Glover v. Paul

144 N.W.2d 382
CourtNorth Dakota Supreme Court
DecidedJuly 28, 1966
DocketNo. 8265
StatusPublished
Cited by1 cases

This text of 144 N.W.2d 382 (Glover v. Paul) is published on Counsel Stack Legal Research, covering North Dakota Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Glover v. Paul, 144 N.W.2d 382 (N.D. 1966).

Opinion

STRUTZ, Judge

(on reassignment).

Lewis C. Stearns died testate on January 29, 1951. His sole heir at law was his adopted daughter, Mona Stearns Lapland Glover, the petitioner in this proceeding. Shortly after his death, his will and codicil were admitted to probate by the Ward County court, Ward County being the residence of the deceased.

Throughout the probate proceedings, Mona Stearns Lapland Glover was represented by legal counsel. It appears from the record that the estate was heavily indebted, and the probate continued from 1951 to 1963, final decree of distribution being entered by the Ward County court on March 22 of the latter year. Under the terms of the final decree, the assets of the estate were ordered distributed to a trust established by the will which provided, in part, as follows:

“I direct that my said trustees shall continue to operate my said trust estate for the period of fifteen years and if in their best judgment, in order to carry out the further provisions of this trust it is necessary or will be beneficial to the beneficiaries, they may continue this trust in force for a period of twenty years from its inception. The effective date of said trust shall be upon the final decree in my estate in probate decreeing my said property to said trustees.”

The beneficiaries of the said trust were all in being at the time of the death of the deceased. They were named in the trust instrument with the provision that such beneficiaries be paid a monthly income as long as they should live during the life of the trust, and upon the termination of the trust the trustees should pay certain sums to specified beneficiaries, if still living.

It is the contention of the petitioner that the provision continuing the trust for fifteen years after entry of the final decree of distribution in the decedent’s estate violates the North Dakota statutory rule against the suspension of power of alienation in effect at the time of the decedent’s death, which provided:

“47-0227. POWER OF ALIENATION; HOW LONG SUSPENDED. Except in the single case mentioned in section 47-0413, the absolute power of alienation cannot be suspended, by any limitation or condition whatever, for a longer period than as follows:
“1. During the continuance of the lives of persons in being at the creation of the limitation or condition; or
“2. For a period not to exceed twenty-five years from the time of the creation of the suspension.” [N.D.R.C. 1943.]

Petitioner contends that the “creation of the limitation” occurred at the death of Mr. Stearns, and that the permissible period during which the property may be tied up is measured from that date. That was January 29, 1951. She further contends that operation of the trust for fifteen years from the date of the final decree in the estate, or [384]*384March 22, 1963, would extend the time of such limitation to March 22, 1978, or for more than the twenty-five-year limitation from the creation of the suspension. Thus, it is contended, the rule against suspending the power of alienation for not more than twenty-five years from the creation of the suspension is clearly violated, and, under Section 47-0231, providing that every future interest which, by any possibility, may suspend the absolute power of alienation for a longer period than is prescribed by law, is void in its creation.

The trial court held that the trust established by the will is not void and does not violate the North Dakota rule against per-petuities. From judgment entered, the petitioner has appealed to this court.

The applicable provisions of the trust instrument are as follows:

“FIFTH: I give, devise and bequeath all of the rest, residue and remainder of my estate, real, personal and mixed, to James W. Stearns, B. L. Kamins, A. R. Weinhandl, Harold Montgomery and Lars O. Kleppe, in trust however, for the following uses and purposes: They shall hold, manage, control, invest and reinvest my said estate in such manner as they shall deem for the best interest of my said estate and the beneficiaries under said trust, and my said trustees are hereby given and shall have full and ample rights, powers and authority to do any and every thing that is in their judgment necessary or advisable to conserve, protect, manage, handle and control said estate, including the right to lease, sell, convey, exchange, invest and reinvest any of the said property or the assets of said trust, and to execute any and all contracts, deeds, leases and any and all other instruments which said trustees may deem necessary to the execution of the trust as fully and for all purposes as I might or could do if living and acting in the.premises, and without aid or authority of any court.
* * * * * *
“I direct that my said trustees shall continue to operate my said trust estate for the period of fifteen years and if in their best judgment, in order to carry out the further provisions of this trust it is necessary or will be beneficial to the beneficiaries, they may continue this trust in force for a period of twenty years from its inception.”

The trust instrument then directs that, during the life of the trust, the trustees shall pay to Mr. Stearns’ daughter, the petitioner herein, and to other named beneficiaries, designated monthly incomes for as long as they shall live during the life of the trust; and, upon the termination of the trust, specific sums shall be paid to specific beneficiaries, if living. It is further provided that, after payment of Stearns’ debts and those of the corporation which he owned at his death, and after the necessary surplus has been set aside for expansion of the corporation, surplus not needed shall be divided semiannually or annually by the trustees and paid to the named beneficiaries.

At the end of the fifteen-year period from the date the trust became effective, or at the end of an additional five-year period thereafter, if the trustees in their discretion continue the trust for an additional five years, the trustees are directed to sell the trust property and to distribute the proceeds of the sale to beneficiaries named. In the event any of the named brothers or sisters of the deceased die prior to the death of the deceased, or prior to the date of the termination of the trust, the share that would have gone to such deceased brother or sister shall be paid to such decedent’s legatees or heirs at law if the deceased person fails to leave a will. In the case of one brother, Charles B. Stearns, the share which he would have received under the provisions of the trust are directed to be paid to his wife and children, share and share alike.

The petitioner’s case is based upon the contention that the provision for the trust [385]*385to continue for fifteen years after entry of final decree — which decree was entered more than twelve years after the death of Stearns — violates the North Dakota statute against suspension of the power of alienation set out above. Since this court has held that the time for the commencement of the perpetuities period is the testator’s death [Penfield v. Tower, 1 N.D. 216, 46 N.W. 413], in this case such period of suspension would be from January 29, 1951, and until fifteen years after the date of entry of final decree, or until March 22, 1978.

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Bluebook (online)
144 N.W.2d 382, Counsel Stack Legal Research, https://law.counselstack.com/opinion/glover-v-paul-nd-1966.