Story v. First Nat. Bank & Trust Co., in Orlando

• Decision Date: 14 June 1934
• Court: Florida Supreme Court
• Parties: STORY et al. v. FIRST NAT. BANK & TRUST CO., IN ORLANDO, et al.

156 So. 101

115 Fla. 436

STORY et al. v. FIRST NAT. BANK & TRUST CO., IN ORLANDO, et al.

Florida Supreme Court

June 14, 1934

Rehearing Denied July 10, 1934.

Supplemental Petition for Rehearing Denied Aug. 4, 1934.

En Banc.

Suit by Mattie J. Story and others against the First National Bank &amp Trust Company, in Orlando, individually and as executor and as trustee under the will of W. L. Story, Sr., deceased. From a decree sustaining the will, complainants appeal.

Affirmed.

On Petition for Rehearing. Appeal from Circuit Court, Orange County; Frank A. Smith, judge.

COUNSEL

George P. Garrett and W. O. Anderson, both of Orlando, for appellants.

Maguire & Voorhis and Giles & Gurney, all of Orlando, for appellee.

OPINION

TERRELL Justice.

In September, 1929, W. L. Story of Winter Garden, executed his last will and testament, in which he created a trust estate for the benefit of his wife and children, and designated appellee as his executor and trustee. The testator died in March, 1930, and the bill of complaint herein was filed in July, 1931; the heirs of the testator who were also the legatees and devisees under the will being parties complainant. The executor and trustee was made party defendant. The material part of the prayer of the bill is for an interpretation of that part of the will creating the trust estate for the benefit of the wife and children of the testator. An application for the appointment of an administrator ad litem to succeed the trustee and manage the estate pending the litigation was seasonably made and denied and appeal therefrom was taken to this court, resulting in a reversal of the court below. Story v. First National Bank & Trust Co., 103 Fla. 399, 139 So. 179. The merits of the cause were not adjudicated in that case. Various and sundry pleadings, including an answer, were then filed, and the cause came on to be finally heard by the chancellor on the motion of complainants for final decree on bill and answer. This motion was denied, and the will was upheld in toto. The instant appeal is from that decree upholding the validity of the will.

It is first contended that the trust estate as created for the beneficiaries of the testator offends against public policy.

Generally the term 'public policy' has reference to the general principles by which public affairs under the government are conducted. In an old case, Richardson v. Mellish, 2 Bing. 229, text 252, 9 E. C. L. 557, public policy was described as a very unruly horse, and, when once you get astride it, you never know where it will carry you. As applied to a rule of law, it has reference to statutes which have for their purpose the regulation of personal conduct and relations in the interest of the public welfare. Personal acts and contracts are said to be against public policy when the courts refuse to recognize them for the reason that they have a mischievous tendency, are injurious to the public welfare, and are contrary to well-settled legal or moral principles.

The question then arises, Does the will of W. L. Story offend against any will-settled legal or moral principle as recognized in this state? Appellants contend that it is contrary to the rule against perpetuities, the rule against restraints or alienation, or, as referred to by statute in some jurisdictions, the rule against suspending the power of alienation. The rule against perpetuities and the rule against restraints are well-settled rules of law in this state, and, if the trust created by the Story will offends against either of them, it must be held invalid and contrary to public policy. Appellants point out nineteen contingencies which they contend might arise under the will, any of which would invalidate it.

The pertinent part of the will brought in question is as follows:

