Cooney v. Montana

• Decision Date: 11 February 1964
• Citation: 347 Mass. 29,196 N.E.2d 202
• Parties: Anna C. COONEY, guardian, v. Winifred MONTANA.
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

Page 202

196 N.E.2d 202

347 Mass. 29

Anna C. COONEY, guardian, v. Winifred MONTANA.

Supreme Judicial Court of Massachusetts, Worcester.

Argued Oct. 11, 1963.

Decided Feb. 11, 1964.

Harry Zarrow, Worcester (Marvin K. Rasnick, Worcester, with him) for petitioner.

William P. DeCarolis, Worcester, for respondent.

Before WILKINS, C. J., and SPALDING, WHITTEMORE, CUTTER, KIRK, SPIEGEL, and REARDON, JJ.

REARDON, Justice.

The petitioner seeks in this proceeding brought in the Probate Court to establish an oral trust of the proceeds of a policy of insurance written on the life of Eugene T. Sullivan, deceased. The probate judge in a report of material facts found that the policy was in the amount of $10,000 and contained a provision affording double indemnity in case of death by accident of the assured. The respondent, Winifred Montana, sister of Eugene T. Sullivan, was named as beneficiary. The judge concluded 'that the assured intended that the proceeds of the insurance policy were to be * * * Mrs. Montana's, free of trust, that he intended her to use her sole discretion and judgment in the spending of the proceeds * * * [and] that the only limitation in the proceeds would be a moral and not a legal one.' A decree was entered that the entire proceeds of the policy are the absolute property of the respondent. The guardian of the Sullivan and Vassar children appealed. ¹ The evidence is reported.

In addition, the judge made the following findings. In 1948, Sullivan married Cecilia Vassar, a widow with three children. There were two chilidren born of this marriage, Sharleen and Kathleen. Kathleen suffers from a congenital deformity, spina bifida, and has during her short life been subjected to seventeen surgical operations. She is hampered in walking and in other respects. Save for short visits to her family, she has been a resident patient at the Massachusetts Hospital School in Canton since 1954. Cecilia Sullivan died in 1954 and Sullivan Continued to maintain in Shrewsbury a normal, happy home for the five children. Sullivan was in business for himself. In late 1958, while on a business trip in a private chartered plane he was killed in a crash in Long Island Sound. The wreckage of the plane was discovered several weeks after the accident by divers and 'frog-men.' Some time later, the present petitioner, Mrs. Cooney, as maternal grandmother of the Sullivan and Vassar children, and Mrs. Montana, as aunt of Sharleen and Kathleen, filed separate petitions to be appointed the guardian of all five children. The judge found both petitioners suitable persons but appointed Mrs. Cooney because he 'felt that the welfare of the Sullivan children would be best served if Sharleen was to live in the same household with the Vassar children and if Kathleen could visit with them from time to time.'

Sullivan took out the life insurance policy in 1956 and named Mrs. Montana as his beneficiary. Some weeks later at her home he advised her of this fact. In answer to her question as to what he wanted her to do, he replied that she 'was to take care of Sharleen and Kathleen after their high school. That Social Security would take care of them until then. * * * [T]hat she was to use her discretion and judgment in reference to any school they might attend. * * * [T]hat she was to use her discretion and judgment in the spending of this money. * * * [H]e suggested that she spend $5,000.00 for Kathleen, $2,500.00 for Sharleen and after paying the funeral and other expenses that she spend the balance on Callista Vassar (his step-daughter). * * * [T]hat Callista might want to study to be a hairdresser, that * * * Mrs. Montana might pay her tuition. * * * [T]hat she use the same discretion and * * * judgment in supervising them as if they were her own. He stated that she spend $10,000.00. * * * He was particularly worried about his daughter Kathleen * * *. Her future was necessarily vague.'

The insurance company paid Mrs. Montana $18,972.77. She spent $300 for divers and 'frog-men,' over $300 for furniture and clothing for the Sullivan children, $3,000-$4,000, for her father's welfare, $500 for travel expenses of her brother George and herself in 'travelling to and from the Connecticut area' where Sullivan's body was found, and $442.75 toward tuition in a hairdressing school for Callista. She has expended, in one way or another, all money received by her in excess of $10,000, which latter sum in cash she has placed in a safe deposit box.

The judge also found that Sullivan trusted his sister who was '[t]he closest person to him,' and that he was an intelligent businessman who could have, had he wished, set up a trust in the policy itself. He died intestate leaving a gross estate valued at approximately $19,000 largely derived from a compromise of an action based upon his death.

