Quinn v. Peoples Trust & Sav. Co.
| Decision Date | 05 April 1945 |
| Docket Number | 28060. |
| Citation | 60 N.E.2d 281,223 Ind. 317 |
| Court | Indiana Supreme Court |
| Parties | QUINN et al. v. PEOPLES TRUST & SAVINGS CO. et al. |
Appeal from Allen Superior Court, No. 2; D. Burns Douglass judge.
Eggeman Reed & Cleland, of Fort Wayne, for appellants.
Newkirk & Keane, of Fort Wayne, for appellees.
On July 7, 1936, Celia Foley duly executed a will and on February 27 1942, added a codicil. After a few small bequests the testator disposed of the residue of her estate by Item VII, about which this litigation revolves. Item VII reads as follows:
'All the rest, residue and remainder of my property, both real and personal, whereever situated, I will, bequeath and devise to The Peoples Trust and Savings Company in Fort Wayne, Indiana, in trust, for the purposes and upon the conditions as follows, to-wit:
'1. Said Trustee shall hold all property given it and collect the income therefrom and may in its discretion from time to time sell such part thereof as needed and as it thinks advisable, all with or without notice and appraisement and upon such terms as it thinks best and proper.
'Said Trustee may also invest and reinvest, from time to time, any money coming into its hands, whether the money be from sale of property or from income on the trust property.
'2. Said Trustee is directed to pay from the funds in its possession to my friend, Miss Bernadette Monahan, of Fort Wayne, Indiana, the sum of twenty-five dollars ($25) per month for and during her natural life and said monthly payments are to begin one month after my death.
'3. Said Trustee is directed to pay from said trust property to my friend, Mrs. Olive Eaton, of Fort Wayne, Indiana, the sum of fifteen dollars ($15) per month for and during her natural life, and said monthly payments are to begin one month after my death.
'4. After the Trustee has set aside from the trust property a sufficient amount to take care of the monthly payments to be made as hereinabove directed, the remainder of the trust property, including that not used for said monthly payments, shall be used to promote college or university education of children of employees of the Pennsylvania Railroad Company living in the City of Fort Wayne, Indiana. This is done by me in memory of and in honor of my deceased brother, Thomas J. Foley, a former Pennsylvania employee. Only one person at a time shall receive benefit of this bequest and the persons from time to time to receive the benefits hereof shall be chosen whenever there is available property for the purpose herein designated by a committee of three persons, to-wit: (a) President of Trustee. (b) Judge of the court in Allen County having probate jurisdiction, and (c) Superintendent of the School City of Fort Wayne.
'The boy or girl selected to receive the benefit hereunder shall have the right to select or choose the college or university, but the amount to be paid each year shall be left to the committee aforesaid and shall not exceed eight hundred dollars ($800) per year and shall not be paid to any one person for more than four years.
'Whenever an award is made, the annual amount shall be paid in eight equal installments, one month apart, the first installment to be paid at the beginning of the school year.
'This fund shall be administered as aforesaid until completely exhausted.'
By the codicil the monthly payments to Miss Bernadette Monahan were changed to forty dollars per month, and the payment to Mrs. Olive Eaton was eliminated because of the intervening death of Mrs. Eaton.
The testatrix never married and died on December 29, 1942, leaving no father, mother, sister or brother. She left as her sole and only heirs the appellants, two of whom are nephews, one of whom is a niece, one of whom is a grand-nephew and one of whom is a grand-niece.
The appellants commenced this action by complaint in three paragraphs filed on April 1, 1943, asking a declaratory judgment determining the validity of the trust and the rights of appellants in the residuary estate of the testatrix.
Each paragraph of complaint alleges the relationship of appellants to the testatrix and the execution of the will in question and that the testatrix died and left personal property in excess of eighty-five thousand dollars after payment of all indebtedness, costs of administration and specific bequests; that in addition thereto she left real estate of an estimated value of ten thousand dollars, with a rental income of approximately one hundred dollars per month; that in the future the gross income from personal property will exceed twenty-five hundred dollars per year and the gross income from real estate will exceed one thousand dollars per year. At the bottom of appellants' case is their belief that under the will only one child at a time can receive the benefits of the trust in an amount not exceeding eight hundred dollars per year, and that the trust estate will produce large excess income which may accumulate in perpetuity.
