Highland. v. Empire Nat'l Bank Of Clarksburg

• Decision Date: 21 December 1933
• Docket Number: (No. 7698)
• Court: West Virginia Supreme Court
• Parties: Gertrude M. Highland et al. v. Empire National Bank of Clarksburg, a corporation, et al.

114 W.Va. 498

Gertrude M. Highland et al.

v.Empire National Bank

of Clarksburg, a corporation, et al.

(No. 7698)

Supreme Court of Appeals of West Virginia.

Submitted November 9, 1933.

Decided December 21, 1933.

Executors and Administrators

Powers conferred upon joint executors, in the nature of a trust, must be exercised jointly.

Error to Circuit Court, Harrison County.

Proceeding by Gertrude M. Highland and others against the Empire National Bank of Clarksburg and others. To review an adverse decree, Gertrude M. Highland and others bring error.

Reversed.

E. A. Bowers, 8. A. Powell and L. A. Henderson, for plaintiffs in error.

Steptoe & Johnson, Stanley C. Morris and James M. Guiher, for defendants in error.

Litz, Judge:

This proceeding, originating in the county court of Harrison County, was instituted September 26, 1932, by Gertrude M. Highland, widow, and Stephen Lee Highland, Anita High- land Simmons, Linda Marion Highland arid Florence Jean Highland, children of Virgil L. Highland, deceased, and Cecil B. Highland, petitioners, against the Empire National Bank and Melvin G. Sperry, as coexecutors and cotrustees with Cecil B. Highland under the will of Virgil L. Highland, for the removal of Sperry and the bank as executors and trustees. In their answer to the petition for their removal, Sperry and the bank also prayed for the removal of Cecil B. Highland as executor and trustee. The county court, after considering a mass of testimony taken in open court in. sessions lasting approximately two weeks, entered an order removing the three executors and trustees. Upon writs of error to the judgment of the county court, the circuit court of Harrison County, presided over by the judge of another circuit (the regular judge, the Honorable Birk S. Stathers, being disqualified), reinstated each of them. Thereafter, Cecil B. Highland obtained a writ of error from this court to the order of the circuit court in reinstating the bank and Sperry.

Virgil L. Highland, a prominent and highly respected business man of Clarksburg, died, testate, August 9, 1930. He was largely interested in numerous business ventures including the Empire National Bank of Clarksburg (with a capital stock of $250,000.00 divided into 2500 shares of the par value of $100.00 each) and the Clarksburg Telegram Company, a corporation, which formerly published in Clarksburg the Clarksburg Telegram, a daily Eepublican newspaper. As a substantial stockholder, director, and president of the bank, he directed its affairs and policies from its organization in 1904 to the time of his death. Likewise, as practical owner thereof, he also directed and controlled the affairs and policies of the newspaper company from its beginning in 1901, during the remainder of his life. In 1927, he and J. Hornor Davis, who owned the controlling interest in The Exponent Company, a corporation, publishing a daily Democratic newspaper in Clarksburg, organized the Clarksburg Publishing Company, a corporation, for the purpose of publishing the two papers, by merging the Telegram and Exponent companies. The stock in the new corporation was divided into 3, 000 common shares and 2, 000 preferred. Eighteen hundred shares of the common stock, designated as Class A stock, and repre- senting the interest of the stockholders in the Clarksburg Telegram Company, were issued to Virgil L. Highland, as trustee under a voting trust agreement between himself and J. Hornor Davis, trustees, Clarksburg Telegram Company and The Exponent Company, and the remaining 1200 shares of common stock, designated as Class B stock, and representing the interest of the stockholders in The Exponent Company, were issued to J. Hornor Davis, as trustee under the agreement.

By his last will and testament, dated March 20, 1917, following the designation of certain bequests, he gave, devised and bequeathed unto the Empire National Bank, as executor and trustee, all of the rest and residue of his estate and property, of whatever kind or nature, and wherever situated, "in trust to hold, manage and control the same, and every part thereof, collecting the rents, incomes, dividends and profits arising therefrom, and paying out of said rents, incomes, dividends and profits all proper taxes, assessments, charges and expenses incident to the management thereof, including such fire insurance as may be deemed reasonable/' The will proceeds:" I hereby authorize and direct my said executor and trustee to carry on any business or financial affairs in which I may be interested, individually, or with others, at the time of my death, as fully, and to the same extent, as I could or might do if still living; and to so handle and manage my estate as not to unnecessarily jeopardize the interests of any person or persons with whom I may be associated in any business undertaking at the time of my death, and to that end my said executor and trustee, and its successors in office, are hereby authorized to make, sign, accept, or endorse notes, bonds, acceptances or commercial paper of any character or description, which may be required to carry on such business, or renew paper which I am on, individually or jointly, with others, for debts which I owe, or for which I am surety, and such bonds, notes, or commercial paper shall bind and be obligatory on my estate with the like effect, in all respects, as if I, in my lifetime, had made, signed, accepted, or endorsed the same; and my said executor and trustee, and its successors in office, shall have charge of, and control and manage the said trust estate, with the right and authority to sell or dispose of the same, both real and personal, or any part thereof, at private or public sale; to change, from time to time, the form or character of any of the investments thereof; to invest the same from time to time in mortgages on real estate, or any such other safe, interest bearing securities as to them shall seem best; with full power, at all times, and from time to time, to alter, change and vary the investments thereof, whether existing at the time of my death, or made thereafter: Provided, that they shall not sell or dispose of my shares of the capital stock of the Clarksburg Telegram Company, and that they shall not sell or dispose of any other property, real or personal, of which I may die seized, unless they are satisfied that such sale or disposition will be for the benefit cf my estate, and for the best interests of those entitled thereto."

The executor and trustee was also authorized and directed to pay, out of the rents, dividends, and profits of the estate, monthly to the widow, during the continuance of the "trust", the sum of $1,000.00 for the support and maintenance of herself and testator's children, and such additional sums as might be necessary to keep the children in school and to give to each of them a thorough college education; and, in event of her death before the termination of the trust, to apply the allowance for her, or as much thereof as might be necessary, to the support, maintenance and education of the children. The will further authorized and directed the executor and trustee, in event of an insufficiency of income for the purpose, to sell, from time to time, such of the real and personal property of the estate as might be necessary to meet the payments to the widow; and to distribute the interest of each child under the will as he or she became twenty-five years of age. It also directs the executor and. trustee to devote and apply the proceeds from any and all insurance on the life of the testator, first, to the discharge of his individual indebtedness, second, to the discharge of any other debts for which he may be bound as surety, and third, to the payment of specific bequests, "so as to best protect and preserve" the estate. The will contains many other provisions, confirming the intention of the testator to confer upon the executor and trustee complete, discretionary powers to manage, control and dispose of the estate.

By codicil, dated July 5, 1927, the proviso in the will, against the sale or disposition of the shares of capital stock of the Clarksburg Telegram Company, is cancelled, leaving to the executor and trustee "the same discretion in the...