King v. Hawley

E. O. Sylvester died August 13, 1946. His surviving sister, Ida M. Graves, was appointed executrix of his will and as such administered his estate. His will, executed April 7, 1942, disposed of his estate in the following language: “I devise and bequeath all my property to my sister, Mrs. Ida M. Graves of Stockton, California, and request that she be appointed sole executrix of my will, and that she may not be compelled to give any bond or security as such executrix, and that she may settle the estate in her own way and sell any or all of the real or personal estate at public or private sale as she may think best, and that she

Prom this judgment Evelyn M. Hawley and G. W. Graves appeal and contend as follows: 1. By the will of Sylvester and the decree of distribution made in the matter of his estate there was conveyed to Ida M. Graves a fee interest and not a mere life estate. 2. If it be true the will and decree vested only a life estate in Ida M. Graves with remainder over to respondent James Woodward King, then the various dispositions she made of the Sylvester properties involved come within the powers given to her to dispose of and to use these properties for her “comfort and support.” 3. The court erred in rejecting certain offered testimony, hereinafter more specifically referred to. 4. The court erred in admitting evidence of transactions in the estate of Sylvester participated in by appellants Evelyn M. Hawley and George W. Graves but which were wholly unrelated to the matters in issue before the court. 5. The court erred in adjudging King was entitled to the $10,000 purchase money which Evelyn M. Hawley was shown to have paid for the Tuolumne County land. Generally, appellants contend that the evidence as a whole is insufficient to support the essential findings and the judgment of the trial court.

Taking up first appellants’ contentions as to the proper construction to be placed upon the provisions of Sylvester’s will as construed by the probate court in its decree of distribution, we hold that thereby there was vested in Ida M. Graves an estate for life with remainder over to respondent; that she was given a full right to use the property for her comfort and support and to that end could fully consume it and for that purpose could sell it and use the proceeds of such disposition, but, again, for her comfort and support. We hold further that in the exercise of the power of consumption, use and disposition, she was limited to the purpose for which the property was given to her, that is, her use and consumption for her comfort and support, and that she could not give the property away during her lifetime nor will it

“ ‘A will is to be construed according to the intention of the testator’ (Civ. Code, sec. 1317), and that ‘intention is to be ascertained from the words of the will, taking into view the circumstances under which it was made’ (Civ. Code, sec. 1318), .which words, in the absence of a clear intention to use them otherwise, ‘are to be taken in their ordinary and grammatical sense’ (Civ. Code, see. 1324). Unless irreconcilable, ‘ all the parts of a will are to be construed in relation to each other, and so as, if possible, to form one consistent whole.’ (Civ. Code, sec. 1321.) Applying these rules, and having in mind that ‘a clear and distinct devise or bequest cannot be affected ... by any other words not equally clear and distinct [italics ours] (Civ. Code, sec. 1322), we find no difficulty in arriving at the intention of Julia P. A. Prather as expressed in her will. In disposing of her property she recognized her husband as being first entitled to consideration, but in providing for him she gave expression to the thought of her nieces, particularly the one who bore her name, Julia. While the first dispositive clause of the will, namely, ‘I give all the property of which I die possessed to my husband Thomas Prather . . . ,’ is clear and, taken alone, admits of no construction other than that an absolute disposal of her estate to him was intended, the second dispositive clause, to wit, ‘Upon the death of my husband the said Thomas Prather one-half of the unexpended portion of my estate bequeathed to my husband to be given to my niece Julia Adams . . . , the other one-half to be given to the surviving

daughters of my brother Edson F. Adams in equal shares, ’ is equally clear and distinct. (Estate of Tooley, 170 Cal. 164 , [Ann.Cas. 1917B 516, 149 P. 574 ].) Hence, unless irreconcilable with the first clause, it should be construed in relation therewith. Read in connection with the first clause, it is clear that in using the words, ‘unexpended portion of my estate,’ she had reference to that portion of her estate which should remain unconsumed by her husband at his death, and this part of her estate so remaining was, by the terms of the will, addressed not to her husband as legatee, but to the executor of her will, ‘to be given’ in the manner provided by law to her nieces. Thus addressed to the executor the words were not precatory in character but are words of command. (Estate of Marti, 132 Cal. 666 , [ 61 P. 964 , 64 P. 1071 ].) . . . Her intention was to limit the estate given the husband to such part thereof only as he might in his lifetime expend, consume, or make use of, without in any manner restricting him in the , control and disposition thereof for such uses. [Italics ours.] Subject to such control and disposal for his use and consumption to its complete exhaustion, it was Julia’s estate, and, after such carving therefrom as the husband might make for his use and consumption, the portion, if any, remaining at his death and designated by Julia as ‘the unexpendedportion of my estate’ she made the subject of testamentary disposition, directing it ‘to be given’ not by her husband, who as we have seen had no interest therein, but by her executor and the law to the nieces mentioned. The meaning of the second clause of the will, when viewed in connection with the first, in our opinion is as clear and distinct as any other part of the will, and thus construed in relation to the first, effect is given to both and the intention of the testatrix made clear.”

