Moore v. Cavett

• Citation: 368 P.2d 224
• Decision Date: 28 November 1961
• Docket Number: No. 38989,38989
• Parties: Marcla L. MOORE, Joseph C. Campbell, Jr., and Allen Hales Buck, Plaintiffs in Error, v. K. CAVETT and The First National Bank and Trust Company of Oklahoma City, as Trustees of the W. T. Hales Estate Trust, Defendants in Error.
• Court: Supreme Court of Oklahoma

Page 224

368 P.2d 224

94 A.L.R.2d 1293

Marcla L. MOORE, Joseph C. Campbell, Jr., and Allen Hales

Buck, Plaintiffs in Error, v. K. CAVETT and The First National Bank and Trust Company of

Oklahoma City, as Trustees of the W. T. Hales

Estate Trust, Defendants in Error.

No. 38989.

Supreme Court of Oklahoma.

Nov. 28, 1961.

Rehearing Denied Jan. 30, 1962.

Syllabus by the Court.

1. In actions to construe the provisions of a trust instrument, the only necessary parties to such actions shall be those persons designated by name in the instrument creating the trust, and any persons who may be actually receiving distributions from the trust estate at the time the action is filed; contingent beneficiaries designated as a class shall not be necessary parties. 60 O.S.1951 § 175.23, subd. C.

2. Where continuance is sought on account of absence of a party to the action, the trial court's ruling will not be disturbed unless it clearly appears that the court abused its discretion in overruling the motion for continuance.

3. When permanent improvements are authorized by the trust instrument to be erected by the use of trust principal, it is not required that an amortization fund or reserve for depreciation be set up and maintained from income unless the trust instrument so provides.

4. It is within the discretion of the trial court to allow as a charge against trust principal the attorneys' fees and other expenses reasonably and necessarily incurred by parties to litigation with respect to substantial and material issues in a trust if an adjudication is essential to proper administration of the trust and if the litigation is in good faith for the primary benefit of the trust as a whole.

5. The requirements of 12 O.S.1941 § 611, that the trial court make findings of fact and conclusions of law under certain circumstances, are complied with when the court makes separate findings of fact and conclusions of law on the material issues on which there is conflicting evidence.

Appeal from District Court of Oklahoma County; Glen O. Morris, Judge.

Action by trustees of testamentary trust for instructions concerning erection of building by use of trust principal. Judgment for trustees and three of contingent beneficiaries (remaindermen) appeal. Trustes cross-appeal on issue of trial court's allowance of attorneys' fees to contingent beneficiaries' counsel. Affirmed in part and reversed in part with directions.

Byrne A. Bowman, Felix, Griffin, Bowman, Templin & McIntyre, Oklahoma City, for plaintiff in error, Allen Hales Buck.

John H. Kennedy, Oklahoma City, for plaintiffs in error Marcia L. Moore and Joseph C. Campbell, Jr.

Cochran, Dudley, Fowler, Rucks, Baker & Jopling; Lytle, Johnston & Soule, Oklahoma City, for defendants in error and cross-petitioners in error.

HALLEY, Justice.

This was an action by the trustees of a testamentary trust for instructions concerning the erection of a building on trust real property consisting of two 25 foot lots in downtown Oklahoma City. The trustees attached to their petition a copy of the proposed construction contract and a copy of the proposed lease contract with the prospective lessee of the new building. Two of the contingent beneficiaries (remaindermen) filed motions denying jurisdiction and they together with one other contingent beneficiary filed answers objecting to the erection of a building under such a plan. The trustor's four children, who were the beneficiaries actually receiving distributions from the trust estate at the time of the filing of the petition, filed a joint answer in which they joined with the trustees in requesting that the instructions prayed for in the petition be approved.

The trust in question was created by the last will and testament of W. T. Hales, deceased, for the benefit of the trustor's five children. The three objecting defendants, grandchildren of the trustor, are children of a deceased beneficiary. They will be hereafter referred to as defendants or by name: Moore, Campbell and Buck.

The trial court construed the terms of the will which established the trust and approved the petition of the trustees and made other incidental orders necessary to a complete determination of the issues. The three defendants (contingent beneficiaries) appealed from the judgment and the order overruling their motion for new trial. The trustees cross-appealed from the trial court's order allowing attorneys' fees to counsel for the three defendants and from the order overruling motion for new trial as to that issue.

