First Nat. Bank of Florida v. Moffett, 85-36
| Decision Date | 12 December 1985 |
| Docket Number | No. 85-36,85-36 |
| Parties | 10 Fla. L. Weekly 2740 FIRST NATIONAL BANK OF FLORIDA, etc., Appellant, v. Eleanor H. MOFFETT, etc., Appellee. |
| Court | Florida District Court of Appeals |
Ellen B. Herrera, of Raymond, Wilson, Conway, Barr, Burrows and Jester, Daytona Beach, for appellant.
Terence R. Perkins, of Cobb and Cole, Daytona Beach, for appellee.
The First National Bank of Florida appeals from a final judgment requiring it to make additional payments under a trust administered by the bank. We conclude that the trial court erred in interpreting the trust and accordingly reverse.
The trust in this case was established by Paul Winship Bidwell. Article IV of the trust provides in part as follows:
Upon Grantor's death the Trustee shall:
A. Make available to the Personal Representative of Grantor's estate any funds necessary to satisfy all debts taxes, devises, and administrative expenses resulting from Grantor's death should his probate estate be insufficient for such purposes.
B. Pay over to Clara W. Hagen the sum of fifty thousand ($50,000.00) dollars in fee and discharged of trust.
C. Divide the balance of all trust assets into two (2) equal parts, one such part held for the benefit of Howard Bidwell and one such part for the benefit of Clara W. Hagen. Each part shall be administered and distributed in the manner and according to the terms and conditions as follows:
1. During the life of each beneficiary, the Trustee shall pay to the individual beneficiary of each part in each taxable year of the trust a unitrust amount equal to five (5%) percent of the net fair market value of the trust assets valued as of the first day of each taxable year of the trust. Such unitrust amount shall be paid in equal quarterly installments from income and, to the extent income is not sufficient, from principal. All income of the trust for a taxable year in excess of the unitrust amount shall be added to principal.
2. Upon the death of each individual beneficiary, (or if either or both shall not survive the Grantor), the Trustee shall distribute all of the then principal and income of his or her part, other than any amount due the individual beneficiary, to the Springfield Unit of the Shriners Hospital For Crippled Children, Springfield, Massachusetts. Grantor requests said institution to establish the EMMA REID BIDWELL Fund to be used for any purpose its official governing body may direct.
The court below concluded that this language was unambiguous in its requirement that the five percent income to be paid to each beneficiary be computed on the basis of the total trust assets and not just on that part set aside for each beneficiary. The bank contends that this determination is clearly erroneous. We agree.
Where the terms of an instrument are clear and unambiguous, there is no need for the court to engage in a construction of such instrument. Barnett First Nat. Bank v. Cobden, 393 So.2d 78 (Fla. 5th DCA 1981). However, where there is ambiguity or uncertainty arising from the language used, construction of the instrument is necessary. Barnett, 393 So.2d at 79.
In the present case, the language of Article IV is ambiguous because it can reasonably be read in two ways. One interpretation is that the language mandates payment of income based on a percentage of all of the trust assets. The other interpretation is that the language refers to a percentage of the assets in the part of the trust assigned to each beneficiary. Since the trust is ambiguous, construction of the instrument is necessary.
In construing wills and trusts, the intent of the testator or settlor should prevail and effect given to his wishes. See Knauer v. Barnett, 360 So.2d 399 (Fla.1978); Gilbert v. Gilbert, 447 So.2d 299 (Fla. 2d DCA 1984). This intention should not be determined by isolated words and phrases but rather the instrument as a whole should be considered and the testator's general...
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