Thompson's Estate, In re

• Decision Date: 16 May 1980
• Citation: 414 A.2d 881
• Parties: In re ESTATE of Frederick M. THOMPSON.
• Court: Maine Supreme Court

Page 881

414 A.2d 881

In re ESTATE of Frederick M. THOMPSON.

Supreme Judicial Court of Maine.

May 16, 1980.

Pierce, Atwood, Scribner, Allen, Smith & Lancaster by Everett P. Ingalls, Portland, (orally), for Sweetser Children's Home.

Jerome S. Matus (orally), Asst. Atty. Gen., Augusta, for Attorney General.

Verrill & Dana, Michael T. Healy, Portland (orally), for Abilities & Goodwill, Inc.

Roberts, Shirley & Humphrey, James J. Shirley, Springvale (orally), for intervenor, Waban Projects.

Marden, Dubord, Bernier & Chandler, Alton C. Stevens, Waterville (orally), for Pine Tree Society.

S. James Levis, Jr., Portland, for D. T. Drummond, Jr., Adm'r.

Preti, Flaherty & Beliveau, Joel C. Martin (orally), Arthur A. Peabody, Portland, for Jane Frisbee Holmes.

Before WERNICK, GODFREY, and NICHOLS, JJ., and DUFRESNE, A. R. J.

DUFRESNE, Active Retired Justice.

The four intervenors as potential cy pres beneficiaries of the charitable trust set up in the will of Frederick M. Thompson (testator) and the Attorney General of the State of Maine appeal to the Law Court from a judgment of the Superior Court, Cumberland County, sitting as the Supreme Court of Probate in Equity, to the effect that the Canal National Bank, the plaintiff successor-trustee, shall hold the reference trust as a resulting trust for the benefit of those persons taking by intestate succession under the estate of Frederick M. Thompson. We sustain the appeal, vacate the judgment and remand to the Supreme Court of Probate, for further proceedings consistent with this opinion.

Frederick M. Thompson died in Portland, Maine, on November 24, 1923. After providing for the payment of his just debts, funeral charges and expenses of administration, Thompson gave, bequeathed and devised all the remainder of his estate to his wife, Amelia, for the term of her natural life only, with full power and authority, however, to use all the income and so much or the whole of the principal as she may consider necessary to use for her comfort and welfare, her judgment therein to be final. At her death, Thompson's will formulated the trust which is the subject of judicial construction in these proceedings. After accumulating the principal and interest for fifty years from his death as directed by the testator, the trustee was to apply the fund in manner as follows:

That a benevolent corporation shall be organized under the laws of the State of Maine, to be known as the Fred Thompson Children's Outing Home, by the then municipal officers of the town of Cape Elizabeth, in the County of Cumberland and State of Maine, together with twelve reputable business and professional men, who shall be residents of said Cape Elizabeth, and appointed for that purpose at the first annual meeting of the town held after the termination of said fifty year period, and I further will and direct that my said trustee, upon receiving proper evidence of the organization of said benevolent corporation, shall deliver and pay over to it all of said funds and property, including all principal and accumulated interest, and I hereby give, bequeath and devise all of said property to said Fred Thompson Children's Outing Home forever, to be used and expended by it, however, as follows:

I direct that said Fred Thompson Children's Outing Home shall acquire a farm of twenty-five acres or more, situated in said Cape Elizabeth, erect suitable buildings thereon, and there maintain throughout each year a nonsectarian home for crippled and other children from five to sixteen years of age, from all parts of New England, cripples to have the preference at all times, and during the summer months of each year, to provide an outing and vacation home for as many children, especially from the larger cities of New England as it may be possible to care for. I direct that said corporation shall have the sole control and authority over said home and it is the object and purpose of the donor of this fund that said home be maintained so as to provide comfort, cleanliness and order, and with the fixed purpose to make brighter and more cheerful the lives of children in the midst of all of the home atmosphere it is possible to create.

Amelia K. Thompson, the testator's widow and life beneficiary under his will, died on November 22, 1946. Canal National Bank qualified as trustee and has been holding the trust assets as directed in the will.

