Warner v. Baylor

• Decision Date: 20 January 1964
• Docket Number: 5657,Nos. 5656,s. 5656
• Parties: MORRIS T. WARNER, ET AL. v. FRED S. B. YLOR, SOLE EXECUTOR, ETC., ET AL. BOYS' HOME, INCORPORATED v. FRED S. BAYLOR, SOLE EXECUTOR, ETC., ET AL. Record
• Court: Virginia Supreme Court

Page 263

134 S.E.2d 263

204 Va. 867

MORRIS T. WARNER, ET AL. v. FRED S. B. YLOR, SOLE EXECUTOR, ETC., ET AL.

BOYS' HOME, INCORPORATED v. FRED S. BAYLOR, SOLE EXECUTOR, ETC., ET AL.

Record Nos. 5656, 5657.

Supreme Court of Appeals of Virginia

January 20, 1964.

George M. Cochran and Frank L. Summers, Jr. (Philip Lee Lotz; R. E. Cabell, Jr.; Nelson, McPherson & Summers, on brief), for appellants, Morris T. Warner, et al.

Lester I. Bowman, for appellant, Boys' Home, Incorporated.

James N. Kincanon; Tom Stockton Fox, for appellees, Anne Funkhouser Francis, Mae Dillon Ferguson, in her own right and as Administratrix, &c. B. C. Goodloe, guardian ad litem, for Mary Starke Ferguson, infant, appellee, on brief. Record No. 5656.

James N. Kincanon; Tom Stockton Fox, for appellees, Mae Dillon Ferguson, in her own right and as Administratrix, &c., and Anne Funkhouser Francis. Record No. 5657.

JUDGE: I'ANSON

I'ANSON, J., delivered the opinion of the court.

S. D. Ferguson and Fred S. Baylor, as executors under the will of Mary Woodward Williams, deceased, filed a bill against Anne Montgomery Woodward; Edward Woodward, Jr.; Arthur Barnette; Alvin Williams, Jr.; Pauline Grider French; Morris T. Warner, Gilpin Willson, Jr., and George M. Cochran, Trustees of Trinity Protestant Episcopal Church, Staunton, Virginia; Bettie Bickle Home, Incorporated; Virginia Hilton Sommerville; Fred S. Baylor, individually; Augusta National Bank of Staunton, Trustee; King's Daughters' Hospital of Staunton, Virginia; Boys' Home, Incorporated; Mary Scott Ferguson Taylor; Anne Funkhouser Francis; Milton Winter Ferguson; Mae Ferguson; and Mary Starke Ferguson, an infant; all legatees under the will of certain common stock of American Telephone and Telegraph Company (hereinafter called A.T. & T.) and/or Westinghouse Electric Corporation (hereinafter called Westinghouse). The bill asked, inter alia, for interpretation of the will and the guidance and direction of the court in the distribution of these stocks.

It was alleged in the bill, inter alia, that after the testatrix executed her will A.T. & T. issued two additional shares of its common stock to the holder of each outstanding share, the three shares having the same aggregate par value as the one original share, and at the time of testatrix's death she owned three shares for every one she owned at the time of execution of her will; and that subsequent to execution of the will Westinghouse issued one additional share to the holder of each outstanding share of its common stock, the two shares having the same aggregate par value as the one share, and that testatrix at the time of her death owned two shares for every one she owned at the time of the execution of her will.

All of the parties defendant filed their answers admitting the allegations of the bill except Arthur Barnette; Alvin Williams, Jr., Fred S. Baylor and Mary Scott Ferguson Taylor. The infant answered by her guardian ad litem. Anne Funkhouser Francis; Milton Winter Ferguson, now deceased; Mae Ferguson; and the infant (by her guardian ad litem); who are all legatees under the residuary clause of the will and appellees herein, asserted in their answers that they were entitled to receive the additional shares of stock issued after the will was executed. On the other hand, the other defendants who answered the bill, most of whom are appellants herein, asserted that they were entitled to a proportionate part of the additional shares of stock in order to receive the interest in the corporations that they would have received had there been no change in the corporate structures.

The cause was referred to a special master commissioner, who, after an ore tenus hearing, reported that the A.T. & T. and Westinghouse stock was split in accordance with the allegations in the bill; that the evidence was insufficient to show a scheme or plan of testamentary disposition of testatrix's estate; and that the legatees of specified numbers of shares of stock were entitled to receive only the number designated in the will and not the additional shares resulting from the splits, which pass to the residuary legatees.

