Opinion ID: 1058877
Heading Depth: 2
Heading Rank: 1

Heading: Class Members' Remainder Interests

Text: In construing deeds, courts are primarily concerned with ascertaining the intention of the grantor. See Hall v. Hall, 604 S.W.2d 851, 853 (Tenn.1980); Collins v. Smithson, 585 S.W.2d 598, 603 (Tenn.1979). Because the law favors the vesting of estates at the earliest practical moment, any doubt regarding the grantor's intent should be resolved in favor of an intention to create a vested remainder rather than a contingent remainder. See Williams v. McFarland, 162 Tenn. 468, 37 S.W.2d 116, 119 (1931). This preference for vested remainders is so strong that no remainder will be construed as contingent which may, consistently with the [grantor's] intention, be deemed vested. Albright v. Albright, 192 Tenn. 326, 241 S.W.2d 415, 417 (1951). The preference for early vesting applies with equal force to class gifts. See Nicholson v. Nicholson, 496 S.W.2d 477, 479 (Tenn.1973); Walker v. Applebury, 218 Tenn. 91, 400 S.W.2d 865, 868-69 (1965); Karsch v. Atkins, 203 Tenn. 350, 313 S.W.2d 253, 255 (1958). A class gift is a gift to a group of persons who are not named, who have one or more characteristics in common, and whose number may vary. See Jennings v. Jennings, 165 Tenn. 295, 54 S.W.2d 961, 963 (1932); see also Williams, 37 S.W.2d at 118. In 1927, the Tennessee General Assembly enacted the Tennessee Class Gift Statute, which provides: Where a ... conveyance, transfer or gift is made to a class of persons subject to fluctuation by increase or diminution of its number in consequence of future births or deaths, and the time of payment, distribution, vestiture or enjoyment is fixed at a subsequent period or on the happening of a future event, and any member of such class shall die before the arrival of such period or the happening of such event, and shall have issue surviving when such period arrives or such event happens, such issue shall take the share of the property which the member so dying would take if living, unless a clear intention to the contrary is manifested by the ... deed or other instrument. Tenn.Code Ann. § 32-3-104 (1984). Prior to the enactment of this statute, Tennessee courts supported a rule of construction that was known as the Tennessee Class Doctrine. See Satterfield v. Mayes, 30 Tenn. 58, 59 (1850); see also Nicholson, 496 S.W.2d at 479. This doctrine held that remainders to a fluctuating class of persons remained contingent until the time set in the instrument for distribution or payment. See Satterfield, 30 Tenn. at 59; see also Nicholson, 496 S.W.2d at 479. This Court has concluded that the enactment of the Tennessee Class Gift Statute abolished the Tennessee Class Doctrine. See Walker, 400 S.W.2d at 867. Therefore, the rule now is that even if the time of distribution or payment is set at a subsequent period or upon the happening of a future event, the individual members of the class will take vested transmissible interest unless the [instrument], considered as a whole in the light of all the circumstances, manifests a clear intention to the contrary. Karsch, 313 S.W.2d at 255. For the Tennessee Class Gift Statute to apply to a conveyance, the granting instrument must: 1) convey the property to a class; 2) set the time for distribution at a subsequent period or on the happening of a future event; and 3) not show a clear intention to preclude the issue of a deceased class member from taking the share of property that the deceased class member would have taken if living at the time for distribution. See Tenn.Code Ann. § 32-3-104 (1984). Fourth and finally, a member of the class must die before the time for distribution and must have issue living at the time for distribution. As to the first requirement, the deed refers to two groups of people as potential remaindermen. The first clause of the deed conveys the remainder to the heirs of [Wilson's] body. The deed's second clause defines the remaindermen as [Wilson's] children or the representatives of [her] children. Both clauses identify a group of people who are not named, who have one or more characteristics in common, and whose number may vary. See Jennings, 54 S.W.2d at 963; see also Williams, 37 S.W.2d at 118. Both groups may also fluctuate in number due to future births and deaths. Regardless of the group to which the grantor intended to convey the remainder, the granting instrument conveys the property to a class. The deed also satisfies the second requirement of the Tennessee Class Gift Statute. The instrument states that the remainder interest is to go to the heirs of [Wilson's] body on her death. It is undisputed that this language sets the time for distribution as the time of Wilson's death, which is the happening of a future event. The statute's third requirement is that the deed not manifest a clear intention to preclude a deceased class member's issue from taking the