Morgenthaler v. First Atlantic Nat. Bank of Daytona Beach

• Decision Date: 18 May 1955
• Citation: 80 So.2d 446,54 A.L.R.2d 353
• Parties: Henry W. MORGENTHALER, Jr., Joined by Elizabeth Taylor Morgenthaler, his wife, and David Turner Morgenthaler, their son, Petitioners, and Joseph E. Morgenthaler, Petitioner, Appellants, v. FIRST ATLANTIC NATIONAL BANK OF DAYTONA BEACH, Florida, as Executor, Appellee.
• Court: Florida Supreme Court

Page 446

80 So.2d 446

54 A.L.R.2d 353

Henry W. MORGENTHALER, Jr., Joined by Elizabeth Taylor Morgenthaler, his wife, and David Turner Morgenthaler, their son, Petitioners, and Joseph E. Morgenthaler, Petitioner, Appellants, v. FIRST ATLANTIC NATIONAL BANK OF DAYTONA BEACH, Florida, as Executor, Appellee.

Supreme Court of Florida, Division A.

May 18, 1955.

Edward L. Semple, Miami, for appellants.

Cobb & Cole, Daytona Beach, for appellee.

DREW, Chief Justice.

We preface this opinion with the observation that our task in this case-involving as it does-a difficult question that this court has never decided, has been simplified, and we have been greatly assisted by the concise, logical and ably prepared briefs of counsel for both parties as well as a record embracing only essential matters.

We are concerned here with the will of Sophia Morgenthaler dated June 5, 1935, (hereinafter referred to as the 'will') and the codicil thereto dated September 10, 1949, (hereafter referred to as the 'codicil'). The codicil of April 3, 1952, is not directly involved in the question before us.

The original will devised the residue of the estate to a trustee. Broad powers were given the trustee with reference to the management and investment of said residue. The portions of the will pertinent to the issue now under consideration are embraced in paragraph Fourth ¹ and in paragraph Four of the codicil along with the explanation or introductory portion thereof. ^{2 2} Sophia's sister Rose, as is apparent from paragraph one of the codicil predeceased Sophia.

A little while after the death of Sophia, her nephew, Henry W. Morgenthaler, Jr., joined by his wife, Elizabeth, and his son David, and another nephew, Joseph E. Morgenthaler, (two of the nephews provided with annuities in the will and codicil) filed, separately, petitions before the provate Judge entitled 'Petitioners' Election to Take Corpur of Estate instead of Annuity.' The prayers of the petitions were substantially the same. ³

The Probate Judge disagreed with petitioners' contention that they were the unqualified and absolute owners of the corpus of the estate to be used to purchase the annuities, but held that in purchasing said annuities the executor or trustee 'shall so contract with the Life Insurance Company or Companies, selected to write said annuities, that there will be no restrictions on the petitioners, or either of them, in the matter of sale, transfer, mortgage, hypothecation, or similar handling, of said annuities subsequent to the time they are received by petitioners, except that in the case of Henry W. Morgenthaler, Jr., said annuity contract or contracts shall provide that upon his death the unused portion of that annuity shall be paid over unto his wife, Elizabeth Taylor Morgenthaler and his son, David Turner Morgenthaler, share and share alike, or to the survivor of them, in the event the other shall have passed on prior to the decease of said Henry W. Morgenthaler, Jr.'

On appeal and cross appeal to the Circuit Court, that court affirmed the Probate Judge on his holding concerning the ownership of the corpus but reversed him on the proposition quoted above. It is the decree of the Circuit Judge that we now have before us on the appeal of the petitioners in the Probate Court. Hereafter we shall refer to them as the appellants. The executor and trustee we shall call appellee.

Two questions are presented here. Both the appellants and the appellee agree that the first is: 'Where a testator directed an executor to purchase for a beneficiary a 'full refund life annuity' in a responsible life insurance company upon a contract to pay to said beneficiary a monthly annuity in as large amount as the fund will purchase, with the proviso in the contract that the unused portion, upon the death of the annuitant, be paid over to persons to whom it is directed to be paid by such annuitant, is not the beneficiary entitled to elect and to receive the corpus of the estate in lieu of such annuity?'

