Snader v. Slingluff

The question which is raised on the record in this case is presented by an interpleader proceeding, and was instituted to establish the ownership of the proceeds of certain bonds under a declaration of trust alleged to have been made by a certain Samuel Engler, a resident of Paris, France. It will be necessary for a proper understanding of the case to briefly state the material facts as disclosed by the pleadings and evidence as upon these will rest the decision of the case.

Mr. Engler was a native of Carroll County, Maryland, but more than twenty-five years prior to his death was a resident of Paris. He died in the year 1894 leaving a valuable estate which he disposed of by last will and testament. The fund here in controversy was derived from a sale of certain coupon bonds which is conceded to have been the property of Samuel Engler, the alleged settlor, and which were delivered by him to the trustee about ten years before his death. This fund is claimed on the one hand by the appellee, the executor, as a portion of the undisposed estate of the testator under the will, and on the other hand by the appellants, the children of Solomon P. and Mary E. Engler, under the declaration of trust in their favor, signed by one David Roop in the capacity of trustee, and also under certain letters of the settlor showing the intention on his part to create the trust and the execution thereof.

The declaration of trust upon which the claim of the appellants partly rests is in writing and is in the following language:

"Melville, Oct. 14, 1884.

"This is to certify that I have received from Samuel Engler transferred in my name, the following Mobile and Ohio First mortgage R.R. bonds No. 6485, 6486 and 6487 of $1,000 face value each. And one bond No. 724 of $500 face value, coupons attached at 6 per cent, beginning with Dec. 1, 1884, to be held in trust for children of S.P. and Mary E. Engler. The interest collected to be remitted to Samuel Engler. The above conditions to be observed and carried out until otherwise ordered and directed."

$3,500 — in all.

(Signed) DAVID ROOP." This paper was delivered by David Roop, the trustee on the 14th of October, 1884, to Mary E. Engler, the mother of the appellants, and has been in her possession since that date.

The record shows that by an agreement filed in the case on the 23rd of January, 1902, it is admitted that the bonds mentioned in this paper were transferred on the 21st of July, 1884, from a certain Evan Haines to David Roop, and subsequently on May 4th, 1893, were transferred from David Roop to bearer. It further appears from a letter, dated Paris, January 5th, 1884, written by Samuel Engler to Solomon P. Engler that the former had directed this to be done. He states among other things in this letter "I have given orders to E. Haines to hand over the remainder of what he had to David Roop, if he does so at once, all is passed and he shall be liberally dealt with and good feeling." And in a letter to Mrs. Mary E. Engler, dated October 3rd, 1892, in referring to these bonds he says, "Now I come to the point in which I propose to write you. David Roop has still in hand $3,500 of Mobile and Ohio Rail Road first mortgage bonds. They give $210 per year interest this I must have until my death after that the interestmay be paid to you, but I must be assured that ____ your life and that of your children ____ how can you ____ promises above would be ____ like that of Sol and your mother ____."

David Roop, the trustee, died in January, 1895, and the bonds were in his possession at the time of his death which took place shortly after the death of Samuel Engler. The fund now in dispute was recovered from the estate of Roop, the trustee, in settlement of these bonds which were held by him, and from a decree of the Circuit Court of Baltimore City, directing the fund to be paid to the executor of Samuel Engler, this appeal has been taken.

The question then in the case comes to this. Do the facts relied upon by the appellants create and establish such a trust as a Court of equity will enforce in their behalf. In the case ofLloyd v. Brooks, 34 Md. 27, this Court held that the question in such cases is one of fact; has there been a gift or not, or has there been a declaration of trust or not, and in determining this, the acts of the party, as well as his intention in doing those acts, must be considered and regarded by the Court.

In the case now under consideration we have the declaration of trust in writing and signed by the trustee. The paper distinctly states that the trustee has received from the settlor, transferred in his name, certain coupon bonds, to be held in trust for the children of S.P. and Mary E. Engler. The interest was to be collected and to be remitted to the settlor. These conditions were to be observed and carried out until otherwise ordered and directed. It thus appears that the subject-matter of the trust is clearly stated, the benficiaries under it are definitely named, and the condition upon which the property was to be held is distinctly set out. The bonds were delivered and transferred to the trustee for the benefit of the cestui quetrustent reserving the interest thereon, by the direction of the settlor and in the trustee's possession from July 31st, 1884, to the date of his death, in January, 1894. There is not a particle of proof to show that the settlor or donor ever attempted to disturb, change, annul or revoke by will or otherwise, the trust which is set up in this case. On the contrary, it is shown by his letter to Mrs. Mary E. Engler as late as October 3rd, 1892, that he knew that his direction to Haines to deliver and transfer the bonds to the trustees had been carried out because he there states, "that David Roop, the trustee, has still in hand $3,500 of Mobile and Ohio R.R. first mortgage bonds," the bonds from which the fund in the case is derived.