The theory of the first paragraph of complaint is that Item VII of the will is wholly void and that the plaintiffs, as testatrix's heirs, are entitled to her residuary estate. The theory of the second paragraph of complaint is that Item VII is invalid as to excess income, and that the plaintiffs are entitled to receive from time to time so much of the income of the trust estate as is not necessary in a strict and literal compliance with the administrative provisions of the trust clause of the will as written. The theory of the third paragraph of complaint is that Item VII is invalid as to the real estate and such personal property as is not necessary to produce income required in a strict and literal compliance with the administrative provisions of the trust clause of the will and that the court should determine the amount of property necessary to produce such income and award the excess property to plaintiffs.
Each defendant filed a demurrer to each paragraph of complaint alleging insufficiency of facts and lack of jurisdiction of the court over the subject matter of the action.
The trial court sustained all the demurrers and the plaintiffs elected to stand upon their complaints and judgment was entered against the plaintiffs who now appeal to this court.
The jurisdiction of the trial court was challenged on the ground that neither paragraph of complaint alleges facts which entitled plaintiffs to relief under the declaratory judgments act. By jurisdiction of the subject matter is meant jurisdiction of the class of cases to which the particular case belongs. State ex rel. Felthoff v. Richards, 1932, 203 Ind. 637, 650, 180 N.E. 596; McCoy v. Able, 1891, 131 Ind. 417, 30 N.E. 528, 31 N.E. 453. The declaratory judgments act gives all courts of record jurisdiction in declaratory judgment cases. Burns Ind.Stat.1933, § 3-1101, Baldwin's 1934, sec. 438. Section 2 of the declaratory judgments act provides that 'Any person interested under a * * * will * * * may have determined any question of construction or validity arising under the instrument, * * * and obtain a declaration of rights * * * thereunder * * *.' Burns Ind.Stat.1933, Sec. 3-1102, Baldwin's 1934, sec. 439.
Section 4 of the declaratory judgments act also specifically provides for determination of any question arising in the administration of an estate or trust, including construction of wills. Burns 1933, § 3-1104(c), Baldwin's 1934, Sec. 441(c). Use of the declaratory judgments statute in cases such as this has been recognized by this Court. Weppler v. Hoffine, 1940, 218 Ind. 31, 36, 29 N.E.2d 204, 30 N.E.2d 549. Being a court of record the trial court had jurisdiction of the subject matter and the facts alleged were sufficient to justify exercise of such jurisdiction.
Appellants assert that the will here involved does not create a public charitable trust, and upon the validity of this proposition depends the application of the other rules of law which are controlling in the decision of this case. They assert that the trust is not a public charitable trust, because it is limited in its operation to too small a group. They say further that it is a private trust to perpetuate the memory of the testatrix's deceased brother.
Trusts for the promotion of education are almost universally held to be charitable. In the Restatement of the Law of Trusts, § 370, p. 1146, it is stated: 'A trust for the advancement of education is charitable,' and in the comment following it is pointed out that trusts for the promotion of education include trusts 'to establish scholarships or otherwise to assist students in acquiring education.'
Bogert, in his work on Trusts and Trustees, says in Vol. 2, § 374, p. 1164, 'There has never been any doubt that trusts to advance education are charitable,' and at page 1168 says that aid to students through scholarships, is clearly within the rule that trusts to advance education are charitable.
The Foley will clearly dedicates her entire residuary estate to the promotion of education. Item VII gives the residue of testatrix's estate to a competent trustee, provides for a small annuity to a friend and then says, 'The remainder of the trust property, including that not used for said monthly payments, shall be used to promote college or university education to children of the employes of the Pennsylvania Railroad Company living in the City of Fort Wayne, Indiana,' and Item VII closes with the sentence, 'This fund shall be...
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