Finlayson v. CABARRUS BANK & TRUST COMPANY
| Decision Date | 04 March 1960 |
| Docket Number | No. C-109-G-58.,C-109-G-58. |
| Citation | 181 F. Supp. 838 |
| Court | U.S. District Court — Middle District of North Carolina |
| Parties | H. Lee FINLAYSON, Jr., Plaintiff, v. CABARRUS BANK & TRUST COMPANY, a North Carolina Corporation, Concord, North Carolina, as Surviving Executor and Trustee Under the Last Will and Testament of Emma F. Whitman, Deceased, Defendant, and Arthur Lee Padgett, Jr. and First & Merchants National Bank of Richmond, Virginia, as Executors and Trustees Under the Last Will and Testament of Norwood K. Whitman, Deceased, Defendants-Intervenors. |
Smith, Moore, Smith, Schell & Hunter, of Greensboro, N. C., and Tucker, Mays, Moore & Reed, of Richmond, Va., for plaintiff.
E. T. Bost, Jr., and W. H. Beckerdite, Concord, N. C., for defendant.
Adams, Kleemeier & Hagan, of Greensboro, N. C., for defendants-intervenors.
This is an action by the plaintiff, H. Lee Finlayson, Jr., a resident of the State of Florida, against the Cabarrus Bank and Trust Company, a North Carolina banking corporation, as surviving executor and trustee under the last will and testament of Emma F. Whitman, deceased, in which the plaintiff seeks possession of shares of certain common and preferred stock of the National Oil Company, and other property, or the cash equivalent thereof. The plaintiff asserts that he is entitled to the stock and properties, or their value, under the will of his grandmother, Hattie Lee Finlayson.
The defendant filed answer denying that plaintiff is entitled to the possession of said stock and properties, or their value, and set up by way of further answer and defense that the rights of the parties had already been adjudicated adverse to the plaintiff in a civil action brought by Emma F. Whitman, defendant's testate, in the Superior Court of Cabarrus County, North Carolina, against H. Lee Finlayson, Jr., the plaintiff herein, and others, wherein it was decreed that Emma F. Whitman took a fee simple interest in certain real estate under the will of her mother, Hattie Lee Finlayson.
The plaintiff replied to the defendant's answer and asserted that the Cabarrus County action did not have the effect of construing the will of Hattie Lee Finlayson, but that if such action did have such legal effect, the judgment was void by reason of the circumstances under which the action was brought and the circumstances under which the plaintiff had executed an assignment.
Thereafter, the defendants-intervenors, Arthur Lee Padgett, Jr., and First and Merchants National Bank of Richmond, Virginia, as executors and trustees under the last will and testament of Norwood K. Whitman, deceased, by consent of counsel for plaintiff and defendant, were permitted to intervene and for the reason that the recovery of the stock and properties, or their value, sought by the plaintiff, would diminish and reduce the principal of a marital deduction trust established under the will of Emma F. Whitman for the benefit of her husband, Norwood K. Whitman, and would thus adversely affect the beneficiaries of the estate of Norwood K. Whitman. The defendants-intervenors answered the complaint and denied that plaintiff was entitled to the relief sought.
After the pleadings were filed and the issues joined, the parties filed a written stipulation of facts. It was agreed that four questions arose upon the pleadings and the stipulations, the first three of which involved matters of law not requiring the intervention of a jury and should be decided by the court upon the stipulation of facts, the pleadings, and briefs and oral arguments of the parties. In the event the fourth question should become determinative of the rights of the parties, any issue of fact in connection therewith is to be submitted to a jury.
The briefs of the parties having been received, the court, after considering the pleadings, stipulations, exhibits, oral arguments, and briefs of the parties, now makes and files herein its Findings of Fact and Conclusions of Law, separately stated:
Findings of Fact
1. The plaintiff, H. Lee Finlayson, Jr., is a citizen and resident of the State of Florida.
2. The defendant, Cabarrus Bank and Trust Company, is a North Carolina banking corporation with its principal office in Concord, Cabarrus County, North Carolina, within the jurisdiction of this court. Emma F. Whitman died a resident of Cabarrus County, North Carolina, in August, 1957, and left a last will and testament naming the defendant, Cabarrus Bank and Trust Company, and her husband, Norwood K. Whitman, as co-executors and co-trustees. Norwood K. Whitman died on December 25, 1957, and the defendant, Cabarrus Bank and Trust Company, thereafter became and is now vested with the sole and exclusive authority as executor and trustee under the last will and testament of Emma F. Whitman. The will of Emma F. Whitman has been duly probated in the Superior Court of Cabarrus County.
