Mountain Park Institute, Inc. v. Lovill

• Decision Date: 30 April 1930
• Docket Number: 373.
• Parties: MOUNTAIN PARK INSTITUTE, Inc., et al. v. LOVILL et al.
• Court: North Carolina Supreme Court

153 S.E. 114

198 N.C. 642

MOUNTAIN PARK INSTITUTE, Inc., et al. v. LOVILL et al.

No. 373.

Supreme Court of North Carolina

April 30, 1930

Appeal from Superior Court, Surry County; Sink, Special Judge.

Proceeding by the Mountain Park Institute, Incorporated, and others against James W. Lovill and another, executors of R. L Haymore, deceased, for construction of testator's will. Judgment for plaintiffs, and defendants appeal.

Error.

Executor when he needs instruction, may bring suit in equity to obtain construction of will.

This is a proceeding in which the plaintiffs ask for a construction of the will of Rufus L. Haymore, deceased, and for a decree directing the defendants as his executors to turn over to the plaintiffs, trustees of Mountain Park Institute, the sum of $100,000 to be held by said trustees in trust for the uses and purposes set forth in the will. The controversy involves particularly the third, fourteenth, and nineteenth items, the material parts of which are as follows:

Item 3. "I bequeath the sum of One Hundred Thousand Dollars to the trustees of Park Mountain Institute, in trust for a period of time and for objects and uses as follows: To invest the same in interest bearing securities or in productive real estate and to apply the income thereof for the payment of teachers employed at Park Mountain Institute, Mount Park, Surry County, and any surplus that may remain after the paying of teachers, to be applied to the general expenses of Park Mountain Institute. I hold a certain deed of trust against the property of the said institute, which deed of trust is to be cancelled if a school shall be conducted there, in accordance with the provisions of a charter obtained from the State of North Carolina, for a period of ten years. I direct that the income from this trust fund of One Hundred Thousand Dollars be used to pay teachers and general expenses of Park Mountain Institute, as hereinbefore set forth, until this deed of trust is due; and if at that time the said school shall not have been run for a period of ten years, and the said deed of trust is foreclosed, I direct that this trust be closed, and that the fund of One Hundred Thousand Dollars, together with any accrued income that may not have been expended as hereinbefore provided, and any sum arising from the sale, of property under the said deed of trust be distributed among my heirs at law in exactly the same manner as the same would descend if this will had not been made --that is, according to the statutes of North Carolina governing the distribution of estates, both real and personal, in case of intestacy. But if the Institute shall be conducted as provided in its charter and the aforesaid mentioned deed of trust shall not be foreclosed, then I direct that this trust fund be then held by the trustees of Park Mountain Institute, and their successors as a permanent trust fund for the uses and objects hereinbefore enumerated."

Item 14. "After the payment of all my just debts in the manner hereinbefore provided for, provision of the trust fund above mentioned, which trust fund I desire to have established as soon as can reasonably be done after my death in order the Park Mountain Institute may begin to receive the benefits therefrom, and payment of all devises and bequests hereinbefore made, I direct my executors to divide my estate into four equal parts, either by partition of my sale, or partition as to part and sale of part," etc.

Item 19. "I direct that my executors make provision for the trust fund hereinbefore established, and that they settle all devises and bequests hereinbefore made, except those mentioned in paragraphs 15, 16, 17, and 18 of my will, as soon as they can do so conveniently and without selling my property at a sacrifice. I will state that I am anxious for the income from the trust fund established for Park Mountain Institute be available as soon after my death as possible in order that the school may continue without interruption and the teachers be paid. I have heretofore supported this institution, and I trust that this gift will enable it to enter upon a larger field of usefulness after my death."

Other items aid in ascertaining the testator's intent as expressed in these three.

The complaint, an amended complaint, the answer, and an amended answer were filed, each side making the will a part of its pleading, and the defendants in the amended answer setting up an account showing their dealings with the testator's estate.

When the case came on for hearing, the defendants demurred ore tenus on the ground that the complaint does not state a cause of action or allege the existence or nonexistence of facts giving the court jurisdiction to proceed to a hearing.

The court overruled the demurrer, and the defendants excepted and gave notice of appeal to the Supreme Court. Thereupon they tendered one issue as to whether they had acted arbitrarily and another as to whether Mountain Park Institute had been conducted up to that time in keeping with its charter. The judge refused to submit the issues to a jury and the defendants excepted. He then entered upon the hearing without objection by any of the parties and after considering the complaint and answers, the will, copies of the original records of accounts, and the admissions of counsel, he found certain facts and gave judgment for the plaintiffs, as appears of record. The defendants excepted and appealed.

Murray Allen, of Raleigh, and Folger & Folger, of Mt. Airy, for appellants.

Manly, Hendren & Womble, of Winston-Salem, W. L. Reece, of Dobson, and S. P. Graves, of Mt. Airy, for appellees.

ADAMS J.

The first assignment of error is addressed to the question whether the complaint states a cause of action. The appellants argue that it does not, and that the demurrer ore tenus should have been sustained. The proceeding was brought, they say, not by the executors named in the will, but against the executors, the legatees, and the devisees by the plaintiffs who, having no authority or power to administer the testator's estate, cannot prosecute a suit to construe the will, or to control the discretion vested in the executors, without at least specifically charging bad faith or arbitrary conduct. This statement is deduced from the proposition that unless an executor voluntarily applies to the court for direction and guidance the court will not generally interpose to control the exercise of his discretion. 25 C.J. 162, § 640(e).

It is well settled that an executor upon whom the will casts the performance of a duty may, when he needs instruction, bring a suit in equity to obtain a construction of the will. Bank v. Alexander, 188 N.C. 667, 125 S.E. 385; Trust Co. v. Stevenson, 196 N.C. 29, 144 S.E. 370; Dulin v. Dulin, 197 N.C. 215, 148 S.E. 175. In such case the jurisdiction is incident to that of trusts. Courts of equity do not exercise advisory jurisdiction if no trust has been created, or if the estate is a legal one, or if the question of construction is purely legal. Tayloe v. Bond, 45 N.C. 5; Alsbrook v. Reid, 89 N.C. 151; Cozart v. Lyon, 91 N.C. 282; Reid v. Alexander, 170 N.C. 303, 87 S.E. 125; Herring v. Herring, 180 N.C. 165, 104 S.E. 363.

But it does not follow that executors or trustees have the exclusive right to institute suits in which the construction of wills may be involved. Since equity has inherent power as an incident to its jurisdiction of trusts to construe wills to the extent to which trusts are thereby created, beneficiaries under a will, whose interests are founded in a trust relation or whose beneficial right is dependent upon the due performance by an executor of an obligation arising out of a confidence reposed in him by the testator, may bring suit to compel performance of the trust and incidentally to have the will construed. As suggested in Reid v. Alexander, supra, the suit would be constituted in a court of equity under the "known and accustomed head" of ""Equitable Titles," embracing trusts and their administration. 2 Page on Wills, § § 1401, 1405.

Here the plaintiffs are prosecuting a suit in equity for the enforcement of a trust. They request a construction of the will, not as affording in itself the main relief they seek, but as incident to an equity which they allege entitles them to the beneficial enjoyment of property given them under the will. It is therefore apparent that in overruling the demurrer ore tenus the judge made no error.

From this order the defendants had no right of appeal. According to its...