Morrell v. Building Management, Inc., 241 N.C. 264 (1954)

Dec. 15, 1954 · Supreme Court of North Carolina

241 N.C. 264

WILLIAM C. MORRELL v. BUILDING MANAGEMENT, INC., and EASTERN MOTORS, INC.

(Filed 15 December, 1954.)

1. Wills § 33c—

A devise of property to a trustee for the benefit of testator’s two sons for a period of ten years witb direction that at the expiration of the ten-year period the property should go to the two sons “or to their heirs” in fee simple, is held to vest title in the two sons immediately upon the death of testator with the right of full enjoyment postponed until the termination of the trust, and therefore, each son became seized of a vested and trans-mittible estate in fee simple to a one-half interest in the locus in quo. Upon death of one of the sons during the trust period, his children take no interest in the property under the will.

2. Wills § 46: Estoppel § 2—

Even if the owner of a vested fee simple title cannot convey a valid and marketable title thereto during the life of a trust, his deed executed prior to the termination of the trust will estop him and those claiming through him by deed, will, or inheritance, and his after-acquired title will “feed the estoppel” and vest the title thus acquired in his grantee.

Appeal by plaintiff from Martin, Special J., March Term 1954, New HaNOver.

Modified and affirmed.

Civil action to recover a one-fialf undivided interest in and to tfie real property described in tfie complaint or for judgment decreeing that plaintiff is tfie owner of a one-fialf undivided interest in said property, and for an accounting for tfie rents and profits derived therefrom.

Felix J. Meeks, Sr., died testate 21 December 1941. At tfie time of fiis death fie was seized and possessed of tfie land in controversy. In fiis will fie devised said property (215 and 217 North Third Street, Wilmington, N. 0.) in trust to one Demasco S. Carr for tfie use and benefit, of fiis two sons, Felix J. Meeks, Jr., and William E. Meeks. Tfie trustee was directed to rent said property and pay tfie net income derived therefrom monthly to fiis said sons.

Tfie section of fiis will creating tfie trust, directing tfie trustee in respect to tfie execution thereof, and providing for its termination and tfie distribution of the corpus of tfie estate contains tfie provision now at issue, which is as follows:

. . It is my wish and desire, and I so direct, that tfie aforesaid trust shall run for a period of ten years from tfie date of my death, and at tfie expiration of said ten year period, tfie property herein mentioned shall go to my two sons, Felix J. Meeks, Jr., and William E. Meeks, or their heirs, in fee simple, share and share alike.”

On 4 January 1946, within the ten-year period fixed for tfie continuance of tfie trust, William E. Meeks executed and delivered to Broadfoot Iron Works a deed sufficient in form to convey a one-fialf undivided interest in and to tfie locus, reserving unto himself, however, the income therefrom during the ten-year period of the trust; and Broadfoot Iron Works thereafter conveyed said one-half undivided interest to tfie defendant Building Management, Inc. On 6 March 1946, Felix J. Meeks, Jr., and wife conveyed tfie other one-fialf undivided interest to Broadfoot Iron Works, and on 16 July 1949, Broadfoot Iron Works conveyed tfie locus to defendant Building Management, Inc.

William E. Meeks died intestate 6 May 1947, within less than ten years after tfie death of tfie testator and prior to the termination of the trust. He left surviving one son, tfie plaintiff herein, as fiis sole heir at law. The son’s name was changed from William E. Meeks to William 0. Mor-rell by order of the Circuit Court of Jackson County, Missouri, at Kansas City. He claims a one-half interest in tfie locus in quo as a devisee under tfie terms of tfie will.

When, tbe cause was called for trial in tbe court below tbe parties Avaived trial by jury and agreed that tbe judge presiding should bear tbe evidence, "make tbe findings of fact, conclusions of law and render judgment tbereon.” Thereupon, after bearing the evidence and argument of counsel, tbe court found the facts, and, upon tbe facts found and tbe stipulations entered into by tbe parties, concluded that upon the death of tbe testator bis two sons named in bis will “became seized of a vested and transmittible estate in fee simple in remainder to a one-balf undivided interest in tbe locus in quo, the complete enjoyment of possession of which was postponed until tbe termination of tbe trust estate, there being no condition precedent which prevented tbe immediate vesting of tbe estate in remainder upon tbe death of Felix J. Meeks, Sr.” It thereupon entered judgment that tbe defendant Building Management, Inc., is vested with a good and indefeasible fee simple title to tbe property described in tbe fourth paragraph of tbe complaint. Plaintiff excepted and appealed.

Helium <& Humphrey and McClelland & Burney for plaintiff appellant.

