In re Reynolds Guardianship

• Decision Date: 21 March 1934
• Docket Number: 309.
• Parties: In re REYNOLDS' GUARDIANSHIP.
• Court: North Carolina Supreme Court

173 S.E. 789

206 N.C. 276

In re REYNOLDS' GUARDIANSHIP.

No. 309.

Supreme Court of North Carolina

March 21, 1934

Appeal from Superior Court, Cabarrus County; Warlick, Judge.

In the matter of the guardianship of Anne Cannon Reynolds II. Petition by the Cabarrus Bank & Trust Company, one of the guardians of Anne Cannon Reynolds II, which caused an order to be served on Annie L. Cannon, coguardian of Anne Cannon Reynolds II, directing her to show cause why the guardians should not be directed to make the proper motion in the superior court of Forsyth county to avoid or set aside a judgment and decree therein and a contract therein referred to in so far as they affect property rights of the ward. The petition was denied, and petitioner appeals.

Reversed.

CONNOR J., dissenting.

Joseph F. Cannon on September 8, 1931, petitioned the clerk of the superior court of Cabarrus county to appoint the Cabarrus Bank & Trust Company and Mrs. Annie L. Cannon, guardians of the estate of Anne Cannon Reynolds II, and that she was entitled to income from $500,000. The clerk made the order.

"Now these are therefore to authorize and empower the said Guardians to enter in and upon all and singular the goods and chattels, rights and credits, of said minor child wheresoever to be found, and the same to take into possession, secure and improve, and further to manage said estate and every part thereof for the benefit and advantage of the said minor child, and according to law."

We think the digest of this whole controversy is set forth in the judgment and decree tendered by the Cabarrus Bank & Trust Company, one of the guardians of Anne Cannon Reynolds II and the judgment and decree signed by the court below which are as follows: Judgment and decree tendered by petitioner:

"This cause coming on to be heard before his Honor, Wilson Warlick, Judge Presiding, at the regular April Term, 1933 of the Superior Court of Cabarrus County upon the petition of Cabarrus Bank & Trust Company, one of the Guardians of Anne Cannon Reynolds II; and it appearing to the Court that an order has heretofore been served upon Annie L. Cannon Co-Guardian of Anne Cannon Reynolds II, directing her to show cause, if any she have, why the Guardians of the said Anne Cannon Reynolds II should not be advised, ordered and directed to forthwith make the proper motion in the Superior Court of Forsyth County in the case of 'Anne Cannon Reynolds II, a minor, acting by and through her next friend, J. F. Cannon, and Anne Cannon Reynolds II, a minor, acting through her next friend, Howard Rondthaler, versus Zachary Smith Reynolds, a minor, et al.,' for the purpose of having the alleged judgment and decree of the Court therein, and the alleged contract therein referred to, declared null and void in so far as they affect any of the property rights or interests of the said Anne Cannon Reynolds II in the trust estates created for her benefit by the Wills of her paternal grandparents, and in the personal estate of her deceased father, Zachary Smith Reynolds; and it further appearing that, in response to said order, the said Annie L. Cannon, Co-Guardian of Anne Cannon Reynolds II, having filed a response to said petition; and affidavits having been filed herein on behalf of both Guardians.

