England v. Simmons ( 2014 )


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  • 295 Ga. 1
    
    FINAL COPY
    S13G1709. ENGLAND v. SIMMONS et al.
    BLACKWELL, Justice.
    Robert Carl Haege died in December 2006. Three months earlier, Haege
    had made a will, in which he left his “personal assets” to his brother and sister,
    and in which he left his “business interests, both tangible and intangible, real or
    personal, connected to the business known as Traditional Fine Art, Ltd.” to his
    brother, sister, and two longtime employees.1 After Haege died, questions arose
    about the disposition of property associated with Traditional Fine Art, Ltd.,
    insofar as Traditional Fine Art was a sole proprietorship and, therefore, had no
    legal existence separate and apart from Haege himself. The will was admitted
    1
    The relevant provisions of the will read as follows:
    I give, bequeath and devise all of my personal assets, both real and
    personal, to James E. Haege, my brother[,] and Sharon Haege England, my
    sister, per capita. I give, bequeath and devise all of my business interests, both
    tangible and intangible, real or personal, connected to the business known as
    Traditional Fine Art, Ltd. to James S. Simmons, Elery Stinson, James E. Haege
    and Sharon Haege England, per stirpes. It is specifically the intent of this
    provision that Steve [sic] S. Simmons enjoy, after this bequest, thirty four
    (34%) percent of the outstanding member certificates, that Elery Stinson enjoy
    seventeen (17%) percent of the outstanding member certificates, that James E.
    Haege and Sharon Haege England each enjoy twenty four and one half
    (24.5%) percent of the outstanding member certificates.
    to probate, and Sharon Haege England — Haege’s sister — was appointed as
    executrix of his estate. England failed to distribute any property to James S.
    Simmons and Elery Stinson — the two longtime employees — and they filed
    this lawsuit against England, seeking a declaratory judgment as to the meaning
    of the will with respect to the property associated with Traditional Fine Art. The
    trial court entered a final judgment for England, concluding that, because
    Traditional Fine Art was only a sole proprietorship, the property associated with
    the business was merely the personal property of Haege, and there was,
    therefore, nothing to pass under the “business interests” provision of the will.
    Simmons and Stinson appealed, and in a split decision, the Court of
    Appeals reversed. Simmons v. England, 
    323 Ga. App. 251
    (746 SE2d 862)
    (2013). The majority of the Court of Appeals looked to the intention of the
    testator as evidenced by the plain terms of his will, and it concluded that Haege
    evidently meant to differentiate between his personal property “connected with
    the business known as Traditional Fine Art, Ltd.” and his other “personal
    assets.” 
    Id. at 253-254.
    Noting that “the intention of the testator must prevail,”
    and noting as well that “operation is to be given to every part of [the will] if this
    can be done without violating its terms or the intention of the testator,” the
    2
    Court of Appeals concluded that Simmons and Stinson were entitled — along
    with England and her brother — to share in any “business interests, both
    tangible and intangible, real or personal, connected to the business known as
    Traditional Fine Art, Ltd.,” and the existence and identity of such property were
    “simply issues for the factfinder, which must identify the business interests.” 
    Id. (citations and
    punctuation omitted). Two judges dissented, reasoning as the trial
    court did that a sole proprietorship has no legal existence and that all property
    connected with the business was merely the personal property of Haege. 
    Id. at 254-255
    (Boggs, J., dissenting). On the petition of England, we issued a writ of
    certiorari to review the decision of the Court of Appeals, and we now affirm.
    In this Court, England does not dispute the fundamental premise of the
    decision of the Court of Appeals — that a sole proprietor may separately dispose
    in his will of personal property connected with his sole proprietorship and his
    other personal property — and she is right not to dispute it. See Bank of
    Statesboro v. Simmons, 
    164 Ga. 885
    (
    139 S.E. 661
    ) (1927) (a testamentary gift
    of a sole proprietorship, broadly including certain enumerated categories of
