Miller's Estate, In re

• Decision Date: 24 November 1964
• Citation: 230 Cal.App.2d 888,41 Cal.Rptr. 410
• Court: California Court of Appeals Court of Appeals
• Parties: In the Matter of the ESTATE of Katherine G. MILLER, also known as Katherine Gardner Miller, Deceased. Miriam Miller HARTMAN, Appellant and Cross-Respondent, v. Charles Davison FIELD, Cross-Appellant, v. Burke E. BURFORD, Respondent and Cross-Respondent. Civ. 352.

Page 410

41 Cal.Rptr. 410

230 Cal.App.2d 888

In the Matter of the ESTATE of Katherine G. MILLER, also known as Katherine Gardner Miller, Deceased.

Miriam Miller HARTMAN, Appellant and Cross-Respondent, v. Charles Davison FIELD, Cross-Appellant, v. Burke E. BURFORD, Respondent and Cross-Respondent.

Civ. 352.

District Court of Appeal, Fifth District, California.

Nov. 24, 1964.

Hearing Denied Jan. 20, 1965.

Hutchinson & Quattrin, by J. Albert Hutchinson, San Francisco, for Miriam Miller Hartman.

Alef & Schnitzer, by Arthur Alef, Los Angeles, for Charles Davison Field, for appellants.

Burford, Hubler & Burford, by Burke E. Burford, Porterville, for Burke E. Burford.

CONLEY, Presiding Justice.

The legal relationships of the various parties interested in this probate proceeding are again before this court. Once before the Fifth District Court of Appeal has passed upon certain rights of the parties, the opinion being reported as Estate of Miller, 212 Cal.App.2d 284, 27 Cal.Rptr. 909; it will be unnecessary to repeat in detail all of the factual matters set forth in that opinion.

Although there are only one reporter's transcript and one clerk's transcript, there are in fact four appeals which the court must dispose of. Miriam Miller Hartman appealed from the decree of the probate court settling the second, third, fourth, and supplemental accounts and reports, allowing statutory fees and fees for extraordinary services and for final distribution. Mrs. Hartman also appealed from the order of the court relative to the rights and duties of the trustee, Burke E. Burford, the scrivener of the will, who is also executor of the estate. There is also a cross-appeal by Charles Davison Field, a grandson of the testatrix, from those portions of the order of the court of September 20, 1963, relative to the distribution to the trustee for the benefit of Miriam Miller Hartman and an appeal by him from the similar provisions of the final decree of distribution.

At the time she made her will of November 14, 1958, and the codicil of March 1, 1959, Katherine G. Miller was the widow of Dr. Austin V. Miller, a physician practicing his profession in the City of Porterville. Dr. and Mrs. Miller had three daughters, Sally Miller Field, Miriam Miller Hartman, and Marcia Miller Nelson. The family had been a close-knit and apparently loving family with particular ties of affection existing between the mother and father and each of the daughters. The Millers had educated their offspring and particularly favored the professional aspirations of Miriam by paying for her training as a Doctor of Medicine specializing in ophthalmology. Unhappily, she had been recently troubled by what is termed a disease in the record, an habitual overindulgence in alcohol, temporarily at least, which seemed to put an end to any aspiration on her part to continue to be a skillful and successful medical practitioner. The situation eventually became so bad that she was formally deprived of her license to practice medicine. At that time her beloved mother made her will and the codicil attached to it, and it is quite simple in reading between the lines to see that, while the mother still loved her three daughters and desired to have all of them benefit by the joint accumulations of Dr. Miller and herself, she was acutely aware that Mrs. Hartman in her then condition could not unassisted safely and properly handle her share of the estate and that a trust should be created.

It is equally obvious that the mother desired with all her heart that her three daughters should be well cared for and should have the benefits of the family accumulations which she was passing on. She gave outright one-third of her property to Mrs. Nelson and one-third to Mrs. Field, and set up a trust with her attorney, Mr. Burke E. Burford, for the remaining one-third.

From what is said in the document viewed with the foregoing background, it is crystal clear that it was the essential wish of the mother that the daughters be basically treated alike; with respect to a one-third share of the property the then pending situation relative to alcoholism made it essential that during the continuation of her unfortunate addiction to alcohol, the third daughter should not have title to the property itself, but the use of the income only.