'In the event of the death of any of my children prior to said distribution, leaving heirs of the body him, her or them surviving, then I direct that said heir or heirs of the one so deceased shall be entitled to the share of the deceased son or daughter as the case may be, and I direct that my said trustee shall withhold the distribution of said share and continue to perform the duties of trustee with regard to the investment, re-investment and handling of the estate of said heirs until the youngest of the respective heirs of the deceased son or daughter shall arrive at the age of thirty (30) years, at which time said heir or heirs shall be entitled to receive his, her or their proportionate part of said estate. Provided, however, in the meantime my said trustee shall use such part of the income, or principal, as may be necessary for the support, maintenance and education of such heirs; my intention here being that in the event of the death of a child of mine leaving heirs of the body him or her surviving, the trustee shall administer the estate of the particular child until the youngest of his or her children shall arrive at the age of thirty (30) years. In the event of the death of any of my children prior to my demise, or prior to the distribution herein provided, without leaving heirs him or her surviving then it is my desire that the share of said child or children be proportioned equally among the survivors in the manner contemplated by the terms of this will, the heirs of a deceased child receiving the share which the mother or father ther would have received if living.

'Provision is above made for the retaining by my said trustee of the share in my estate, of my daughter, Kate Agnes Story Burch. As to her share it is my desire that my said trustee shall withhold the distribution of the principal amount thereof during her lifetime but that she be paid upon request her proportionate part of the income from my said estate as provided for the other children, prior to the general distribution thereof as contemplated by this will, and that as to said income paid to her prior to the general distribution that she be charged in the same manner, and upon the general distribution of my said estate, I direct my said trustee to withhold her share and to continue to perform the duties of trustee with regard to the investment, re-investment and handling of her share, paying over to her quarter-annually or monthly as she may desire, the net income therefrom, and after her demise, I direct that the whole of her share be divided among her children, the heirs of her body, share and share alike, upon the youngest of her said children arriving at the age of thirty (30) years. Provided, however, in the meantime my said trustee shall use such part of the income or principal as may be necessary for the support and education of said children.'

Under the rule against perpetuities, the vesting of an estate under a will or deed can be postponed no longer than a life or lives in being and twenty-one years plus the period of gestation. This was the rule of the common law, and prevails in Florida and other states if not modified by statute. Many states have modified it in various ways. 'Lives in being' has reference to those living at the date of the testator's death, not at the time of the execution of the will. Under the old common law it was possible by executory devise to perpetuate estates in families so as to prevent their alienation for any period of time or purpose the owner might desire. Such an estate was termed a 'perpetuity'; in other words, a grant or devise wherein the vesting of the interest therein is unlawfully postponed. Thompson on Real Property, vol. 3, 722.

The rule against perpetuities concerns itself only with the vesting or commencing of the estate and not with its termination. It was designed to prevent the perpetual entailment of estates and give them over to free and unhampered conveyance. The rule is not applicable to charitable trusts.

At one time, estates in fee simple were inalienable, but the statute quia emptores, 18 Edw. 1, c. 1 (1289), enabled tenants in fee simple to alienate their lands at pleasure. After this, provisions in deeds or other conveyances for the purpose of restraining alienation, were held invalid. Under the common law, the beneficiary of a trust conveying real estate in fee, in which no one else was interested, could, on becoming of age, ignore and terminate any restraint on his right to alienate it. Such has been termed the rule against restraints or as deduced from statutes attempting to regulate conveyancing, the rule against the suspension of the power of alienation.

There is a distinction between the common-law rule against restraints and the statutory rule against suspension of the power of alienation. If the former rule is violated, the restraint only is bad and the enjoyment or possession of the gift is accelerated, while if the latter rule is violated, the interest or gift including the attempt to suspend its vestiture is void ab initio. A violation of the latter rule works the same result as a violation of the rule against perpetuities. Having no statute on the subject, we are not concerned with the latter rule in Florida.

In Claflin v. Claflin, 149 Mass. 19, 20 N.E. 454, 3 L. R A. 370, 14 Am. St. Rep. 393, the common law was modified to provide that a beneficiary may not always be entitled to terminate the trust for him immediately upon coming of age even though no one else has an interest in it (the fund). The effect of this doctrine is to hold that the trust may continue longer than at common law, though it was not determined how much longer. Prof. Kales thinks that under the Claflin doctrine a beneficiary so situated could insist upon the termination of the trust estate not later than a life or lives in being plus twenty-one years after the death of the testator, while Prof. Gray is of the view that the trust should...