President, etc., of Bowdoin College v. Merritt

• Decision Date: 05 June 1896
• Docket Number: 11,563.
• Citation: 75 F. 480
• Parties: PRESIDENT, ETC., OF BOWDOIN COLLEGE et al. v. MERRITT et al.
• Court: U.S. District Court — Northern District of California

75 F. 480

PRESIDENT, ETC., OF BOWDOIN COLLEGE et al. v. MERRITT et al.

No. 11,563.

United States Circuit Court, N.D. California.

June 5, 1896

Robert Y. Hayne and George N. Williams, for complainants.

Horace W. Philbrook, J. C. Martin, A. A. Moore, A. H. Cohen, Rodgers & Paterson, E. Nusbaumer, and H. C. Campbell, for respondents.

HAWLEY District Judge.

This is a suit in equity to quite title to certain property. The views that have been heretofore expressed, and the principles of law that have been discussed and decided by this court in this case (54 F. 55; 59 F. 6; 63 F. 213), will not be considered, commented upon, or reviewed. The case will now be considered upon its merits.

The main question for decision, under the issues raised by the pleadings and presented by the testimony, is whether a decree should be given against James P. Merritt, Catherine M Garcelon's next of kin, against Harry P. Merritt, her residuary devisee and legatee, and against George W. Reed, her administrator declaring valid a deed of real estate of the value of $750,000, and a conveyance of personal property of the value of $500,000, and a declaration of trust, all being parts of one instrument and embracing all her property, except $14,000, alleged to have been made by her April 21, 1891, to John A. Stanly, her attorney at law and legal adviser, and Stephen W. Purington, her general business manager and agent as trustees. To arrive at a proper solution of this question, it will be necessary, among other things, to determine (1) whether the conveyances were executed in violation of section 1313 of the Civil Code of California, which makes void any attempt of a person to give, by will, more than one-third of his estate to charitable uses; (2) whether Catherine M. Garcelon had the mental capacity to comprehend the character and extent of her property and to make the conveyances; (3) whether the conveyances were obtained from her by undue influence or fraud.

It will become necessary, in reviewing the questions of fact, to consider all the circumstances and surroundings of the respective parties. The testimony of the witnesses covered a wide range, and opened up a broad field for the study of human nature in all of its phases and essential characteristics. The reasons for the conclusions reached by the court cannot very well be crystallized, by brevity of expression, into the limited space of an ordinary judicial opinion. Many of the minor details of the evidence will not be noticed at all. Others will only be generally stated. It will, however, be essential to refer, in a review upon the most important questions, to the lives, history, and character of some of the persons who figure so prominently in the transactions involved in this litigation. In the outset it is proper to state that the witnesses were, as a rule, intelligent, many of them being people of extensive business experience and knowledge, men and women of probity and strength of character. Many of them were the relatives or close friends of the family of Dr. Merritt and Mrs. Garcelon, and frequent visitors at their home. Their character and credibility, with perhaps two or three exceptions, were unimpeached, and stand unquestioned. One noticeable feature must be mentioned: Many of the witnesses who appeared on behalf of the defendants were, more or less, in personal feeling at least, interested in the result of this litigation. Several of them had not received as much from Mrs. Garcelon as they expected. Some of the witnesses who appeared on behalf of the complainants were also beneficiaries in the trust, and were satisfied with what they had received, and felt grateful for the kind remembrances of Mrs. Garcelon. The interested feeling of many of the witnesses was plainly discernible by the court, and in several instances human nature plainly manifested itself. There were also several witnesses on the respective sides that were not in any manner interested either way.

1. Are the conveyances a fraud upon, and a violation by indirection of, section 1313 of the Civil Code of California?

This section reads as follows: 'No estate, real or personal, shall be bequeathed or devised to any charitable or benevolent society, or corporation, or to any person or persons in trust for charitable uses, except the same be done by will duly executed at least thirty days before the decease of the testator; and if so made, at least thirty days prior to such death, such devise or legacy, and each of them, shall be valid; provided, that no such devises or bequests shall collectively exceed one-third of the estate of the testator leaving legal heirs, and in such case a pro rata deduction from such devises or bequests shall be made so as to reduce the aggregate thereof to one-third of such estate; and all dispositions of property made contrary hereto shall be void, and go to the residuary legatee or devisee, next of kin, or heirs according to law.'

