Indian Head Nat. Bank of Nashua v. Rawls
| Citation | 194 A.2d 767,105 N.H. 142 |
| Parties | INDIAN HEAD NATIONAL BANK OF NASHUA et al. v. Carolyn Gregg RAWLS et al. |
| Decision Date | 05 November 1963 |
| Court | Supreme Court of New Hampshire |
Sullivan, Gregg & Horton, Nashua (James L. Sullivan, Nashua, orally), for plaintiffs.
Cheever & Sullivan, Wilton, for Carolyn Gregg Rawls, furnished no brief.
Sheehan, Phinney, Bass, Green & Bergervin and Kimon S. Zachos, Manchester, for David A. Gregg, III and Virginia T. Gregg, Guardian of Stephen T. Gregg.
Wiggin, Nourie, Sundeen, Nassikas & Pingree, Manchester, for Crotched Mountain Foundation, Inc., furnished no brief.
Ernest R. D'Amours, Manchester, Director of Register of Charitable Trusts, pro se, furnished no brief.
Paragraph 'A' of 'Clause First' of the trust agreement directs the trustees to divide the principal of the trust fund into three equal shares, one for each of the children of the settlor, Carolyn, David and Stephen.
Under paragraphs 'B', 'C' and 'D' of this clause, 'the Trustees shall accumulate the income of the share' of each child until he or she reaches the age of forty-five. On reaching that age each child is to receive the current income of his or her share until the age of sixty when distribution of all the principal and unpaid, accrued and accumulated income of this share is to be made to that beneficiary. In case of the death of a beneficiary before final distribution of principal and of accrued income distribution is to be made to the surviving issue of the deceased in a manner specified therein. In the absence of such issue the payment of current income and final distribution of principal and of accrued income is to be made to the surviving children or child of the settlor, named above, or to their issue.
If on the death of the last survivor of these three named beneficiaries there is no issue of any of them then living, the remaining principal and income is to be paid and distributed to Crotchet Mountain Foundation, Inc. as successor to the beneficiary named in the trust agreement.
The language of 'Clause First' considered as a separate entity isolated from the other provisions of the trust instrument would necessitate the conclusion that the trustees have an unalterable duty to accumlate the income of each share until its beneficiary, has reached the age of forty-five. It would follow that the trustees could not make payments prior to that time for educational or other purposes out of either the income or principal of the trust. 1 Restatement (Second), Trusts, s. 182, comment c.
However it is well established in this jurisdiction that our courts have shown a signal regard for the intention of a settlor of a trust as they do for that of a testator. Katz v. Katz, 104 N.H. 478, 190 A.2d 425; Merrow v. Merrow, 105 N.H. ----, 193 A.2d 19 (July 30, 1963). The nature and extent of the interest given to trust beneficiaries is to be determined from the whole instrument and not from an isolated phrase or clause of it. Athorne v. Athorne, 100 N.H. 413, 415, 128 A.2d 910; Gourley v. Greene, 102 N.H. 501, 503, 161 A.2d 172. The relationship of the settlor to the beneficiaries and his duties toward them are among the facts to be considered by a court trying to place itself in the shoes of the creator of the trust in order to ascertain what he intended by the trust instrument. Amoskeag Trust Co. v. Haskell, 96 N.H. 89, 91, 70 A.2d 210, 71 A.2d 408.
There is no room for doubt that the settlor selected his three children as the main objects of the benefits to be conferred by the trust. Amoskeag Trust Co. v. Haskell, supra, 96 N.H. 97, 70 A.2d at pp. 216-217, 71 A.2d at p. 409. At its creation, April 22, 1953, two of these beneficiaries, David and Stephen, were about 13 and 8 years of age. David is now an ensign in the United States Navy and Stephen a freshman in college. Although not determinative of the issue (Merrow v. Merrow, supra, 1 Restatement (Second), Trusts, s. 164, Ill. e) the settlor, who is living, has unequivocally stated to the trustees that it was his intention to give them the power to make payments out of income and principal for educational or other purposes prior to the beneficiaries attaining the age of forty-five. He has no objection to their making the payments that have been requested for expenses of the education of these beneficiaries.
'Clause Third' paragraph 'E' of the trust agreement provides that ...
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