Agan v. United States National Bank

363 P.2d 765, 227 Or. 619, 1961 Ore. LEXIS 353
CourtOregon Supreme Court
DecidedJuly 19, 1961
StatusPublished
Cited by18 cases

This text of 363 P.2d 765 (Agan v. United States National Bank) is published on Counsel Stack Legal Research, covering Oregon Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Agan v. United States National Bank, 363 P.2d 765, 227 Or. 619, 1961 Ore. LEXIS 353 (Or. 1961).

Opinion

O’CONNELL, J.

This is a suit brought against the executors and trustees of the estates of Maria C. Jackson and Philip Ludwell Jackson by certain employees of the Journal Publishing Company “on behalf of themselves and all other persons now in the employ of Journal Publishing Company or who are associated with the management and operation of the Oregon Journal.” The suit is brought to restrain the defendants from administering the trusts in a manner alleged to be in violation of the terms of the trusts.

The trial court entered a decree of dismissal pursuant to its order sustaining the defendants’ demurrer to plaintiffs’ complaint after plaintiffs declined to plead further.

Plaintiffs allege that the defendant trustee failed to carry out certain directions contained in each of the following parts of the testamentary trusts created by the settlors:

THE MABIA C. JACKSON TRUST
“2. The net income from the trust shall be distributed by the trustees for use within the State of Oregon for charitable, educational or eleemosynary purposes and for the advancement of public welfare. The trustees shall have wide discretion in the selection of the particular purposes for which said distribution shall be made and shall select beneficiaries as they shall deem to be most appropriate and best calculated to promote the welfare *622 of the public of the 'City of Portland or the State of Oregon, or both. ^ ^ ^
“ * * * I specifically direct that when and if my executors or trustees, or my executors and trustees, as the case may be, shall in their sole discretion deem it to the best interests of The Oregon Journal as a continuing local newspaper of the character described in paragraph 3 of Article VI of my said last will and testament or to the best interests of the trust estate to make such sale of any stock of Journal Publishing Company they shall exercise their discretion to make such sale in such manner that, if possible, the ownership and control of Journal Publishing Company and the newspaper which it operates shall be retained on a local basis, preferably in the hands of persons who are then in the actual employ of Journal Publishing Company or who are associated with the management and operation of the paper; and I direct that in any disposition of such stock the purpose herein stated shall be carried out even though the amount which may be realized through such sales may bé very substantially less than might be obtained if such stock or the paper owned by said Journal Publishing Company were to be sold in a different manner or to other purchasers.”
THE PHILIP LUDWELL JACKSON TRUST
“ * * # Without in any way limiting the broad powers herein granted to the trustees to sell and dispose of the assets of the trusts, I express the wish, which shall not be construed to be mandatory or binding upon the trustees, that if any stock of Journal Publishing Company, an Oregon corporation, shall be included in the assets of the trusts, the trustees shall in any disposition of such stock endeavor to do so in a manner such as to perpetuate the Oregon Journal, the newspaper published by Journal Publishing Company as a newspaper which conforms generally to the standards of that news *623 paper since the founding thereof by my late father, Charles Samuel Jackson. If it may be done without jeopardy to the standing of said newspaper the trustees shall endeavor to favor and give preference to persons actually in the employ of Journal Publishing Company engaged in the publishing and operation of the newspaper. I appreciate that at this time I cannot adequately define the processes to be adopted by the trustees in carrying out the policies of administration with respect to the stock of the Journal Publishing Company expressed in this paragraph and for that reason I give to the trustees broad powers to be exercised in their discretion in accomplishing the purposes and policies expressed in this article.”

The alleged acts constituting the violation of the trusts were described in the complaint, as follows:

“(a) Causing the value of the trust property to depreciate substantially in a manner threatening the retention of the ownership and control of the Journal Publishing Company and the newspaper which it operates on a local basis in that defendants have caused the circulation of the Oregon Journal to decrease substantially, have caused advertising revenues of the Oregon Journal to decrease substantially, have caused the majority of the staff of the Oregon Journal to go on strike and have placed the Oregon Journal in a serious financial condition.
“(b) Entering into agreements with non-local interests which in some measure remove control of the Journal Publishing Company and the newspaper which it operates from the local basis.”

The demurrer to the complaint was based upon the following grounds: (a) that plaintiffs had no legal interest in the enforcement of the trust; (b) that the trust being charitable the Attorney General was a necessary party plaintiff; (e) that there were no facts showing that defendants have abused their discretion; *624 (d) that even assuming an abuse of discretion, plaintiffs have mo legally protected interest in tbe absence of allegations that defendants have decided to sell the stock of Journal Publishing Company, that plaintiffs are ready, willing and able to- purchase the stock at a reasonable price, and that defendants are about to act arbitrarily in carrying out a -sale of the stock to non-local interests.

The trial court sustained the demurrer on the ground that plaintiffs’ interest was not substantial enough to enable them to bring suit. The trial court treated the case as a suit to enforce a charitable trust and since, as it correctly concluded, charitable trusts are enforceable only by the Attorney General and not by a private citizen, it held that plaintiffs were not entitled to maintain this suit for enforcement of the trusts.

Plaintiffs take the position that the provisions of the trust giving the Journal Employees a preference right to purchase the stock made them beneficiaries of a private trust, it being conceded that the other provisions of the trust were charitable in character.

We are of the opinion that the provisions of the will referred to did not create a legally enforceable interest in the plaintiffs. To qualify -as beneficiaries of the trusts in question plaintiffs must prove that the settlors intended to create an enforceable equitable interest in the class which plaintiff purport to represent. 1 Restatement of Trusts 2d, §§25, 127 (1959). Neither trust will bear such a construction. In both trusts the employees and persons associated with the-management of the newspaper were designated for preference in treatment merely -as an incident of carrying out the settlors’ purpose to keep the control of the *625 paper on a local basis. The preference was to be given the class only in the event that the trustees 'held stock of the Journal Publishing Company and only if they elected to sell the stock.

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Bluebook (online)
363 P.2d 765, 227 Or. 619, 1961 Ore. LEXIS 353, Counsel Stack Legal Research, https://law.counselstack.com/opinion/agan-v-united-states-national-bank-or-1961.