the remainder interest which the said Hugh Comer Howell has in the estate of his grandfather, Hugh M. Comer, under the will of the said Hugh M. Comer, which will has been probated in the court of ordinary of Chatham County, Georgia, the life-tenant of the estate in which the said Hugh Comer Howell has a remainder interest being the widow of his said grand-father, and the said interest accruing upon her death. The said banking corporation shall have the same power and authority to dispose of said policy of life insurance and said remainder interest that is hereinbefore granted to it in regard to the assets described hereinbefore. To have and to hold the said assets and property and the said interest unto the said banking corporation, its successors and assigns, forever.

'Touching the said remainder interest, after the reimbursement of the said banking corporation and the payment in full of any indebtedness due to it by the said Hugh Comer Howell under these premises, for the purpose of making a trust, as herein mentioned, and the sum of one ($1.00) dollar, the said Hugh Comer Howell has conveyed, transferred, and assigned, and by these presents does convey, transfer, and assign unto the said banking corporation, as trustee, his said remainder interest in the estate of his said grandfather; so that should the same accrue, the said banking corporation may hold the same, but in trust for the said Hugh Comer Howell for and during his lifetime, paying to him the income therefrom and from and after his death, then in further trust for the wife and child or children of the said Hugh Comer Howell, should he thereafter marry and leave a wife, child, or children; and in the absence of a wife or child, then in further trust for the right heirs of the said Hugh Comer Howell as they may be at the time of his death. To have and to hold the said remainder interest, as trustee, and under the terms of this trust, unto the said banking corporation, its successors and assigns, forever.

'In the administration of said trust the said trustee shall have as full power in its management as the said Hugh Comer Howell would personally have with reference thereto, and in particular shall have the right to sell the whole or any part thereof, at any time that to it in its discretion seems best, at public or private sale, on terms or for cash, without the order or permission of any court whatsoever. The trustee may invest the proceeds of any such sale in any securities that to it in its discretion may seem proper, not being limited to the securities prescribed by law for trust estates. The trustee shall be entitled to receive reasonable compensation for its services in the administration of said trust, together with all reasonable and necessary expenses, charges, counsel fees, and other disbursements incurred under such administration, all of which shall be paid out of the said trust estate, and a charge therefor is hereby created against said trust estate.

'In witness whereof the said Hugh Comer Howell, the party of the first part, has hereunto set his hand and seal the day and year first above written.

'[Signed] Hugh Comer Howell [L. S.]

'Signed, sealed and delivered in the presence of us:

'[Signed] E. C. Long.

'[Signed] C. A. Drew. Notary Public, State at Large, Atlanta, Ga.'

'State of Georgia, County of Fulton.

'This indenture made this 12th day of November, 1926, between Hugh Comer Howell, of Atlanta, Georgia, party of the first part, and the Citizens and Southern Bank, a banking corporation of Savannah, Georgia, party of the second part, witnesseth:

'Whereas the said Hugh Comer Howell, on the 30th day of April, 1926, executed and delivered to the said banking corporation his certain indenture, whereby he conveyed to the said banking corporation all of the assets mentioned or referred to in the nine sheets annexed to the said indenture of April 30, 1926, his life-insurance policy in the Mutual Benefit Life Insurance Company, and his remainder interest in the estate of his grandfather for the purposes mentioned in the said indenture, and in trust to the said banking corporation for these purposes, with the powers and rights in the trustee mentioned in the said indenture, as will more fully appear by reference to the said indenture of April 30, 1926; and whereas the obligations of the said Hugh Comer Howell doing business as Comer Howell Company, set forth on the nine typewritten pages headed 'Liquidated Balance Sheet of Comer Howell and Company' attached to the said indenture, have been paid by the said banking corporation and the advances by the said banking corporation have been liquidated, and further there is a balance of cash on hand, after the payment of the said debts and the reimbursement of the said banking corporation, to the credit of the said Hugh Comer Howell; and whereas it was intended to include in the trust all of the said assets after the settlement of the affairs of Comer Howell and Company, and the purpose of this indenture is to cover these assets:

'Now, therefore, the said Hugh Comer Howell, in consideration of the premises and of the sum of one ($1.00) dollar, has conveyed, granted, assigned, and set over and by these presents does convey, grant, assign, and set over unto the said banking corporation, its successors and assigns, all of the said assets, including the cash on hand, accounts, stock in the 'Atlanta Constitution' in the name of the said Hugh Comer Howell, and all other personal property, accounts and assets mentioned in the said indenture made April 30, 1926, or intended to be covered thereby, whether herein particularly mentioned or not, in trust and upon the same terms and trusts as are mentioned in the said indenture touching the said remainder interest, that is to say, in trust for the said Hugh Comer Howell for and during his lifetime, paying to him the income

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