Hogue <& Hogue for appellee Building Management, Inc.

Barnhill, C. J.

This cause was tried in tbe court below on tbe theory that the testator devised to bis two sons an estate in remainder — either vested or contingent. Tbe plaintiff contended that whatever estate was devised was contingent, as to each son, upon whether be survived tbe trust, and that since plaintiff’s father died prior to tbe expiration of tbe trust, be took nothing under tbe will; that tbe words “or their heirs” created another class of devisees who should take tbe share of a son in the event tbe son should die prior to tbe date set for tbe distribution of tbe corpus of the estate. That is to say, be contended that tbe roll must be called as of that date to ascertain who are the devisees; that he is tbe sole heir of William R. Meeks, and that as such be became the owner of one-balf of the corpus at tbe expiration of tbe trust.

On tbe other band, the defendants contend that William R. Meeks, immediately upon tbe death of the testator, was vested with title to one-balf of tbe corpus in remainder in fee, subject only to tbe terms of tbe trust which merely postponed tbe enjoyment thereof.

The parties, both in their briefs and oral arguments, pursue the appeal to this Court upon tbe same assumption.

But the will creates no prior estate, less than a fee, with limitation over to the two sons such as would make tbe estate devised to them an estate in remainder, either vested or contingent. Hence tbe law of remainders and future interests has no application here.

“Where an active trust is created for the use and benefit of named beneficiaries, or there is a gift of all or a part of the income therefrom to the beneficiaries, pending final division, or there is other language in the will evidencing a clear intent that a beneficial interest in the estate shall vest in the parties named immediately upon the death of the testator, with directions to the trustees to divide and deliver the estate at a stated time in the future, the interest vests immediately upon the death of the testator and the date of division merely postpones the complete enjoyment thereof.” Carter v. Kempton, 233 N.C. 1, 62 S.E. 2d 713. This rule, to be followed in the construction of wills, is now settled law in this jurisdiction. Williams v. Smith, 57 N.C. 254; Fuller v. Fuller, 58 N.C. 223; Coddington v. Stone, 217 N.C. 714, 9 S.E. 2d 420; Robinson v. Robinson, 227 N.C. 155, 41 S.E. 2d 282; McQueen v. Trust Co., 234 N.C. 737, 68 S.E. 2d 831; Jackson v. Langley, 234 N.C. 243, 66 S.E. 2d 899; Weill v. Weill, 212 N.C. 764, 194 S.E. 462; Priddy & Co. v. Sanderford, 221 N.C. 422, 20 S.E. 2d 341; Pridgen v. Tyson, 234 N.C. 199, 66 S.E. 2d 682; see also 57 A.J. 807; 69 C. J. 595; 2 Simes Future Interests 103.

The will under consideration creates no contingent future interest. The beneficiaries of the trust are named in the will and were persons in being at the time the will took effect and the estate was created. They were, under the terms of the will, to have and receive the income from the property monthly, and upon the termination of the trust, they were to receive their respective shares, freed of the trust provisions. Thus there is no postponement of the vesting of their title to the property. Instead, title thereto vested in them immediately upon the death of the testator. The trust merely served to postpone their right to the full enjoyment of the estate devised until its termination.

Even if we should conclude that in view of the fact the sons were to receive only the income from the estate during the life of the trust, neither son could convey a valid and marketable title to his share of the property during the life of the trust — -and we do not so conclude — this would not affect the result. The deed executed by William E. Meeks would operate as an estoppel against him and those claiming by or through him by deed, will, or inheritance.

When a grantor conveys land to which he has no title or a defective title at the time of the conveyance, but who thereafter acquires title to the property, his after-acquired title “feeds the estoppel” and, by operation of law, vests the title thus acquired in the grantee. Croom v. Cornelius, 219 N.C. 761, 14 S.E. 2d 799; Thames v. Goode, 217 N.C. 639, 9 S.E. 2d 485; Woody v. Gates, 213 N.C. 792, 197 S.E. 561; Bell v. Adams, 81 N.C. 118; Benick v. Bowman, 56 N.C. 314.

The judgment entered in the court below will be modified by striking out the words “in remainder” as used in the court’s conclusion of law therein contained so that it will read “. . . that at the death of Felix J. Meeks, Sr., William E. Meeks, Sr. became seized of a vested and trans-mittible estate in fee simple to a one-half undivided interest in the locus in quo, the complete enjoyment of possession of which was postponed until the termination of the trust estate, there being no condition precedent which prevented the immediate vesting of the estate upon the death of Felix J. Meeks, Sr.” As so modified said judgment is affirmed.

Modified and affirmed.