Estate of Rey

WARD, J.

On April 27, 1927, Leon Louis Rey died testate leaving real and personal property. The will, providing for the creation of certain trusts, was admitted to probate and Prosper L. Wolf and a son, Leon M. Rey, were appointed and qualified as executors. In December of the same year, after approval of a first and final account, a petition for distribution was ordered. On July 28, 1928, a decree of final discharge was granted. On May 20, 1937, the second son named in the will filed an application for an accounting on one of the testamentary trusts, and in addition alleged that certain stocks and bonds referred to in a second testamentary trust had not been administered. On December 2, 1937, the Anglo California Trust Company having refused to act, the court, settled the final account of the sole trustee Leon M. Rey and terminated the trust relative to certain stock by ordering distribution. On January 13, 1938, an order was made denying the application for an accounting. This appeal is by Noel M. Rey, referred to in the wall as Noel Rey, from the order settling the final account of the sole trustee and from the order denying the application for an accounting.

The first question presented for determination arises from the construction placed upon the proviso clause in the sixth paragraph of the will reading as follows: "Sixth: The stock which I own and hold in L’Echo de L’Ouest, a corporation, I give and bequeath to Anglo California Trust Company and Leon M. Rey, in Trust However, for the followdng uses and purposes and not otherwise: They are to hold the same and pay the income from said stock to nry sons, Leon M. Rey and Noel Rey, for and during the period of ten (10) years from the date of my decease at which time said stock shall

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be divided equally amongst my two sons, Leon M. Rey and Noel Rey, share and share alike; subject However, that my two sons shall retain control of said newspaper corporation and if my said son Noel Rey should in anywise dispose of the stock which now stands in his name or vote the same so as to surrender control of said corporation to minority stockholders, then and in that event the share of stock which he would have received shall go to and vest in my son Leon M. Rey; ’ ’. The court divided the stock equally between the two sons and terminated the trust.

Appellant Noel M. Rey argues that the limitation in paragraph six is placed upon the two sons after distribution. In other words, that the distributees should have been directed to vote the stock jointly after distribution. Respondents contend that the limitation was upon the trustees for the ten-year period of the trust. Construing the intention from the words used in the will, and from the surrounding circumstances, we must agree with the contention of respondents that no restriction is placed on the beneficiaries after distribution and termination of the trust, otherwise the restriction could last forever. If such an intention was contemplated, why did not the testator leave the stock directly to the two sons without the ten-year trust limitation 1 The beneficiaries would have obtained immediate and absolute control upon distribution of the estate subject to the limitation that they should continue control of the corporation. Whether such a provision would have violated the rules against perpetuities or have been simply a continuance of limitation during the lives of the beneficiaries is not necessary to discuss in this proceeding. The trustees were empowered to vote the stock. In the absence of one, the other had the right to vote all shares unless the order appointing them directed otherwise. (Civ. Code, sec. 320c.) Leon M. Rey was named by the testator as one of the two trustees. In such capacity he might persuade the cotrustee, if appointment had been accepted, to take some action that might result in a relinquishment of control, but the real purpose which actuated the testator is that Noel, who held control of personal stock standing in his name, should be prohibited, at least for ten years, from voting his personal stock “so as to surrender control”. If Noel violated this direction, his trust share should “go to and vest in my son Leon M. Rey”. If the stock had been given directly to the