Lewis v. Deposit Guaranty National Bank

279 So. 2d 605, 1973 Miss. LEXIS 1474
CourtMississippi Supreme Court
DecidedJune 18, 1973
DocketNo. 47158
StatusPublished

This text of 279 So. 2d 605 (Lewis v. Deposit Guaranty National Bank) is published on Counsel Stack Legal Research, covering Mississippi Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Lewis v. Deposit Guaranty National Bank, 279 So. 2d 605, 1973 Miss. LEXIS 1474 (Mich. 1973).

Opinion

SMITH, Justice:

The proceedings which resulted in the entry of the decree from which this appeal has been prosecuted were begun in the Chancery Court of the First Judicial District of Hinds County by appellant, John Hart Lewis, as petitioner, against his brother, M. A. Lewis, Jr., Deposit Guaranty National Bank, (Deposit Guaranty Bank and Trust Company) and other devisees and legatees named in the will of the late M. A. Lewis (Sr.), as defendants. The suit involved the construction and administration of a testamentary trust established under the Lewis will. A copy of Item Three of the will, creating the trust, is appended to this opinion.

The Lewis will was admitted to probate in August, 1953. From that time until the death in October, 1956 of Mrs. Eva Hart Lewis, widow of the testator, she and Deposit Guaranty Bank and Trust Company administered the trust, as testamentary trustees, as provided in the will. Following the death of Mrs. Lewis, on a petition [606]*606filed by Deposit Guaranty Bank and Trust Company, as surviving trustee, the Court, also in keeping with directions contained in the will, appointed the testator’s sons, John Hart Lewis and M. A. Lewis, Jr., to serve with the bank, as trustees. In this decree, entered in December, 1956, it was provided that:

[I]n all other matters connected with the conduct and management of said trust, the three testamentary co-trustees, . . . shall be guided by, act and manage the said affairs of the trust pursuant to and in accordance with the judgment and views of a majority of said three testamentary co-trustees.

Since then, the bank, with John Hart Lewis and M. A. Lewis, Jr., have continued to administer the estate as trustees, and M. A. Lewis, Jr., has also served as attorney.

The substance of the principal contentions of John Hart Lewis, as set out in his original and amended petitions, may be summarized as follows: He sought removal of his brother and cotrustee, M. A. Lewis, Jr., as attorney and denial to him of attorneys fees, or, alternatively, leave to employ, at the expense of the trust estate, an attorney of his own; a partial distribution to himself of $13,000 because of an alleged ‘‘business emergency”; the setting aside of a sum, based upon the life expectancy of Mrs. Sage, sufficient to meet the requirements of the will during her lifetime, the balance of the estate to be set aside for the use and benefit of the “other living named beneficiaries.”

The testator in establishing, and providing for the administration and final distribution of the trust estate, directed that:

Said Trustees shall thus accumulate the net income from said estate and keep the same prudently invested but with no duty to make any distribution thereof, unless in case of an unforeseen emergency, the Trustees may determine to make a total or partial distribution of such income, if by them deemed to be for the best interest of this estate.

He also, in unequivocal language, provided that:

The time for determination of the identity of the cestuis que trustent [beneficiaries] hereunder shall be and is hereby fixed as at the time of the death of my cousin, Mrs. Vivian Sage, when this trust is to be terminated and the property divided, and not at my death.

It is abundantly clear that the testator intended to restrict the actions of the trustees to the accumulation and investment of the trust funds, and specifically provided that distribution should not be made (except in the event the trustees should determine that an “unforeseen emergency” had occurred) until the death of Mrs. Vivian Sage. Mrs. Sage is living at this time. The estate has been increased during its administration since the testator’s death from an original value of approximately $300,000 to over $1,000,000.

In dealing with the trust estate, in matters left to their discretion by the testator, under the. terms of the 1956 decree so providing (and as a matter of practical and reasonable necessity) the trustees have acted, and must act, within the framework of the trust, according to the will of the majority, subject, of course, to review by the chancery court or chancellor, if their acts are properly called in question. In this case, a majority of the trustees declined the demands of John Hart Lewis which are now the subject of this litigation. In order to override the decision of the majority of the trustees it was necessary that it be established that they had abused their discretion or had acted contrary to the terms of the trust or in derogation of some duty to the trust estate. Otherwise, a decision of the majority of the trustees will not be disturbed by the court.

The chancellor dealt with each of the several contentions advanced by John Hart Lewis. He denied the request for a partial [607]*607distribution, saying that “under the clear and unmistakable terms of this will no one at this time can definitely say who the beneficiaries of this trust will ultimately be.” He held, as had a majority of the trustees, that no “unforeseen emergency” existed within the meaning of the will, requiring partial distribution. The demand of petitioner that M. A. Lewis, Jr., be removed as attorney for the trust upon the grounds that there was a conflict of interest in that he was a beneficiary under the will, (if he should survive Mrs. Sage), attorney for Deposit Guaranty National Bank, a cotrus-tee, as well as a member of the executive committee of its board of directors was also rejected, the chancellor saying:

[T]he Court is of the opinion that there is no conflict of interests on the part of M. A. Lewis, Jr. as attorney for the different entities set forth in Proposition II, but, on the contrary, finds that it is to the best interests of the estate that he continue to act as attorney for the Trust. There was no evidence that any of his acts or advice was contrary to the best interests of the trust estate, and the Bank as trustee specifically requested that he be retained as counsel for the Trust. .
The testator knew and was well aware of the animosity and differences that existed between his sons. He knew, and so did his attorney who drew the will, that in all probability the two would not go out of their way to agree with each other in many respects. In the thinking of the Court, there was unusual wisdom in this particular instance of so making the two successor trustees along with the Bank, because that questions would be asked as to all procedures and that the estate, by amicable agreements between the three, would not be dissipated. In view of the increase of the estate from $300,000 to over $1,000,000 would bear out the wisdom of the testator in the selection of these trustees.

Appellant says in his brief, “Here Appellant, although previously consenting to representation by M. A. Lewis, Jr., (as attorney) has now revoked this consent and has invoked the aid of the courts in obtaining objective legal representation in trust matters.” The first objection interposed to the retention of M. A. Lewis, Jr., as attorney, appears, therefore, to have been interposed after some fourteen years of satisfactory service in that capacity. Long-standing animosity had existed between John Hart Lewis and his brother, M. A. Lewis, Jr., but this was known to the testator and it is apparent from the prospering of the trust estate during this period that such enmity had not affected the estate adversely and it was not established that it had ever done so.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Estate of Greenberg v. Sugarman
146 N.E.2d 404 (Appellate Court of Illinois, 1958)

Cite This Page — Counsel Stack

Bluebook (online)
279 So. 2d 605, 1973 Miss. LEXIS 1474, Counsel Stack Legal Research, https://law.counselstack.com/opinion/lewis-v-deposit-guaranty-national-bank-miss-1973.