Pierson v. Palestine Contractors, Inc.

• Decision Date: 15 December 1977
• Docket Number: No. 1068,1068
• Parties: H. Wayne PIERSON et al., Appellants, v. PALESTINE CONTRACTORS, INC., Appellee.
• Court: Texas Court of Appeals

Page 908

559 S.W.2d 908

H. Wayne PIERSON et al., Appellants,

v. PALESTINE CONTRACTORS, INC., Appellee.

No. 1068.

Court of Civil Appeals of Texas, Tyler.

Dec. 15, 1977.

Rehearing Denied Jan. 5, 1978.

Charles H. Clark, Tyler, for appellants.

Terry M. Thorn, Paxton, Whitaker & Parsons, James R. Paxton, Palestine, for appellee.

DUNAGAN, Chief Justice.

This case involves a construction of a retirement trust established by appellee, Palestine Contractors, Inc., for the benefit of its employees. The appellants are three individuals who were employees of the appellee until they voluntarily terminated their employment in 1972 and 1973. It was stipulated by the parties that the appellants had a vested interest in the retirement trust at the time of their termination. Upon the termination of employment by appellants, the appellee caused to be issued three annuity policies which it had purchased from Crown Life Insurance Company. These policies do not contain any provisions of nontransferability.

The ownership of the policies was taken in the name of the Palestine Contractors Retirement Trust. Each appellant was named on the policies as the annuitant with their respective wives named as beneficiaries. These policies were then delivered to the appellants.

Appellants requested appellee to transfer ownership of the policies to the appellants. Appellee refused to do so, claiming that the trust instrument did not require such action.

Appellants brought this suit to construe the trust instrument, seeking a judgment of specific performance requiring appellee to transfer ownership of the annuity policies to the names of the appellants. Trial was without a jury and the trial court found for appellee.

We affirm.

All parties agree that the appellants have a vested interest in the benefits of the retirement trust. Vested interest is defined in the trust instrument as ". . . the minimum amount which a participant is entitled to receive under the applicable provisions of the plan . . . ."

Neither side has any pleadings asserting that the trust instrument is ambiguous. The appellants go on to say in their brief that "(A)ppellants do not think there is any ambiguity in this contract . . . ." The appellee agrees that the instrument is not ambiguous. Since this instrument is not ambiguous, we feel the applicable rules for construction of the instrument are set forth in Brown v. Brown, 245 S.W.2d 995 (Tex.Civ.App. Amarillo 1954, writ ref'd) at page 997:

". . . In construing instruments our courts are governed by certain well established rules. A written instrument, not alleged to be ambiguous, must be construed so as to carry out the primary intent of the parties. It must be considered as a whole and given its reasonable, natural and probable meaning. It must be interpreted according to the obvious import of its language without resorting to a subtle or a forced construction. One clause cannot be considered by itself; every clause must be considered with reference to the whole instrument as well as with reference to every other clause. Southern Travelers' Ass'n v. Wright, Tex.Com.App., 34 S.W.2d 823; Southwestern Life Ins. Co. v. Houston, Tex.Civ.App., 121 S.W.2d 619, error refused; Pagel v. Pumphrey, Tex.Civ.App., 204 S.W.2d 58, writ refused; Green v. Farmers & Merchants State Bank, Tex.Civ.App., 100 S.W.2d 132, writ refused; Guardian Trust Co. v. Bauereisen, 132 Tex. 396, 121 S.W.2d 579."

It is apparent that our primary consideration in construing this instrument must be to determine the intention of the parties. We must gather the intention of the parties from a reading of the entire instrument and not from isolated parts thereof. Wynnewood State Bank v. Embrey, 451 S.W.2d 930, 932 (Tex.Civ.App. Dallas 1970, writ ref'd n. r. e.); Burrus Mills, Inc. v. Hein, 378 S.W.2d 85, 88 (Tex.Civ.App. Dallas 1964, writ dism'd); Ervay, Inc. v. Wood, 373 S.W.2d 380, 384 (Tex.Civ.App. Dallas 1963, writ ref'd n. r. e.).

The following trust provisions are deemed to be relevant to the propriety of action taken by the appellee in this case:

"5-2 METHOD OF PAYMENT OF BENEFITS

(A) OTHER THAN LIFE INSURANCE DEATH BENEFITS Any vested amount which a participant or his beneficiary may be entitled to receive by reason of the participant's retirement, death, disability or termination of employment will, in the sole discretion of the trustee, be distributed, in cash or in kind or in some combination thereof, as follows:

(1) . . .

(2) Any fully vested life insurance contracts on the life of and purchased for the sole benefit of said participant will either be:

(A) . . .

(B) Will be converted by the Trustee to a nontransferable annuity (as defined in sub-section 2-1(K) herein) for the benefit of the participant or his beneficiary and of the type set out in sub-paragraph 5-2(A)(3)(c) below, subject to the provisions and any applicable limitations of sections 5-4 and 8-3 thereof, and will then, following the completion of such conversion, be released to the participant or his beneficiary; or

. . . ."ny

Nontransferable annuity is defined in the trust instrument as:

"(K) Nontransferable annuity is an annuity type of contract wherein no portion of the interest of the owner, if said owner is other than the trust, can be transferred, sold,...