Mickelberry's Food Products Co. v. Haeussermann
| Decision Date | 10 March 1952 |
| Docket Number | No. 1,No. 42189,42189,1 |
| Parties | MICKELBERRY'S FOOD PRODUCTS CO. et al. v. HAEUSSERMANN et al |
| Court | Missouri Supreme Court |
C. Kenneth Thies, St. Louis, for appellants.
Edward W. Tobin, Edward A. Haid, St. Louis, for respondent Fred G. Haeussermann.
Gerwitz, Seegers & Lee and Paul M. Gerwitz, Jr., all of St. Louis, for respondent Adolf G. Ackermann, trustee.
On the 10th day of December, 1945, plaintiffs purchased and now own all of the capital stock of Laclede Packing Company, a Missouri corporation. By this action they seek to recover the sum of $36,945.51, more or less, being the cash surrender proceeds of certain insurance policies issued on the lives of defendants, Fred G. Haeussermann and Adolf G. Ackermann, pursuant to two life insurance trust agreements entered into between former stockholders of Laclede Packing Company and defendants as trustees. The trial court found the issues in favor of defendants and plaintiffs appealed.
Plaintiffs' action is pleaded and based upon the theory that by the terms of the life insurance trusts they, as purchasers of the capital stock of Laclede Packing Company, are entitled to have the trust liquidated and the proceeds distributed to them free of the trust. Defendants contend: (1) that the trust agreements inure only to the benefit of certain beneficiaries and do not inure to the benefit of plaintiffs by virtue of purchase of the stock; (2) that the contracts for the sale of the stock of Laclede Packing Company to plaintiffs did not contemplate that plaintiffs acquire, plaintiffs did not intend to acquire, and the stockholders of Laclede Packing Company did not convey any rights in said trusts; (3) that plaintiffs, by their acts, conduct and declarations, are estopped from asserting any rights therein; (4) that plaintiffs had no insurable interest in the lives of the insured defendants, and for that reason could not acquire any right in the proceeds of the surrendered policies; and (5) that there is a defect of parties.
Plaintiffs, other than Mickelberry's Food Products Company, a Delaware corporation, hold only qualifying shares of stock of Laclede Packing Company. Mickelberry's Food Products Company is the beneficial owner of all of the stock. These corporations hereinafter will be referred to as 'Mickelberry's' and 'Laclede'.
Laclede was organized in 1921. Defendants Haeussermann and Ackermann were among its original incorporators and from that time until the sale of the stock to Mickelberry's on December 10, 1945, were officers and principal stockholders therein.
On August 10, 1937, defendant Ackermann was president and defendant Haeussermann was secretary-treasurer of Laclede. On that date the two life insurance trust agreements involved in this case were executed. These instruments are identical in form, except in one Ackermann is named 'Trustee' and the insurance therein authorized to be obtained is to be on the life of Haeussermann, the secretary-treasurer. In the other Haeussermann is named 'Trustee' and Ackermann, the president, is named as the person whose life is to be insured. For that reason only one of the agreements need be summarized. The first paragraph reads:
'This Declaration of Trust made this 10th day of August, 1937, by and between all persons, firms, partnerships, and corporations who are or may be the registered common stockholders of Laclede Packing Company, a Missouri corporation, according to its books of record, particularly (names of stockholders) and their successors and assigns, hereinafter called the 'Parties of the First Part' and Adolf G. Ackermann, of the City of St. Louis, Missouri, hereinafter called the 'Trustee', Witnesseth:'
The trust agreement then provides, in substance:
That the stockholders on demand will advance funds in proportion to a schedule thereto attached with which the trustee is to buy insurance on the life of Fred G. Haeussermann, secretary of Laclede, in such sums as the trustee may elect, payable to trustee Ackermann for the purposes thereinafter provided; and upon advancing additional funds as required, the Trustee shall hold the policies 'for the beneficiaries hereinafter provided.' Upon the death of insured the proceeds of such policies are to be used, first, to retire outstanding bonds of Laclede, and, second, to purchase stock of Laclede from estate of deceased insured. Such bonds or stocks so acquired shall be held for the bonefit of 'beneficiaries of this trust' in proportion to their respective interests. The trustee is authorized to borrow against the cash value of said insurance policies to pay premiums and to proportionately charge such loan against the cash value of each beneficiary in the policies upon distribution. If the cash value of any beneficiary's interest is depleted by loans, then any other beneficiary may take over such interest. 'Any beneficiary hereunder may withdraw from this trust agreement at any time by selling and assigning his or her interest or equity to any other beneficiary of this trust.'
