Court Opinion

ID: 6484015
Source: CourtListenerOpinion
Date Created: 2022-06-26 23:07:38.329045+00
Date Added: 2024-06-11T15:54:15.612506
License: Public Domain

CONCURRING OPINION OP
PERRY, J.
The English rule referred to in the foregoing opinion, that trust funds may not be invested otherwise than in government bonds and real estate mortgages, was not, as I understand it, a part of the common law, but merely a rule adopted by the courts of chancery in the exercise of their discretion and in the enforcement of the fundamental principle that such investments should be only in the safest securities. See 11 Am. & Eng. Encycl. Law 815; lYoerner on Gruardianship, Sec. 63, p. 211. If this view is correct, Section 5 of the Judiciary Act of 1892, which enacted the common law of England, with certain stated exceptions, as the common law of Hawaii, has no application in this matter, and the court was, in 1894, in the case of In re Banning, and is now in this case, in the consideration of the subject, unhampered by any statutory enactment. If, on the other band, the rule first above referred to, is to be regarded as a part of the common law of England, still the final result is the same. One of the' exceptions named in the Act of 1892 is, “except as otherwise * * * fixed by Hawaiian judicial precedent.” Prior to the passage of that Act, to-wit, in February, 1S90, and in September and again in October, 1892, this court, in the Estate of "W. O. Lunalilo (Probate Records No. 2414), permitted and approved the invest*361xnent of trust funds in the bonds of at least two industrial corporations, tbe "Wailuku Sugar Company and the Oahu Railway and Land Company, and in the stock of one mercantile corporation, C. Brewer & Company, Limited. Whether or not similar investments were approved in other cases, I -am not prepared to say, but sufficient appears to show judicial precedents contrary to the alleged requirements of the common law. In the Banning case, closely contested by -eminent counsel as it was, the point was not even suggested.
What the court said in the case last mentioned on the subject of the investment of trust funds, was not obiter dictum; it was upon a point directly involved and elaborately ar-gued. It is an insufficient ánswer to say that tho trustee there was acting under a will, for the direction of the will was that investments were to be made “in good seexxrities wdth lower rates of interest in preference to high rates with corx’espondixxg risks.” The coux-t did not hold, nor co-xxld it well have done so, that this furnished to the trustee greater freedom of action than, in the absence of a will, the law' would have allowed.
While co-ncurriixg in the view that the decisions of this court rexxdered px-ior to annexation are binding on the Circuit Courts of this Territory unless and uixtil reversed or modified, I do not think that the decision of the Uxxited States Circuit Ooxxrt of Appeals for the Ninth Oircxxit, in the case entitled The Schooner Robert Lewers Company v. Kamaka Kekauoha, 114 Fed.--, is to any great extent an authority in support of that view. All that the court there decided was that a certain decision reported in 2 Haw. 209 (1S60) was a “judicial modification” of the common law of England within the meaning of Section 5 of the Act of 1892 and that therefore the eommoix law rule under consideration iix that case did not apply.
Except as modified by the foregoing, I concur in the opinion of the majority.