Preston v. City Nat. Bank of Miami
| Decision Date | 26 March 1974 |
| Docket Number | No. 73--328,73--328 |
| Citation | 294 So.2d 11 |
| Parties | Ernice Shirley Weinkle PRESTON, Appellant, v. CITY NATIONAL BANK OF MIAMI, a National banking corporation, et al., Appellees. |
| Court | Florida District Court of Appeals |
Snyder, Young, Stern & Tannenbaum, Morth Miami Beach, for appellant.
Frates, Floyd, Pearson, Stewart, Proenza & Richman, Heller & Kaplan, Miami, for appellees.
Before CARROLL and HENDRY, JJ. and DREW, E. HARRIS, Associate Judge.
In the previous appearance of this case, 1 we reversed the judgment dismissing the complaint with prejudice. First, because '. . . the complaint, On its face (was not) vulnerable to a contention of laches On motion to dismiss.' (Emphasis supplied.) We said, 'If there are facts and circumstances which should so require, they are not shown on the complaint, and if they exist would be matters to be presented in defense of the action by answer.' Second, the allegations of the complaint that such assignment (of plaintiff's right to receive the corpus) had been made by her without legal advice and without comprehending the consequences thereof; that the same had been obtained by the undue influence of her brother (trustee), and that such action of the trustee constituted a breach of confidential and fiduciary relations. These and other reasons delineated were sufficient facts, if proven, upon which relief could be granted. Third, a justiciable question was presented as to the validity of a voluntary transfer or assignment by the beneficiary of a spendthrift trust of her right to receive benefits provided for therein.
The case was returned to the able trial judge who heard all the testimony, considered all the evidence, and entered the final judgment. Pertinent portions appear in the footnote. 2
We are in complete accord with the trial judge's conclusion, based on the evidence produced before him at the trial that the lengthy passage of time, (nearly 10 years) between the date of her signature to the amendment to the trust indenture and her repudiation of it, was detrimental to the defendant. Moreover, the plaintiff, during this long period of time, accepted payments of income produced by the whole corpus and otherwise, by her acts, ratified the amendment. The findings of the trial judge that the amendment was clearly understood and approved by the plaintiff, and that she knew what she was doing, that there was no fraud or overreaching, is under elemental rules, binding on this Court where supported by competent substantial evidence. We not only find that quality of evidence present in this record but we completely concur in the trial judge's estimate of it.
This leaves the sole pertinent question posed by appellant's Points I and V, viz:
We will discuss both points together.
Appellant's argument is that, even assuming the assignment was knowingly, freely and voluntarily made and thoroughly understood by the appellant, the Trust, being a spendthrift trust, could not lawfully be so amended. We do not agree. It is conceded by the parties that the amendment was executed and the original trust indenture changed 3 only to the extent of assuring to the benficiary income therefrom during her life. Such a plan is far more consistent with the purpose of a spendthrift trust than the original one. Such a trust is exactly what the name implies. Usually conceived by parent, or relatives, or friends concerned over the irresponsible propensities of a loved one, or their inability to cope with the problems of earning a livelihood and to prevent them becoming public charges, these documents have been long recognized by the courts. After the benefits of such a trust pass to the possession of a beneficiary, the creator's power to protect the beneficiary against himself or herself is gone. And so it is that the provision here in the original trust is with reference to corpus, to say the least, somewhat inconsistent with the purpose usually prompting such arrangements. It probably was because of the desire of the creator, and of the beneficiary, years after the trust was originally written to assure the beneficiary financial stability during her life (so far as possible), that the changes were made. Subsequent events, including four marriages, established the wisdom of the change.
But, appellant argues, the original plan is irrevocable, and any attempt of the beneficiary to change it is invalid. In support of this thesis is quoted the statement in 24 A.L.R.2d § 4 at 1109 and the Waterbury case. 4 The Waterbury case is inapposite. It related only to alienation of Income, and there were other factors which clearly separate it from the problem here. The A.L.R.2d quotation, supra, has reference to the 'assignment of the right to Future income'.
If such right could be assigned by a beneficiary of a spendthrift trust, the very purpose of such a trust would be destroyed. There can be no doubt of the validity of this premise. But here, we are dealing, not with 'alienation of future income,' but the right to receive future corpus 5--two very different concepts in this area.
The terms of a trust may be modified if the settlor and all the beneficiaries consent. Having the power to terminate, they obviously have the power to create a new trust or to modify or change the old. 6 In Florida, this principle has long been recognized. 7
What we have said about trusts generally applies to that type of trust characterized as spendthrift trusts. There is no reason in logic or law to create distinctions. The word 'spendthrift' merely describes its nature, as would the words 'charitable', 'educational' or other similar words employed in the field of trusts. Ordinarily, the principal purpose of a spend-thrift trust is to protect the beneficiary against debtors. That is the reason for the well nigh universal provision against alienation of any future right to the benefits flowing therefrom. Here, this purpose has been assured by the amendment to an even greater degree than was arranged in the original instrument and all with the consent of those affected. This is all that the law requires.
No point is made in this appeal as to the trial court's denial of the prayer for an accounting from the bank.
Affirmed.
1 Preston v. City National Bank of Miami, 258 So.2d 283 (3 Fla.App.1972).
2 '1. That on March 28, 1946, ESTHER WEINKLE, created an inter vivos, irrevocable trust, naming the...
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