Russell's Ex'rs v. Passmore

• Decision Date: 10 June 1920
• Court: Virginia Supreme Court
• Parties: RUSSELL'S EX'RS. v. PASSMORE et al.

103 S.E. 652

RUSSELL'S EX'RS.

v.PASSMORE et al.

Supreme Court of Appeals of Virginia.

June 10, 1920.

[COPYRIGHT MATERIAL OMITTED]

Appeal from Circuit Court, Charlotte County.

Suit by George E. Passmore, Jr., and others, against the executors of George B. Russell, deceased. Decree for plaintiffs, and defendants appeal. Affirmed.

This suit in equity involves the question of the existence of an express parol private trust, created by a gift. The subject of the trust, if it exists, is personal property. The donor was George E. Passmore, the father of appellees, who were plaintiffs in the court below. The trustee was George B. Russell, the testator of appellants, who were defendants in the court below.

The donor had only four children, two boys, George E. Passmore, Jr., and Washington Passmore, and two girls, Marion Passmore and Ellen Passmore, all infants of tender years, the first named being the oldest, and being only 5 or 6 years of age at the time the original trust hereinafter mentioned was created, and only about 13 or 14 years of age when this suit was instituted.

The suit was instituted in the early part of the year of 1919. The plaintiffs, the said four infant children, sued by their guardian as their next friend. The bill alleges that certain bank stock (20 shares as stated in the original bill) in the possession of the defendants, and which was held by their testator in his own name at the time of his death, was in truth the subject of an express trust which was created in the lifetime of both the said donor and trustee, to wit, in the fall of 1910, for the benefit of one of said infant plaintiffs, to wit, George E. Passmore, Jr., in the following manner, namely:

That "the said George E. Passmore, in company with one Charles Osborne, went to see the said George B. Russell, deceased, and placed in his custody for the benefit of your complainant, George Edward Passmore, Jr., 20 shares of the bank stock of the State Bank of Charlotte County, Incorporated, subject to the express trust that said stock and the proceeds thereof should be used for the benefit of your complainant, George Edward Passmore, Jr. That said George B. Russell, deceased, accepted said trust upon said conditions and expressly promised the said George E. Passmore that he would faithfully execute said trust. Thereupon said stock was caused to be transferred upon the books of the bank to the said George B. Russell, who thereafter held the same in his own name and collected all dividends thereon declared" (in his lifetime) "subsequent to the fall of 1910."

The bill also alleges the death of George E. Passmore in the spring of 1911; of George B. Russell in March, 1918, the latter leaving a will which merely directed that all of his "just debts and funeral expenses be paid as promptly as practicable, " and gave, devised, and bequeathed "all" of his "property, both real and personal, of every kind and description, " to his wife, one of the executors named in the will, who qualified as such along with the other executor so named. The bill further alleges what dividends on the stock were collected by the said George B. Russell prior to his death, and prays that the executors aforesaid be required to transfer said stock to said George E. Passmore, Jr. or some one for him, and "to account for the dividends collected by their testator as aforesaid, " with interest, and for general relief.

The bill states:

"That the other children of George E. Pass-more are made parties complainant to this bill in order that they may be before the court should it appear that they have any interest in said trust property or the proceeds thereof."

There was a demurrer to the bill on grounds which raise the questions which are made the basis of some of the assignments of error and which are disposed of in the opinion below.

The demurrer was overruled.

The executors answered, denying that the alleged trust or any trust whatsoever was at any time created by the said alleged donor or accepted by the said George B. Russell.

There were depositions of witnesses taken and filed in behalf of the plaintiffs and defendants. The proof developed the fact that the bank stock aforesaid consisted of 50, instead of 20, shares, and by leave of court the bill was amended so as to so allege. Of the proof in the cause it is deemed sufficient to make the following further statement: The evidence on which the plaintiffs rely as creating a trust is wholly parol testimony. The character of the testimony willappear from what is said below concerning it. It must be especially noted that the proof discloses certain features of fact which make a case which is different from that alleged in the bill.

The initial transaction by which the character of a trust was imposed upon the gift in question occurred on September 8, 1910. Mr. Osborne, a witness for the plaintiffs, testifies in regard to this transaction as follows:

In Chief.

" * * * I went to Drakes Branch with Mr. George E. Passmore to see Mr. Russell, Mr. Geo. B. Russell" (this was on September 8, 1910, as appears from other testimony in the cause), "and Mr. Passmore asked Mr. Russell to take some bank stock to be held by him in the event of the death of Mr. Passmore, the proceeds of which were to be used as Mr. Russell saw fit for the benefit of Geo. E. Pass-more, Jr.

