Cram's Will, Matter of
| Decision Date | 08 February 1980 |
| Docket Number | No. 14670,14670 |
| Citation | 186 Mont. 37,606 P.2d 145 |
| Parties | In the Matter of the Trust Created Under the WILL of Royalston Heywood CRAM, a/k/a Royalston H. Cram, and as R. H. Cram, Deceased. |
| Court | Montana Supreme Court |
Bottomly & Gabriel, R. V. Bottomly (argued), Great Falls, Frederick Sherwood, Helena, for appellant.
Church, Harris, Johnson & Williams, Great Falls, R. Keith Strong (argued), Great Falls, Cannon & Gillespie, Helena, for respondent.
Mike Greely, Atty. Gen., Sheri K. Sprigg, Asst. Atty. Gen., Helena, for amicus curiae.
Appellant Donna Bottomly appeals from a memorandum decision and order of the Cascade County District Court denying her petition in which she claimed to be a beneficiary under the trust of Royalston Heywood Cram; and granting Northwestern Union Trust Company's petition for instructions which resulted in a modification of the trust instrument.
Royalston Heywood Cram was a sheep rancher and resident of Cascade County. On March 30, 1948, he executed his Last Will and Testament. He died on January 13, 1954. His Will was admitted to probate on February 17, 1954. The parties do not dispute the validity of Cram's 1948 Will.
Cram's Will provided for a trust with the Union Bank and Trust of Helena, Montana, named as trustee. On March 9, 1955, the Northwestern Union Trust Company of Helena, Montana, successor to the named trustee in the Will, received the estate as trustee pursuant to the terms of the Will. The trustee has ever since that time administered the trust in accordance with the terms of the instrument.
The trust was created for the benefit of members of the Future Farmers of America of Montana and the 4-H Club of Montana. The purpose of the Cram trust, as recited in the instrument, is:
". . . to encourage and assist youths of the state interested in the woolgrowing and sheep raising industry of the state, and it is expected the leaders or heads of the two organizations will supervise and assist the various certified youths of their respective organizations, qualified to and receiving benefits, in the purchase of sheep to the best advantage to the end that these youths may get started in the sheep and wool raising industry. . . ."
The trust instrument contains detailed instructions relating to those youths who qualify as eligible recipients of the trust funds, which creates the problem in the instant case. Those instructions are as follows:
The instrument provides that on or about September 15 of each year, after $100 has accumulated, the trustee shall determine and notify the state leaders of FFA and 4-H of the number of $100 stipends available to members of those organizations. The FFA and 4-H Club leaders are employees of the State of Montana, and they perform their duties as leaders as a part of their official duties with the University system and the Office of Superintendent of Public Instruction.
The instrument then provides for the certification of names of members of the two organizations who are eligible to receive the stipends. That provision, which prompted the involvement in this proceeding of the Office of Public Instruction and the Montana Human Rights Division, is as follows:
"Whereupon, such head or leader of the respective organizations shall certify to the Trustee the names of youths having the qualifications mentioned above, eligible to receive benefits hereunder, and, if the Trustee and its officers are satisfied, the Trustee will, thereupon, issue a check, drawn upon Heywood Foundation fund, payable to the head or leader of the Future Farmers of America in Montana and one of the members of this organization so certified for, in the sum of $100.00 for the purchase of sheep, and then issue a check to the head or leader of the State 4-H Club of Montana and one of the members of this organization so certified for the purchase of sheep. . . ."
In the fall of 1977, appellant Donna Bottomly, a member in good standing of FFA, applied for a Cram trust stipend. When the FFA refused to provide any further lists, the trustee petitioned the District Court for instructions. Donna Bottomly, the Montana Human Rights Commission and the Superintendent of Public Instruction all appeared and requested the District Court to reform the trust in order to eliminate the discriminatory provisions.
On October 24, 1978, the District Court entered a memorandum decision and order. The Court found that the discrimination involved in the Cram trust was clear, and that it was not the FFA or the 4-H Club or their respective state leaders who had created the discriminatory guidelines concerning the eligibility of prospective trust beneficiaries. The District Court found that Cram had established the discriminatory guidelines, and that he had clearly intended to do so. The District Court further found that the only involvement of the FFA and 4-H Club was that Cram had selected a limited group of favored members of those organizations to receive trust property.
The District Court modified the Cram Will by: (1) removing the provision that the state leaders of the FFA and the 4-H Club be notified of the number of $100 stipends to be made; (2) removing the provision requiring the state leaders to certify a list of names of eligible recipients to the trustee; and (3) removing the provision requiring the trustee to make the state leader a co-payee of the trust checks issued. The District Court instructed the trustee to continue its administration of the Cram trust, as modified. The District Court further instructed the trustee to seek the assistance of other persons from which to obtain the necessary list of names of eligible recipients under the trust, and to make them co-payees on trust checks issued if the state leaders of the FFA and 4-H Club refused to furnish a list of names of eligible recipients.
The District Court denied appellant's petition, and granted Northwestern Union Trust Company's petition for instructions. Appellant Bottomly now appeals; the Montana Human Rights Commission and the Superintendent of Public Instruction have not appealed.
Appellant Bottomly raises three issues on appeal:
(1) Is the Cram Will, as modified by the District Court, discriminatory?
(2) Can the modified Cram trust be enforced in its present form?
(3) Can the Cram Will be reformed so as to be enforceable?
The first issue is whether the Cram Will, as modified by the District Court, is discriminatory. The parties agree that the modified Cram Will is discriminatory; however, the trustee contends that the discrimination is not unlawful, but permissible. We hold that the trust provision of the Cram Will as modified by the District Court is discriminatory. The language contained in the instrument clearly excludes female members of FFA or 4-H from becoming eligible recipients under the Cram trust.
The second issue is whether the modified Cram trust can be enforced in its present form. The District Court modified the original instrument, and the parties agree that the District Court possesses the power to apply deviation and cy pres principles in order to modify a Will. These powers were recognized, though not applied in the case of In re Swayze's Estate (1948), 120 Mont. 546, 551, 191 P.2d 322, 325. Accordingly, this Court's scope of review is limited to an examination of the Cram trust as modified by the District Court.
The precise issue, as we perceive it, is whether "state action" is involved in the terms and operation of the modified Cram trust rendering it unlawful as a denial of equal...
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