Since the evidence is reported, it is our duty to decide the case in accordance with out 'own judgment, giving due weight to the findings of the judge, which will not be reversed on oral testimony unless plainly wrong.' MacLennan v. MacLennan, 316 Mass. 593, 595, 55 N.E.2d 928, 930. Malone v. Walsh, 315 Mass. 484, 53 N.E.2d 126. The determinative testimony is that of Mrs. Montana concerning the conversation with her brother which is not disputed. The present issue is not whether that testimony should be believed but how is should be interpreted. As in the MacLennan case we may draw inferences of fact and 'no weight is to be attached to inferences drawn by the trial judge.' In the light of these principles we consider whether in the circumstances a trust has been created. Russell v. Meyers, 316 Mass. 669, 672-673, 56 N.E.2d 604.

A review of the evidence illuminates certain aspects of the case not treated in the judge's report. Mrs. Montana, served with a subpoena duces tecum two days before the hearing, failed to bring with her records of payments made by her from the proceeds of the insurance policy. She testified that following receipt of the check from the insurance company she deposited it in a savaings account in a Cambridge bank and that after the guardianship hearing in November, 1959, she placed $10,000 in cash in a safe deposit box. Her testimony concerning her disposition of that money which she received in excess of $10,000 was not specific. She stated that in her conversation with her brother nothing was said about the double indemnity provision in the policy. She told of giving the welfare officer of the town of Shrewsbury a 'little over $200' for beds and furniture for the children. She estimated that she spent $3,000-$4,000 for her father, and she explained that she 'didn't keep track' of the money 'over the $10,000.' She stated that her brother had said nothing to her about the expenditure of any money for the father. She said she had not seen any of the three girls since the hearing on the guardianship three years before, although she had occasionally visited Kathleen prior to that hearing. She could not state the ages of any of the three girls. She further said that her attorney had the only key to the safe deposit box in a Boston bank containing the $10,000 in cash. Her brother asked her to 'see to it that Kathy would be taken care of.' Her father had died the year before this hearing in a nursing home where he had been for three years at State expense, and the amounts she spent on him were for extras.

In response to the question, 'Do you remember telling the Judge * * * [at the guardianship hearing] that your brother Eugene had told you and that you knew that this money was to be used for the children?' the respondent answered, 'Yes,' the only reservation in the respondent's answer relating to the time of its use. To the question, 'And you agreed to do what he asked you to do?' the reply came, 'That's right.' The respondent also testified to being in reasonably comfortable economic circumstances personally.

Callista Vassar testified that her stepfather had told her about the policy which with Mrs. Montana as the beneficiary 'was to take care of the children, if anything should happen to him.' She said that she had gone to a hairdressing school after her stepfather's death and was forced at one point to leave following a futile request to Mrs. Montana that her tuition be paid; that, two or three months later, Mrs. Montana did pay the tuition and she returned to the school. She stated that in a telephone conversation with Mrs. Montana relative to possible repair of a radio given to Kathleen by Mrs. Montana, the respondent said 'she didn't know nothing about the radio and she said she didn't want to hear any more about the children. The two girls, she didn't want nothin' more to do with them.' To a question from Callista, '[Y]ou don't even want to know them any more?' she replied, 'That's right.'

An aunt of the children, Geraldine Joubert, testified that her brother-in-law had told her that 'he had taken out quite a large policy * * * [that] he had an understanding with * * * [Mrs. Montana] and, if anything happened to him, she would take care of the kids with the money.'

The petitioner testified that she had been taking care of the children '[p]ractically since they were born'; and that Kathleen came home to her on holidays and vacations.

We must decide whether the conversation between Sullivan and his sister imposed an oral trust on the insurance proceeds. 'An express trust in personal property may be created and proved by parol.' Rugo v. Rugo, 325 Mass. 612, 617, 91 N.E.2d 826, 829. Russell v. Meyers, 316 Mass. 669, 672, 56 N.E.2d 604. No particular form of words is necessary but the words employed must unequivocally show an intention that the legal estate be vested in one person to be held in some manner or for some purpose on behalf of another. Atkins v. Atkins, 279 Mass. 1, 8, 180 N.E. 613. See Scott, Trusts (2d ed.) § 52; Bogert, Trusts and Trustees, § 65. The existence of a trust does not depend upon the terminology used...