Berret v. Allen

Couch, J., delivered the opinion of the Court. Bruce Hamer Berret and County Banking and Trust Company, appellants, appeal from an order of the Circuit Court for Cecil County denying them the right to mortgage or sell portions of a farm held in trust by the Bank for the benefit of Berret. By a will executed in 1949 Nora B. Mendenhall, Berret’s grandmother, bequeathed to Bruce Berret and his mother, ⁵⁴⁵ Bessie Mendenhall Allen, as joint tenants with right of survivorship, an 8.32 acre portion of the farm. The rest of the farm property was bequeathed to the legatees named in the residuary clause of the will, which provided: "Fourth: All the rest, residue and remainder of my said estate shall be distributed among my children in equal shares, who are Howard, Joseph, Lavinia, Mary, Bessie and the share to which Abe would have been entitled to, if he were living, I give to his children, Abe and Angeline.” In 1958 Nora B. Mendenhall, by codicil to her earlier will, provided: "After my decease my grandson, Bruce Hamer Berret, is to have the farm. ...

I want this as a trust... until Bruce reaches 45 (forty five) years old. . . . The farm taxes, upkeep of the farm, the homes, the debts are to be paid before the proceeds are paid to Bruce Hamer under the trust; otherwise, the farm would have to be sold. It cannot be sold without the approval of the trustee. Bruce Hamer is not to sell the silver, antiques, etc....

If the farm ever has to be sold before Bruce Hamer reaches the age of 45 the money is to be invested and Bruce Hamer is to have the interest until he becomes 45.” Bruce’s mother was named trustee in the codicil. In 1959 Mrs. Mendenhall died. Subsequently, in 1963, a dispute arose between Bruce and his mother and this resulted in her replacement as trustee and the appointment of the County Banking and Trust Company in her stead by the Circuit Court for Cecil County. Bruce managed the farm until 1973 or 1974, when the trustee began an active role in the management.

The record discloses that the farm has been unable to produce sufficient income to support Bruce and his family so that he has had to obtain a job off the farm. Because of his inability to mortgage or sell all or part of the farm, and in an effort to make the farm productive, Bruce has invested his own money to the extent of some forty ⁵⁴⁶ thousand dollars. Furthermore, the trustee is just about breaking even for its efforts. In view of this situation Bruce and the trustee agreed upon a plan whereby a portion of the trust property would be developed as residential property, which would require the initial outlay of money for subdivision expenses and thus the need for a mortgage.

The trustee, however, was unwilling to proceed without court approval, which precipitated the instant petition for such approval. 1 The chancellor, in denying the relief sought, stated in part: "The language of the will brings the court to conclude that the testatrix did not contemplate any voluntary sale of the farm during the trusteeship. ... Neither the Beneficiary nor the Trustee have any power to sell it. ... The Court is not persuaded from the testimony offered that the proposed alternative of selling some of the property with the inherent speculative risks in developing real estate is either in keeping with the wishes of the testatrix or that the Beneficiary would be proven to be any better off.” Finally, the chancellor refused to answer the question raised by appellants — whether the beneficiary had a fully vested interest. On appeal appellants argue: "I. Mr. Berret, as beneficiary of the Trust created by the codicil of Nora Bell Mendenhall, is entitled to a declaration and clarification of his status under said codicil.

II

Mr. Berret’s interest in the Trust property is fully vested.

III

The Trustee was granted the power to sell the corpus of the Mendenhall Trust, either by express or by implied grant. ⁵⁴⁷ IV. The Trustee possesses the power to mortgage the corpus of the Trust.” We need only address the first argument, that the beneficiary of the trust is entitled to a declaration and clarification of his status under the codicil, to dispose of this appeal. Berret, in his petition, requested the court to declaré his