Succession of McLean

580 So. 2d 935, 1991 WL 74789
CourtLouisiana Court of Appeal
DecidedMay 8, 1991
Docket22378-CA and 22682-CA
StatusPublished
Cited by8 cases

This text of 580 So. 2d 935 (Succession of McLean) is published on Counsel Stack Legal Research, covering Louisiana Court of Appeal primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Succession of McLean, 580 So. 2d 935, 1991 WL 74789 (La. Ct. App. 1991).

Opinion

580 So.2d 935 (1991)

SUCCESSION OF Marjorie Palmer McLEAN.

Nos. 22378-CA and 22682-CA.

Court of Appeal of Louisiana, Second Circuit.

May 8, 1991.
Writ Denied September 6, 1991.

*937 Mills, Timmons & Flowers by Robert A. Thrall, Shreveport, for appellant, John H. Litzler-Bankruptcy Trustee.

Arter & Hadden by Brenda H. Collier, Dallas, Tex., Special Counsel for John H. Litzler-Trustee in Bankruptcy for Harvey D. McLean, Jr.

Sessions & Fishman by Max Nathan, Jr., New Orleans, for mover-appellee, Mary McLean Obering-Trustee of The Harvey D. McLean, Jr. Trust.

James A. Van Hook, Shreveport, for appellee, Mary Amanda McLean Obering.

Before SEXTON, NORRIS and HIGHTOWER, JJ.

NORRIS, Judge.

John H. Litzler (Litzler), Trustee in Bankruptcy for Harvey D. McLean, Jr. (McLean), appeals a judgment of March 1, *938 1990 authorizing a partial funding, over Litzler's objection, of the Harvey D. McLean, Jr. Trust (McLean Trust) with a residual bequest of Exxon stock in the succession of McLean's mother, Mrs. Marjorie McLean. Litzler also appeals a separate judgment in the same suit signed June 21, 1990 authorizing a further funding of the McLean trust with a residual bequest of all remaining succession assets except cash; declaring that the McLean Trust is a valid and enforceable spendthrift trust; and ruling that the debts asserted by Litzler and another creditor are not judgments for which seizure of trust assets are permitted pursuant to La.R.S. 9:2005(3). Devolutive appeals nos. 22,378 and 22,682 were granted on these respective judgments. The appeals were consolidated and are both before us for resolution. For the reasons expressed, we affirm.

FACTS

The facts for both appeals are as follows: Mrs. McLean died on March 10, 1988, leaving an estate with a range of assets from considerable oil and gas interests to substantial stock holdings in the Exxon Corporation. She had two children: Harvey D. McLean, Jr. and Mary Amanda McLean Obering. Mrs. McLean's statutory will made various specific bequests not germane to these appeals. The will also made a specific bequest of $500,000 to Mrs. McLean's granddaughter by Obering, subject to Obering's usufruct; and one of $500,000 to her four grandchildren by McLean, subject to spendthrift trust provisions (the Grandchildren's Trust). Of the residue, the will gave one-half to Obering and one-half to a trust for the benefit of McLean (McLean Trust). This trust, which is made subject to maximum spendthrift provisions, is the crux of the controversies herein.

The will was probated in March 1988. In January 1989 McLean was placed in bankruptcy. Litzler was ultimately named trustee of McLean's bankruptcy estate. The will named McLean as trustee of both the Grandchildren's Trust and the McLean Trust. At the time of the bankruptcy petition, McLean had not accepted either trusteeship. Afterwards, on March 23, 1989, he executed a written acceptance of trusteeship of the Grandchildren's Trust and a written renunciation as to the McLean Trust.

PROCEDURAL HISTORY FOR APPEAL NO. 22,378

The involuntary bankruptcy proceeding was filed against McLean January 12, 1989 and the U.S. Bankruptcy Court granted relief under Chapter 7 on February 7, 1989. The petitioning creditor, FSLIC as receiver for Vernon Savings & Loan of Dallas (now the FDIC) asserted a claim of over $27 million against McLean. The FDIC intervened in these succession proceedings. Litzler also intervened to respond to Obering's first annual accounting.