Appellants argue-and not without considerable force and persuasion and upon respectable authority-that the answer must be in the affirmative because, under the common law in force July 4, 1776 ⁴, and at all times since then, a bequest of money to be used in the purchase of an annuity gives the legatee a right to the money and he can insist that the annuity shall not be bought. ⁵ Appellee agrees that this is a correct statement of the later holdings of the English Courts. It is commonly called the English rule. Appellants argue that this rule has been the law of England and hence a part of the common law since the case of Yates v. Compton, 2 P.Wms. 308, decided in 1725; but appellee says that Yates v. Compton, supra, does not decide this point at all and that the first English case to support appellants' contention was that of Barnes v. Rowley, 3 Ves.Jr. 305, decided in 1797. Thus, there is present here, among other questions, a dispute as to the status of the common law on this point on July 4, 1776. This question is intriguing, but for the reasons hereafter expressed, we find no necessity for pursuing it. Further developing appellants' theory and using their premise, arguendo, that the common law in force July 4, 1776, became a part of the law of Florida and was the law in this state at all times pertinent to this case, they say that such law governed the question and that we are bound to honor it under the rule of stare decisis.

Appellee counters with the proposition that, with the exception of Massachusetts ⁶ and New York ⁷, every common-law state where the question has arisen has rejected the English rule and adopted the American rule which gives effect to the testator's intention as expressed in the will. ⁸ Summarized, appellee says the American rule is the proper rule because.

(1) It is consistent with the respect which our American Courts have always shown for the intention of the testator.

(2) The English rule is not part of the common law that we inherited from that nation.

(3) The English rule is arbitrary, and to follow it would be at the expense of justice.

(4) The reason for the English rule, that it is useless to purchase an annuity because the legatee might immediately sell his annuity at substantially the amount of the purchase price of the annuity does not exist. It is not true that a legatee by the sale of an annuity will be able to 'receive substantially the amount of the purchase price of the annuity.'

The plain language of the will and codicil convinces us that it was the clear intention of Sophia Morgenthaler to provide an income to her nephews, who bore her name, during their lifetime, in an amount-as she said in the preface to the codicil-'sufficient to maintain the average individual.' It is equally clear that to accomplish this purpose she directed her trustee to purchase the annuities. We think it is also clear that it was her desire that these nephews should not be privileged to receive the corpus at their behest or request. Both the Probate Judge and the Circuit Judge reach these same conclusions and appellants with commendable frankness do not argue to the contrary. The simple question then, on this issue, is whether we shall honor the plain intent of the testator or disregard that intent as the English courts and the Massachusetts and New York courts have done on the theory that the courts would not compel an executor to perform an act which would be entirely nugatory. ⁹

From the beginning this court has undeviatingly held to the view that in construing wills its guide and polar star is the intent of the testator. The cases of this court affirming this proposition are legion. There is no higher duty nor greater responsibility on the courts than that of seeing to it, in proper cases, that the will of the dead is honored. Knowledge in the living that this will be done affords a marked degree of solace and comfort in the afternoon and evening of life. One possessed of his normal faculties, may, during his infetime dispose of his own possessions as he pleases. He may, if he chooses, drop his wealth to the bottom of the sea and no man can restrain him. Why, then, should he not be allowed so to dispose of his wealth after his death where the manner in which he does so is not unlawful or contrary to the public policy of the State?

Accepting the premise, then, that our paramount duty is to lend our arm to effectuating the plain intent of the testatrix that her nephews receive the annuity for their life and without power to sell or dispose of it-such intention being unchallenged-does the so-called English rule require us to hold contrary? We think not.

We doubt that the law of England, on July 4, 1776, on the question was crystallized to the point that it could be said that on that date it was the common law of England of a general nature. But even if it were, we are not bound to adhere if we should determine that such rule dethrones a principle which is sacred to our way of life and fundamental in our concepts of right and justice. We have never hesitated, in proper cases, to overrule our own precedents where to do otherwise would result in injustice and oppression or perpetuate a palpably erroneous decision. Why, then, should we hesitate to recede from or refuse to follow a common-law concept which we have never judicially recognized or sanctioned?

In Layne v. Tribune Co., 108 Fla. 177, 146 So. 234, 237, 86 A.L.R. 466, 472, speaking through the late Chief Justice Davis, we said:

'Courts of justice are bound by the rule of stare decisis to follow the common law as it has been judicially declared in previously adjudicated cases. And the courts as such have no inherent right to revise or amend the settled rules of the common law to suit their own ideas of wherein the law should be modernized by amendments which would overturn long standing precedents. But it does not follow from what has been said in this regard, that the courts...