Day v. Grossman, A--39

• Decision Date: 25 February 1957
• Docket Number: No. A--39,A--39
• Parties: Hazel S. DAY, Plaintiff-Appellant, v. Bernard A. GROSSMAN, Executor and Trustee under the Last Will and Testament of Alexander S. Wilson, deceased, Defendant-Respondent.
• Court: New Jersey Superior Court — Appellate Division

Page 28

44 N.J.Super. 28

129 A.2d 577

Hazel S. DAY, Plaintiff-Appellant, v. Bernard A. GROSSMAN, Executor and Trustee under the Last Will and Testament of Alexander S. Wilson deceased, Defendant-Respondent.

No. A--39.

Superior Court of New Jersey Appellate Division.

Argued Feb. 11, 1957.

Decided Feb. 25, 1957.

Archie Elkins, Jersey City, argued the cause for appellant.

John B. O'Neill, Jersey City, argued the cause for respondent (Milton, McNulty & Augelli, Jersey City, attorneys; Charles J. Milton, Jersey City, of counsel).

Before Judges CLAPP, JAYNE and FRANCIS.

The opinion of the court was delivered by

JAYNE, J.A.D.

One Alexander S. Wilson, a resident of the City of Bayonne, died testate on December 27, 1954. His last will and testament, dated January 21, 1953, was duly admitted to probate on January 7, 1955, and the defendant conformably with the nomination in the will qualified as the executor and trustee of the decedent's estate.

Of present relevancy is article 'Fifth' of the will which reads:

'Fifth' As to the trust fund herein, created and to be created from the proceeds of my stock holdings in and ownership of the business of A. S. Wilson, Inc., as set forth above, and created further from the funds on deposit to my personal account, in banks, I do give, devise, bequeath and apportion same as follows, viz.:

'a. To Hazel S. Day, for life, the sum of $2,500. (twenty five hundred dollars) per year, in quarterly, semiannual or annual payments as the trustee may find best suited for the welfare of the said beneficiary. And as long as the said beneficiary remains single, and accordingly in need of maintenance and support, and if in that period, in the discretion of the trustee it becomes necessary to invade the principal of the trust estate for the benefit and welfare of the said beneficiary, the trustee may and he hereby is given power and discretion to do so, to the extent he deems necessary.

'b. Upon the death of said Hazel S. Day, the balance of said trust fund, if there be any balance left, to then be held by the trustee for the account of the said William Wilson, Jr. and Robert Wilson, my grandchildren, share and share alike, and to be paid to them by the trustee, upon their reaching twenty-one (21) years of age. The corpus of this remainder, if any, may be held in the discretion of the trustee as a common fund, or in equal, separated funds, for the account of each infant.'

The annuitant, Hazel S. Day, has remained unmarried and has persistently requested the defendant in the exercise of his fiduciary discretion to increase the amount of the annuity for her benefit and welfare in pursuance of the power and authority conferred upon him by the terms of the testator's will. The defendant has declined to grant her requests.

The annuitant, evidently conceiving the refusals of the defendant to be arbitrary and unreasonable in the existing conditions, sought relief in the Chancery Division, Her complaint charged that the defendant 'has abused his discretion in refusing to make a larger payment to plaintiff for her maintenance and support' and prayed for an order directing the defendant in his fiduciary capacity to pay to plaintiff the annual sum of $5,000 or such increased sum above $2,500 'as the court feels plaintiff is justly entitled to for her proper maintenance and support.'

In response to the defendant's motion, the judge of the Chancery Division dismissed the complaint, disclosing in his order two specific reasons: the one, that the complaint failed to state a cause of action for which relief could be granted; and the other, that the remaindermen of the trust were not made parties to the action.

We immediately acquiesce in the conclusion of the Chancery Division judge that in an action of this object and nature implicating a reduction in the Corpus of the trust, the remaindermen, one of whom is an infant, are necessary and indispensable parties in interest. A determination of the action in favor of the plaintiff would likely affect their interests in the trust estate. The principle is exemplified in the following decisions: Read v. Patterson, 44 N.J.Eq. 211, 14 A. 490 (E. & A.1888); Pfefferle v. Herr, 65 N.J.Eq. 325, 55 A. 1103 (Ch.1903); In re Ungaro's Will, 88 N.J.Eq. 25, 102 A. 244 (Ch.1917); In re Kiger's Estate, 98 N.J.Eq. 512, 514, 131 A. 95 (Ch.1925); Woulfe v. Atlantic City Steel Pier Co., 129 N.J.Eq. 510, 516, 20 A.2d 45 (Ch.1941). Cf. Ajax Electrothermic Corp. v. First Nat. Bank of Princeton, 7 N.J. 82, 90, 80 A.2d 559 (1951).

