Zahn v. National Bank of Commerce of Dallas, 15504

• Decision Date: 02 October 1959
• Docket Number: No. 15504,15504
• Citation: 328 S.W.2d 783
• Parties: George ZAHN et al., Appellants, v. NATIONAL BANK OF COMMERCE OF DALLAS, Appellee.
• Court: Texas Court of Appeals

Page 783

328 S.W.2d 783

George ZAHN et al., Appellants, v. NATIONAL BANK OF COMMERCE OF DALLAS, Appellee.

No. 15504.

Court of Civil Appeals of Texas, Dallas.

Oct. 2, 1959.

Rehearing Denied Oct. 30, 1959.

Biggers, Baker, Lloyd & Carver, Chandler Lloyd and Monty C. Barber, Herbert Marshall, Eldridge, Goggans, Davidson & Silverberg, Lamar Holley, H. Bascom Thomas, Jr., Dallas, for appellants.

Thompson, Knight, Wright & Simmons, William E. Collins and Harold F. Kleinman, Dallas, for appellee.

DIXON, Chief Justice.

The National Bank of Commerce of Dallas, Texas, independent executor brought this suit seeking construction of certain provisions in a will and asking for a declaratory judgment. There are three groups of appellants with adverse interests: the heirs at law of the testatrix, five cousins named as beneficiaries, and three minor relatives also named as beneficiaries.

The Will.

Mrs. Genevieve Zahn Ware, a widow, died October 19, 1956 leaving a holographic will. Among other provisions in the will were the following:

'Third: I direct that the 652.2 acres of land located in Lipscomb County, Texas known as the 7K Ranch, deed covering same in my name, same recorded September 10th, A.D.1946 in Lipscomb, Lipscomb County, Texas Record of Deeds, Book 60 page 448, P. O. Boyd, County Clerk shall not be sold for two (2) years from the date of my death.

'If at the end of that time no oil or minerals have been found thereon, same is to be sold to the best advantage without oil and mineral rights--said oil and mineral rights to be put in trust with the National Bank of Commerce, Dallas County, Texas for the following named persons, who are my cousins, their heirs and assigns forever, * * *. Miss Viola Zahn, Coalinga, California, Mrs. Ruby Zahn White Stockton, California, Ellsworth Zahn, Cucamonga, California, Harry Zahn, Stayton, Oregon.

'The proceeds from the sale of said land shall be equally divided between those who are alive at by death share and share alike as follows: George Zahn, Miss Viola Zahn, Mrs. Ruby White, Ellsworth Zahn, Harry Zahn * * *

'Any monies remaining when my estate is closed, I give, devise and bequeath to the following second cousins: Gilbert White, son of Mr & Mrs G. Warren White, Ronald Zahn and Linda Zahn son and daughter of Mr & Mrs Ellsworth Zahn, Constance Hill, Daughter of Mr & Mrs Sherman Hill, share and share alike for their education and welfare--* * *.'

On August 15, 1957 the executor Bank filed this suit. On May 16, 1958 the court rendered judgment which included certain findings, declarations and constructions pertaining to various provisions of the will. Only the above quoted provisions are the subjects of this appeal.

Judgment of Trial Court.

With reference to the 652.2 acres of land the court made these holdings:

'(1) The Court finds, declares and construes that as of the date of the death of Genevieve Zahn Ware on October 19, 1956, the fee simple title to said tract and parcel of land, with the exception of oil, gas and other minerals in and under said tract, was and is vested in undivided interests of one-fifth each in Viola Zahn, Ruby Zahn White, Ellsworth Zahn, George Zahn and Harry Zahn, subject to the orderly administration and payment of the debts of the Estate of Genevieve Zahn Ware, deceased, and subject to divestment in the event that oil or other minerals are found thereon within two years from the date of the death of Genevieve Zahn Ware, in which event, fee simple title to said tract and parcel of land shall vest in the heirs at law of Genevieve Zahn Ware. * * *

'(2) If no oil, gas or other minerals are found in or under said tract of land within two years from date of the death of Genevieve Zahn Ware, said tract, with the exceptions of all oil, gas and other minerals in or under said tract, shall be sold by the Executor and the net proceeds of such sale paid in equal shares to Viola Zahn, Ruby Zahn White, Ellsworth Zahn, George Zahn and Harry Zahn. * * * '(3) as of the date of this judgment no oil, gas or other minerals have been found in or under said tract and parcel of land. * * *

'(4) as of the date of the death of Genevieve Zahn Ware on October 19, 1956, the legal title in and to the oil and minerals in and under said tract of land was vested in the National Bank of Commerce of Dallas, as Trustee for the benefit of the heirs at law of Genevieve Zahn Ware. * * *

'(5) such trust is an invalid trust and is void. * * *

'(6) the heirs at law of Genevieve Zahn Ware are, in fact, fee simple owners, free and clear of trust, of all oil, gas and other minerals in and under said tract of land, subject only to an orderly administration and the payment of the debts of the Estate of Genevieve Zahn Ware. * * *'.