We proceed to the second contention of appellants, which is that, conceding a vesting in Ida M. Graves of a life estate with limited powers of disposition and in respondent King a vested remainder, yet the disposition made by the life tenant of the property which she received was within the scope of her power to dispose of and use the property for her “comfort and support.” We will consider first the meaning which the law attaches to the words “comfort and support” as limiting the right or power of Ida M. Graves in the disposition, use and consumption of the property of which she became a life tenant. It is elementary that a donee of the life estate may make only such disposition and use of the

“The scope and extent of a testamentary power of sale or disposition depend largely on the provisions included in the will creating and conferring the power with respect to the purpose for which the power is given, or the circumstances in which it is to be exercised. Where the power is a limited one, it may be exercised only in good faith, and strictly within its limits, and the donee can do nothing, by way of exercise of the power, that is not authorized by the will; . . .

“A power to use, consume, or expend property for the support or maintenance of the donee, or of another, authorizes only such sales, or such encroachments upon the property, as are necessary and proper for his reasonable support and maintenance, taking into consideration his position in life, the style and manner in which he maintains himself, his state of health, and the like, and gives the donee no power of disposition for any other purpose, and no authority to dispose by will or otherwise of the unconsumed portion of the property, even though he claims it all in his lifetime or attempts to transfer it to himself. The power may, however, be exercised by a transfer or conveyance of the property, in good faith, for the consideration of life support and care of the donee of the power by the grantee or transferee, or, in a proper case, where the power is given for the support or maintenance of another than the donee, by a conveyance of the property to such other. . . .

“A power to consume or dispose of property for the donee’s ‘benefit’ is broader than one for his support or maintenance, and, in general, includes whatever promotes his personal prosperity and happiness, so that he may consume or sell the property as he chooses, without limitation except that of good faith. Likewise, a power of sale or disposition for the donee’s ‘comfort’ is broader than one for his maintenance, and encroachment on the property is not restricted to the necessaries of life, but may include things which bring ease,

contentment, or enjoyment to the donee, and, in general, such a power authorizes the expenditure of the property or its proceeds for any purpose, consistent with the donee’s former manner of living and station in life, and taking into consideration the value of the property, which the donee thinks will give him personal comfort. So it has been said that, so long as the donee does not deplete the estate for the mere purpose of defeating the testator’s intention, or of preferring certain heirs or remaindermen over the others, the courts will be slow to condemn expenditures as not within such a power. The donee must, however, act honestly and in good faith, and » a transfer with intent not to consume the property for himself, but to preserve it for others after his death, and thereby to change the beneficiaries, after him, from the remaindermen chosen by the testator to those of the donee’s own selection, is a fraud on the testator and the power. Moreover, a power of disposal-for the donee’s benefit, or comfort, is exercisable only for his personal benefit, or personal comfort, by the application of the property or its proceeds to, primarily, his physical comfort and ease, and not for the benefit or comfort of another ■ and while it includes, to a limited extent, his mental comfort, such power does not authorize a transfer or disposition for the donee’s mere mental satisfaction, or peace of mind, such as a gift to his children, so that they may have the property after him, instead of the remaindermen designated by the testator, or a gift to a church, charity, or public institution.” (Italics ours.)

In applying the foregoing rules to a questioned disposition or use under the power given the issues generally will be mixed issues of law and fact. An issue of fact may well develop as to whether in truth a disposition, use or consumption was truly one for the comfort or support of the donee of the power and if that be the case then the conclusion of the trier of fact would be binding upon courts of review. So the basic intent with which a transfer or disposition is accomplished may justify a factual finding that there was no true exercise of the power but a deliberate violation thereof for the purpose of defeating the remainderman and depriving him of his rights. With this summary of the applicable rules we proceed to a statement of the facts shown at the trial, bearing in mind of course that the trial court has found that the dispositions of the property made by the donee, Ida M. Graves, were in fact not done or intended for her comfort or support within the proper meaning of those terms,

It appeared that Sylvester and appellant G. W. Graves, who up to the time of her death was the husband of Ida M. Graves, had been lifetime friends and associates, partners in many business ventures. When Sylvester died they owned and were operating in partnership real property in San Joaquin County. Sylvester and Mrs. Graves were brother and sister and there existed long sustained affection, one for the other. Appellant Evelyn M. Hawley had for many years been on friendly terms with Sylvester and with Mr. and Mrs. Graves, spending many summers at the Tuolumne County ranch and during the later years of Sylvester’s life had performed for him many friendly offices which were likewise performed for Mrs. Graves during her life. Respondent King was the surviving son of a former partner and business associate of both Sylvester and Mr. Graves and Sylvester had interested himself in the career of King. At Sylvester’s death his estate consisted principally of the following: Property in Tuolumne County, known as the Sylvan Lodge property, being a tract of approximately 750 acres located easterly of Sonora; a partner’s one-half interest in a tract of land in San Joaquin County; a lot in Stockton improved by a duplex building with seven rooms in each unit; and cash in bank of approximately $9,500. The following is a brief chronological statement of events as shown by the testimony. Sylvester died August 13, 1946, and on September 6th following Mrs. Graves was appointed executrix of his estate which was probated in Tuolumne County. November 29, 1946, appellant Graves presented a verified claim against the estate of Sylvester for $15,200, based upon money payments he alleged he had made for Sylvester over a period of ten years or more. February 18, 1947, Mrs. Graves was hospitalized with the first of a number of heart attacks which she suffered. Three days thereafter and while the estate of Sylvester was still in probate, she executed a deed of the Tuolumne County property to Evelyn M. Hawley. Nothing was paid by the grantee for this conveyance. She testified once that Mrs. Graves wanted her to have the property and again that Mrs. Graves had desired to will the property to her. February 24, 1947, Mrs. Hawley recorded the deed and also on that day a commercial account in the American Trust Company in the name of Ida M. Graves was converted to

