Shaull v. United States

161 F.2d 891, 82 U.S. App. D.C. 174, 1947 U.S. App. LEXIS 2855
CourtCourt of Appeals for the D.C. Circuit
DecidedMay 19, 1947
DocketNo. 9406
StatusPublished
Cited by4 cases

This text of 161 F.2d 891 (Shaull v. United States) is published on Counsel Stack Legal Research, covering Court of Appeals for the D.C. Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Shaull v. United States, 161 F.2d 891, 82 U.S. App. D.C. 174, 1947 U.S. App. LEXIS 2855 (D.C. Cir. 1947).

Opinion

WILBUR K. MILLER, Associate Justice.

The question presented by this appeal is whether the District Court of the United States for the District of Columbia should establish and supervise the administration of a parol trust in the proceeds of government converted insurance on the life of Thomas L. Collins.

Many years ago Collins lived in Columbus, Ohio, where for a time he was engaged in business with his half-brother, Paul Hewetson. Collins was then married and had one son, Thomas B. Collins. The business failed and the marriage terminated in divorce. In 1935 Collins was married in Illinois to a second wife, Elizabeth, and thereafter made his home in Pittsburgh, where there were born two sons, Joseph S. and Paul Francis. In 1940 they removed to Washington, D. G, and remained there [893]*893until July, 1942, when they went to Cedar Rapids, Iowa, to live with Elizabeth’s mother, Mrs. Marilla Shaull. Soon after their arrival at Cedar Rapids, Collins was taken to a veterans’ hospital in Des Moines, Iowa, where he died on August 15, 1942. Government insurance on his life of the value of $10,065.60 has not been paid.

In November, 1939, the decedent wrote to the Veterans’ Administration revoking a prior designation of his wife, Elizabeth, and son, Thomas B., as beneficiaries of his policy, and asking to substitute “my brother Paul Plewetson, * * * 10,000 to be held in trust for my children Thomas B., Joseph S. and Paul Francis Collins.”

He was advised by the Veterans’ Administration that, although he could name a beneficiary as trustee, “this Administration would not accept the responsibility of carrying out the trust so that the names of the cestuis que trust should not be given.” No attempt was made to explain the novel idea that the naming of cestuis que trustent would cast on the Veterans’ Administration the responsibility of carrying out the trust. But in obedience to that official ruling Collins submitted a new designation of Hewet-son, as trustee, tó be the beneficiary of the policy, omitting any reference lo cestuis que trustent.

Mrs. Marilla Shaull, guardian of her two small grandsons under appointment by an appropriate Iowa court, in 1943 notified the Administrator of Veterans’ Affairs that the beneficiary named in the policy was in fact trustee for the three sons of Thomas L. Collins and that, therefore, two-thirds of the proceeds should be in trust with him for her wards. Upon receipt of that claim, the Administrator declined to pay the proceeds to Hewetson and refrained from making any award under the policy. Why Mrs. Shaull’s assertion caused the Administrator to withhold payment to the designated beneficiary does not appear, but it is reasonable to assume that the government thought it best to await an authoritative determination of the terms and conditions of the trust before disbursing the proceeds of the policy.

Asserting that Collins had orally declared the policy to be in trust for the equal use and benefit of his three sons, and relying on § 19 of the World War Veterans’ Act of 1924, as amended, being § 445, Title 38 U.S.C.A.,1 as giving jurisdiction to the District Court of the United States for the District of Columbia, the guardian sued to have that court establish the alleged parol trust, define its terms and conditions, appoint a trustee, require him to give security for the faithful performance of his duties, and supervise his administration of the trust. The defendants were the United States, its Treasurer and Administrator of Veterans’ Affairs, Paul Hewetson and Thomas B. Collins. When the suit was. filed, Hewetson was still a citizen and resident of Columbus, and young Collins, then in the armed services, apparently was domiciled in that city. Answers were filed by all the defendants. Depositions were taken and an affidavit of Hewetson was filed.

The District Court, without an explanatory opinion, granted summary judgment to the United States, Thomas B. Collins and Paul Hewetson. It dismissed the complaint as to the Treasurer of the United States and as to the Administrator of Veterans’ Affairs on the ground that a cause of action against them was not stated. The guardian appeals.

We consider first whether the District of Columbia court had jurisdiction undci [894]*894§ 19. The defendants2 argue that the guardian does not and cannot claim the proceeds of the policy in the sense in which the word “claim” is used in the statute; and that, even if she were a proper claimant, a disagreement between her and the Veterans’ Administration does not appear; from which they conclude that the,court in the District did not have jurisdiction.

The contentions are untenable. In averring that her wards are the beneficial owners of two-thirds of the trust fund, the guardian was making, in a very real sense, a claim to a portion of the proceeds of the policy.3 We hold that Mrs. Shaull’s notice to the Veterans’ Administration amounted to a claim under a contract of insurance.

This leads us to the question whether there was a “disagreement as to claim” between the guardian and the Administration. When the United States denied the existence of a parol trust under which the infants were the beneficial owners of a portion of the trust fund, and asserted that it would have theretofore paid the money to Hewetson, trustee, except for Mrs. Shaull’s claims, it admitted the existence of a disagreement with her as to the manner in which the proceeds should be disbursed. Her only contention was that Hewetson was to receive two-thirds of the fund in trust for the two small boys; if the United States had agreed with her, it would have paid the money to, Hewetson without further ado. Instead of agreeing, the government expressly denied the guardian’s contention in that regard, and refused to pay the proceeds to Hewetson. In such circumstances, we hold that there was a disagreement in the statutory sense between a claimant and the Veterans’ Administration.

The suit having been properly brought in the District of Columbia under the terms of § 19, the court had power also to adjudicate all claims with respect to the policy, including those which were made by Hewetson and the adult son of the insured. As the two defendants last named answered and pleaded to the merits without reservation, they are for that reason also unable to challenge the court’s jurisdiction over them.

The propriety of summary judgments in favor of the defendants, the United States, 'Hewetson and Thomas B. Collins, is next to be considered. The answers of Hewetson and young Collins admit that the decedent orally declared a trust for the use and benefit of his three sons, -although the answer of the United States denies it. The pleadings of all the defendants deny that the three sons were to share equally in the proceeds of the trust. Hewetson claims in his answer that “the manner, amount and method of disbursement as between said three children, * * * were left entirely to the judgment of this defendant as trustee.” There was thus made an issue of material fact as to the terms and conditions of the trust.

But when the motions for summary judgment were submitted, the depositions and affidavit on file had disspelled that issue of fact. It was established, without contradiction, that in July, 1939, Collins informed Hewetson of his plan to make him trustee for his three sons. Collins’ letter [895]*895to the Veterans’ Administration in November, 1939, clearly stated that the trust was to be for the three boys.

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161 F.2d 891, 82 U.S. App. D.C. 174, 1947 U.S. App. LEXIS 2855, Counsel Stack Legal Research, https://law.counselstack.com/opinion/shaull-v-united-states-cadc-1947.