Hayward v. Tacoma Savings Bank & Trust Co.

153 P. 352, 88 Wash. 542, 1915 Wash. LEXIS 1154
CourtWashington Supreme Court
DecidedDecember 11, 1915
DocketNo. 12931
StatusPublished
Cited by6 cases

This text of 153 P. 352 (Hayward v. Tacoma Savings Bank & Trust Co.) is published on Counsel Stack Legal Research, covering Washington Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Hayward v. Tacoma Savings Bank & Trust Co., 153 P. 352, 88 Wash. 542, 1915 Wash. LEXIS 1154 (Wash. 1915).

Opinion

Mount, J.

This action was brought Ito, terminate a trust. The trial court sustained a demurrer to the amended complaint and the action was dismissed. The plaintiff has appealed. .

It appears from the allegations of the amended complaint that, on the 6th day of September, 1913, the appellant and Anthony J. Hayward, now deceased, were husband and wife; [543]*543and that on that day they conveyed to the respondent, Tacoma Savings Bank & Trust Company, by trust deed, a large number of tracts of land situated in several counties in this state. Nearly all of these different tracts of land were community property. The home property, also included in the trust deed, and located in the city of Tacoma, was the separate property of the appellant.

By the terms of the trust deed, the trustee was required to pay all taxes and assessments on the property, and to sell sufficient thereof to reimburse itself for moneys advanced, and to create a fund sufficient to produce the sum of $200 per month, which was required to be paid to the appellant after the death of Mr. Hayward. The trust deed required that deeds made during the lifetime of the grantors should be jointly made by the grantors and the trustee; and after the death of Anthony J. Hayward, sales were to be made by joint agreement of the appellant, the executors of the will of Anthony J. Hayward, and the trustee. The trust deed further provided that the trustee was to receive as compensation in addition to interest upon sums advanced, a sum equal to the fees allowed by law for the administration of estates of deceased persons, and that these should be a first charge upon the estate.

At the time of making this trust deed, and as a part of the same transaction, Mr. Hayward executed a will in which he recited:

“I have contemporaneously with the execution of this will executed a trust deed of all of my real estate to Tacoma Savings Bank & Trust Company in trust for the use and benefit of my wife, Martha E. Hayward, my daughters, Emma M. Eastman and Hallie B. Hayward, and my son, Myron B. Hayward. I direct that said trust agreement shall be carried out according to its spirit and letter.
“I hereby constitute my wife the executrix of this will, and after her death it is my desire that the administration of the estate shall be completed according to the terms of said trust deed hereinbefore referred to by my children, Emma M. [544]*544Eastman, Hallie B. Hayward, and Myron B. Hayward, as co-executors, and in case of the death of any of them, by the survivors. Any real estate not covered by said trust deed is hereby willed in trust to the Tacoma Savings Bank & Trust Company, to be held and distributed in the same manner and form and subject to the same conditions as the real estate described in said trust deed. . . .”

The trust deed provided that the trustee should have power to sell and convey any of the property therein mentioned, at either public or private sale, and on such terms as the trustee thought would be most advantageous to the estate. After making provisions for expenses and advancements by the trustee, the trust deed provided that the property should be converted into interest bearing securities, consisting of real estate first mortgages and first-class bonds and warrants, until a fund should be created, sufficient in the judgment of the trustee to enable the trustee to pay from its proceeds, without impairment of the principal, the taxes on the home of Mrs. Hayward and the $200 monthly payment to be made to her during her lifetime. After such fund shall have been provided, the trustee is, by the trust deed, directed to distribute the balance of the estate among the children of the grantors.

The complaint then alleges that all of the beneficiaries named in the said deed of trust are of legal age and residents of Pierce county, state of Washington; that on the 30th day of April, 1914, all of the remaindermen and beneficiaries under said deed joined in a conveyance to the appellant of all of their rights in and to the lands described in the trust deed, and renounced all their title and interest by virtue of the will of Anthony J. Hayward.

The complaint further alleges that the appellant signed the trust deed when laboring under great mental distress, and was not fully competent to understand the terms, conditions, and effect of the deed; that the appellant had no opportunity of consulting with her legal adviser, and under[545]*545stood that her separate property would not be subject to the payment of advances made by the respondent trust company; that the appellant demanded a reconveyance of all the property, and offered to reimburse the respondents for all proper. charges and expenses incident thereto. These are briefly the allegations of the complaint.

It is argued by the appellant that “A trust will be discharged if all of the beneficiaries are sui juris and desire it, or when the entire beneficial interest passes to one person.” A number of authorities are cited to this effect. We think this is the rule where a trust is an inactive or dry trust; but where the trust is a special or active trust, we think this rule does not apply. It is plain in this case that the trust created is an active trust. The trustee, under the terms of the trust deed and under the will, which was executed at the same time and as a part of the same transaction, was required to pay all assessments and taxes of every kind against the properties, which were located in different counties in the state. Upon the death of Mr. Hayward, the trustee was required to advance to the appellant the sum of $200 on the first of each month. It is apparent, from a reading of the trust deed and the will, that it was the desire of Mr. Hayward, in making the trust deed and the will, to provide a comfortable allowance for his wife during her lifetime, and that then the property expressly reserved to her use should descend to her children; and, intending to relieve his widow from the burdens of caring for and looking after the property, it was placed in the hands of a trustee to actively care for and convey the same for the purposes mentioned in the trust deed. This is plainly an active trust; and it is clear, we think, that the fee of this property rests in the trustee.

The rule that in all cases of active trusts the title to trust property is in the trustee is supported by the authorities from the earliest times. The case of Smith v. Proctor, 139 N. C. 314, 51 S. E. 889, 2 L. R. A. (N. S.) 172, is sufficient [546]*546to show that this is the established rule upon this point. It was there said:

“In Am. & Eng. Enc. Law (2 ed.), vol 28, p. 923, it is said: ‘If there is an axiom of the law it must be regarded as axiomatic in the construction of active trusts that the trustee will take precisely that quantum of legal estate which is necessary to the discharge of the declared powers and duties of the trust. Thus the trustee will take, by implication of law, a fee in the estate when the duties of the trust require it, although the conveyance is in terms a life estate or fails to use the word ‘heirs.’ ’ In the same volume, at page 924, it is also said: ‘The estate of trustee will, nevertheless, not extend beyond the term required by the exigencies of the trust, the unnecessary portions of the estate becoming executed by the statute of uses.’ The authorities clearly show this to be a correct statement of the doctrine.”

In Martin v. Moore, 49 Wash.

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Bluebook (online)
153 P. 352, 88 Wash. 542, 1915 Wash. LEXIS 1154, Counsel Stack Legal Research, https://law.counselstack.com/opinion/hayward-v-tacoma-savings-bank-trust-co-wash-1915.