On November 2, 1989, Obering, individually and as executrix, filed a petition for partial judgment of possession of succession assets. On the same date, Obering, as trustee of the McLean Trust, filed for authorization for Obering, as executrix, to deliver one-half of the Exxon shares remaining in the Succession to herself, as trustee for the McLean Trust.

On December 1, 1989 judgments were signed authorizing Obering to dispose of sufficient Exxon shares to fund all bequests except the residual bequest to the McLean Trust. A rule was ultimately set for February 7, 1990 to hear the request, in effect, to fund the McLean trust with the Exxon shares in accord with the will.

Litzler and the FDIC filed exceptions of prematurity, lack of procedural capacity, no cause of action and no right of action to the February 7 hearing. After arguments by the attorneys, the court gave oral reasons and concluded that to fund a trust, there must first be a valid trust to fund. An order and judgment of partial possession was signed March 1, 1990 overruling all of the exceptions and authorizing Obering, as executrix, to deliver to Obering, as trustee, all remaining shares of Exxon Corporation owned by the succession. The bankruptcy trustee appeals this judgment and assigns the following errors:

(1) The trial court erred in presuming that there were no pleadings or proceedings *939 to raise the issues of the validity of the trust itself or the spendthrift provisions thereof.
(2) The trial court erred in presuming the validity of the trust itself.
(3) The trial court erred in presuming that the spendthrift provisions of the trust were valid; and
(4) The trial court erred in failing to sustain appellant's peremptory exception of no right of action.

DISCUSSION

At the outset, we address whether the validity of the trust, its spendthrift provisions, or the issues raised by the exceptions can be appealed. The judgment signed February 7, 1990 orders that:

Mary McLean Obering, as Executrix of the Succession of Marjorie Palmer McLean, be and hereby is authorized to partially pay the legacy to Mary McLean Obering, as Trustee of the Harvey D. McLean, Jr. Trust by delivering unto said Trustee all of the remaining shares in Exxon Corporation currently belonging to the Succession. (emphasis added) Tr. 268, 269.

By ordering a partial funding of the Mclean Trust, the judgment implicitly finds that there is a valid trust to fund; therefore we will first address the assignments of error concerning the validity of the trust.

Appeal is from the judgment rather than the court's oral reasons. Hardin v. Munchies Food Store, 510 So.2d 33 (La.App. 2d Cir.1987), and citations therein. Though the trial court may have orally suggested that trust's spendthrift provisions are valid, the judgment itself does not address, either implicitly or expressly, the spendthrift nature of the McLean Trust. Thus, the issue of the spendthrift nature of the McLean Trust is not before us in this appeal and we pretermit discussion of the portion of assignment # 1 concerning the spendthrift provisions and assignment # 3.

In addition, the overruling of peremptory exceptions of no right of action and no cause of action are interlocutory judgments and not appealable absent showing of irreparable harm. Bush Const. Co., Inc. v. Carr, 512 So.2d 493 (La.App. 1st Cir.), writ denied 514 So.2d 1175 (1987); Belser v. St. Paul Fire & Marine Ins. Co., 492 So.2d 198 (La.App. 1st Cir.1986); Updegraff v. Parish of St. Bernard, 433 So.2d 863 (La.App. 4th Cir.1983). Litzler has presented no evidence of irreparable harm. The judgment as to these exceptions is not, strictly speaking, appealable. However, because the resolution of the issues presented on the partial funding of a valid trust are so interrelated with the issues presented by the exceptions of no cause and no right of action raised in this case, we will consider those issues.

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Bluebook (online)
580 So. 2d 935, 1991 WL 74789, Counsel Stack Legal Research, https://law.counselstack.com/opinion/succession-of-mclean-lactapp-1991.