"Q. Please state briefly what took place on this occasion?

"A. Mr. Passmore gave me a package of money, amount of which I do not know, which he instructed me to give to Mr. Russell, after which Mr. Passmore gave Mr. Russell what he claimed to be bank stock" (which other testimony in the case identifies beyond question as the 50 shares of bank stock mentioned in the bill as amended), "and Mr. Russell gave Mr. Passmore the package of money which I had just given to him. * * *"

On Cross-Examination.

"You have testified that, as you understand, this bank stock was to be held by Mr. Russell an. the event of Mr. Passmore's deaths is that correct?

"A. Yes, sir; that is correct.

"Q. Then upon what terms, if you know, was it to be held prior to his death t

"A. I do not know.

"Q. There was nothing said about that?

"A. Nothing said about that.

"Q. After the death of Mr. Passmore, I understand that the proceeds were to bo used as Mr. Russell saw fit for the benefit of Geo. E. Passmore, Jr.?

"A. Yes, sir; I so understood.

"Q. It was only after the death of Mr. Pass-more?

"A. Yes, sir; I understood it. * * *

"Q. Did you understand that Mr. Russell was to have full discretion in the manner that the money was to be used as Mr. Russell saw fit for the benefit of Passmore's son?

"A. I understood that Mr. Russell was to use this money as he saw fit for the best interest of the child.

"Q. * * * Was there anything said about the termination of the trust?

"A. It was not.

"Q. Was there anything said about what periods the money was to be paid for this son?

"A. None.

"Q. And nothing was said about the return of the principal or corpus?

"A. Nothing. * * *

"Q. Do you know why Mr. Passmore desired to turn the stock over to Mr. Russell upon the conditions which you have described? * * * "A. Mr. Passmore stated to Mr. Russell that he wanted to turn this stock over to him to make sure that this boy got the benefit of it; that the boy's grandfather, Mr. W. C. Winn, would get it away from him if possible to do it. * * *

"Q. Was there any promise made by Mr. Russell as to what he would or would not do with this bank stock?

"A. Mr. Passmore requested Mr. Russell to take this stock, to hold it and use it for this boy; Mr. Russell agreed that he would do it.

"Q. Can you recall just what was said?

"A. I do not think I could recall the exact words that were used. * * * "

On Redirect Examination.

"Q. Relative to the reason why Mr. Pass-more desired to create this trust for the benefit of his son, I will ask you, in this connection, if you know whether or not Mr. Passmore had any confidence in his father-in-law, Mr. Winn, and whether this had anything to do with the reasons for creating the trust?

"A. I have heard Mr. Passmore state that he did not have any confidence in his father-in-law, Mr. Winn. * * *

"Q. Mr. Winn, the father-in-law of Mr. Pass-more, and Mr. Passmore were on bad terms at this time, were they not?

"A. 1910? Yes, sir.

"Q. And it was the desire of Mr. Passmore to make some provision for his son, Geo. E. Passmore, Jr., and make it in such a way so that Mr. Winn could not possibly know anything about it?

"A. He so expressed himself on many occasions.

"Q. And for that reason it was desired by Mr. Passmore that this matter should be kept in secrecy?

"A. Yes, sir. * * * "

It appears in evidence that said donor died March 8, 1911; that the trustee, Russell, died in May, 1918.

It appears from the testimony of Osborne that both the said donor and trustee were his "close friends, " and that with the exception of an interval of about 21 days from December 20, 1910, to January 15, 1911, when he was in a hospital in Richmond, the witness, after September, 1910, frequently saw the said donor during his lifetime, and also the said trustee, Russell, during his lifetime, but neither of them said anything further to this witness on the subject of the trust after September 8, 1910. Indeed, no one mentioned this matter to this witness until the summer of 1918, after the death of the trustee, Russell, when Mr. Peters, who was one of the administrators of said donor, who died intestate, first mentioned the matter to witness. The material testimony of this witness on this subject is as follows:

"Mr. Peters approached me at the corner of a store in Keysville some time during the summer of 1918, after the death of Mr. Geo. B. Russell, and asked me what I knew about the stock Mr. Passmore had given to Mr. Russell, or words to that effect. * * * I replied by asking Mr. Peters what he knew about it, and his statement to me at that time was that Mr. Passmore a few hours before his death told him that Mr. Geo. B. Russell had...