Appellants contend that the trial court erred in refusing to admit into evidence a letter written by Mrs. Graves to Mrs. Hawley under .date of June 7, 1947, concerning the Tuolumne County property. It was contended that the letter was admissible as showing the state of mind of Mrs. Graves concerning the property and her desire to sell the same to rid herself of its care. The letter referred to some annoyances that had arisen in the handling of the property and contained a statement that there seemed to be no other way out than to sell the property before the expenses of attending to it should bankrupt her.- The point is not open to discussion on appeal since after objection made and considerable argument to the court the offer of the letter was withdrawn before the court had finally ruled upon its admissibility. Under those circumstances the claim of error is not well taken.

Appellants contend that the court erred in admitting into evidence “other wholly unrelated transactions had in the estate of Ernest 0. Sylvester with the defendants, Evelyn M. Hawley and George W. Graves.” By this appellants refer to the transactions surrounding the transfer through probate

Appellants specifically urge that the evidence is insufficient to support certain findings of the trial court. What has heretofore been said we think adequately disposes of these contentions, but we will discuss these specific objections. Appellants say that there is no support for the court’s finding that the Tuolumne County property was not conveyed for the comfort and support of Mrs. Graves. In presenting their argument counsel for the appellants refer to many matters which we have not stated, but which were in evidence and from which the trial court might have inferred innocence instead of guilt, but to argue such matters is only to argue the weight of the evidence. Such arguments are only valid in the trial court. When there is considered the early attempted gift of the property to Mrs. Hawley while it was still subject to probate, the about-face and the reconveyance when counsel advised that the gift was void, the gift of the duplex at the expense of Mrs. Graves’ private estate, the inadequacy of the price therefor as shown by a following sale of the same property for in excess of $15,000 which had brought the Sylvester estate but $4,000, the resentment of Mr. Graves that Sylvester should give any interest whatever to respondent King, whom he termed a stranger, the curious circumstances attending the second conveyance of the Tuolumne County property to Mrs. Hawley with the interposition of Mr. Ward, the payment of $10,000 for the property by Mrs. Hawley by depositing that amount in the joint account of herself and Mrs. Graves, when, we say, all of the foregoing is considered, the trial court was justified in placing upon the entire series of transactions the construction which it did, that is, that there existed from a time shortly after the will was disclosed, a consistent and persistent plan and intent upon the part of Mrs. Graves, Mr. Graves and Mrs. Hawley to defeat the inten

Appellants contend against the finding of the trial court that there was no consideration paid by Mrs. Hawley for the second transfer to her of the Tuolumne County property and they point to the evidence that she paid $10,000 in the manner hereinbefore narrated. But the trial court could have inferred that the deposit of that money in the joint account of Mrs. Graves and Mrs. Hawley indicated that it was a purported consideration never intended when made to get out of Mrs. Hawley’s control and ownership and this notwithstanding that a little over a month after the deposit was made Mrs. Graves withdrew that amount of money and placed it in the Morris Plan Bank, for this act may have been motivated entirely by a fear that the veneer of joint deposit would prove too thin to conceal the real purpose of the transfer. Again we think the matter so plain that the point should not be labored. Whether an innocent construction could be placed upon these matters is of no moment here if, as we hold, the trial court was warranted in the construction it did place upon them when it found there was in fact no consideration paid.

Appellants finally contend that the court was without jurisdiction to decree respondent was the owner of the $10,000 deposit in the Morris Plan Bank which, as we have seen, Mrs. Graves declared represented all that was left of the Sylvester estate. It must be borne in mind that this was an equitable action and that respondent succeeded in proving a conspiracy to defraud him of his rights. One step in the carrying out of that conspiracy was the placing by Mrs. Hawley in the joint account of herself and Mrs. Graves of a fund of $10,000 as a purported payment for the conveyance of the Tuolumne County property to her. When she sold the property she received a down payment in an equal amount. She was thereby made whole. The court, in adjusting the equities, had jurisdiction of the parties and the cause, and had the right to make a complete disposition of all relevant issues and rights between the parties before it. It was fully authorized to treat the $10,000 in the Morris Plan Bank as a fund in substitution for the $10,000 down payment on the purchase price of the property which Mrs. Hawley had received and made no

The judgment is affirmed.

Peek, J., and Schottky, J. pro tern., concurred.