Williams v. Burgett

831 So. 2d 597, 2002 Ala. LEXIS 97, 2002 WL 442718
CourtSupreme Court of Alabama
DecidedMarch 22, 2002
Docket1001999
StatusPublished

This text of 831 So. 2d 597 (Williams v. Burgett) is published on Counsel Stack Legal Research, covering Supreme Court of Alabama primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Williams v. Burgett, 831 So. 2d 597, 2002 Ala. LEXIS 97, 2002 WL 442718 (Ala. 2002).

Opinions

WOODALL, Justice.

This is an action to recover certain property alleged to be a portion of the estate of the remaindermen after the death of the life tenant. Dewey Williams, as executor of the estate of Hattie E. Williams, deceased, and others (hereinafter referred to collectively as “the remaindermen”), appeal from a judgment of the Walker Probate Court in favor of Faye W. Burgett, in their action to recover from Burgett the remainder of the estate of Lacy S. Williams, after the death of Hattie E. Williams, the life tenant. We reverse and remand.

This dispute arises out of “Item two” of the will of Lacy S. Williams, who died before December 14, 1994. At the time of his death, Lacy Williams was the husband of Hattie Williams. Item two provided, in pertinent part:

“I will, give, devise and bequeath all of my property, both real, personal and mixed, wheresoever situated and wheresoever located and in which I may have any interest at my death to my beloved wife, Hattie E. Williams, for and during the term of her natural life, with the absolute power of disposition of all or any part thereof, and upon her death any part of my said estate then remaining shall go [to designated descendants, with the rest and residue to children then living or their survivors, sharing equally in fee simple absolute].... ”

(Emphasis added.)

Hattie Williams sold timber from the real estate that had passed to her through [598]*598her husband’s will. With the proceeds of the timber sale, she purchased certificates of deposit (“the CDs”). The CDs were issued in the names of Hattie Williams and her daughter, Faye W. Burgett, jointly, with right of survivorship. Hattie Williams died testate on November 20, 1998; Burgett subsequently redeemed the CDs.

On March 16, 2001, Hattie Williams’s son, Dewey Williams, as executor of her estate and as one of the remaindermen, filed in the Walker Probate Court a “Petition for Determination of Estate Ownership Interest in Certain Assets.” The petition sought a declaration that the proceeds of the CDs were part of the remainder estate created in Item two of Lacy Williams’s will. The court ordered that the other remaindermen be served with notice of the proceedings.1

The case was submitted to the probate court on stipulated facts. On June 20, 2001, the probate court entered a final judgment. It held that “the proceeds from the disposition of [the timber] held in certificates of deposit with joint ownership with right of survivorship” were not part of the life estate of Hattie E. Williams, and, consequently, that the proceeds from the CDs passed to Burgett, “as the surviving joint tenant” of the CDs. From that judgment, the remaindermen appealed.

The sole question on appeal is a legal one — whether, upon the death of a life tenant, the remaindermen are entitled to the traceable proceeds of a sale of assets of the estate by, and during the lifetime of, the life tenant, who had an absolute power of disposition as to the estate. Because we answer that question in the affirmative, we conclude that the probate court erred.

To be sure, the probate court’s judgment was in accord with the common law. Under the common-law rule, where a do-nee received what purported to be a life estate, coupled with an absolute power of disposition, the donee was deemed to have received an estate in fee simple absolute, and the remaindermen took nothing. Gaylord v. Goldblatt, 423 So.2d 203 (Ala.1982); Rutledge v. Crampton, 150 Ala. 275, 43 So. 822 (1906); Young v. Sheldon, 139 Ala. 444, 36 So. 27 (1904).

However, the common-law rule “often resulted in a clear defeat of the testator’s real and evident intention.” Reeves v. Tatum, 233 Ala. 455, 457, 172 So. 247, 249 (1937). Thus, in order “to protect the estates of those in remainder,” the Legislature modified the common law. Alford’s Adm’r v. Alford’s Adm’r, 56 Ala. 350, 353 (1876). Specifically, Ala.Code 1975, § 35-4-292(a) provides:

‘When an absolute power of disposition, not accompanied by any trust, is given to the owner of a particular estate for life or years, such estate is changed into a fee absolute, as to the rights of creditors and purchasers, but subject to any future estates limited thereon, in case the power is not executed or the lands sold for the satisfaction of debts during the continuance of such particular estate.”

