In re Trust Under Agreement dated May 13, 1950 ex rel. Wiedemann

358 N.W.2d 139, 1984 Minn. App. LEXIS 3806
CourtCourt of Appeals of Minnesota
DecidedNovember 20, 1984
DocketNo. C5-84-1332
StatusPublished
Cited by1 cases

This text of 358 N.W.2d 139 (In re Trust Under Agreement dated May 13, 1950 ex rel. Wiedemann) is published on Counsel Stack Legal Research, covering Court of Appeals of Minnesota primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
In re Trust Under Agreement dated May 13, 1950 ex rel. Wiedemann, 358 N.W.2d 139, 1984 Minn. App. LEXIS 3806 (Mich. Ct. App. 1984).

Opinion

OPINION

HUSPENI, Judge.

Trustee petitioned the district court on stipulated facts to construe trust provisions regarding final distribution. The trial court held that the remainder of the trust should be distributed to the trustor’s great-grandchild, excluding a surviving grandson. The grandson appeals. We reverse.

FACTS

On May 12, 1950, Karl Wiedemann executed a trust agreement, with First National Bank of Minneapolis as trustee. The trust was part of a divorce settlement with his wife, Edna Wiedemann. They had one daughter, Edna J. Vogel.

Under the trust, Edna Wiedemann received a life estate, followed by a life estate for her daughter. Edna Vogel had a limited testamentary power to dispose of the entire estate among her spouse, issue, and certain foundations. However, Edna Vogel predeceased her mother, and did not exercise her power of appointment. She was survived by two children, Richard Vo-gel (appellant) and Adelle Vogel Crane. As a result, each living child of Edna Vogel received an equal income interest in the trust after Edna Wiedemann’s death, and was entitled to an equivalent share of the trust principal when he or she attained age thirty.

Richard received his share of the trust estate upon his thirtieth birthday. However, Adelle did not survive her 29th year. She was survived by one son, William Crane (respondent by his guardian, Crocker National Bank). Thus, the 6th article of [141]*141the trust is applicable, covering “any contingency not herein provided for.” Under Article 6, “all such undistributed principal shall be paid over to the heirs at law of [Edna Vogel].” Literally read, that means one-half to Richard and one-half to William. William argues this is an unreasonable or absurd result. He contends Article 5, which gives Edna Vogel’s children an equal income interest and equal principal share at age thirty, shows Karl Wiedemann’s intent was to benefit his grandchildren equally, and that Adelle does not benefit equally unless her child receives her share. The trustee bank petitioned the court on stipulated facts for instructions. The trial court agreed with William. Richard appeals.

ISSUE

Whether the trial court erred in determining that construction of the literal language of the trust instrument gives rise to an unreasonable or absurd result?

ANALYSIS

The relevant trust provisions follow:

Fourth: CONTINGENT DISTRIBUTION OF PRINCIPAL BY DAUGHTER’S WILL. In the event said daughter of the Trustor is not then living, then said principal shall be paid over, discharged from this Trust to the persons and in the manner and proportions fixed by the exercise of the following limited power of appointment, as may be provided in the Last Will and Testament of said daughter of the Trustor; said daughter is given power to appoint the remaining principal of the trust fund within a class consisting of her husband, her children and issue, natural or adopted, the spouses of such children and issue, and such religious, charitable or educational corporations and foundations, no part of the net earnings of which inures to the benefit of any private stockholder or individual, and no substantial part of the activities of which is carrying on propaganda or otherwise attempting to influence legislation, as said daughter of the Trustor may designate.
Fifth: CONTINGENT DISTRIBUTION OF PRINCIPAL IF NO WILL. In the event that the daughter of the trustor does not live until final distribution of principal is made to her hereunder, and fails to exercise said power of appointment by a valid Will, then the remaining principal of the Trust Fund shall continue to be held in Trust for the equal benefit of any surviving child or children of Edna J. Vogel, daughter of the Trustor. The net income therefrom shall be paid equally to or for the use of said child or children until age 30, at which time an equal distributive share of principal shall be paid over, discharged from this Trust to such child or children. Sixth: ULTIMATE CONTINGENT DISTRIBUTION OF PRINCIPAL. If under any contingency not herein provided for, there remains any undistributed principal in the Trust Fund for which there is no provision for distribution, then all such undistributed principal shall be paid over to the heirs at law of said daughter of Trustor as determined by the intestate law of the State of Minnesota then in force at the time distribution of such principal is required to be made hereunder. For the purposes of such distribution of principal as provided in this Sixth subdivision, the Trustor, father of said daughter, shall not be considered as an heir at law in any respect.

The trustor’s intent, as expressed in the language of the trust, dominates construction. In re Ordean’s Will, 195 Minn. 120, 261 N.W. 706 (1935). If there is no ambiguity in the language when read in light of the surrounding circumstances, extrinsic evidence of the trustor’s intent is not allowed. In re Hartman’s Will, 347 N.W.2d 480 (Minn.1984). The reviewing court may not speculate as to what the trustor would have done if he knew of events that occurred after his death. Id. at 484.

The trustor’s intent is a fact issue, which is normally subject to the clearly erroneous standard. However,

[142]*142[w]here, as in this case, the critical evidence is documentary, there is no necessity to defer to the trial court’s assessment of the meaning and credibility of that evidence.

In re Trust Known as Great Northern Iron Ore Properties, 308 Minn. 221, 225, 243 N.W.2d 302, 305 (1977).

Richard’s proposal reflects a literal interpretation of the trust instrument. The trustee cannot disregard the plain words of the instrument “unless it clearly appears that they were otherwise used [ambiguous] or that an unreasonable or absurd result will follow therefrom.” In re Fiske’s Trust, 242 Minn. 452, 460, 65 N.W.2d 906, 911 (1954). Without deciding whether the language was ambiguous, the trial court decided it led to an unreasonable or absurd result.

The trial court’s decision is based on the belief that Wiedemann intended to benefit his grandchildren equally, as evidenced by the fifth article. The language clearly indicates that the grandchildren are to benefit equally. However, William and the trial court further assume that the grandchildren do not benefit equally unless their issue receive their parent’s equal share.

If the testator provides equally for his children, it does not necessarily follow that he intends to provide equally for more distant generations yet unborn. Hartman, 347 N.W.2d at 484. Karl Wiedemann’s trust shows his primary interest was to provide for his daughter, Edna Vogel. She was entitled to dispose of the entire corpus if she so desired. She did not exercise her testamentary option. Since it is always highly possible a person may die intestate, Karl Wiedemann provided for that possibility by dividing the principal among Edna’s children. Edna Vogel had one son at the time of the trust, and was still of childbearing age.

Edna Vogel’s children had to survive their mother and grandmother before they received their income interest.

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Related

Matter of Wiedemann
358 N.W.2d 139 (Court of Appeals of Minnesota, 1984)

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Bluebook (online)
358 N.W.2d 139, 1984 Minn. App. LEXIS 3806, Counsel Stack Legal Research, https://law.counselstack.com/opinion/in-re-trust-under-agreement-dated-may-13-1950-ex-rel-wiedemann-minnctapp-1984.