The three defendants made eight assignments of error which will now be dealt with in the order presented.

First. Two of the defendants, Moore and Campbell, claim that the trial court erred in overruling their motion consisting of a special appearance and denial of jurisdiction. Defendants Moore and Campbell are citizens and residents of California. No summons was issued to or process served on any of the defendants. Prior to a hearing on the merits of the matter, the court found that defendants Moore, Campbell and Buck were not necessary parties to the action and overruled the motions of the defendants Moore and Campbell as stated above and allowed them to file answers. Defendant Buck filed his answer and appeared by counsel. The other contingent beneficiaries, all of whom were grandchildren or great-grandchildren of the trustor, did not file answers but appeared in court by their attorney. We have previously decided a case in which contingent beneficiaries of a trust made the same complaint that is being made by the appealing parties in the instant case. In that case, Hurst v. Kravis, Okl., 333 P.2d 314, 317, we decided adversely to the contentions of the appealing defendants and said:

'The minor contingent beneficiaries were not designated by name and were designated as a class and were not receiving any distribution from the trust and although they were parties to the action they were not necessary parties under the provisions of Title 60 O.S. 1951 § 175.23, subd. C, a section of the Oklahoma Trust Act providing jurisdiction to District Courts to construe trust instruments:

"Actions hereunder may be brought by a trustee, beneficiary, or any person affected by the administration of the trust estate. If the action is predicated upon any act or obligation of any beneficiary, such beneficiary shall be a necessary party to the proceedings. The only necessary parties to such actions shall be those persons designated by name in the instrument creating the trust, and any persons who may be actually receiving distributions from the trust estate at the time the action is filed; contingent beneficiaries designated as a class shall not be necessary parties."

We believe that the relative positions of the parties in the Hurst case, supra, were almost identical with parties in this case, and that the trial court in the instant case was therefore correct in its finding that the defendants were not necessary parties although they were allowed to appear and present their objections to the trustees' petition.

Second. Defendants Campbell and Moore assign as error the trial court's refusal to grant their motion for continuance for a reasonable time so that they could be present to assist counsel at the hearing on the trustees' petition. Defendants cited Beck v. Peard, 183 Okl. 195, 80 P.2d 614, 615, as being in point. In that case the defendant Beck lived in California and presented an affidavit for continuance which stated that by reason of other litigation which he had pending in the courts of California he would be unable to be present. In that case this Court said:

'* * * There is no statute which specifies the necessary averments of an application for continuance on the ground of the absence of a party as such. Under Sec. 396, supra, [12 O.S.Supp. 1959 § 667] a continuance upon such ground may be granted 'for good cause shown' and 'upon terms as may be just.' Therefore the rule by which we are governed, as called to our attention by plaintiff, is that where a continuance is sought on account of the absence of a party to the action, unless it clearly appears that the court abused its discretion in overruling the motion for such continuance, this court will not disturb the action of the lower court. Lynch v. Peterson, 1923, 91 Okl. 28, 215 P. 617; Sherman Machine & Iron Works v. Cole Mfg. Co., 1915, 51 Okl. 353, 151 P. 1181.

'In determining whether the trial court abused its discretion there are two considerations. First, did the defendant give a sufficient reason for not being present at the trial? and, second, assuming that he did, was his presence as a party necessary?'

In that case the Court answered both questions in the affirmative. In the present case we believe that the trial court did not abuse its discretion in overruling the motion for continuance because the defendants gave no reason for their absence except that they resided in California. Furthermore, we have just stated that they were not necessary parties. See also 17 C.J.S. Continuances § 27, p. 211, which states that it is not ordinarily considered essential for a party to be present to assist his counsel at the trial of a cause unless other reasons are shown.

Third. Defendants contend that the trial court failed to properly interpret the will of the decedent which established the trust. The defendants divide this contention into four parts which we will discuss separately.

(a) Defendants say that the trustor created two separate trusts and neither was to be invaded by the other. Excerpts from the will are quoted in defendants' brief to support this theory, but no cases are cited to bear it out. We do not believe that the language of the will can be construed as establishing two trusts.

(b) Defendants next state that the wishes of the trustees, life income beneficiaries and other contingent beneficiaries should not control and cite Hill v. Hill, 49 Okl. 424, 152 P. 1122, as being a...