Allen v. Merrill

Wiest, C. J. This is a bill, by executors of an estate and trustees under a will, to remove a cloud from their title, occasioned by attachment and execution levies upon the interest of one beneficiary of the trust. Oscar M. Allen died July 26, 1910, leaving a will, nominating plaintiffs joint executors and trustees. The will devised a life estate in the homestead to his wife with reversion to his children, and bequeathed household furniture and personal belongings to his wife, devised the remainder of his property to the executors in trust, with power to sell or mortgage and invest the proceeds so as to get the best possible income from the same and carry on his business, if necessary, and to pay, out of the income, $1,000 to his wife and to divide the balance, annually, share and — 469 — share alike, between his wife and his five children. The will also provided: “In case of the death of any of my said children, the annuity that would go to such child if living, is to go to his or her children, if any, share and share alike, if there be more than one. If any of my children shall die without issue, the share that would go to such child if living, shall be equally divided among my surviving children, the issue of any deceased child to take the share their parent would have taken' if living, share and share alike, if there be more than one. * * * “In case my said wife shall die before I do, or shall not accept the provision of this will, I, in that event, direct that my estate shall be settled in five years after my death and handled in all respects as in this will is provided for handling and dividing it after the death of my wife, with the -same trust and power in the executors and trustees and the same legacies, devises and payments of annuities. * * * “The provisions in this will for my wife are to be in lieu of dower and of her statutory rights to personal property. In case my said wife shall elect to take her statutory rights under the laws of Michigan, in place of taking under this will, I direct that subject to her dower and statutory rights, my estate shall be managed and divided as is herein provided in case of her death, and that she take nothing by virtue of this will.” The will provided that, on the death of his wife, his children should take the homestead and the rights of the children in the corpus of the estate be determined as follows: “In case any of my said children should not be living at the death of my wife, the share that would go to such child if living, shall go to his or her surviving children, share and share alike, if there be more than one. In case any of the children shall die before the death of their mother, then the share * * * that would go to such child if living, shall be divided — 470 — equally share and share alike among my surviving children, and the issue of any deceased child shall take the share the parent would have taken if living, share and share alike, if there be more than one.” This will was executed January 19, 1905, and a. codicil thereto was executed February 1, 1910. The codicil is not material upon the questions involved. At the time of his death the testator left surviving him Hannah Allen, his widow, Oscar M. Allen, Dee Allen, Glenn S. Allen, sons, Lillah B. Clement and Fannie M. Hollingsworth, daughters, and Ralph M. Allen and Duane Allen, grandsons. The widow died August 20, 1920. The daughter, Lillah B. Clement, died June 22,1920. The son Oscar M. Allen died in the month of December, 1920, and the grandchildren, Ralph and Duane Allen, have been dead over two years. The executors and trustees have been acting as such since their appointment by the probate court for the county of Kalamazoo on September 16, 1910. On May 12, 1911, the widow filed her election to take under the statute and not under the will. The real estate devised in trust is of the value of about $300,000. On May 27, 1921, the defendants Merrill, Lynch & Company, commenced a suit by attachment in the circuit court for the county of Kalamazoo against Dee Allen and the sheriff of Kalamazoo county attached the interest of Dee Allen in the real estate so held by the plaintiffs as trustees. This suit against Dee Allen was brought on a judgment rendered against him in the State of New York. The default of Dee Allen was entered in the attachment suit for want of appearance and a judgment rendered in favor of Merrill, Lynch & Company for the sum of $14,336.36, upon which judgment an execution was issued and levy made by the sheriff upon the trust property. At the time the bill herein was filed the sheriff was about — 471 — to proceed to a sale under such levy. After the levy Dee Allen appeared specially in the suit and moved to set his default and the judgment aside and an order was entered, December 2, 1921, granting the motion on condition that he appear generally in the case and plead to the declaration therein and pay certain costs and attorney fees. Dee Allen did not avail himself of such leave. The bill of complaint herein was filed December 17, 1921, and the sale under execution enjoined. Upon the final hearing the circuit judge entered a decree determining the execution levied upon the homestead property was valid and might proceed to a sale of Dee Allen’s interest therein; that the attachment and the execution levied upon the real estate held by. plaintiffs as executors and trustees be vacated, and enjoined sale under execution. Dee Allen has not appealed. Defendants Merrill, Lynch & Company and Curtis A. Pringle, under-sheriff of Kalamazoo county, and Jerome S. Borden have appealed. Pringle and Borden have no interest in the suit as they acted only as officers in levying the attachment and execution. In the bill plaintiffs also asked damages for slander of title arising out of the attachment proceedings, and attack the validity of the judgment against Dee Allen. Defendants attack the validity of the trust created by the will, claiming the scheme thereof offends against the statute forbidding suspension of the power of alienation beyond two lives in being (3 Comp. Laws 1915, § 11533). Under the will the trustees hold the legal estate, for they have power to convey and thereby cut off the equitable estates or interests of the designated beneficiaries. Such holding by the trustees, coupled with the duty, in case of sale, to bring the avails to the administration of the trust, suspends in law the power of alienation. And this brings us to the pivotal — 472 — question of whether this suspension goes beyond two lives in being. If the widow elected to take under the statute, then the will directed the estate to be settled in five years after testator’s death, by distribution, first, to his children then living (one life in being); second, in case of death of any of his children, with issue, then to such issue by right of representation (two lives in being), and if no issue, then to his surviving children. The distributees, so designated, were all in being at the death of testator. The trust was a valid one. It is also claimed that the whole scheme of the trust was disrupted by the election of the widow to take under the statute. The will answers this contention by its provisions in case of such event and prevents application of the rule that, “the failure of an essential feature of an entire trust scheme destroys the whole.” The learned circuit judge was clearly right in setting aside the attachment and execution levies. Feldman v. Preston, 194 Mich. 352. Plaintiffs, as executors and trustees, are not concerned with the validity of the judgment rendered against Dee Allen. They are not his guardians and can do no more than ask that the trust estate be freed from the attachment and the execution. Dee Allen, on his own application, had leave granted him to appear and defend in the case against him, and the executors must leave that feature of the matter to him to care for. It is also contended that the designated period of the trust has long since expired and therefore the trust should be ended, the estate vested in the beneficiaries and the trustees discharged. With their levies under attachment and execution vacated the defendants, Merrill, Lynch & Company, stand as mere judgment creditors of one beneficiary of the trust and, as such, they are in no position to call the trustees to — 473 — account or to invoke the law for the ending of the trust and the vesting of the estate in the beneficiaries. If the trustees have not filed annual accounts, as provided by statute, the law opens the way to compel them to do so but it would be of no advantage to the defendants in this case to have such an order herein. The claim made in the bill relative to slander of title was not pressed in the court below, and we leave the matter to such future action as plaintiffs may be advised to be open to them. The decree entered in the circuit is affirmed, with costs to plaintiffs. McDonald, Clark, Bird, and Moore, JJ., concurred with Wiest, C. J.