Court Opinion

ID: 6549722
Source: CourtListenerOpinion
Date Created: 2022-07-19 22:23:05.005501+00
Date Added: 2024-06-11T15:56:04.564256
License: Public Domain

McCulloch, C. J. (after stating the facts). The will of Brogan devised his property to his daughter for life, with contingent remainder over to her issue, if any survived her and attained the age of twelve years, and, if none, then to trustees for the charitable purpose named. No trust was created except upon a definite failure of issue of the testator’s daughter, and unless the will is valid no trust can ever arise. The question of the validity of the will purporting to create the trust rests upon the decision of another court of exclusive jurisdiction. It is not contended that the court of equity has jurisdiction over the contest of a will, nor is there any ambiguity in the terms of the instrument which calls for construction. This proceeding merely involves a compromise of the will contest by the contesting heirs and the trustees, whereby the estate is to be divided according to their judgment; and the court’s approval or authority with respect to that compromise is sought. The will does not confer power upon the trustees to alienate or compromise away any part of the trust estate, and, if authority to do so exists at all, it must be found in the inherent power of courts of equity over trusts. That such jurisdiction of the courts over charitable trusts exists to a certain extent and for certain purposes is not doubted. The jurisdiction exists to control and supervise the carrying out of a trust already created, and this involves a general superintending control for the purpose of enforcing the trust and preventing a failure thereof. Chancery courts also assume jurisdiction for the purpose of construing the terms of the instrument whereby a trust is created and to determine its scope. And in case of doubtful construction the trustees may invoke the jurisdiction of the court for direction in executing a trust. Williamson v. Grider, 97 Ark. 588. But the courts do not possess the prerogative power of creating trusts, or of altering the terms of instruments creating them. 2 Perry on Trusts (6 ed.) p. 1203. The effect of the court’s approval of this compromise is to decide the will contest pro tanto, or to alter the terms of the will as executed by the testator and to vest the absolute title to the property and divide it according to the court’s judgment of justice and expediency. We think the court possesses no such jurisdiction. No authorities are brought to our attention upholding the assumption of that power. In fact, we are unable to discover any adjudged cases where the exercise of the power has been involved. “The rights and powers of a trustee * * * are derived from and measured and limited by the instrument creating the trust,” and “they will not be permitted to change the nature, objects and purposes of the trust, or vary the rights of the beneficiaries.” 39 Cyc. 290. The power of courts over charitable trusts, so far as concerns the úse to which the property conveyed is to be appropriated, is derived from the same source whence the authority of the trustees originates, namely, the instrument whereby the trust is created, and the directions of the donor must be adhered to as rigidly by courts as by trustees. Courts may define, but not enlarge, the powers conferred upon the trustee by the instrument creating the trust. That doctrine is concisely stated boy a learned court in the following words: “It may be conceded that a court of equity has no power to make a new will for a testator, and that the extent of its power is to construe the will as presented to it. And, further, that such court can no more authorize an act to be done which is in excess of the powers conferred by the will than can the trustees therein do such act. As to these propositions there is, or can be, no question or doubt.” Drake v. Crane, 127 Mo. 85. The jurisdiction of courts of equity to supervise the execution of charitable trusts does not include the power to alter the terms of the trusts, nor to sanction a diversion of any portion of the trust estate. That would involve the making of a new will for the testator and a disposition of the property contrary to the intention of the donor. The facts of this case fairly illustrate the force oí the doctrine we are undertaking to announce. The tes tator intended to create a trust upon certain contingen cies and devote substantially all of his property to th( purposes of the trust. He clearly expressed his purpose in his last will and testament. The contemplated settlement changes that and diverts the major portion of the property from the operation of the trust. It makes an appropriation of the testator’s property contrary to his expressed intention. We do not mean to hold that trustees are powerless to settle and compromise, either with or without the sanction of the court, controversies concerning the property included in the trust estate. They doubtless have the implied power to adjust such controversies with adverse claimants of the property, and the approval of the chancery court is only necessary under those circumstances to protect the trustees from charges of fraud or improvidence in the exercise of those powers. But the settlement or compromise involved in this case reaches to the very foundation of the trust and involve§ a direct change and setting aside of the will of the testator. This is as much beyond the power of the court as of the trustees themselves. Cases are cited where courts of equity have exercised the power of entering into compromises for infants and persons of unsound mind. This power has been exercised under the general superintending control of courts of equity in States where that jurisdiction still rests in those courts over the estates of such persons. That is a different question from the one presented in this case. Where courts of equity are empowered to exercise general control' over the estates of infants or persons of unsound mind, the judgment of the court is substituted for that of the person under disability who lacks the power to act for himself. But in case of a charitable trust, which is dependent upon the instrument which creates it for its existence, that instrument is the sole measure of the power of those who are called upon to execute the trust, whether the trustees themselves or the court in the exercise of a superintending control, and a court of equity has no authority to exercise any greater powers. The question suggests itself whether the court has jurisdiction to bind, by its decree, a child or children of Mrs. Raymond hereafter born, if any. When they come into being, if any should be born, and attain the age of twelve years, the contingent remainder vests in them under the will. There were no children in being at the time of this decree, but there is no presumption against the possibility of issue. We held in the case of Bedford v. Bedford, 105 Ark. 587, that a court of equity had the right to order the sale of property for reinvestment in which there were different estates, including contingent remainders; but that is a different power from that exercised in this case, for here there is no protection of the interests of the contingent remaindermen. On the contrary, their interests are extinguished and the property divided by this decree between the life tenant under the will and the trustees and the title in fee vested in them. Perhaps a sufficient answer to that question is the fact that if a child or children of Mrs. Raymond should be born, and attain the age of twelve years, the remainder would vest in them, and thus exclude the trustees from any participation in the estate, and that they would get nothing in that event, whereas they get a substantial part of the property under this compromise. We will, therefore, not go into that question, deeming it sufficient for the purpose of this case to rest upon the conclusion which we have reached that the chancery court has no such power over trusts as would enable it to change the intention of the testator and divert a substantial portion of the trust estate. The right of appellant, as bishop of his diocese, to prosecute the appeal is challenged. He was made a party to the proceedings for the purpose of resisting the confirmation of the compromise, and, according to the terms of the trust, he has a superintending control and the right to call the trustees to account in equity and to prevent a violation of the trust. Hendrix College v. Arkansas Townsite Co., 85 Ark. 446. There is also the question raised whether the contestant appealed within the time prescribed by statute; but as that question will arise directly in the contest proceedings which are still pending, we do not deem it proper to decide that question in the present case. Our conclusion is that the decree of the chancery court authorizing a division of the property contrary to the terms of the will which created it is beyond the power of the court, and for that reason the decree is reversed with directions to dismiss the complaint. Smith, J., dissenting.