'If, after performance of the Trustee under the above provisions or if there are no bonds or stock of the Laclede Packing Company available for purchase under the above conditions, the Trustee shall distribute free from trust (the net proceeds of the policies) to the common stockholders of record of the Laclede Packing Company on the date of the death of Fred G. Haeussermann, * * * according to the number of shares of common stock held by such stockholders and the respective interest of each beneficiary as hereinbefore provided.'
Then follows the clause upon which plaintiffs, as owners of all of the stock of Laclede, base their right to the cash surrender value of the policies: 'In the event that the majority of the beneficiaries of this trust, who are the common stockholders of Laclede Packing Company should at any time desire to liquidate this trust they may do so and hereby reserve the right to so do by serving written notice of their desire on the Trustee hereof, whereupon the Trustee shall * * * notify the various insurance companies * * * to cancel said policies and * * * he shall make a pro rata distribution free from trust of all such amounts recovered to the stockholders of record of Laclede Packing Company as of the date of the service of notice to terminate this trust * * *.'
Pursuant to the provisions of these trusts, sufficient sums were provided by the stockholders for the purchase of $100,000 of insurance on the life of Ackermann and a like sum on the life of Haeussermann, and the policies involved in this case were purchased. In the policies on the life of Haeussermann the beneficiary was designated: 'Will pay to the Insured's: Adolf G. Ackermann, as Trustee, under Trust Agreement dated August 10th, 1937, made by and between Adolf G. Ackermann, et al. and said Trustee.' This provision was also in the policies issued on the life of Ackermann, except that Haeussermann was the named trustee.
On January 4, 1938, new stock certificates were issued to the Laclede stockholders. These certificates bore a legend stamped thereon: 'This certificate is issued subject to the conditions and restrictions contained in a certain contract dated August 10, 1937, which affects the negotiability of this stock and which contract has been spread upon the minutes of the corporation and will be exhibited by the secretary thereof upon request.'
The premiums were paid by checks drawn on Laclede to each of the trustees, who, in turn, remitted to the insurance companies. It was the custom to charge these premiums against Laclede dividends or surplus.
Certain minutes of Laclede and reports made by its auditors were introduced in evidence as tending to support plaintiffs' contention that the insurance trusts were construed by its prior stockholders to have been made for the benefit of succeeding stockholders rather than certain beneficiaries, as contended by defendants. These audit reports and minutes were:
On November 1, 1941, in a certified public accountant's report, made at the instance of Laclede for the year ending October 31 1941, the following except is recorded: $An audit made by Laclede's auditors on February 5, 1945, some ten months prior to the purchase of the stock by the plaintiffs, recites:
The minutes of a regular directors meeting held on October 26, 1945, less than two months prior to the date plaintiffs purchased all of the Laclede stock, show adoption of the following resolution: 'Be It Resolved, that a dividend of $1.13074 per share be paid out of surplus to stockholders of record as of this date, said dividend to be paid to the respective trustees of said insurance trust in proportion to the amounts needed to satisfy the net premiums payable under the policies held thereunder, and
'Be It Further Resolved, that whereas there are fifty-five shares of issued stock held in the treasury of the company, that the company pay the premium on such proportionate share in...
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...the language of a contract is plain, there can be no construction because there is nothing to construe.' Mickleberry's Food Products Co. v. Haeussermann, Mo.Sup., 247 S.W.2d 731, loc. cit. 738. Construction is necessary, however, where the terms of a contract are Exceptions C, Y (Part), E a......
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