Mercantile Trust Co. v. Kilgen

298 S.W.2d 387, 1957 Mo. LEXIS 573
CourtSupreme Court of Missouri
DecidedJanuary 14, 1957
DocketNo. 45592
StatusPublished
Cited by4 cases

This text of 298 S.W.2d 387 (Mercantile Trust Co. v. Kilgen) is published on Counsel Stack Legal Research, covering Supreme Court of Missouri primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Mercantile Trust Co. v. Kilgen, 298 S.W.2d 387, 1957 Mo. LEXIS 573 (Mo. 1957).

Opinion

DALTON, Judge.

Action by a co-trustee under a certain inter vivos trust agreement against another co-trustee under the same trust agreement and other defendants for a construction of the trust agreement and other written documents and for instruction as to whether the distributive share of George J. Kilgen under the trust agreement should be charged with the indebtedness evidenced by two notes of George J. Kilgen held by the trust estate and, if so, as to the extent of the charge.

The trial court ordered :the full amount of the principal .and interest of said notes, amounting to approximately $25,600, charged against the distributive share in question, amounting to approximately $24,500. George J. Kilgen, as beneficiary and co-trustee, has appealed and contends that no charge on account of said notes should be made against his distributive share and, further, that an allowance of attorneys’ fees máde by the court to appellant’s attorneys should have been in a substantially larger sum. This court has jurisdiction of the appeal, since the amount involved exceeds $7,5001 Art. V. Sec. 3, Const. of Mo. 1945, V.A.M.S.; Scullin v. Mercantile-Commerce Bank & Trust Co., 361 Mo. 337, 234 S.W.2d 597, 599.

The facts and detailed provisions of the trust agreement and the terms of the other documents which appellant contends modified the trust agreement are not in dispute.

Charles C. Kilgen by an instrument dated May 11, 1931, created an inter vivos trust and named himself and the Mississippi Valley Trust Company as co-trustees. Kilgen died May 6, 1932 and, as provided by the terms of the trust instrument, he was succeeded as co-trustee by his widow, Ida J. Kilgen. After her death on September 30, 1954, she was succeeded as co-trustee by appellant George J. Kilgen. The respondent Mercantile Trust Company is the successor to the Mississippi Valley Trust Company and is now a co-trustee under the trust agreement and as such trustee instituted the present action naming George J. Kilgen in his individual capacity and as co-trustee of the trust among the defendants. In his answer appellant asked the court to find that the trust estate was not entitled to the amount of -the indebtedness evidenced by his notes or the interest thereon; that his distributive share, as beneficiary under the trust agreement, be not charged with either the principal or interest of said notes; and that a reasonable attorneys’ fee for the attorneys repre-[389]*389se-nting h-im-½ his capacity as co-trustee be allowed and paid out of the corpus of the trust estate. .

' The second paragraph of the trust agreement provided that out of the net income: of the trust e,state, while the grantor and his wife were diving, the trustees were to. pay the grantor’s wife, Ida J. Kilgen, the sum of $600 per month and the balance of such income was to be paid to the donor in as nearly equal monthly installménts as may be practicable. , Upon the death of either Ida J. Kilgen or the grantor, the trust provided that the accumulated income should be paid to the survivor of them and all income thereafter received should be paid in as nearly equal monthly installments as may be practicable to the survivor during his or her natural life.

The third paragraph of the trust agreement provided that the trust should termi-' nate upon the death of the survivor of the grantor and his wife and that “all the property then constituting the trust estate, both principal and income then accrued or on hand and not advanced to either of the life tenants hereunder, shall be transferred, free of trust, as followsThen follows, in said paragraph, 'the description of the takers upon the termination of the trust, and included among said takers, is appellant ’George J. Kilgen, who, in his individual capacity, is given one-eighth (⅛) of the trust estate.

The trust terminated with the death of the grantor’s wife, Ida J. Kilgen, on September 30, 1954.

Included in the assets of the said trust estate at the time it was created were two promissory notes of George J. Kilgen, each payable to Charles C. Kilgen, in the principal amount of $2,500, dated November 4, 1926, and due November 4, 1927, and bearing interest at the rate of 6% payable annually, “and if interest be not paid annually to become as principal and bear the same rate of interest until paid.” The notes bore the endorsement of Charles C. Kil-gen and they were still among the assets of the .trust estate when the trust terminated. . No payments of principal. or interest were ever made on either of these two' notes.

Charles C. Kilgen, the grantor of said' trust, reserved the right to alter, amend or revoke the trust, in whole of in’part, as follows: “The trust is hereby created and the interests hereunder are vested subject to the express condition and reservation that the grantor may at any time or from time to timé alter or amend' the terms of this Indenture or may revoke this Indenture in whole or in part, and may free any sum or sums of money, securities or other property from the terms of this trust at any. time or from time to time during the, grantor’s lifetime, each such- right to be-exercised by 'written notice to that effect,executed by the grantor and delivered to the trustees hereunder, and as and when duly requested the trustees shall deliver to the grantor or to whomsoever he shall designate, all or any part or parts of the property held under the terms of this trust.”

The trust agreement further provided that upon termination of said trust, distribution of the corpus was to be subject, to the following provisions: “The forego--ing schedule of distribution under the terms of this article Third is hereby made subject to the condition that as to each son of the grantor whose notes form part of the assets of the trust estate at the. termination of this trust, it is hereby directed that his share of the trust estate if he be then living otherwise the share of the trust estate which would be transferable to him hereunder if then living, shall be charged with the sum total of his said notes and if the aggregate sum of such notes be, larger than his share of the trust estate' as above set out, then such excess sum due, on such notes shall be deemed cancelled, and the other .shares of the trust estate set; apart by the foregoing provisions of ⅛⅛ Article Third, shall thereupon be proportionately reduced so as to make proper allowance for such depletion of the assets of the trust estate.”

[390]*390Thereafter, on May 13, 1931, the grantor wrote the Mississippi Valley Trust Company, the then co-trustee of said trust, a letter which, in part, read as follows: “As part of the securities deposited under the above trust there were two notes of George J. Kilgen each for $2500.00, dated November 4, 1926, due November 4, 1927, with interest at 6% from date. No interest has been paid on these notes since they were executed and I hereby request that you make no effort to collect either the principal or the interest on these notes.”

Thereafter, on June 18, 1952, the grantor’s wife, Ida J. Kilgen, who had survived him, and was then receiving all of the net income until her death, wrote her co-trustee, the Mercantile Trust Company, a letter which reads as follows:

“Gentlemen: At the time of the creation of the trust by Mr. Charles C. Kilgen, under his agreement dated May 11, 1931, he transferred to the Trust Estate two notes of George J.

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298 S.W.2d 387, 1957 Mo. LEXIS 573, Counsel Stack Legal Research, https://law.counselstack.com/opinion/mercantile-trust-co-v-kilgen-mo-1957.