After reading and considering said petition and response thereto, and the affidavits appearing in the record, and the various exhibits appearing in the record, and after hearing argument of counsel, the Court, upon the undisputed facts, finds that the petitioner has shown reasonable, adequate, sufficient and probable cause for filing a motion in the Superior Court of Forsyth County, in the action above entitled, praying that the decree in said action be set aside upon the following grounds, to-wit: (1) The alleged contract, referred to in the judgment and decree in the Forsyth County action, was null and void, in so far as the said Anne Cannon Reynolds II was concerned, inasmuch as she was a minor without legal capacity to enter into said contract, and inasmuch as no one had authority to enter into said contract for or on her behalf. (2) The alleged decree in said action simply attempted to ratify and confirm said illegal contract and, consequently, was itself null and void. (3) That Anne Cannon Reynolds II was neither a proper nor necessary party to said action; and had no existing cause of action properly before the Court in said action. (4) The alleged contract and decree constituted an illegal, unwarranted and ineffectual attempt to alter and modify the Wills of the infant's grandparents, R. J. Reynolds and Katherine S. Johnston. (5) The alleged contract and decree constituted an illegal and ineffectual attempt to release and extinguish any future contingent rights or interest which the said infant might have in the trust estates created by her said grandparents. (6) The alleged contract and decree constituted an illegal and ineffectual attempt to change the status or relationship of the said infant as a grandchild of her paternal grandparents. (7) The alleged contract and decree constituted an illegal and ineffectual attempt to divert the trust estates established by the Wills of the grandparents of said infant by cutting the said infant out of any future participation therein. (8) The said alleged contract and decree constituted an illegal and ineffectual attempt to cut the said infant out of any future contingent rights she might have had in the trust estates created by her grandparents when there was obviously no necessity, and no finding by the Court of a necessity, for so doing. (9) The proceedings in the action in Forsyth County were merely formal and were instituted and carried on only to give an apparent sanction to an alleged settlement previously agreed upon by the parties, and that the judgment entered in pursuance of the agreement, and by consent, merely, was only colorable. (10) That the said alleged contract and said alleged decree constituted an illegal and ineffectual attempt to divert a part of the trust estate created by the Will of R. J. Reynolds for the benefit of Zachary Smith Reynolds from the said infant, Anne Cannon Reynolds II, in the event the said Zachary Smith Reynolds should die before reaching the age of twenty-one years, leaving her surviving; that, at the time of the entry of said contract and said decree, neither Zachary Smith Reynolds, nor anyone else for or on his behalf, was capable of thus diverting any part of said trust estate from the beneficiaries named in the Will of R. J. Reynolds; nor did any party, or Court, at said time, have the power or authority to change, modify or alter the Will of the said R. J. Reynolds or the Will of Katherine S. Johnston to such an extent as to eliminate the infant, Anne Cannon Reynolds II as a prospective beneficiary under said Wills, and any attempt to do so was utterly null, void and ineffective. (11) That, upon the death of the said Zachary Smith Reynolds, intestate, before reaching the age of twenty-eight years, the said Anne Cannon Reynolds II, under the terms and provisions of the Wills of her grandparents, would participate in the trust estates therein created, as a child of Zachary Smith Reynolds in spite of the alleged contract and decree. (12) The said contract and decree did not involve the ordinary case of the sale of a future contingent interest to a definite grantee, which is sometimes enforcible in equity, but presented an attempted contract between a living father and his child by the terms of which the child, for a present consideration, purported to release and extinguish any future or contingent rights which she might have, in the trust estates established by her grandparents, by reason of her status as child of her father. The Court holds that, upon the showing made by the petitioner, it is the duty of the Guardians to file the proper and appropriate motion in the said action in Forsyth County for the purpose of having the decree entered therein set aside in so far as it affects the rights of the said Anne Cannon Reynolds II, the merits of said motion to be finally passed upon and determined upon the hearing thereof in the Superior Court of Forsyth County. The Court further holds that the Guardians should immediately take the necessary steps to protect the interests of their ward in the Maryland action referred to in the petition.

The Court further holds that the alleged new proposal, purporting to be submitted for or on behalf of the relatives of Zachary Smith Reynolds, involving the establishment of a foundation to the memory of Zachary Smith Reynolds, is not before this Court. That the persons for or on behalf of whom said proposal is submitted are not parties properly before this Court upon the hearing of the petition in this matter; that, consequently, in any event, this Court could not properly consider such alleged proposal upon the hearing of the petition herein; that, if any new proposal is to be made, it should be addressed to the Superior Court of Forsyth County, in the action to which all persons in interest are parties. Wherefore, the said Guardians are hereby authorized and directed to file the motion in the Superior Court of Forsyth County hereinbefore referred to and to take the necessary steps to protect the interests of their ward in the Maryland action referred to in the petition."

The judgment and decree signed by the court below is as follows "This cause coming on to be heard before His Honor, Wilson Warlick, Judge of the Superior Court, regularly holding the Superior Courts of the Fifteenth Judicial District in which is situate Cabarrus County, and regularly holding the April Term of the Superior Court of Cabarrus County on the 27th day of April, 1933, upon the duly verified petition and...