California Trust Co. v. Ott

California Court of Appeal Jul 17, 1943 No. Civ. 13881Published

Before: Bishop

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Holding. The court held that a testator's will, which purported to devise all of his property, effectively exercised a reserved power of appointment over trust assets, even though the will was executed prior to the creation of the trust.

Issues

Did the testator intend for his will to exercise his reserved power of appointment over the trust corpus?
Does a will executed before the creation of a trust effectively exercise a power of appointment if the will purports to devise all of the testator's property?

Disposition. affirmed

Quotations verified verbatim against the opinion

“The trial court found “that said Francis S. Ott, Deceased, intended to and did exercise in his Last Will above set forth, his power of appointment.””

“Real or personal property embraced in a power to devise, passes by a will purporting to devise all the real or personal property of the testator.”

“A power existing at the donee’s death but created after the execution of his will is effectively exercised thereby if the will is an otherwise effective appointment.”

[716]

BISHOP, J. pro tem.

Plaintiff, as a trustee faced with rival claims to the corpus of the trust which it had become duty bound to distribute to someone, brought this action to secure a judgment designating the proper distributee. From the judgment, which instructs the plaintiff to deliver the trust fund and property to the estate of the widow of Francis S. Ott, his brother appeals.

Francis S. Ott and Phebe Ott, husband and wife, executed the trust agreement appointing the plaintiff as trustee. The property assigned to the trustee was the separate property of the husband, consisting of the personal property to be distributed to him from the estate of his sister. In general, the trust provided for semi-annual payments of income and of a small fraction of the principal to the two trustors so long as they both live, and to the survivor of the two during his or her lifetime. The first paragraph of the Fifth subdivision of the trust instrument leads us toward the point of conflict in this case. It reads: ‘ ‘ FIFTH: Upon the death of the survivor of the Trustors, the Trustee shall distribute the entire principal of the Trust Estate, or so much thereof as then remains, together with any undistributed income therefrom, to such persons and in such manner and proportions as the Trustor, Francis S. Ott, shall appoint by his Last Will and Testament duly admitted to probate in the State of California, or in default of such appointment or to the extent to which same shall not be effective, to the heirs of such Trustor, as such heirs shall then be determined in accordance with the laws of succession of the State of California now in full force and effect, and this Trust shall thereupon cease and terminate."

The trust agreement was executed in March of 1930. Francis S. Ott died in June of the same year, leaving a will which he had made in July of the previous year and which was duly admitted to probate in the State of California. By this will two specific bequests were made, one to Louis L. Ott, his brother, the appellant here, in "the sum of Ten Dollars ($10.00) in cash, and no more,” and the other, the sum of five hundred dollars, to the Midnight Mission, Inc. Again it is the fifth subdivision of the instrument that merits detailed attention: "I give, devise and bequesth to my beloved wife, Phebe Ott, of Los Angeles, California, all the rest and residue of my estate, both real, personal and mixed, of every kind and nature, wherever the same may be situate, absolute, forever." Upon the death of the wife in February of 1941,

California Trust Co. v. Ott

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