Court Opinion

ID: 9765051
Source: CourtListenerOpinion
Date Created: 2023-08-29 03:49:06.79793+00
Date Added: 2024-06-11T12:52:43.383269
License: Public Domain

DROWOTA, Justice,
dissenting.
I respectfully dissent based on my belief that the majority have departed from previous decisions of this Court and have misconstrued the residuary clause of General Ogle’s last will and testament.
The statute that is involved in this case, T.C.A. § 66-1-106, was enacted in 1932. Prior to the enactment of this statute, Tennessee followed the common law rule that a devise of a life estate, together with an absolute power of disposition, created a fee simple estate for the named life tenant, which effectively defeated the rights of any named remaindermen, whether the power of disposition was exercised or not. The effect of the passage in 1932 of the statute that is now codified as T.C.A. § 66-1-106 was explained by the Supreme Court in Hobbs v. Wilson, 614 S.W.2d 328 (Tenn.1981), as follows:
“The effect of this statute is to convert a life estate in real property, coupled with full power to dispose of the property, into ‘a fee absolute as to the right of disposition,’ while saving the rights of a remain-derman in property when the power of disposition is not executed.” (Citations omitted.) 614 S.W.2d 328, at 330.
The testamentary provision that we are called on to interpret in this case is as follows:
“I hereby leave, bequeath and devise the remainder of my estate, including real property and personal or mixed property, to my wife, Loretta Sutton Ogle, for her lifetime and at her death the remainder, if any at that time, to be divided among my three (3) children, Bobby Ogle, Bonnie Ogle Reagan, and Betty Jo Ogle. Said children to share and share alike.” (Emphasis added.)
*671In Redman v. Evans, 184 Tenn. 404, 199 S.W.2d 115 (1947), this Court, in an opinion that was written fifteen years following the enactment of the precursor of T.C.A. § 66-1-106, dealt with a testamentary provision that was similar to the one involved in this case. The provision before the Court in Redman v. Evans was as follows:
“The residue of my estate, including my home and furnishings, to go to my nephew, Fred Watkins Evans, to handle as he sees fit during his lifetime; and the balance to go to his two daughters, Ann and Frances Evans.” 199 S.W.2d 115, 116.
The Supreme Court in Redman v. Evans thought that the most important indication of the testator’s intent was her use of the term “balance,” which term the Court found to be the functional equivalent of the term “remainder,” which is the term involved in this case. The Supreme Court in Redman found that the provision in the will was sufficient to give the life tenant the unlimited power of disposition. Id. at 117-119. Our discussion in Redman included the following:
“Perhaps the most significant expression on the face of this will supporting the view that it was intended that the life tenant might encroach upon the corpus is the reference following the provision authorizing Evans to handle, or use, this property ‘as he sees fit,’ to ‘the balance.’ It is impossible to avoid the deduction that Mrs. Jackson had in mind that in his handling or use of the estate a part of the principal or corpus would or might be consumed by him, thus leaving a ‘balance.’ It is as thought she had said to this favorite nephew, ‘take all that remains of my estate, after payment of my debts and the legacies I have specified, and do with it as you see fit; the balance remaining when you die I want to go to your daughters.’ The Century Dictionary defines ‘balance’ as ‘A surplus; a remainder; the rest; the residue; what remains or is left over; as, he bequeathed the balance of his estate to A.B.; the balance of a meal.’
In more than one case this Court has recognized the significance of the use of the term ‘balance’ or its equivalent, ‘remaining.’ In Downing, Executor, v. Johnson, 45 Tenn. 229, it was ‘balance’ that was held to imply a power to encroach on the corpus; and in Eaton v. Nashville Trust Company, 145 Tenn. 575, at page 581, 238 S.W. 865, at page 866, Green, J., says: ‘The gift over of the “remaining balance” also forces the implication that George M. Spotswood was to have an unlimited power of disposition when the money came into his hands.’ (Italics inserted.) Meacham v. Graham, 98 Tenn. 190, 200, 39 S.W. 12, and Bradley v. Carnes, 94 Tenn. 27, 27 S.W. 1007, 45 Am.St.Rep. 696, are cited.
Under the sub-heading ‘Implied power to sell,’ many cases are annotated in 2 A.L.R. 1310, 27 A.L.R. 1387, and 69 A.L.R. 835, construing the phrase, following a devise of a life estate, for the use of the life tenant, with a limitation over of “what remains,’ or ‘the remainder,’ as implying a power of disposition, and as indicating a purpose to vest in the remaindermen what is left only. We are unable to make any material distinction between the phrases ‘the remainder’ or “what remains’ and ‘the balance.’ Both alike clearly imply a power conferred to encroach upon the corpus. It is only the balance, that is, what remains of the estate, that the testator passes by the will to the remainderman. For example, in Young v. Hillier, 103 Me. 17, 67 A. 571, where the will gave to the wife all the testator’s estate ‘for her use during life’ and at her death “whatever may remain of said estates’ to a daughter, it was held that the use given the wife extended to a sale of the real as well as the personal property as, otherwise, there was no practical significance in the use of the word ‘remain’ in this connection. So here, the use of the phrase ‘the balance’ is meaningless, unless it connotes what is left after the life tenant has handled or used the estate during his lifetime ‘as he sees fit.’ Illustrations might be multiplied indefinitely.” 199 S.W.2d 115, at 188.
General Ogle’s use of the phrase “if any” following his reference to “the remainder” makes the deduction that he foresaw that his surviving wife might dispose of some or all of the property comprising his residuary estate *672even more compelling than this Court’s deduction in Redman.
In the case of Hobbs v. Wilson, supra, the testamentary provision was as follows:
“I hereby will and devise unto my said wife, Mrs. Erma Wilson McAuley, all of the remainder of my real estate for life and, having full confidence in her judgment and discretion, I authorize her to use so much of the corpus thereof as she shall find necessary for her comfort and maintenance, she being the sole judge of her needs, ... and at her death, whatever remains undisposed of, if any, I will and devise the same in fee simple to my twelve nieces and nephews as equal tenants in common, ... [the remaindermen then are named].”
This Court concluded that the foregoing provision gave Mrs. McAuley an unlimited power of disposition and changed her life estate into a fee simple with power of disposition. We went on to hold that it placed in her the power to terminate the interest of the remaindermen by executing the power of disposition in her lifetime.
In Hobbs, Mrs. McAuley did sell the real property. The remaindermen argued that a conveyance by a life tenant with power to dispose of property does not cut off their interest but that their interests are merely transferred to the proceeds of the sale. This Court held that if the remaindermen were to take any estate, they must come within the saving provisions of T.C.A. § 66-1-106. The statute saves the remainder interest “in the event and so far as the power is not executed or the property sold ... during the continuance of the particular estate.” Id. at 330.
Mrs. Ogle executed her power of disposition by selling the real property, which terminated the remainder interest of the defendants.
I believe that the majority’s decision represents an incorrect interpretation of the testator’s will and is inconsistent with other decisions of this Court rendered after 1932. See, e.g. Jones v. Jones, 225 Tenn. 12, 462 S.W.2d 872 (1971).
I would affirm the judgment of the Court of Appeals.