Jarrett v. Green

52 S.E.2d 223, 230 N.C. 104, 1949 N.C. LEXIS 577

• Court: Supreme Court of North Carolina
• Decided: March 9, 1949
• Status: Published

Opinion

Stacy, O. J.

The question for decision is whether the evidence suffices to carry the case to the jury in the face of the demurrers. The trial court answered in the negative. "We are inclined to a different view.

The executor was well advised “to submit the question to the court for an interpretation of the section of the will dealing with the sale of stock.” He was ill-advised when, apparently without the knowledge of his own counsel, he sold the 86 shares on 9 March, 1943, at the price o'f $225 per share. Not only was he enjoined specifically by the testator to retain the stock if feasible, but he was also under a fiduciary duty to the plaintiffs to prevent its sale, if reasonably within his power. Van Alstyne v. Brown, 77 N.J.Eq. 455, 78 Atl. 678; Scott on Trusts, Yol. 2, See. 176. The value determined for inheritance-tax purposes was the price fixed for offering the stock to the stockholders of the Imperial Life Insurance Company, who were then directors, in the absence of a better obtainable hid. This is made manifest by the last paragraph of Item 6 of the will. Note that in this last paragraph the testator spells out his intent, which after all is his will. Bank v. Corl, 225 N.C. 96, 33 S.E. 2d 613; Cannon v. Cannon, 225 N.C. 611, 36 S.E. 2d 17. The stock was without general market price because closely held and none offered for sale.

Initially, however, there was to be no sale of the stock except m case of necessity, or plain wisdom, and under the plaintiffs’ evidence the occasion of necessity was nonexistent at the time of the purported sales. At least the permissible inferences deducible therefrom suffice to overcome the demurrers. Leno v. Ins. Co., 228 N.C. 501, 46 S.E. 2d 471. Hence, we do not reach the terms of the will under which the executor was authorized to sell to stockholder-directors of the Insurance Company.

Ye refrain from discussing the evidence as the defendants are yet to be heard. It is suggested on behalf of Starnes and Warlick that they are innocent purchasers for value without notice. Suffice it to say there is evidence to support a contrary finding.

The action is to establish a constructive or resulting trust, to recover the property, and for an accounting. Bank v. Crowder, 194 N.C. 312, 139 S.E. 601; Costner v. Cotton Mills Co., 155 N.C. 128, 71 S.E. 85; Lemly v. Atwood, 65 N.C. 46. It readily survives the plea of laches and the applicable ten-year statute of limitations. G.S. 1-56; Creech v. Creech, 222 N.C. 656, 24 S.E. 2d 642; Teachey v. Gurley, 214 N.C. 288, 199 S.E. 83. In protesting tbe nonsuit, counsel for plaintiffs say, “We are entitled to pursue the hunt so long as we can track the fox; and not until we lose the trail are we obliged to abandon the chase, call our dogs and go home.”

There was error in sustaining the demurrers to the plaintiffs’ evidence.

Reversed.