(Emphasis added.)2 “The obvious intent of § 35^-292 was to effect a change in the common law so as to give effect to the testator’s intent, ... where clearly provided in the will, allowing the remainderman to receive the property if the life tenant died without disposing of it.” Gaylord v. Goldblatt, 423 So.2d 203, 204 (Ala.1982).

[599]*599The parties agree on these general principles of law. They also agree that Hattie Wilhams possessed an “absolute power of disposition,” within the meaning of § 35-4-292. Their disagreement concerns the status of the traceable proceeds from the inter vivos disposition of an asset of the estate, namely, the proceeds from the timber sale, which formed the corpus of the CDs.

In that connection, Burgett argues that “[s]ince [Hattie Williams] did have an absolute power of disposition, the proceeds from her sale of timber were not limited to her maintenance and support.” (Brief of Appellee, at 18) (emphasis added). Lacy Williams’s will, Burgett contends, “did not grant a remainder interest in the proceeds of any disposition.” (Brief of Appellee, at 15) (emphasis added). Thus, she insists, “[t]he proceeds became [the property of Hattie Williams] absolutely and cannot be held to be the property of the remainder-men. The proceeds were hers to do with as she chose” (Brief of Appellee, at 18), “including placing the funds in certificates of deposit with the right of survivorship.” (Brief of Appellee, at 9.)

Nearly 100 years ago, this Court squarely addressed and rejected an identical argument. Smith v. Cain, 187 Ala. 174, 65 So. 367 (1914). The dispute in Smith arose out of a provision in the will of Thomas Y. Cain, granting his wife, Nancy J. Cain, a life estate in certain real estate, coupled with “an absolute right to dispose of all of the testator’s property.” 187 Ala. at 177, 65 So. at 368. The dispute involved the proceeds of the sale of the real estate by the life tenant, which proceeds were converted to cash deposits and investments in mortgages. 187 Ala. at 176, 65 So. at 368. After the life tenant died, the remaindermen sued John G. Smith, the life tenant’s testamentary executor, to recover the remainder estate, namely, the cash and mortgages. The chancellor overruled Smith’s demurrer, and Smith appealed. This Court affirmed. Id. at 181, 65 So. at 369.

On appeal, Smith argued, as Burgett does here, that once the life tenant exercised the power to sell any of the property “the proceeds at once became [the life tenant’s] absolute property, and, whether consumed by her or not, were absolved from any element of trust in favor of the remaindermen heirs at law.” 187 Ala. at 177, 65 So. at 368. Smith’s “theory [was], in short, that the interests of the remain-dermen [could] attach, under the terms of the will, only to such of the testator’s property as remained in the hands of [the life tenant] at her death unchanged in kind and inform.” 187 Ala. at 177-78, 65 So.

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Related

Nevin v. Nevin
366 So. 2d 266 (Supreme Court of Alabama, 1979)
Edwards v. Williamson
80 So. 867 (Supreme Court of Alabama, 1919)
Reeves v. Tatum
172 So. 247 (Supreme Court of Alabama, 1937)
Alford's Adm'r v. Alford's Adm'r
56 Ala. 350 (Supreme Court of Alabama, 1876)
Young v. Sheldon
139 Ala. 444 (Supreme Court of Alabama, 1903)
Rutledge v. Crampton
43 So. 822 (Supreme Court of Alabama, 1907)
Smith v. Cain
65 So. 367 (Supreme Court of Alabama, 1914)
Reynolds v. Jones
145 So. 2d 437 (Supreme Court of Alabama, 1962)
Gaylord v. Goldblatt
423 So. 2d 203 (Supreme Court of Alabama, 1982)

Cite This Page — Counsel Stack

Bluebook (online)
831 So. 2d 597, 2002 Ala. LEXIS 97, 2002 WL 442718, Counsel Stack Legal Research, https://law.counselstack.com/opinion/williams-v-burgett-ala-2002.