The omission to join the remaindermen of the trust as parties to this action was improper. However, it has been the traditional practice in a court of equity to retain a bill (now complaint) pending the addition of new parties. Plumley v. Plumley, 8 N.J.Eq. 511 (Ch.1851); Broad Street National Bank v. Holden, 109 N.J.Eq. 253, 156 A. 827 (Ch.1931); Spitz v. Dimond, 131 N.J.Eq. 186, 188, 24 A.2d 188 (E. & A. 1942).

We proceed to the consideration of the other reason for which the complaint was dismissed. Preliminarily, it is observed that defendant's notice of motion definitely specified as its grounds in addition to the improper omission of necessary parties also that the court lacked jurisdiction of the subject matter and that the complaint failed to state a claim upon which equitable relief could be granted. The motion was manifestly addressed to the court pursuant to R.R. 4:12--2, and its functional scope was that of the former demurrer at common law, accompanied for immediate purposes by the acknowledgment that the factual allegations of the complaint are to be accepted as true. Kurtz v. Oremland, 24 N.J.Super. 235, 240, 93 A.2d 792 (Ch.Div. 1952); Orrok v. Parmigiani, 32 N.J.Super. 70, 107 A.2d 815 (App.Div.1954).

We are aware that in this instance the affidavit of the defendant and a copy of the testator's will were attached to the notice of the motion and a counter-affidavit of the plaintiff was presented to the court a the hearing of the motion. See, R.R. 4:12--3; Toth v. Vazquez, 3 N.J.Super. 379, 65 A.2d 778 (Ch.Div.1949); Horelick v. Pennsylvania R. Co., 13 N.J. 349, 351, 99 A.2d 652, 41 A.L.R.2d 1278 (1953). However, in the consideration of a motion under R.R. 4:12--2, the judge may in his discretion exclude accessory affidavits. Horelick v. Pennsylvania R. Co., supra.

Some discussion of the stated grounds of the motion is apt. First, that the Chancery Division lacked jurisdiction of the subject matter. Not so. Within the original inherent jurisdiction of Chancery abides its administrative and supervisory jurisdiction over the management and preservation of trusts. While its powers in that field of our jurisprudence are not illimitable, yet the frequently expressed notion that Chancery may not authorize and direct trustees to pursue a course or perform acts which they are not expressly authorized to do or, indeed, permitted to do under the terms of the trust is fallacious. Consult, 2 Scott, Trusts, § 167 et seq.; 3 Bogert on Trusts, § 562 et seq.; 2 Perry, Trusts (7th ed.), § 764; 1 Restatement, Trusts, § 167; Lambertville National Bank v. Bumster, 141 N.J.Eq. 396, 57 A.2d 525 (Ch.1948); Burlington County Trust Co. v. Kingsland, 18 N.J.Super. 223, 86 A.2d 815 (Ch.Div.1952).

Then, too, equity has for centuries entertained complaints alleging arbitrary, capricious, and unreasonable conduct of fiduciaries in the administration of trusts. Its jurisdiction to hear and determine such complaints and afford a remedy where justified is likewise inherent.

The invocation of the supervisory and remedial jurisdiction of Chancery by a testamentary life annuitant who desires to inaugurate a judicial inquiry concerning the good faith of the trustee in the exercise of his discretionary authority to determine the adequacy of a maintenance annuity in ensuing eventualities is not neoteric. One needs only to achieve an acquaintance with the alleged causes of action in such cases as Holcomb v. Executors of Holcomb, 11 N.J.Eq. 476, 485 (Ch.1858); Read v. Patterson, 47 N.J.Eq. 595, 22 A. 1076 (E. & A. 1890); Crocheron v. Savage, 75 N.J.Eq. 589, 73 A. 33, 23 L.R.A.,N.S., 679 (E. & A. 1909); O'Gorman v. Crowley, 81 N.J.Eq. 520, 86 A. 442 (E. & A. 1913); Turnure v. Turnure, 89 N.J.Eq. 197, 104 A. 293 (E. & A. 1918); Strong v. Dann, 90 N.J.Eq. 329, 108 A. 86 (Ch.1919); Swetland v. Swetland, 100 N.J.Eq 196, 134 A. 822 (Ch.1926), affirmed 102 N.J.Eq. 294, 140 A. 279 (E. & A. 1928); Titsworth v. Titsworth, 107 N.J.Eq. 436, 443, 152 A. 869 (Ch.1931); Tansey v. New Brunswick Trust Co., 124 N.J.Eq. 558, 3 A.2d 575 (Ch.1938); Camden Safe Deposit & Trust Co. v. Read, 124 N.J.Eq. 599, 4 A.2d 10 (Ch.1939); Commonwealth-Merchants Trust Co. v. Seglie, 127 N.J.Eq. 160, 12 A.2d 153 (Ch.1940); Conlin v. Murdock, 137 N.J.Eq. 12, 43 A.2d 218 (Ch.1945). Particularly informative are Scott on Trusts (2d ed.), § 187 and § 575 et seq., and 6 N.J.Practice (Clapp, Wills and Administration), § 575; ...