3. The defendants-intervenors, Arthur Lee Padgett, Jr., and First and Merchants National Bank of Richmond, Virginia, are the duly appointed executors and trustees under the last will and testament of Norwood K. Whitman, deceased, which said will has been duly probated in the chancery court of the City of Richmond, Virginia. Arthur Lee Padgett, Jr., is a citizen and resident of the City of Richmond, Virginia, and First and Merchants National Bank of Richmond, Virginia, is a national banking corporation with its principal office and place of business in the City of Richmond, Virginia.
4. The amount in controversy in this action, exclusive of interest and costs, exceeds $3,000.
5. Hattie Lee Finlayson, grandmother of the plaintiff and mother of defendant's testate, Emma F. Whitman, died in Goldsboro, Wayne County, North Carolina, in 1925, leaving a last will and testament which was duly admitted to probate in the Wayne County Superior Court.
6. The pertinent provisions of the will of Hattie Lee Finlayson are as follows:
7. Emma Finlayson Cannon, mentioned as one of the beneficiaries in the will of Hattie Lee Finlayson, was married to E. T. Cannon until January 19, 1938, and was thereafter married to Norwood K. Whitman until the date of her death in August, 1957. No child was born to her of either marriage. Emma Finlayson Cannon, one of the beneficiaries under the will of Hattie Lee Finlayson, and Emma F. Whitman, defendant's testate, was one and the same person.
8. H. Lee Finlayson, mentioned as a beneficiary in the will of Hattie Lee Finlayson, and who was the son of Hattie Lee Finlayson and the father of the plaintiff, died testate on September 8, 1937, leaving the plaintiff as his only surviving child, and without any other child having been born to him.
9. Included in the assets of the Hattie Lee Finlayson estate were 1920 shares of common stock of National Oil Company and 488 shares of preferred stock of National Oil Company. Emma Finlayson Cannon (Whitman) received in distribution from the estate of her mother, Hattie Lee Finlayson, 640 shares of common stock of National Oil Company, evidenced by Certificate No. 25, and 163 shares of preferred stock of National Oil Company, evidenced by Certificate No. 11, both certificates being dated January 23, 1926. These certificates were reissued to Emma F. Whitman by National Oil Company, by new certificates dated August 10, 1942, the common stock being represented by Certificate No. 71 and the preferred stock by Certificate No. 46. National Oil Company is the same corporation referred to in Item 3 of the will of Hattie Lee Finlayson as "National Oil Stock Company."
10. The estate of Emma F. Whitman is still in the process of administration and cannot be settled until the matters at issue in this action are finally determined.
11. By unanimous consent of all the stockholders, the National Oil Company has been completely liquidated. Its preferred stock has been redeemed; its common stock has been called in and cancelled; and its assets have been distributed to the stockholders.
12. The Cabarrus Bank and Trust Company, as surviving executor and trustee under the last will and testament of Emma F. Whitman, holds the proceeds derived from the redemption of the 163 shares of preferred stock of National Oil Company, and the cancellation and redemption of the 640 shares of common stock of National Oil Company, which said shares, both common and preferred, were derived by Emma F. Whitman from the estate of her mother, Hattie Lee Finlayson, deceased.
13. During the early part of 1927, Emma F. Whitman, defendant's testate, instituted a civil action in the Superior Court of Wayne County, North Carolina, entitled "Emma Finlayson Cannon and husband E. T. Cannon v. H. Lee Finlayson and wife, Rosalie Finlayson, H. Lee Finlayson, Jr., and any child or children that may be hereafter born to said H. Lee Finlayson and any child or children that may be hereafter born...
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Cabarrus Bank and Trust Company v. Finlayson
...at any time without children and hence the plaintiff was entitled to the property left to the daughter. See Finlayson v. Cabarrus Bank & Trust Co., D. C.M.D.N.C., 181 F.Supp. 838. There is, of course, no question that the will should be construed in accordance with the law of North Carolina......
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