Vickery v. Maryland Trust Co.

Henderson, J., delivered the opinion of the Court. This appeal is from a decree of the Circuit Court of Baltimore City construing a Declaration of Trust executed by Mabel R. Vickery, deceased, on December 19, 1929. On that date the settlor executed an irrevocable instrument, conveying certain stocks and bonds to the ¹⁸¹ Maryland Trust Company, trustee, in trust to collect the income and, after paying proper charge's, to pay the remaining net income as follows: “First: During my lifetime to pay the same to me. “Second: Upon and after my death * * * to pay the same in equal parts to my then surviving brothers and sister and my nephews and nieces, all of my nephews and nieces at the time of any distribution of said income to take as a unit and to receive his or her respective share of said distribution per capita and not per stirpes, the issue of any deceased nephew or niece to take the part which his, her or their respective parent would have taken if then living; so that all of my nephews, and nieces (including the issue of any deceased nephews or nieces) as a unit shall, at the time of any distribution of said income after my death and during the lifetime of the last survivor of my brothers, sister and nephews and nieces living at the time of my death, receive the same amount as each of my then surviving brothers and sister; or, should both of my brothers and my now living sister pre-decease at least one of my nephews or nieces, prior to the termination of this Trust, then thereafter during the continuance of this Trust and after my death, the whole of said net income shall be divided equally among my nephews and nieces, the issue of any deceased nephew or niece to take as above provided. “Third: Upon the death of the last survivor of my brothers, sister and nephews and nieces living at the time of my death, the said Trustee shall divide and distribute the principal of said estate among my nephews and nieces born after my decease, and the issue of all my nephews and nieces, per stirpes and not per capita, absolutely and free of all trust.” At the date of the Declaration of Trust the settlor’s parents were dead and she had two brothers, Stephen and Thomas, and one sister, Mary, who were then living, and five nephews and nieces, one nephew being the son of Thomas, and one nephew and three nieces being the children of a deceased sister, Edith Vickery Heiskell. ¹⁸² The settlor also had at that time two grandnephews and three grandnieces, grandchildren of Mrs. Heiskell. The settlor died on January 11, 1946.

She was survived by her two brothers, Thomas and Stephen, and by the same nephews and nieces, and the same grandnephews and grandnieces and another .grandniece born after the date of the Declaration of Trust. Her sister, Mary Vickery Playford,- had predeceased her, leaving no issue. Her brother Stephen died, unmarried, while this case was pending in the lower court. On December 20, 1929, the day after the execution of the Declaration of Trust, the settlor executed a will wherein she disposed of “all the rest, residue and remainder of my estate and property of every kind, nature and description, and wheresoever located, in possession, in remainder or over which I may have testamentary disposition (excepting the trust estate created by myself under a Deed of Trust, dated December 19, 1929, to the Maryland Trust Company, Trustee, which will be disposed of under the terms of said Trust) ” to the same persons and in language similar to that used in the Declaration of Trust. ’ ' The initial' paragraph of the Declaration of Trust declared: “Know All Men By These Presents, that I, Mabel R. Vickery, unmarried, of Baltimore City, Maryland, desiring to provide an income for myself during my natural life, and thereafter for my living brothers and sister and the issue-of any deceased brother or sister until the death of thé' lást survivor of my brothers, sister, and my nephews and nieces living at the time of my death; and in such manner or proportion that, upon my death and until the decease of said last survivor, the total net income from the Trust hereby created, shall from timé to time be. equally divided between .my then living brothers and sister and the issue, as a unit, of my then deceased sister and brothers per capita. and not per stirpes,;the issue of any deceased nephew or niece to take the part which his, her or their parent, would have taken ¹⁸³ if then living; * * * have granted, assigned, transferred and conveyed * * At the trial below, the Chancellor admitted in evidence, over objection, a letter dated December 26, 1929, from the draftsman of the Declaration of Trust to the Maryland Trust Company, which letter was approved by the settlor over her signature, reading in part as follows: “* * * I beg to say that Miss Vickery, the grantor, during her several conferences with me in connection with the preparation of this Deed of Trust, expressed her wishes as follows, and it was this expression which has been incorporated into the Deed of Trust: * * * that, after her death and until the decease of the last survivor of her brothers, sister, and nephews and nieces, who may have been living at the time of her death, the entire net income be divided from time to time into as many equal parts as there may be surviving her at the time of each distribution thereof, brothers and sisters plus one, the one additional part to be divided equally among the issue of any deceased brothers and sisters per capita and not per stirpes, the issue of any deceased nephew or niece to stand in the place of his, her or their parent per stirpes and not per capita; this provision, of course, as the Trust continues, will result in a decreasingly smaller number of parts into which the income is to be divided as a brother or sister dies; with the result that, after the death of her now living two brothers and sister, the entire net income will be divided in equal parts among her nephews and nieces per capita and not per stirpes, until the decease of the last survivor of those living at the time of her death when the Trust will terminate.” The Chancellor, by his decree, determined that, in the Declaration of Trust: (a) the limitations of life interests to the brothers and sister and nephews and nieces of the settlor are valid; (b) the limitations of life interests to issue of nephews and nieces of the settlor, and all remainders created by that instrument, are void because in violation of the Rule against Perpetuities; (c) ¹⁸⁴ no nephew or niece may share as such in the fund until the death of his parent; (d) any amounts representing void interests pass under the residuary clause of the will and are payable to the executors under the will of Mabel R. Vickery.

Thomas H. Vickery, and his son, Thomas H. Vickery, Jr., appealed from the decree. There were no cross-appeals. The appellants contend (1) that the limitations of life interests to nephews and nieces are void, as well as the limitations to issue of nephews and nieces and the remainders; (2) if the limitation to nephews and nieces is valid, Thomas H. Vickery, Jr., is entitled as a nephew to share in the income during the life of his father because of the explicit language of the second paragraph of'the Declaration of Trust, and because the letter purporting to state the settlor’s intention to the contrary was inadmissible; (8) that the part of the trust estate which is subject to the invalid limitations does not pass under the residuary clause of the will, but should be distributed directly to her next of kin. All of the parties concede and agree that the ultimate remainders to the issue of nephews and nieces, purportedly created by the Declaration of Trust, are void; all of the parties likewise agree that the life interests to the brothers and sister are valid.

The controversy hinges upon the status of the life interests of nephews and nieces and their issue. 1. The parents of the settlor were dead when the Declaration of Trust was executed, and it necessarily follows that the brothers and sister of the settlor, then living, were the only persons who could ever answer that description. The rule against perpetuities is directed, not against the duration of estates, but against the lateness of vesting. As stated in Gmy on Perpetuities, 4th Ed., Sec. 201, page 191: “No interest is good unless it must vest, if at all, not later than 21 years after some ‘life in being’ at the creation of the interest.” “In determining this question of remoteness, there is an invariable principle that regard is to be had to possible, and not ¹⁸⁵ merely actual events.” Perkins v. Iglehart, 183 Md. 520, 527 , 39 A. 2d 672, 677 ; Gambrill v. Gambrill, 122 Md. 563, 569 , 89 A. 1094 .

Gray states (Sec. 370, p. 392) : “A devise to the testator’s grandchildren as a class is good if the vesting is not postponed to a time after they become of age, for they must all become of age within 21 years after the death of their parents (the testator’s children), and the parents must all have been bom (or begotten) in the testator’s lifetime. What is true of a devise to grandchildren of the testator is true also of a devise to grandchildren of a person who has died before the testator.”