With reference to the provision beginning 'any monies remaining * * *' the court made thesse holdings:

'(1) The Court finds, declares and construes that the word 'monies', as used in such clause, is intended to cover and include and does cover and include the residue and remainder of (a) any cash on hand at the death of a decedent, (b) any cash received as proceeds of the sale of any bonds, stocks, leases, insurance or lots owned by decedent at her death, and (c) any personal property and choses in action, in the hands of the Executor and undistributed by the Executor on the date of the closing of the estate and after the payment of all debts of the estate and payment and distribution of all specific bequests and devises to specific legatees and devisees. * * *

'(2) the word 'monies', as used in such clause is not intended to cover and include, and does not cover and include, any real property or proceeds from the sale thereof. The Court specifically finds that such word does not cover and include any interest whatsoever in the real property described in the third clause of decedent's will or the proceeds from the sale of any interest therein.'

We pause here to point out that at the time the trial court's judgment was rendered the two year period prescribed in the will had not transpired. The testatrix died October 19, 1956. The judgment was rendered May 16, 1958. Miss Maurine Jacobs, President and Trust Officer of the executor bank, testified that several substantial bids for mineral leases had been received since the death of the testatrix, but said bids were conditioned on the conclusion of this litigation and a final determination of the question of title.

Appeal of Heirs at Law.

The heirs at law, several in number, have appealed from that portion of the judgment which awarded to the five cousins fee simple title to the 652.2 acres of land in Lipscomb County with the exception of all oil, gas and other minerals in and under said tract.

In support of their contention the heirs at law as appellants in this part of the appeal assert that the trial court erred (1) in failing to hold that the will did not make a valid disposition of the surface to the 652.2 acres and the same therefore descended by intestacy to the heirs at law of Genevieve Zahn Ware; and (2) in holding that as of the date of the death of the testatrix the five named cousins became the fee simple owners of all the 652.2 acres except the oil, gas and other minerals in and under said tract.

The five cousins in their role as appellees in this part of the appeal have replied with three counterpoints. Their position is that (1) the will effectively disposed of the land described therein vesting title to the surface and the mineral estate in the executor as trustee for the benefit of those to take title to same at the end of the two year period; (2) the devise of the land in question does not violate the rule against perpetuities because title to such land does vest within the period of the rule; (3) the trust is a dry passive trust entitling the beneficiaries to both legal and equitable title.

We agree with the heirs at law that the rule in this State is that whether property passes under a will or by descent and distribution, the title vests immediately upon the death of the owner; there is never a time when the title is not vested in somebody. Casey v. Kelley, Tex.Civ.App., 185 S.W.2d 492; White v. White, 142 Tex. 499, 179 S.W.2d 503. But we do not agree with their contention that under the terms of the will there is a hiatus of two years in this case during which time the title did not vest in any devisee, consequently testatrix should have been found to have died intestate as to this property so that the heirs at law take title to the surface rights.

We think that immediately upon the death of the testatrix legal title vested in the independent executor as trustee for the benefit of those to take title at the end of the two year period, whether they be the heirs at law or the five named cousins. The will expressly directs that the land 'shall not be sold for two years.' But 'same is to be sold' at the end of that time if oil and minerals have not been found thereon. The mineral rights and the surface rights are then to be severed, the mineral rights are to be 'put in trust' for the five cousins, and the proceeds of the sale of the surface rights shall be equally divided 'among those of the five cousins who are alive at my death.' (emphasis supplied). We construe these provisions to be instructions and directions to the independent executor, and to mean that the testatrix intended to vest the executor as trustee with such title as was necessary to carry out her directions.

We quote from the opinion in Brooker v. Brooker, 130 Tex. 27, 106 S.W.2d 247, 253: * * * 'It is true that such will, regarding the properties attempted to be left in trust, contains no express language vesting any character of title, legal or real, in any person or class of persons. In spite of this, by the use of the term 'trustees' and the necessary implication arising from the authority attempted to be conferred, and the duties attempted to be imposed, we are compelled to the conclusion that the...