By amended complaint dated June 6, 1975, the trustee sought instructions from the Probate Court under its jurisdiction in equity (4 M.R.S.A. § 252) respecting the manner in which the Thompson trust fund should be applied. The complaint alleges, and all parties stipulated, that in June of 1975 the current total value of the trust assets was in the approximate amount of $88,000.00 and that on September 23, 1974 the municipal officers of Cape Elizabeth had voted unanimously not to organize the corporation to be known as the Fred Thompson Children's Outing Home as directed in Thompson's will and had declined to do so on the ground that the assets of the trust were inadequate to carry out the testator's specific benevolent purpose. The trustee bank brought in, as parties defendants, the Attorney General of the State of Maine, the administrator d.b.n.c.t.a. of the estate of Frederick M. Thompson, as well as the respective fiduciaries of estates of deceased heirs or next of kin of Mr. Thompson. Jane Frisbie Holmes intervened as an heir, as did four charitable organizations, to wit: Abilities of Goodwill, Inc., Pine Tree Society for Crippled Children and Adults, Inc., Sweetser-Children's Home, and Waban Projects, Inc.

The case was presented to the Probate Court sitting in Equity, as well as to the Supreme Court of Probate sitting in Equity, on an agreed statement of facts and documentary evidence. The charities, supported by the Attorney General, pleaded for the application of the cy pres doctrine. The manner in which the individual charities respectively proposed to use the funds and carry out, as near as possible, the charitable purpose expressed in the Thompson will was fully argued and urged upon the courts. Holmes and the fiduciary defendants disagreed and do presently press their contention that the Thompson trust failed completely, because, in setting up the trust for the Children's Outing Home, Frederick M. Thompson did not attest to a general charitable intent.

There is no dispute that the testator's dream of the Children's Outing Home as conceived by him in his will is unattainable because of insufficiency of the trust assets, and the critical issue throughout this litigation was, and is, whether the trust wholly fails, because it was a specific benevolent project to which the testator committed himself exclusively, or whether the will evinces in the testator that general charitable intent which will save a charitable trust that cannot be carried out in the particular manner indicated in the trust document and permit an alternative method of execution to be effected, as close as possible to the testator's original design.

In the Probate Court, the Judge found that the bequest creating the charitable trust demonstrated a general charitable intent. He applied the cy pres doctrine and instructed the trustee, after payment of necessary expenses and reasonable counsel fees out of the trust estate, to distribute the trust assets in equal shares free of trust to the four intervening charities. Holmes and the several fiduciaries representing the heirs and next of kin of Frederick M. Thompson appealed that decision to the Superior Court sitting as the Supreme Court of Probate, on the stated reasons that the testator did not have a general charitable intent and that, even if the doctrine of cy pres were applicable, the plans of the charities as disclosed were not alternatives which would accommodate the testator's expressed intent but rather would frustrate the same.

The Superior Court sitting as the Supreme Court of Probate ruled that the doctrine of cy pres was not applicable and, under such circumstances, the trustee bank was holding the trust estate created by the will of Frederick M. Thompson as a resulting trust for the benefit of the heirs at law of Mr. Thompson. The basis for the Justice's ruling is contained in the following paragraph of his decision:

In the instant case the very specificity of the language and purpose of the Testator evidenced his attachment to the very specific purpose described in his will and the accomplishment of that purpose by the very specific means enumerated. There is nothing in the language to evidence a general charitable intention.

We disagree with the Justice in his conclusion that the Thompson will did not exemplify a general charitable intent on the part of the testator.

Initially, we may state that the "clearly erroneous" standard of review does not apply in this case, since the evidence before the Supreme Court of Probate consisted of an agreed statement of facts and documentary exhibits. In such circumstances, we are free to evaluate the evidence, without reference to the findings below, in determining whether the facts justify the application of the cy pres doctrine. In re Edwards' Estate, 161 Me. 141, 210 A.2d 17 (1965). See also Pappas v. Stacey, 151 Me. 36, 116 A.2d 497 (1955), appeal dismissed 350 U.S. 870, 76 S.Ct. 117, 100 L.Ed. 770.

The doctrine of cy pres may be explained as a judicial principle for the preservation of a charitable trust when the accomplishment of the particular purpose of the trust is or becomes impossible, impractical or illegal. In such a situation, if the creator of the trust manifested in the trust instrument what has been termed by the courts a general charitable intent, i. e. an intent to devote the trust to a charitable purpose more general than the frustrated purpose, a court of equity, instead of allowing the trust to fail, will apply the trust funds cy pres, i. e. to a charitable purpose as nearly as...