The defendant's contention is that the documents in question were ambulatory, revocable at the will and pleasure of Mrs. Garcelon during her life, and that it was not intended they should take effect, so far as she was concerned, until after her death, and that these conditions make the documents a will, and not a deed. This question must be determined from the language of the instruments, aided by the surrounding facts, and the circumstances and conditions of the respective parties at the time of their execution.

The statute in question does not apply to every disposition of property. It is evident, from a careful reading of its provisions, that it is limited in its application to 'devises or bequests' of property by will. It does not apply to deeds. Every person, having the mental capacity, and being free from debts and personal obligations, has the unquestioned right to convey and dispose of his property by deed as he pleases, and his acts in so doing cannot be set aside if the transaction is free from fraud and undue influence. What is the essential difference between a deed and a will? A deed must pass a present interest in the property, although the right to possession and enjoyment may not accrue until some future time. An instrument which does not pass any interest until after the death of the maker is a will. Nichols v. Emery (Cal.) 41 P. 1089; Craven v. Winter, 38 Iowa, 478; Spencer v. Robbins, 106 Ind. 580, 5 N.E. 726; Kopp v. Gunther, 95 Cal. 64, 30 P. 301; Diefendorf v. Diefendorf, 132 N.Y. 100, 30 N.E. 375; Chrisman v. Wyatt (Tex.Civ.App.) 26 S.W. 759; Jenkins v. Adcock (Tex.Civ.App.) 27 S.W. 21; Bunch v. Nicks, 50 Ark. 367, 378, 7 S.W. 563; Bromley v. Mitchell, 155 Mass. 509, 30 N.E. 83; Mowry v. Heney, 86 Cal. 475, 25 Pac, 17; Book v. Book, 104 Pa.St. 240; McGuire v. Bank, 42 Ala. 591; Hall v. Burkham, 59 Ala. 349, 354; Owen v. Smith, 91 Ga. 568, 18 S.E. 527.

In Craven v. Winter the court said:

'A rule recognized by this court, which seems to have the united support of the authorities, furnishes an unerring test to determine the character of the instrument. It is this: 'If the instrument passes a present interest, although the right to its possession and enjoyment may not occur till some future time, it is a deed or contract; but, if the instrument does not pass an interest or right till the death of the maker, it is a will or testamentary paper.' University v. Barrett, 22 Iowa, 72.'

The instrument in question purports to be a deed. Its language is that ordinarily used in deeds. By its terms it passes a present interest in the property therein mentioned to the trustees therein named. It was executed and acknowledged as a deed, and delivered to the trustees as such. It is a deed.

But it is further argued by the defendants that the intention of the parties was to make a will, and that the documents were put into the form of a trust deed for the express purpose of evading the provisions of section 1313, and this argument is sought to be upheld upon the grounds, among others, that Mrs. Garcelon, after the signing of the papers, continued, through her agent, Stephen W. Purington, to manage the property as long as she lived, that she at all times treated the property as her own, that in mentioning the fact of the execution of the documents she spoke of it frequently as her will, that the transaction was a gift by Mrs. Garcelon to take effect at her death, that it was revocable during her life, and that duplicates of the documents were never delivered to the trustees. The testimony shows, without contradiction, that the original instruments were delivered to and kept by John A. Stanly in his safe. It is therefore immaterial what was done with the duplicates, and the fact that they were taken by Stephen W. Purington, and were kept by him in Mrs. Garcelon's safe-deposit box until after her death, does not in any manner destroy or contradict the evidence as to the delivery of the originals, as will hereafter be shown.

It is claimed by the complainants that the deed of trust only contains a limited power of revocation, in this: that it only refers to the provisions in favor of the relatives and friends who are beneficiaries in the trust, and does not apply to the charities which are the real subject of this controversy. The document itself would seem to sustain this construction. The clause as to the right of revocation reads as follows:

'The party of the first part hereto reserves to herself the power of revocation, or of modification, or of substitution of any or all of the trusts hereinbefore declared, such revocation, modification, or substitution to be made within such fifteen years, and to be made by her by a paper writing by her executed.'

There is nothing 'hereinbefore declared' in the instrument which relates to the gifts...