Mrs. Miller's will declared that she was the widow of Austin V. Miller, that he died December 31, 1955, and that she had '* * * three (3) adult daughters the issue of this marriage, to wit: MIRIAM MILLER HARTMAN, born April, 1911, and wife of Irving Pierce Hartman; MARCIA MILLER NELSON, born November 8, 1919, and the wife of Aubrey Orville Nelson; and SALLY MILLER FIELD, born January 15, 1908, and the wife of John Field. I have no other children living or deceased.' She then names her then existing grandchildren in the Nelson and Field families. By the THIRD paragraph of her will she leaves a one-third interest in her estate to Marcia Miller Nelson, a one-third interest to her daughter, Sally Miller Field, and a one-third interest in trust to the trustee principally for the daughter, Miriam. The will continues:

'FOURTH: Testamentary Trust:

'1) During the life of my daughter, MIRIAM MILLER HARTMAN, my Trustee is to pay from the income of the Trust to MIRIAM MILLER HARTMAN, or to any legally appointed guardian acting on her behalf or to pay on her behalf, such sums as my trustee, in his sole discretion, shall determine as necessary to supplement any other income or source of funds she may have, to provide for her support and maintenance. My Trustee is especially cautioned and directed not to make disbursements to pay for, or for which may be used for alcoholic beverages. Should the payments made by my Trustee for support of said beneficiary not consume all of the income, any income not so consumed shall be paid to and become a part of the corpus of the trust.'

The will next provides that when Miriam Miller Hartman dies and the expenses of her last illness and her burial have been paid, the remaining corpus of the trust shall be divided among Mrs. Miller's then living grandchildren; if one of them has died, leaving children, then such surviving children shall also share.

The testatrix further provides:

'In the event the net income of the trust is not sufficient to provide for the support and maintenance of my said daughter including all necessary medical care and nursing she may require, my Trustee shall distribute to her or on her behalf out of the corpus of the trust such sums as the Trustee may determine to be necessary to argument (sic) [augment] the income to provide for such support and maintenance and medical care.'

The will then includes a spendthrift clause and proceeds to give specifically detailed powers to the trustee. However, there are certain qualifying phrases and clauses used in this connection and, although there are at places in the document words which give very wide powers to the trustee, these phrases and clauses show on their face that the testatrix did not mean to give him uncontrolled arbitrary power, but rather that he should function in accordance with the common custom of similar trustees. for example, in paragraph 5(a)(2) of the FOURTH provision of the will relative to the testamentary trust, the document provides a standard of action by the trustee, requiring that at all times he should be:

'Exercising the judgment and care, under the circumstances then prevailing, which men of prudence, discretion and intelligence exercise in the management of their own affairs, not in regard to speculation, but in regard to the permanent disposition of their funds, considering the probable income, as well as the probable safety of their capital, my Trustee is authorized to invest and reinvest all principal in any kind of property, real, personal, or mixed, and in any kind of investment, specifically including, but not by the way of limitation, corporate obligations of every kind, and stocks, preferred or common. My Trustee may continue to hold property received into this trust at its inception or subsequently acquired if and as long as my Trustee, in the exercise of good faith and of reasonable prudence, discretion, and intelligence, may consider that retention is in the best interest of the Trust.'

An objective standard is also thus provided in paragraph 5(b)(4) of the FOURTH provision of the instrument:

'In other respects, all matter relating to principal and income--save as otherwise in this Will provided--shall be governed by the provisions of the California Principal and Income Act as it exists from time to time, and, in the event no such act is in force, then all such other matters shall likewise be determined in the sole discretion of my Trustee.'

Mrs. Hartman is given plenary power to inspect all records kept by the trustee and that the testatrix intended that the court should supervise and control the trust is recognized in the provision designated FOURTH (5)(d):

'd. Accounting: I direct that my Trustee render, at least annually after my death, an accounting and report of his trusteeship to be judicially settled by the Court having jurisdiction of the trust herein and that a copy of said account and report be rendered to such of my income beneficiaries and remaindermen under the trust created herein as shall request the same by filing of request for special notice with the said Court.'

That the principal purpose of the trust is to take care of Mrs. Hartman through employment in her favor of all income necessary '* * * to provide for her support and maintenance * * *' is stressed by the requirement that the trustee should budget the estimated annual income of the trust for the purpose of periodic payments to her in paragraph FOURTH (5)(b):

'To budget the estimated annual income and expenses of the trust in such a manner as to equalize, as far as practicable, periodical payments to beneficiary.'

The will contains an in terrorem...