Herron's Estate, In re

• Decision Date: 19 June 1970
• Docket Number: No. 69--249,69--249
• Citation: 237 So.2d 563
• Parties: In re ESTATE of Andrew W. HERRON, Jr., Deceased.
• Court: Florida District Court of Appeals

Page 563

237 So.2d 563

In re ESTATE of Andrew W. HERRON, Jr., Deceased.

No. 69--249.

District Court of Appeal of Florida, Fourth District.

June 19, 1970.

Rehearing Denied Aug. 12, 1970.

Joseph D. Farish and Eugene E. Shuey, of Farish & Farish, West Palm Beach, for appellant Edith M. Herron.

Larry Klein, of Cone, Wagner, Nugent, Johnson, McKeown & Dell, West Palm Beach, and Byrd, Whitley, Byrd & Devitt, Delray Beach, for appellee First Nat. Bank of Delray Beach, as Executor of Estate of Andrew Herron, Jr., Deceased.

REED, Judge.

The appellant, Edith M. Herron, has appealed from a final order of the County Judge's Court for Palm Beach County, Florida, which in effect held that the proceeds of certain life insurance policies on the life of appellant's deceased husband which policies were the res of an inter vivos trust created by the husband during his lifetime were not subject to appellant's right of dower.

The appellant's husband, Andrew W. Herron, Jr., died a resident of Palm Beach County, Florida, on or about 20 June 1966. His will was admitted to probate by the County Judge of Palm Beach County, and the First National Bank of Delray Beach was appointed executor. In due course the appellant filed in the estate an election to take dower. Thereafter, the executor petitioned the county judge for an order determining what assets should be included in the widow's dower. The petition stated, '* * * the petitioner does not question the said widow's right to dower but rather the assets to which she makes her claim * * *' The appellant filed an answer to the petition in which she alleged that a trust agreement which her husband had executed with the First National Bank of Delray Beach as trustee was illusory or testamentary and, therefore, invalid. On this ground the widow claimed to be entitled to dower in the proceeds of insurance policies on the life of the decedent which policies were payable to the First National Bank of Delray Beach as trustee under the said trust agreement.

On the issue thus framed the county judge entered the order from which this appeal has been taken. In pertinent part the order states:

'ORDERED AND ADJUDGED that the insurance trust established by the decedent herein during his lifetime, constitutes a valid trust disposition which can not be nullified as an illusory device, or one designed to defraud the widow of her dower rights, or otherwise as a nugatory inter vivos transaction.

'The assets constituting the corpus of the trust may not be properly drawn back into decedent's probate estate as assets subject to testamentary disposition, and they are, as a consequence, ineligible for inclusion in the property from which dower is to be assigned.'

The order was entered on the basis of the trust agreement and the will of the decedent. No testimony was taken because both parties agreed to submit the matter on the basis of the instruments referred to and the applicable law.

The issue presented by the appeal is whether or not the county judge committed error when he entered the aforesaid order denying the widow dower rights in the proceeds of the insurance policies which were the subject of the aforesaid trust.

The trust agreement in question was executed by the appellant's husband, Andrew W. Herron, Jr., and the First National Bank of Delray Beach, as trustee, under date 26 September 1962. The agreement recites that the settlor was a resident of Palm Beach County, Florida. The trust agreement provided that the trustee would hold in trust certain life insurance policies on the life of the settlor and, on settlor's death, the proceeds for the benefit of the settlor's wife and surviving children. The policies were delivered to the trustee and made payable to it. By the trust agreement the settlor retained the power to revoke or amend the trust and retained all privileges accruing under the policies during the insured's lifetime such as the right to dividends and the right to borrow on the policies. By the trust instrument, however, the settlor relinquished the right to elect any option under the policy that would cause the proceeds under the policies to be paid in any manner except in a lump sum. The trust further provided that the trustee's sole duty during the lifetime of the insured-settlor would be a duty of safekeeping. The settlor was required by the agreement to make the premium payments on the policies. Benefits provided for the wife were, by the terms of the trust agreement, in lieu of dower and subject to forfeiture if she elected dower.

The will of Andrew W. Herron, Jr., is dated the day following the trust agreement, i.e., 27 September 1962, and makes specific reference to the trust agreement. The will leaves certain items of personal property to the testator's wife and then bequeaths the residue of the testator's estate to the trust created under the aforementioned trust agreement.

At the outset there is a jurisdictional consideration. The sources of the county judge's jurisdiction are Article V, Section 3, Florida Constitution, F.S.A.; F.S. Section 36.01(1), F.S.A., and F.S. Section 733.12(2), F.S.A. The latter provides: 'On any petition for assignment of dower, the right of dower as well as the admeasurement thereof, shall be determined * * *.' Nevertheless, the county judge's court does not have jurisdiction to try title to real or personal property as against a person Not claiming as a beneficiary of the estate. In re Lawrence's Estate, Fla.1950, 45 So.2d 344, 345. The Lawrence case indicates, however, that under the statute last cited above, the county judge Does have jurisdiction to make a finding, for administrative purposes, of what assets belong to the estate. He cannot in so doing affect the rights of persons Not claiming as beneficiaries under the estate. See also In re Donaldson's Estate, Fla.App.1962, 147 So.2d 552, and In re Coffey's Estate, Fla.App.1965, 171 So.2d 568.

In the present case the ruling of the county judge did not affect rights of persons not claiming as beneficiaries of the estate. The only person who was adversely affected was the widow, the appellant here, and she is claiming as a beneficiary of the estate to the extent of her statutory dower right. The ruling of the county judge amounted to a finding for administrative purposes of what assets belonged to the estate. We, therefore, conclude that he had jurisdiction to render the order appealed.

With respect to the merits, the appellant contends the trust was illusory and testamentary, and, finally, that the trust was a fraud on the wife and for that reason invalid.

An illusory trust is a trust arrangement which takes the form of a trust, but because of powers retained in the settlor has no real substance and in reality is not a completed trust.

As authority for her contention that the trust was illusory, the appellant cites ...