Johnson v. Johnson
| Citation | 13 N.E.2d 788,300 Mass. 24 |
| Court | United States State Supreme Judicial Court of Massachusetts |
| Decision Date | 16 March 1938 |
| Parties | MELVIN M. JOHNSON & another, trustees, v. MELVIN M. JOHNSON & others, executors, & others. |
December 27, 1937.
Present: FIELD LUMMUS, QUA, DOLAN, & COX, JJ.
Corporation Transfer of shares. Uniform Stock Transfer Act. Gift. Trust Validity. Equity Pleading and Practice, Rehearing.
No abuse of discretion appearing, there was no error in the denial of a motion for rehearing of a suit in equity.
The mere gratuitous execution under seal, by the owner of shares of stock and another, of an instrument entitled a "declaration of trust," asserting that they had received an assignment of shares as trustees for the benefit of the owner's daughter and others, and the execution by the owner of such an assignment, but without delivery of a certificate of the shares indorsed or with a power of attorney, were ineffectual to vest in the trustees either a legal or an equitable title to the shares.
BILL IN EQUITY filed in the Superior Court on June 22, 1932. After a hearing by Williams, J., one of the plaintiffs, Edith P. Sheppard, moved for a rehearing. The motion was denied and a final decree entered. She appealed from the denial of the motion and from the final decree.
The case was submitted on briefs.
G. Newhall & M.
J. Cohen, for the plaintiff Sheppard.
J. W. Black, Jr., for the defendant executors.
This is a suit in equity brought in the Superior Court by the plaintiff trustees under a "Declaration of Trust." The prayer of the bill is "That the court may enter a decree that the said trust is valid and subsisting and that the corpus thereof is free from all claims of the creditors of the [deceased], Arthur G. Pollard." The deceased was a resident of Lowell at the time of his death on June 4, 1930, and the defendants Johnson, Harry G. Pollard and Sawyer are the duly qualified executors of his will. The plaintiff Johnson is the same person as the defendant executor Johnson. The plaintiff Edith P. Sheppard is a daughter of the deceased and the principal beneficiary under the alleged trust. The executors of the will of the deceased, hereinafter referred to as the executors, filed an answer in which they prayed that the trust be decreed not to be valid and that its corpus be decreed to be assets of the estate of the deceased.
The evidence is not reported. The judge filed a statement of findings and order for decree on July 25, 1933. On May 28, 1937, the plaintiff Sheppard, hereinafter referred to as Mrs. Sheppard, filed a motion for rehearing, alleging that the trial of the case was conducted for her and her cotrustee Johnson by a representative of the latter's law firm, and for the defendant executors, of whom Johnson is one, by another representative of the same law firm; that she received no notice to be present at the trial and did not testify; that she could have testified that there had been a complete communication of the trust to her by the deceased; that the question whether the defendant Union Old Lowell National Bank knew of the existence of the trust prior to the date of its loan to the deceased should have been presented to the court; and that there was evidence to show such knowledge on the part of its president, who is also one of the executors. She further represented that she had no knowledge of the findings of the judge until May 24, 1937. The motion, which was sworn to by Mrs. Sheppard, was denied by the judge on May 28, 1937, and on June 1, 1937, a final decree was entered that no valid trust was created by the declaration of trust involved, and that the shares of stock referred to therein were assets of the estate of the deceased, free from trust, but subject to the claims of the defendant Union Old Lowell National Bank.
The record discloses that on November 20, 1929, the deceased and Johnson executed an instrument under seal, in which they acknowledged that they had received as trustees "under this Declaration of Trust" an assignment of fifty shares of the Proprietors of the South Congregational Meeting House in Lowell, a corporation duly organized under the laws of the Commonwealth. They acknowledged and declared that they had received the assignment to be held in trust, the income from the trust estate to be accumulated during the life of the deceased, and thereafter until the beneficiaries should give notice to the trustees of their desire to receive it. After the death of the deceased his daughter, Mrs. Sheppard, was to receive the net income upon notice by her to the trustees. Mrs. Sheppard was given the power to appoint the trust estate by will. Other provisions of the instrument providing for the disposition of the trust estate in default of appointment, and which would create an interest in certain other living persons as well as a possible interest in persons unascertained or not in being, need not be recited in detail. The instrument provided that the trust could be terminated during the life of the deceased, but only by an agreement in writing signed by the trustee or trustees for the time being and also by Mrs. Sheppard, and, if she were not living, "by the then present beneficiaries who are living and of full age." The "Declaration of Trust" recites its purpose to be as follows: The instrument was signed and sworn to by the deceased and Johnson. After the death of the deceased Mrs. Sheppard, on June 12, 1930, in accordance with the terms of the trust instrument, nominated and appointed herself as trustee to serve with Johnson.
The present suit was begun on June 22, 1932. A guardian ad litem was appointed to represent the possible interests of persons unascertained or not in being. The judge found that, at the time of the execution of the "Declaration of Trust," the deceased also executed an assignment with power to transfer the stock in question in the usual form; that he retained the assignment in his possession, but that it was not found among his papers by the executors and has disappeared. Other findings of the judge are as follows: "At the time of the execution of these papers, said 50 shares of stock were in fact in the possession of the Merchants...
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