Court Opinion

ID: 7908985
Source: CourtListenerOpinion
Date Created: 2022-09-08 22:03:45.885909+00
Date Added: 2024-06-11T16:32:31.636562
License: Public Domain

*731The opinion of the court was delivered by
Johnston, C. J.:
This action was brought by Harold B. Staples, a minor, by his next friend, to impose a trust upon $5,000 of the proceeds of a policy of government war-risk insurance for $10,000. Harold B. Staples was the son of Bessie C. Staples, a widow, who was married to Clyde Murray on April 6, 1916. At the time of this marriage the plaintiff was four and one-half years old. Bessie C. Murray was the wife of Clyde Murray when he enlisted for the war, took out the insurance mentioned, and continued to be his wife until the time of his death. For some reason not clearly shown Clyde Murray enlisted as a single man. He took out the policy of insurance and named his brother, Lloyd D. Murray, the defendant, as the beneficiary, and about that time gave the defendant directions as to the disposition of the insurance. In a letter to Bessie C. Murray written August 2, 1919, the defendant stated:
“Dear Bessie — Clyde has requested that I write you a line setting forth the substance of the requests made by him to me at the time he took out his government insurance. He requested me to make it a part of my duty as his brother and as a benefactor to promise to see that one-half of his insurance, amounting to five thousand ($5,000) dollars, be used to educate and to promote the best interests of Harold B. Staples, acting jointly with you in executing this duty. My promise was given him at that time and this will serve as a like promise to you for me to fulfill this duty with his best interests at heart at all times. (Signed) Lloyd D. Murray.”
It appears that some time later Mrs. Murray made application to the. government for an allotment as the wife of Clyde Murray, which caused her husband some embarrassment. On January 25, 1920, he wrote to her, saying in effect that such a claim if pressed by her would result in a dishonorable discharge to him, the disgrace of a conviction and loss of the insurance which he said “is equally divided between you and Lloyd, and always has been.” He further said that the insurance was—
“The one and last redeeming act which my worldly efforts could produce, but if this claim of me having a wife or ever having had one is proven; why the whole plan is gone forever, and I can hardly provide other means of protection for four innocent children, Harold and Lloyd’s three, one who [is] fatherless and three who are motherless, and to whom God knows I have in my heart never forgot some allegiance and thought in the end I could bid the world good-bye and say it is well for those behind.”
*732In the letter he spoke of his enlisting as a single man as a miserable mistake made in pure ignorance, and that there had been no chance to correct the mistake. He added that he had made and forwarded to the government an affidavit to the effect that it was a case of mistaken identity and that he was and always had been single and "if it is proven that I am an impostor why it leaves you and Lloyd loser of $5,000 apiece, and what it means otherwise to the Murray name.” He advised her to keep the facts as to her position and knowledge to herself, except Lloyd, and to let no one know of her position or business and that it might be necessary to disown him as a husband or even as an acquaintance. Two or three days later the defendant wrote a letter to Mrs. Murray in which he spoke of the serious illness of Clyde and the expectation that he would not live beyond the following spring. As to the insurance matter and claim that she had made for an allotment he admonished her that it would not only cause Clyde to be dishonorably rated in the army, but would cancel his insurance, and stated: “You know what you may expect in connection with the payment of this insurance and you know you can absolutely depend upon a square deal from me as per letter written this summer.” He further requested that if she had started anything to cancel it, and she should leave her residence without even giving a forwarding address. After these letters had passed, Mrs. Murray dropped her application for an allotment as the wife of the soldier. It was shown and found that Clyde Murray was extremely ill after returning from the army, and that he was in government hospitals practically all of the time after his return until his death from a disease contracted in the army. During that time he was classified as being completely disabled and was paid $1,870 out of the insurance in question. The plaintiff has never received any of the proceeds of the insurance policy. One of the findings of the trial court is that, “before his death, Clyde S. Murray by letter to the defendant recalled and revoked all requests he had made in favor of the plaintiff.” This finding was based upon a letter to the defendant in which, after speaking of the disposition of his remains and a request that one Lena should share in the insurance, he added: “So far as-Mrs. Murray and her son are concerned, I am done. The requests I have made in Harold’s favor I retract absolutely.” The conclusion of the court was that a trust was not established and that the plaintiff was not entitled to any part of the insurance.
*733The principal questions discussed on this appeal are, first, was a valid declaration of trust made, and second, if so, was it subject to revocation by Clyde S. Murray, who had requested that a share of the insurance be expended for the benefit of plaintiff.
Defendant argues that nothing tangible passed to him as trustee, nothing that he could take and deliver to the plaintiff, and that the promise or direction was nothing more than a testamentary request that a part of the insurance be devoted to the rearing and education of his stepson, that his stepson was a mere beneficiary in the insurance and that the insured was at liberty to change his beneficiary at any time before his death.
It is the view of the court that a valid trust was not created by the insured, and at most the declaration and promise made did not constitute a complete and executed trust which was beyond the power of revocation. The elements essential to the creation of a trust are that there must be a person competent to create it, explicit words indicating an intention to create a trust, a person capable of holding an ascertainable object as trustee, a definite subject and also a declaration of the terms of the trust. (26 R. C. L. 1179.)
It is the view of the court that when the promise was made .there was no fund in existence, and that unless the insured made the required payments no fund would ever come into existence. Nothing was transferred to the defendant except a request for an application of the proceeds of an insurance policy in which defendant was named as beneficiary. The policy was still within the control of the insured and he was at liberty to change the beneficiary at any time, and at will he could allow the insurance to lapse by failing to make the necessary payments. The designation of a beneficiary was accompanied with a verbal request that the stepson should share in the benefits of the insurance, and since the insured could change the beneficiary and name another than the defendant how could the defendant be regarded as a trustee after he had been ousted and into whose hands no fund had ever been placed. It is true there was no change of beneficiary, but the so-called trusteeship of defendant was no more binding than if a change had actually been made. The fund was something to be received, something to be brought into existence and kept alive by the future action of the insured, and hence it is held that it did not amount to an executed and irrevocable trust. So far as the elements of a trust entered into the transaction, it was executory in character and in *734some respects had the elements of a testamentary bequest subject to change or revocation without the consent of those to whom the tentative gifts had been promised. Plaintiff was in a sense a beneficiary of the insurance contracted for, but he acquired no greater right than the named beneficiary who could be removed and another substituted by the insured at any time. An express revocation of the promised gift to plaintiff was shown, and hence the holding of the trial court that a trust was not established and that plaintiff was not entitled to recover any part of the insurance, must be affirmed.