Robert P. MILLER and wife, Betty W. Miller, Petitioners,
v.
Virginia M. McLEAN (Widow); T. R. Ward and wife, Jane Goode Ward; Helen Goode Golden (Widow); Lillian Vanoy Goode (Widow); Jane Ann Cochran and husband, Deale B. Cochran; Helen Goode Cameron and husband, Donald Cameron, Corita Edwards Miller, and Robert A. Little and T. R. Ward, Trustees, Respondents.
No. 165.
Supreme Court of North Carolina.
March 16, 1960.*361 Redden, Redden & Redden, Hendersonville, for petitioner appellants.
W. H. Childs, Sr., Lincolnton, for Corita Edwards Miller.
Kemp B. Nixon, Lincolnton, and George Hopkins, Atlanta, Ga., for original respondents.
McDougle, Ervin, Horack & Snepp, Charlotte, for Robert A. Little and T. R. Ward, remaining trustees and executors.
RODMAN, Justice.
Sec. 2 of Plato Miller's will devises to his wife in fee and absolutely his home place and household and kitchen furniture. Her right to this property is not involved in this litigation.
Sec. 3 gives to his wife the sum of $325 to be paid monthly "during her natural life or as long as she remains my widow, and paid directly to her monthly by said trustees out of the net income of my estate as fully set out hereinafter in this will."
Sec. 4 appoints petitioner Robert P. Miller and respondents Robert A. Little and T. R. Ward as trustees to provide payment of the monthly allowance fixed by sec. 3. The trustees are directed to take charge of all the cash on hand, stocks, bonds, bank deposits, and other personal property "and the income derived from all these sources from said properties shall be assets in the hands of said Trustees to pay the $325.00 monthly allowance * * * and that the remainder of said income shall be used for the payment of taxes and other necessary expenses of my said estate, and after this is carried out, I will that the remainder of my income shall be equally divided annually between my son Robert P. Miller and his sister Virginia Miller McLean, or to such as legally represent them * *." The trustees were given power "to sell, exchange, re-invest or change * * * any or all of my personal estate * * * in order to carry out the monthly payment to my wife. * * * I further give my three trustees * * * the full power and authority to advance to my son Robert P. Miller and my daughter Virginia Miller McLean, as their necessities may require and the best judgment of said three trustees may dictate, and (sic) part of said bonds, stocks, cash on hand, securities, etc. * * This trust requirement of said three Trustees * * * shall exist during the natural life or as long as she remains my widow, and at her death or remarriage, the said three Trustees * * * shall divide all the remaining or present stocks, bonds, money, etc. * * * and pay * * * the same equally between my son Robert P. Miller and my daughter Virginia Miller McLean, share and share alike or to such as legally represent them, equalizing any advancements made to either or both of them. * * *"
The concluding paragraph of sec. 4 of the will recites that testator owns 64% of the lot now sought to be partitioned, and the remaining 36% was owned by the original respondents.
Sec. 5 devises to his son and daughter "and to such as legally represent them, equally share and share alike" all of his other real estate.
The trustees named in the will were likewise appointed as executors. They qualified and acted as trustees until January 1959 when petitioner Robert P. Miller was permitted to resign as trustee because of his health.
The court found: Those named as executors and trustees, until the resignation of *362 Robert Miller, collected the rents for the lot here sought to be partitioned and deposited the rents so received as part of the trust fund. Robert P. Miller, while acting as executor and trustee, prevailed upon his co-trustees to distribute part of the corpus of the trust estate to himself and his sister, representing to them that adequate property would remain after such distributions to fulfill the purposes of the trust "and on such occasions would specifically call the attention of the other Trustees that the property which is the subject of this proceeding was included in the Trust Estate * * *." Based on these representations, the trustees paid over to petitioner and Mrs. McLean substantial parts of the corpus of the trust estate. "(S)uch liquidation and distribution was made without the consent or approval of the primary beneficiary Corita Edwards Miller, and a further liquidation of the corpus of said Trust could seriously impair the Trust and might render it impossible for the Trustees to carry out the express provisions of the Trust concerning the support and maintenance of Corita Edwards Miller."
Trustees and other fiduciaries must act in good faith. They can never paramount their personal interest over the interest of those for whom they have assumed to act. Erickson v. Starling, 233 N.C. 539, 64 S.E.2d 832; Hatcher v. Williams, 225 N.C. 112, 33 S.E.2d 617; Carter v. Young, 193 N.C. 678, 137 S.E. 875; Freeman v. Cook, 41 N.C. 373; 54 Am.Jur. 246.
The interpretation of the will made by petitioner-trustee, by placing the rents from the real estate in the trust fund coupled with his assurance to his co-trustees that the realty was part of the trust fund, thereby inducing them to distribute to him and his sister a substantial part of the corpus of the fund, so diminishing it as to create doubt as to its sufficiency to pay the widow the monthly sum provided in the will, estops him from now denying that the property is a part of the trust. McNeely v. Walters, 211 N.C. 112, 189 S.E. 114; American Exchange National Bank v. Winder, 198 N.C. 18, 150 S.E. 489; Maxton Auto Co. v. Rudd, 176 N.C. 497, 97 S.E. 477; Holloman v. Southern R., 172 N.C. 372, 90 S.E. 292, L.R.A.1917C, 416.
Because petitioner's conduct has estopped him from denying the lot is a part of the trust fund, we must determine if he is entitled, as a remainderman, to partition the trust estate. G.S. § 46-23. The answer is to be found by ascertaining testator's intent, for his intent will, if not in violation of some well-settled rule of law, be given effect. Entwistle v. Covington, 250 N.C. 315, 108 S.E.2d 603. Did testator intend to give the income not to exceed $325 per month to his widow, or did he mean to provide her with a fixed monthly amount for widowhood to be paid from the income of the fund, if sufficient, but if not, from the corpus?
It is, we think, apparent that testator intended that a fixed sum be paid each month. True, he estimated the income from the fund would provide more than enough to pay this amount, the cost of administering the trust, and leave surplus income. But he likewise foresaw that it might not. He gave to the trustees the power to sell parts of the trust estate. The trustees are not limited to income as a source of payment. If the income should prove insufficient, the trustees have the power and would be under a duty to use the corpus of the fund to make the monthly payments. What will be left for division cannot be determined until the trust estate terminates. Moore v. Langston, 251 N.C. 439, 111 S.E.2d 627; Shepard v. Bryan, 195 N.C. 822, 143 S.E. 835; Baptist Female University of North Carolina v. Borden, 132 N.C. 476, 44 S.E. 47, 1007; Erwin v. Erwin, 115 N.C. 366, 20 S.E. 520.
Since petitioners have no vested right to any part of the trust fund, they cannot have a sale of the lot in question. Makely v. Shore, 175 N.C. 121, 95 S.E. 51.
Affirmed.