American Trust Co. v. Nicholson

78 S.E. 152, 162 N.C. 257, 1913 N.C. LEXIS 341

• Court: Supreme Court of North Carolina
• Decided: May 13, 1913
• Status: Published

Opinion

AlleN, J.

Tbe power of tbe court to order a sale of tbe land in controversy, witb tbe parties before it, considered independent of tbe provision in tbe declaration of trust, “that no partition of said land nor any sale thereof shall be made by any of tbe issiie of tbe said Henry C. Dotger and bis wife, Bertha M. Dotger, until the youngest child shall arrive at tbe age of 21 years, that date being fixed as tbe time when partition is to be made,” is settled in Springs v. Scott, 132 N. C., 563, where Justice Connor, in an elaborate and learned opinion, after reviewing tbe authorities, says:

“Upon a careful examination of tbe cases in our own reports and those of other States, we are of the opinion:

“1. That without regard to tbe act of 1903, tbe court has tbe power to order tbe sale of real estate limited to a tenant for life,'with remainder to children or issue, upon failure t]j.e?eof, over to persons, all or some of whom are not in esse, when one of tbe class being first in remainder after the expiration of tbe life estate is in esse and a party to tbe proceeding to rejiresent the class, and that upon decree passed, and sale and title made pursuant thereto, tbe purchaser acquires a perfect title as against all persons in esse or in posse.

“2. That when tbe estate is vested in a trustee to preserve contingent remainders and limitations, tbe court may, upon petition of tbe life tenant and tbe trustee, witb such of tbe remaindermen as may be 'in esse, proceed to order tbe sale and bind all persons either in esse or in posse.”

Nor do we think the provision quoted prevents tbe exercise of this power. ■

If treated as a restraint on alienation, it is void. Dick v. Pitchford, 21 N. C., 480; Mebane v. Mebane, 39 N. C., 131; Pace v. Pace, 73 N. C., 119; Lattimer v. Waddell, 119 N. C., 370; Wool v. Fleetwood, 136 N. C., 465; Christmas v. Winston, 152 N. C., 48.

In Wool v. Fleetwood, supra, where the subject is fully discussed by Justice Walker, it is held, citing Dick v. Pitchford, that a condition against alienation annexed to a life estate is void; and in Christmas v. Winston, supra, citing Lattimer v. Waddell, that such a condition, whether annexed to a life estate or a fee, is not made valid because limited to a certain period of time.

The other,condition as to partition has not been violated, as no actual partition has been had, and the sale is not for the purpose of dividing the proceeds, which are directed to be held for reinvestment.

It is not necessary for us to decide the question, in the view we have taken of- the case, but there is also high authority for the position that conditions like those before us annexed to estates, limiting, the powers of trustees or cestui que trust, if valid, do not prevent the.court of equity from' ordering a sale of .property contrary to such condition, upon facts like those alleged in the complaint. Curtis v. Brown, 29 Ill., 230; Weld v. Weld, 23 R. I., 318; Johns v. Johns, 172 Ill., 470; Conkling v. Washington Univ., 2 Md. Ch., 504; Stanly v. Colt, 72 U. S., 169; Jones v. Habersham, 107 U. S., 183; Gavin v. Curtin, 171 Ill., 648.

In the first of these cases (Curtis v. Brown) the Court says: “This question of jurisdiction does not depend upon the necessities of this case, but if it is possible that such a case might have existed as would authorize the court to break in upon the provisions of thiso trust deed, and order a disposition of ’the property not in accordance with its terms, then the power°to do so is established. The case might exist where the property was unproductive, as in this case, but where the cestui que trust was absolutely perishing from want, or forced to the poorhouse, or where the trustee could not possibly raise the means to pay the taxes upon the property, and thus save it from a public sale and a total loss, can it.be said that the beneficiary of an estate whieb would bring in tbe market $100,000 should perish in the street from want, or be sent to the poorhouse for support, or that the estate should be totally lost, because there is no power in the courts to relieve against the provisions of the instrument creating this trust? Exigencies often arise not contemplated by the party creating the trust, and which, had they been anticipated, would undoubtedly have been provided for, where the aid of the court of chancéry must, be invoked to grant relief imperatively required; and in such cases the court must, as far as may be,’occupy the place of the party creating the trust, and do with the fund what he would have dictated had he anticipated the emergency. In Harvey v. Harvey, 2 P. Wms., the Court said it ‘would do what in common presumption the father, if living, would, nay, ought to have done, which was, to provide necessaries for his children.’ It is true that courts should be exceedingly cautious when interfering with or changing in any way the settlements of trust estates, and especially in seeing that such estates are not squandered and lost. Trust estates are peculiarly under the charge of and within the jurisdiction of the court of chancery. The most familiar instances in which the court interferes and 'sets aside some of the express terms of the deed creating the trust is in the removal of the trustee for misconduct and the. appointment of another in his stead. But this is as much a violation of the terms of the settlement as is a decree to sell the estate and reinvest it, or to apply the proceeds to the- preservation of the estate, or the relief of the cestui que trust from pinching want. From very necessity a power must exist somewhere in the community to grant relief in such cases of absolute necessity, and under" our system of jurisprudence that power is vested in the court of chancery. This power is liable to be abused or imprudently exercised, no doubt, and so may every power vested in the courts or other branches .of the Government. The liability to the abuse or misuse of power can never prove its nonexistence, else all powers of government would be at once annihilated.” And in the last (Gavin v. Curtin): “We 'think it is well settled that a court of equity, if it has jurisdiction in a given cause, cannot be deemed lacking in power to order the sale of real estate which is the subject of a trust, on the ground, alone, that the limitations of the instrument creating the trust expressly deny the power of alienation. It is true, the exercise of that power can. only be justified by some exigency which makes the action of the court, in a sense, indispensable to the preservation of the interests of the parties in the subject-matter of the trust, or, possibly, in case of some other necessity of the most urgent character. The jurisdiction and power of a court of chancery in this respect were the subject of discussion in this Court in Curtiss v. Brown, 29 Ill., 201; Voris v. Sloan, 68 id., 588, and Hale v. Hale, 146 id., 227, and the conclusion reached in each of such cases is in harmony with the view hereinbefore expressed, that courts in equity have full power' to entertain bills and grant relief in such cases as that at bar.”

"We are, therefore, of opinion, upon a careful review of the whole record, that the plaintiff can convey a good title to the defendant, and that there is no error.

Affirmed.