But it is argued upon the part of the appellee, that the written declarations of the trustee and the letters of the settlor, Engler, in this case, do not establish or create such a valid and effectual trust, as is capable of being enforced.

A large number of cases have been cited to sustain this position but without stopping to state the distinctions on which they rest we think they are clearly distinguishable from this. We do not mean to distrust in the least, nor do we overlook the well settled principles of law, established by those cases, but it will be found upon their examination that the facts stated, upon which they were decided, differ very materially from those here. It was said by this Court in the case of Albert v. Winn,5 Md. 73, that the seventh, eighth and ninth sections of the Statute of Frauds relate expressly to trusts; the first of which provides that a declaration or creation of trust of lands shall be manifested or proved by some writing signed by the party enabled to declare the trust. In consequence of these terms, trusts not constituted but merely proved by some writing, have been considered sufficiently established although the ninth section of the Act directs that all grants and assignments of any trusts shall be in writing.

In the case of Smith Barber v. Darby, 39 Md. 268, it is thus stated: "It is a well established principle that a parol declaration of a trust of personal estate is sufficient * *. It was not necessary to the validity of the trust that he should have signed his name to the note, or notified the children of the existence of the trust or have delivered the note to them, or to some person for them." Other authorities to the same effect are the cases of Cox v. Sprigg, 6 Md. 274; Gardiner v.Merritt, 32 Md. 83; Rieff v. Horst, 52 Md. 268; Gordon v. Small,53 Md. 551; Taylor v. Henry, 48 Md. 560; Milholland v.Whalen, 89 Md. 213; Newkirke v. Place, 47 N.J. Equity, 486;Tanner v. Skinner, 11 Bush, 120; Gardiner v. Rowe, 5 Russ. 258; Fiste v. Hale, 3 Vesey, 737; Bates v. Hurd, 65 Maine, 180.

Mr. Pomeroy, in his work upon Equity Jurisprudence, 2nd vol. sec. 1007, says that when the trust is not created in and by the instrument of conveyance, it may be sufficiently declared and evidenced by the trustee to whom the land is conveyed, or who becomes the holder of the legal titles; and this may be done by a writing executed simultaneously with or subsequent to the conveyance, and such writing may be of a most informal nature. The Statute of Frauds does not extend to trusts of personalty; and such trusts may therefore be created, declared, or admitted verbally; and proved by parol evidence; although the consensus of authorities demands clear and unequivocal evidence.

In this case, we have the written declaration of the trustee executed as to the terms of the trust about the time and subsequent to the delivery of the bonds, a declaration against his interest to impress a trust upon the property and also the various letters of the settlor showing a clear intent on his part to create a trust and the execution of the trust in behalf of the appellants.

Besides this, it appears from the record that Mrs. Engler had a conversation with Roop, the trustee, about these identical bonds after the death of Mr. Samuel Engler, and he admitted that he had the bonds in his possession and would turn them over now as he did not want the care of them any longer. In Milholland v.Whalen, 89 Md. 213, this Court declared that when a person intends to give property to another and vest that property in trustees and declares a trust upon it in favor of the object of his bounty, by such acts the gift is perfected and the author of the trust loses all dominion over it, and in such gifts of mere personal estate, the declaration of trust may be made and proved by parol, without the aid of writing, and when the Court considers that there has been a declaration of trust, it is a trust executed and the Court will enforce it with or without consideration.

We are therefore of the opinion after a careful examination of the case that the Circuit Court of Baltimore City committed an error in directing the fund in dispute to be paid to Fielder C. Slingluff, executor of Samuel Engler, deceased, and its decree of the 21st of February, 1902, will be reversed. The cause will be remanded to the end that a decree may be passed in accordance with this opinion, ordering the fund to be paid, as directed by the declaration of trust, the costs to be paid out of the fund.

Decree reversed, cause remanded, the costs to be paid out ofthe trust fund.

(Decided June 18th, 1902.)