The chancellor entered a decree sustaining the commissioner's report and directing the surviving personal representative under the will to distribute the A.T. & T. and Westinghouse stock in accordance with the commissioner's findings. From that decree we granted an appeal to the trustees of Trinity Church; Boys' Home, Inc.; Anne Montgomery Woodward; Edward Woodward, Jr.; Pauline Grider French; Fred S. Baylor, individually; Sunnyside Presbyterian Home, Inc., successor to Bettie Bickle Home, Inc.; and King's Daughters' Hospital (Record No. 5656); and a separate appeal to the Boys' Home, Inc. (Record No. 5657); all appellants herein.

At the outset we are confronted with motions to dismiss both appeals on the grounds (1) that in Record No. 5656 appellants failed to join Arthur Barnette, Alvin Williams, Jr., and Virginia Hilton Sommerville as parties to the appeal either as appellants or appellees, and Mary Scott Ferguson Taylor, one of the residuary legatees under the will, as party appellee; (2) that in Record No. 5657 the infant residuary legatee, Mary Starke Ferguson, and her guardian ad litem, were omitted as parties; and (3) that appellants failed to comply with Rules of Court 5:3, § 1; 5:3, § 2(a); 5:12, § 1(c); and 5:12, § 1(d), in both appeals.

All of the aforementioned persons were properly before the court below where the cause was considered as one case, and it is likewise considered as one appeal, on one record, in this Court. Boys' Home, Inc., was a party appellant in both appeals. Arthur Barnette, Alvin Williams, Jr., and Virginia H. Sommerville were legatees of designated numbers of shares of stock under the will and they are in the same class and have the same interest as all the appellants. It would indeed be a novel situation if an appeal could not be maintained by one party because another having a similar interest failed to appeal.

Moreover, Barnette, Williams and Mary Scott Ferguson Taylor, the latter being one of the residuary legatees, made no appearance in the court below or in this Court. Mary Scott Ferguson Taylor was made a party appellee in this Court (Record No. 5657) and a copy of appellant's petition was mailed to her. Her interests were in the same class as the other legatees sharing in the residuum, whose positions were fully and ably argued before this Court. Her failure to participate in the proceedings either in the court below or in this Court is indicative of the fact that she was leaving her interests entirely to the courts for interpretation, without asserting any position in the matter, recognizing that she would be bound by this Court's findings.

While it is true that Mary Starke Ferguson was not named as a party to Record No. 5657, she was represented in this Court by her guardian ad litem in Record No. 5656. Since we consider this appeal as only one case, although there were two records, she was properly before us.

The interests of all parties were before us, either actively or by representation, and the motions to dismiss both appeals for nonjoinder of parties are overruled. Andrews, Executrix v. Cahoon, 196 Va. 790, 796, 797, 86 S.E.2d 173, 177.

We have carefully examined appellees' contentions that the aforementioned Rules of Court have not been complied with, and while it may be said that some of the rules have not been followed in their strictest sense, the minor defects complained of are not jurisdictional and do not justify sustaining the motions to dismiss the appeal on those grounds. Hence the motions are overruled.

The appellants' principal contention is that the chancellor erred in holding that they were not entitled to receive their portion of the additional shares received by the testatrix as the result of the stock splits.

The will of the testatrix was executed on April 9, 1958, and after providing for the payment of debts and all taxes, including inheritance taxes on bequests, under separate clauses of Article III she bequeathed 180 shares of A.T. & T. common stock to nine individuals, organizations or corporations, and 135 shares of Westinghouse common stock to five of the same individuals who received the A.T. & T. stock. The bequests, except for name of the legatee and number of shares given, read as follows:

'I give and bequeath unto shares of common stock of the American Telephone and Telegraph Company; [and] shares of common stock of Westinghouse Electric Company.'

By separae clauses under Article III, testatrix gave several legacies in cash, and under another clause she bequeathed specific articles of personal property to three of the same individuals to whom she gave A.T. & T. and Westinghouse stock.

In Article IV, testatrix bequeathed to Augusta National Bank, as trustee for King's Daughters' Hospital:

'One hundred shares of common stock of American Telephone and Telegraph Company;

'One hundred and seventy five shares of common stock of Westinghouse Electric Company;

'Fifty shares of stock of Crane Company;

'Fifty shares of common stock of The Chesapeake & Ohio Railway Company;

'Fifty shares of common stock of Bethlehem Steel Corporation;

'Twenty-five shares of common stock of Kennecott Copper Company; and

'Two hundred shares of common stock of Noland Company; * * *.'

Testatrix directed that the trustee 'take and hold' the stocks and pay the net income from the trust to the hospital to be used for the care and treatment of patients who are unable to pay for their hospitalization. The usual provision authorizing trustee to sell any or all of the stocks and reinvest the proceeds was also included. She provided that this trust be known as the 'James Hamilton Woodward Memorial' in memory of her first husband.

Under Article V, testatrix bequeathed to the Augusta National Bank, in trust, for the Boys' Home the same number of shares of stock in...