    business property, is an effective specific legacy that survives the death of the
    testator). See also Phillip E. Hassman, Ademption of Legacy of Business or
    3
    Interest Therein, 65 ALR3d 541, § 2 [a] (1975) (“The bequest of an
    unincorporated business or an interest therein . . . is the bequest of a specific
    unique thing capable of being identified and differentiated from all other things
    existing in the estate.” (Footnote omitted)); George Gleason Bogert et al., The
    Law of Trusts and Trustees § 571 (“A testator may make such provision as he
    likes regarding a business which he has been conducting through a sole
    proprietorship . . . .”). Instead, England argues that Haege did not actually intend
    to separately dispose of any property associated with his sole proprietorship. In
    support of this argument, England points to the sentence of the will that
    immediately follows the provision leaving “business interests . . . connected
    with the business known as Traditional Fine Art, Ltd.”:
    It is specifically the intent of this provision that [James] S. Simmons
    enjoy, after this bequest, thirty[-]four (34%) percent of the
    outstanding member certificates, that Elery Stinson enjoy seventeen
    (17%) percent of the outstanding member certificates, [and] that
    James E. Haege and Sharon Haege England each enjoy twenty[-
    ]four[-]and[-]one[-]half (24.5%) percent of the outstanding member
    certificates.
    This sentence, England says, limits the “business interests” referenced in the
    preceding sentence to membership certificates evidencing ownership of
    Traditional Fine Art, and since it remained a sole proprietorship when Haege
    4
    died, she concludes, there are no such membership certificates. The provision
    concerning “business interests,” England argues, was meant to apply only in the
    event that Haege organized his sole proprietorship as a separate legal entity,
    which he never did.
    The problem is, if Haege meant only to direct the disposition of
    nonexistent membership certificates, he could have done so quite simply with
    the sentence upon which England relies, and he could have omitted nearly all of
    the preceding sentence about “business interests.” Moreover, that preceding
    sentence must refer to something more than membership certificates, insofar as
    the ownership interest represented by such certificates is indisputably intangible
    personal property, but in the preceding sentence, Haege referred to “all of my
    business interests, both tangible and intangible, real or personal, connected to
    the business known as Traditional Fine Art, Ltd.” If such “business interests”
    only meant membership certificates, the references to tangible and real property
    would have no meaning and would, in fact, be nonsensical.
    Taking the will as a whole, the most natural and reasonable understanding
    of these provisions is that Haege left his personal property that amounted to
    “business interests . . . connected to the business known as Traditional Fine Art,
    5
    Ltd.” — specifically including, but not limited to, membership certificates that
    he owned, if any — to Simmons, Stinson, and his brother and sister, and he left
    all of his other personal property to his brother and sister alone. See A.E.
    Korpela, Annotation, What Passes under Term “Business” or “Business
    Enterprise” in Will, 28 ALR3d 1169, § 3 [b] (1969) (noting general rule that use
    of the term “business” in a will refers to all property involved in the conduct of
    the business). That is how the majority of the Court of Appeals understood the
    will, and it was correct to do so. We also find no error in the conclusion of the
    Court of Appeals that the precise identification of the property amounting to
    “business interests . . . connected to the business known as Traditional Fine Art,
    Ltd.” “are simply issues for the factfinder.” 
    Simmons, 323 Ga. App. at 254
    (citation omitted). Accordingly, we affirm the judgment of the Court of Appeals.
    Judgment affirmed. All the Justices concur.
    Decided March 28, 2014.
    Certiorari to the Court of Appeals of Georgia – 
    323 Ga. App. 251
    .
    Smith, Welch, Webb & White, John P. Webb, Grant E. McBride, J. Mark
    Brittain, for appellant.
    6
    Giacoma Schleicher, Kristofer R. Schleicher, Joyce, Thrasher, Kaiser &
    Liss, Andrew P. Kaiser, for appellees.
    7
    

Document Info

Docket Number: S13G1709

Judges: Blackwell

Filed Date: 3/28/2014

Precedential Status: Precedential

Modified Date: 11/7/2024