McAllister v. Elliot

• Decision Date: 07 February 1928
• Docket Number: No. 2174.,2174.
• Citation: 140 A. 708
• Parties: MCALLISTER v. ELLIOT et al.
• Court: New Hampshire Supreme Court

140 A. 708

MCALLISTER

v. ELLIOT et al.

No. 2174.

Supreme Court of New Hampshire. Hillsborough.

Feb. 7, 1928.

Transferred from Superior Court, Hillsborough County; Sawyer, Judge.

Petition by Harold C. McAllister, administrator de bonis non with will annexed, of the estate of John S. Elliot, deceased, praying that he be advised as to disposition of trust fund created by the will, opposed by John S. Elliot and others. Transferred without ruling. Case discharged.

Petition by the administrator de bonis non with will annexed of the estate of John S. Elliot, praying that he be advised and instructed as to the disposition of a trust fund created by the third paragraph of the will of the said John S. Elliot and bequeathed by a codicil thereto. Transferred without ruling by Sawyer, C. J.

The third paragraph of the will in question created a trust fund of $20,000, and directed that the income thereof be paid to the testator's son, George F. Elliot. The residuary clause gave all the residue of the estate to George. The codicil, which was executed two days after the will, disposed of the trust fund as follows:

"After the decease of my said son, George F. Elliot, and all of his lawful heirs, I give and bequeath in equal shares of the said twenty thousand dollars in trust to the following named persons: [Then follow the names of seven nephews and nieces], to them * * * their heirs and assigns forever in equal shares as hereinbefore stated."

The same provisions of this will were construed in the case of McAllister v. Hayes, 76 N. H. 108, 79 A. 726. George F. Elliot died October 6, 1905, leaving three children, the defendants John S. Elliot, G. Perley Elliot, and Gladys M. Morgan. Other facts appear in the opinion.

Frank C. Livingston, of Manchester, for petitioner.

McLane & Davis and John R. McLane, of Manchester, for defendant grandchildren.

Samuel J. Dearborn, of Manchester, guardian ad litem and agent for nonresident defendants pro se, representing the interests of the nephews and nieces.

BRANCH, J. The decree of this court in the case of McAllister v. Hayes, 76 N. H. 108, 79 A. 726, concludes the present parties upon all points which were adjudicated therein. Although the proceedings in that case originated with a bill praying for the construction of the will of John S. Elliot and for instructions to the trustee, and although the final decree of the court took the form of instructions to the trustee, it was, nevertheless, the judgment of a court of equity upon the merits of the controversy, which finally determined the rights of the parties, and which effectually bars any other proceeding in which the parties seek to secure a different interpretation of the will or to assert rights inconsistent with those established by that decree. In that case, as in the present one, the court was called upon to decide between the conflicting claims of the testator's grandchildren on the one hand and the nephews and nieces named in his will on the other, and, since the parties in interest in both proceedings are the same, they are concluded by the former decree upon the general principle of res adjudicata. Cummings v. Parker, 63 N. H. 198; Hale v. Railroad, 61 N. H. 641; Ashuelot R. R. v. Cheshire R. R., 59 N. H. 409; Hall v. Dodge, 38 N. H. 346; 21 C. J. tit. "Equity," § 864. See, also, Burleigh v. Wong Sung Leon, 82 N. H.—, 139 A. 184.

