Smyth v. McKissick
| Decision Date | 17 March 1943 |
| Docket Number | 163. |
| Citation | 24 S.E.2d 621,222 N.C. 644 |
| Parties | SMYTH et al. v. McKISSICK et al. |
| Court | North Carolina Supreme Court |
This was a suit by the executors and trustees under the will and trust indentures of Ellison A. Smyth, deceased for construction of these instruments and advice as to the proper distribution of the income and corpus of the trusts thereby created, and for an adjudication of the rights and interests of the various beneficiaries. All the parties now living and those unborn, who might by any possibility have an interest in the estate, have been made parties and are represented by counsel. The case was presented below upon facts agreed, the pertinent portions of which may be stated as follows Ellison A. Smyth, the testator and trustor, in 1932, executed an irrevocable trust agreement or indenture whereby he established a trust fund consisting of stocks, bonds and notes of the value of more than a million dollars, and designated himself as trustee, and the plaintiffs as successor trustees. To these he conveyed the described property in trust to hold, invest and reinvest, and receive the revenues, incomes and profits arising therefrom. The trustees were directed to divide the net income derived from this property into four parts and distribute the same annually as follows:
The trust indenture also contained the following provision: "Upon the death of the survivor among Margaret S. McKissick, Annie P. Blake, and Sarah S. Hudgens, and upon the death or re-marriage of Mary Hutchinson Smyth, but not in any event before the year 1941, then and as soon thereafter as practicable, there shall be a final distribution of the corpus of this trust, by dividing the same into four parts and distributing the same as follows:" The method for the distribution of the corpus of the trust was expressed in the same language in which the trustor had previously directed the annual income, that is, to the same classes and in the same proportions, and identified by the same letters, a, b, c and d, together with the limitations in paragraphs "e" and "f".
In 1936 Ellison A. Smyth executed another trust indenture identical in form and language with the first, the only difference being the addition to the trust of certain life insurance policies of the face value of $170,000, with the same directions for the distribution of annual income and corpus to the same four groups of beneficiaries, again designated by letters a, b, c and d, with the same limitations "e" and "f".
In 1934 Ellison A. Smyth executed his will, naming the plaintiffs as executors thereof and trustees of an additional trust set up therein. By the will all the remainder of the decedent's estate, real and personal, after the payment of certain legacies, was devised to the plaintiffs as trustees to hold, invest and reinvest, and to distribute annually the income derived therefrom to the same beneficiaries who were designated in the identical language set out in the trust indentures, that is, the executors and trustees were directed to divide the income into four parts and distribute annually to the four groups, using the same words and same method of designation by the letters a, b, c and d, with same limitations under "e" and "f", as hereinbefore set out. The final distribution of the fund was directed to be made "upon the death of all" the testator's children and the death or remarriage of his daughter-in-law, and not earlier than 1944. "Then" the trustees were to distribute the corpus of the estate by dividing it into four parts and distributing to the same four groups, designated and described in the same language, and by the same letters, according to the same percentages. The testator explained that the apparent discrimination in the distribution of his estate was not due to discrimination in affection, but was based upon his estimate of their several needs and the objects of their care, maintenance and education.
Thomas Smyth, one of the children of James Adger Smyth, and grandson of the testator, Ellison A. Smyth, was married in November, 1932, to Frances Thrower Smyth. Having no children born to them, in 1938, they adopted for life the infant, David Hutchinson Smyth, who was not related by blood to any of the parties herein. The adoption proceedings were had in the State of Illinois and were in all respects regular, and the final judgment of the proper court of that state, decreeing the adoption, was valid and binding. Thomas Smyth died April 2, 1941, leaving a last will and testament by which he disposed of all his property to his widow Frances Thrower Smyth.
On August 3, 1942, Ellison A. Smyth, the testator and trustor, died, leaving the following children and grandchildren:
(a) Margaret S. McKissick, a daughter, who has one child, the plaintiff, Ellison S. McKissick.
(b) Seven living children of his deceased son, James Adger Smyth, and the adopted child of the deceased Thomas Smyth.
(c) Annie P. Blake, a daughter, who had seven children, all now living except one, Julia Blake Cheney, who died before the testator, leaving two minor children.
(d) Sarah S. Hudgens, a daughter, who has five children, all living.
It was admitted that Ellison A. Smyth knew of and approved the adoption by his grandson Thomas Smyth of the infant David Hutchinson Smyth in 1938, and treated this child as he did the children born to his other grandchildren, giving him presents and keeping a photograph of him in his home.
The court below, construing the trust indentures and the will in the light of the facts agreed, adjudged that the trust indentures became effective from date of execution, and the will from the date of the death of the testator; that under those instruments the living children of the three daughters took undivided vested interests in the net income and corpus of the trust and estate property, in the proportions designated, subject to the payment of the income to the first takers for life; that one of the daughters of Annie P. Blake having died, leaving two children surviving, these children took a vested interest in the share of their mother in the income and corpus of the trust and estate property; that the seven living children of James Adger Smyth, deceased, took each an absolute vested interest in one-eighth of the designated proportion of the net income and corpus of the trust and estate property, subject to the payment of one-third of the income to Mary Hutchinson Smyth, widow of James Adger Smyth, for her life; and that as Thomas Smyth, son of James Adger Smyth, was living at the execution of the two trust indentures he took a vested interest in one-eighth of the designated proportion of the net income and corpus of the trust property embraced in the trust indentures, and having died before the testator, his interest therein passed to his wife, Frances Thrower Smyth, by his will, and she became entitled to an absolute vested interest in the share to which Thomas Smyth would have been entitled under the trust indentures.
It was further adjudged that Thomas Smyth having legally adopted for life the infant David Hutchinson Smyth, the said infant became the lawful child of Thomas Smyth, and upon the death of Thomas Smyth before the death of the testator Ellison A. Smyth, David Hutchinson Smyth took, by purchase under the will of Ellison A. Smyth by substitution in the place of his father Smyth, a vested interest in the share of his father Thomas Smyth in the income and corpus of the estate property devised in the will, subject to the payment of his proportion of the income to the widow of James Adger Smyth, for her life.
It was further adjudged that, as to the grandchildren of Ellison...
To continue reading
Request your trial