share of property that the deceased class member would have taken if living at the time for distribution. To make this determination, we are required to identify the class to which the conveyance was made as well as the type of remainder the grantor intended to convey to the class. The deed reads, The interest herein conveyed to the said Martha Jordan Wilson is a life estate, in and to the foregoing described property, with the right to take immediate possession thereof, the remainder interest to go to the heirs of her body on her death, in accordance with the laws of descent and distribution; and should the said Martha Jordan Wilson have no children or representatives of children at her death, then the remainder interest shall go to my next of kin as provided by law. (Emphasis added). The granting language in the present case does not provide a clear definition of the class. On one hand, the deed indicates that the class is composed of the heirs of [Wilson's] body. Case law defines the term heirs of the body as the lineal descendants of a designated person who would succeed to the property of the designated person if that person died intestate owning the property. See Fehringer v. Fehringer, 222 Tenn. 585, 439 S.W.2d 258, 261 (1969). As such, the legal definition of this term requires that the heirs of a designated person's body survive that person. See id. Therefore, if the class is defined as the heirs of [Wilson's] body, the individual members of the class cannot be determined until the time of Wilson's death, and the interest of any class member who predeceases Wilson would lapse. See id. at 261-62. Thus, the remainder would be contingent. The third requirement will not be met if Jordan intended to convey a contingent remainder. An intent to convey a contingent remainder would manifest a clear intention to preclude a deceased class member's issue from taking the share of the property that the deceased class member would have taken. The deed, however, must be considered as a whole in light of all the circumstances. See Karsch, 313 S.W.2d at 255. The deed's second clause refers to the class as Wilson's children or representatives of [her] children. This definition is broader than the legal definition of the term, and it does not require members of the class to survive the life tenant as the legal definition does. The share of the property of a child who predeceases Wilson would pass to that child's representatives. This result is contrary to an intent to convey a contingent remainder. As such, the deed's second clause would satisfy the third requirement of the statute. Since our primary purpose in construing a deed is to ascertain the intention of the grantor, we shall look to the language and structure of the deed to determine to which class of people Jordan intended to convey the remainder. The language and structure of the deed show that Jordan intended the second clause to define the first clause. The granting language initially conveys the remainder to the heirs of [Wilson's] body. However, in explaining what will happen to the remainder in the event that the conveyance to the class should fail, Jordan uses broader language to identify the class. Jordan's decision to add a new, broader phrase instead of merely reiterating heirs of the body, or a synonymous term, evidences an intent to redefine the term. We conclude that Jordan did not intend to use the legal definition of the term heirs of the body. Instead, he intended to convey the remainder interest to Wilson's children and to those who would take by representation in the event that any of Wilson's children should die. Accordingly, the deed does not show a clear intention to preclude the deceased class member's issue from taking the share of the property that the deceased class member would have taken if living because the deed does not clearly convey a contingent remainder to the class. The third requirement, therefore, is satisfied. Finally, for the Tennessee Class Gift Statute to apply, a class member must die before the time for distribution and must have issue living at the time for distribution. We have concluded that Wilson's children and the representatives of her children are members of the class of remaindermen. Two of Wilson's children, William and Kenneth, predeceased her. Since the deed sets the time for distribution as the time of Wilson's death, William and Kenneth both died before the time for distribution. Furthermore, Kenneth was survived by his daughter, McCord, who is still living. Therefore, Kenneth had issue living at the time for distribution. Accordingly, all four of the requirements are satisfied, and the Tennessee Class Gift Statute applies to the conveyance. We hold, therefore, that each class member held a vested, transmissible interest in the property prior to Wilson's death. See Nicholson, 496 S.W.2d at 479; Walker, 400 S.W.2d at 869; Karsch, 313 S.W.2d at 255.