Even if the principle of res adjudicata were not strictly applicable, the same result would necessarily follow by reason of the nature of the proceedings. Bills for direction and advice are maintainable only by fiduciaries (Flanders v. Parker, 80 N. H. 566, 568 120 A. 558; Scammon v. Pearson, 79 N. H. 213, 214,107 A. 605; Ross v. Church, 77 N. H. 592, 90 A. 174, and cases cited; Glover v. Baker, 76 N. H. 393, 396, 83 A. 916) in regard to questions necessarily arising in the administration of their trusts (Adams v. Hospital, 82 N. H. 260, 132 A. 525, and cases cited; Weed v. White, 81 N. H. 197, 199, 123 A. 585; Flanders v. Parker, supra; Drake v. True, 72 N. H. 322, 56 A. 749; Ellis v. Aldrich, 70 N. H. 219, 222, 47 A. 95; Paul v. Dole, 70 N. H. 593, 49 A. 572; Stevens v. Douglass, 68 N. H. 209, 38 A. 730). They are designed to furnish protection to fiduciaries in the discharge of their duties and facilitate the execution of trusts. "The ground upon which a trustee is permitted to maintain a bill for advice is that otherwise he must act at his peril, or else wait until a claimant brings suit. Greeley v. Nashua, 62 N. H. 166. This process enables him to speedily and safely execute the trust." Scammon v. Pearson, supra. "Questions are prospectively determined by a court of equity only in behalf of trustees who in the execution of a trust are entitled to its protection." Glover v. Baker, supra. Judicial advice to a fiduciary will be unavailing as a protection to him, unless it is treated as final and binding upon all concerned. Such is the rule in this state. "The court, under its general equity jurisdiction, has power to determine the rights of the parties on such petition." Dole v. Chattabriga, 82 N. H. 396, 397, 134 A. 347, 348.

In McAllister v. Hayes, supra, it was held: (1) That under the terms of the codicil the principal of the trust fund will eventually pass to the nephews and nieces named therein, but that they are not to have it during the lives of George's children; and (2) that the testator made provision for George's children by directing that the income of the trust fund should pass under the residuary clause of the will to George's estate upon the assumption that it would thence go to them. It was accordingly ordered that the income of the trust fund, after George's death, be paid to his executor during the lifetime of his children, and this arrangement has been in effect ever since that decree was rendered. Under the law as above stated it cannot now be disturbed.

But, in order that there be no misunderstanding in regard to the legal situation here presented, it may properly be pointed out that there are other equally good reasons why the position of the grandchildren cannot be maintained. Their claim is that the gift to the nephews and nieces violates the rule against perpetuities; that this feature of the case was not passed upon by the court in the previous opinion; and that a new decree should now be entered directing the plaintiff to pay the principal of the trust fund to them. This argument proceeds upon the assumption that there are only two possible explanations for the failure of the court to refer specifically to the rule of perpetuities in the case of McAllister v. Hayes, viz: (1) That, since the trustee in that case asked for advice only in regard to the income of the trust fund, the possible application of the rule to the gift to the nephews and nieces which is now suggested was not considered by the court; or (2) that the court deferred consideration of the question because of the possibility that all George's children might die within 21 years after his death, so that the nephews and nieces might be entitled to take under the cy pres doctrine as laid down in the case of Edgerly v. Parker, 66 N. H. 434, 31 A. 900, 28 L. R. A. 328. Neither of these explanations can be accepted.

An examination of the record in the case of McAllister v. Hayes discloses the fact that counsel on both sides in their briefs made repeated references to the rule against perpetuities. 275 Briefs and Cases, 133, 141, 151, 161. Under these circumstances it cannot be concluded that the possible application of the rule was not considered by the court in that case. Moreover, if it were true that the court at that time made its decision without perceiving the force of the legal objection now raised to this gift, this fact would not entitle the grandchildren to a reversal of the decree then entered. "The former judgment 'concludes the parties, not only as to every matter which was offered and received to sustain or to defeat the suit, but also as to any other matter which might have been offered for that purpose.'" Chesley v. Dunklee, 77 N. H. 263, 267, 90 A. 965, 967; Metcalf v. Gilmore, 63 N. H. 174, 189; Ashuelot R. R. v. Cheshire R. R., supra. If the court had deferred consideration of the question now raised because occasion for its decision had not then arisen, and might never arise, the opinion, under the uniform practice in such cases, would have contained a statement to that effect. The silence of the court with reference to this subject is to be explained rather upon the ground that the inapplicability of the rule to any of the devises in the will was clear, and that the only important question presented by the record in that case was...