Commercial Nat. Bank of Charlotte v. Alexander

• Decision Date: 03 December 1924
• Docket Number: 462.
• Citation: 125 S.E. 385,188 N.C. 667
• Parties: COMMERCIAL NAT. BANK OF CHARLOTTE v. ALEXANDER ET AL.
• Court: North Carolina Supreme Court

125 S.E. 385

188 N.C. 667

COMMERCIAL NAT. BANK OF CHARLOTTE v. ALEXANDER ET AL.

No. 462.

Supreme Court of North Carolina

December 3, 1924

Appeal from Superior Court, Micklenburg County; Shaw, Judge.

Suit by the Commercial National Bank of Charlotte, as executor and trustee, against Lillian F. Alexander and other infant defendants. From the judgment rendered, the infant defendants, by their guardian ad litem, appeal. Affirmed.

The petition alleged that the principal part of the estate consisted of shares of stock in certain corporation; that the remainder of the estate was not sufficient to pay indebtedness of estate; that such stock could not be sold except at a loss; that the assets of the estate invested in such stock would probably yield a much larger net income than if elsewhere invested, or otherwise employed; that dividends therefrom were sufficient to pay annuities and gradually extinguish indebtedness; and that it was for the best interests of the estate to hold such stock, and to renew indebtedness. The petition asked for advice as to right of trustee to renew indebtedness from time to time, to pledge assets of estate to secure indebtedness, and to enter into the contract with testator's widow described in the opinion.

W. S Alexander died, leaving a last will and testament, in which he appointed the Commercial National Bank of Charlotte as trustee and said bank and R. A. Dunn as executors of his estate. Dunn renounced his right to qualify. After the will was admitted to probate, the bank, as executor and trustee filed a petition in the superior court, for the purpose of asking the court's advice and instructions as to the proper administration of the trust estate and the approval of a contract made between the petitioner, the widow, and the chief residuary legatee.

The provisions of the will pertinent to the controversy are the following:

"Item I. I give, devise, and bequeath unto the Commercial National Bank of Charlotte, North Carolina (hereinafter called trustee), as trustee upon the trusts and for the uses and purposes hereinafter set forth and expressed, all of my property and estate of whatsoever kind and wheresoever situate, with full power and authority to sell convey, mortgage, exchange, control, manage, invest, reinvest, and deal with the same and every part thereof, and receive and collect the dividends, income, issues and profits thereunder, in as full and ample manner as I myself could do in my lifetime, for the use and benefit of my legatees and beneficiaries hereinafter named.

Item. II. It is my will and desire that said trustee shall renew, extend, and pay off all of my indebtedness, according to the best judgment and discretion of said trustee, dealing with the same in such manner as will best protect my estate and avoid the sacrifice of my property.

Item III. Out of the dividends, income and profits of my estate, I direct my said trustee to pay over to my beloved wife, Lillian F. Alexander, for and during the term of her life, an annual income of six thousand ($6,000) dollars, the same to be paid to her in monthly installments of five hundred ($500) dollars."

Items 4 and 5 provide for the payment of annuities to Minnie R. Alexander and Ernestine B. Alexander for the term of their natural lives, etc.

"Item VI. It is my will and desire that my trustee shall segregate from my property and estate and hold and keep separate and intact sufficient capital assets or corpus of my estate to provide for the payment of the incomes mentioned in items III, IV and V of this will.

Item IX. I authorize and direct my trustee, after providing for and paying annually the incomes mentioned in items III, IV, and V, to hold, invest, and reinvest, year by year, any surplus dividends, profits and income from my estate; upon the expiration of two years from my death, I direct my said trustees to turn over and deliver to my son, Walter L. Alexander, ten per cent. annually of the corpus of my estate, then in its hands over and above the portion thereof necessary to produce the incomes provided for in items III, IV and V. I also direct my trustee, upon the death of the respective beneficiaries under items III, IV, and V, to pay over to my said son, from time to time, the assets and corpus which may be added or restored to my general estate under item VIII.

Item XI. After the death of my said wife and my daughter and my son and his wife, I give, devise, and bequeath all of my property and estate, which shall then remain in the hands of my trustee, to my grand-children, Ernestine L. Alexander and Preston B. Alexander, and any after-born grand-children to be divided equally between them per capita, share and share alike; and if any of said grand-children shall die leaving no issue, the share of such grand-child shall go to the survivor or survivors, and if all of my grand-children shall die leaving no issue, then seventy-five per cent. of said property and estate referred to in this item shall go to the children of my brothers, John B. Alexander and W. C. Alexander, and their issue, per capita, share and share alike, and the remaining twenty-five per cent. shall go to Grandfather Orphanage at Banner Elk, North Carolina, to be held as a permanent fund for the education and maintenance of the inmates of the institution."

Soon after the probate of the will the testator's widow notified the petitioner that it was her purpose and intention to dissent from the will, and demand her year's allowance and distributive share in the estate, if her annuity was not increased from $6,000 to $16,000. It was thereupon agreed between the petitioner and Walter L. Alexander, the principal residuary legatee, that it would be to the best interest of said legatee and the infant contingent remaindermen that the argument be made, and that the annuity be raised to $16,000 in consideration of her renouncing her right to dissent, provided, the agreement should not be binding unless ratified and confirmed a decree of court. The petitioner requested the court to confirm this agreement, and to give the petitioner instructions in reference to other important questions which had arisen, concerning which the petition was in doubt. All the material allegations of the petition were admitted.

At the hearing Judge Shaw made a full investigation and rendered judgment, finding that all the material allegations of the complaint were true, and that it would best subserve the interest of the widow and the contingent remaindermen to carry the contract into effect. The contract was confirmed and ...