In re Wiley's Guardianship
| Decision Date | 16 November 1948 |
| Docket Number | 47317. |
| Citation | 34 N.W.2d 593,239 Iowa 1225 |
| Parties | In re WILEY'S GUARDIANSHIP. |
| Court | Iowa Supreme Court |
Harold Newcomb and George A. Kern, both of Des Moines, for guardian ad litem, appellant.
Howe & Howe and Joseph J. Petosa, all of Des Moines, for guardian, appellee.
The question presented is whether section 682.23, Code 1946, denies to the district court the power to authorize the investment of trust funds by a guardian in securities not mentioned in said section. Like the trial court was answer in the negative.
The guardian of the incompetent stated in his application that he has funds which are not producing an adequate income and should be reinvested to obtain a larger income for the benefit of the ward; all investments mentioned in section 682.23 at present yield a very low return which is insufficient to meet properly the needs of the ward; other investments not mentioned in said section would be sound and yield a substantially larger return; from his investigation the guardian believes it would be for the best interests of his ward to purchase the following stocks (here are listed 10 shares of preferred stocks in two corporations and 25 shares of common stocks in three corporations--a total of 35 shares in five well known, long established concerns). Attached to the application is a description of each of the five recommended issues.
A guardian ad litem for the incompetent was appointed who defended on the sole ground that Code section 682.23 prohibits the investment of funds by guardians in securities not designated in said section. The guardian ad litem admitted all statements of fact in the application. The trial court granted the application. Upon this appeal the guardian ad litem raises the same question presented below.
Section 682.23 provides: 'Authorized securities. All proposed investments of trust funds by fiduciaries shall first be reported to the court or a judge for approval and be approved and unless otherwise authorized or directed by the court under authority of which he or it acts, or by the will, trust agreement, or other document which is the source of authority, a trustee, executor, administrator, or guardian shall invest all moneys received by such fiduciary, to be by him or it invested, in securities which at the time of the purchase thereof are included in one or more of the following classes:' (Here follow 14 numbered paragraphs which designate bonds of the United States, federal land banks states and municipalities and other investments.)
When introduced by the House Committee on Banks and Banking in the 43d General Assembly (1929) the original bill commenced with the portion italicized by us, 'Unless otherwise authorized or directed by the court under authority of which he or it acts,'. The requirements that all proposed investments be first reported to the court or judge for approval and be approved were inserted by way of two amendments to the bill. The original enactment contained the first paragraph quoted above followed by nine paragraphs designating nine different securities. The remaining five of the fourteen numbered paragraphs in 682.23 were added from time to time since 1929.
The main contention of the guardian ad litem is that if the legislature intended the court could approve an investment not specifically mentioned in 682.23 there was no purpose in designating the different securities therein nor in adding to those first designated in 1929. The guardian relies upon the language in section 682.23 above italicized by us as a recognition of the power of the court to authorize investments not designated in the remainder of the section.
There can be no question as to the principal rule of statutory construction relied upon by the guardian ad litem. If fairly possible a statute will not be construed so part of it is rendered superfluous. Effect should ordinarily be given to every provision. Moulton v. Iowa Employment Security Commission, Iowa, 34 N.W.2d 211, 216, and citations; Independent School Dist. v. Iowa Employment Security Commission, 237 Iowa 1301, 1309, 25 N.W.2d 491, 496, and citations.
We think the guardian ad litem is asking us either to read out of the statute the clause we have italicized or to add a provision which greatly limits its meaning and that the construction for which he contends conflicts therewith. Of course we have no power to read the italicized language out of the statute nor to add thereto. Moulton v. Iowa Employment Security Commission, supra, and citations; 50 Am.Jur., Statutes sections 231, 234.
The italicized clause is plainly an exception or proviso which limits the application of the statute. See as having some bearing 43 Words and Phrases, Perm. Ed., pages 315, 316. The fundamental rule for which the guardian ad litem contends that effect should be given all parts of a statute requires that effect be given a proviso when it can be done in accordance with recognized rules of construction. 50 Am.Jur., Statutes, section 440; 59 C.J., Statutes, section 639. See also Campbell v. Jackman Bros., 140 Iowa 475, 480, 481, 118 N.W. 755, 27 L.R.A., N.S., 288; State v. Best, 225 Iowa 338, 280 N.W. 551.
The guardian ad litem concedes trust funds need not be invested in securities designated in 682.23 if 'otherwise authorized or directed by * * * will, trust agreement, or other document which is the source of authority * * *.' He admits this is an exception to the requirement that trust funds be invested in the designated securities. We think the exception or proviso on which the guardian relies is just as effective as the one the guardian ad litem concedes. There is no basis for recognizing the one and repudiating the other. The requirement that trust funds be invested in the designated securities is also expressly made subject to the prior exception 'unless otherwise authorized or directed by the court under authority of which he or it acts.'
It has been suggested that section 682.23 permits the court to approve investments not therein designated only where 'authorized or directed by the * * * will, trust agreement, or other document which is the source of authority.' In other words, that the italicized exception in the statute is in every instance limited or qualified by the exception just quoted which follows it. In effect the suggestion is that the law contains only one exception.
The suggestion cannot be adopted without either the elimination of the italicized proviso (in disregard of the rule that effect be given the entire statute) or the addition of a qualifying provision to the law which would change its plain meaning. We can do neither. The practical effect of adopting this suggestion would be to strike out the italicized proviso as applied to investments by guardians. A 'will, trust agreement, or other document' is seldom, if ever, 'the source of authority' of a guardian. On the contrary the court is the authority under which a guardian acts.
Under our construction of 682.23 according to its plain meaning the remaining 14 paragraphs are not necessarily surplusage. Nor is there irreconcilable conflict between them and the exception on which the guardian relies. We are not called upon to determine what the legislature may have intended except insofar as its intent is expressed in the statute. We may say, however, that the legislature might well have intended to designate for the advice and guidance of fiduciaries and courts the investments it regarded as affording maximum safety without deeming it necessary to deny courts in all instances the power to authorize other investments if found to be safe and advantageous. If the legislature intended in all cases to restrict the court in the approval of investments to those mentioned in 682.23, it could easily have said so. This it did not do.
There can be no question as to the power of the court, if not prohibited by section 682.23, to approve investments by guardians which are shown to be safe and advantageous to the ward. Section 668.9, made applicable to such guardianships as this by 670.1, provides: 'Guardians * * * must prosecute and defend for their wards, may employ counsel therefor, lease lands, loan money, and in all other respects manage their affairs, under proper orders of the court or a judge thereof.'
We have frequently recognized the statute just quoted, substantially unchanged, so far as here applicable, since the Code of 1851, as the important broad provision governing the powers and duties of guardians to act under the supervision of the probate court. The making of the investments here in question is clearly an act of managing the affairs of the ward. If the legislature intended section 682.23 to limit the court in approving investments by guardians to those therein mentioned, such limitation should have been plainly stated.
Statutes in many states designate securities in which trustees may invest without limiting them to the securities designated. In other states the only proper investments are those specified by statute. Anno. 128 A.L.R. 968; Restatement of Trusts, section 227, comment n. Substantially the same argument made by the guardian ad litem--that it was idle for the legislature to designate securities for the investment of trust funds if the designation was not exclusive--could be urged against all such statutes which are permissive and not mandatory.
The guardian ad litem seeks to support his position by a recital in the preamble to chapter 307, Acts 49th General Assembly 1941 amending subsection 5 of what is now 682.23, which he argues shows the legislative intent. The recital refers to a provision in the then existing subsection 5 as 'restricting the opportunities for fiduciaries bound by the present law that...
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