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COLEMAN, trustee, et al. v. CABANISS et al.

Supreme Court of Georgia1904-11-12
121 Ga. 281

Summary

Holding. A power of sale granted in a trust deed extends to the fee simple estate and passes to a successor trustee where the deed requires the successor to accept the estate subject to the same trusts previously expressed. The judgment was reversed.

A trust deed vested the trustee with legal title to a life estate in property, but also granted a power of sale extending to the fee simple (full ownership), not merely the life estate. The court interpreted 'trust property' in the deed to mean the entire fee, rejecting a narrow technical reading that would limit the power to the life estate alone. When the original trustee died, the question arose whether the power of sale passed to a successor trustee appointed under the deed's terms.

The court held that although powers of sale are not automatically inherited by successor trustees absent clear language, this deed expressly required the successor to take the estate 'subject to the same uses, limitations, and trusts' as previously expressed. Since a power of sale constitutes a trust, it passed to the successor trustee by these very words. The court found additional support in the deed's explicit exclusion of another power (the power to create a lien) from passing to successors—indicating the grantor intended the power of sale to transfer. Consequently, a deed executed by the successor trustee conveyed valid fee simple title to the property, with any remainder interests held by the beneficiaries attaching to any reinvested property.

Summary generated by law.co from the public-domain opinion. The opinion text itself is public domain.

Key issues

  • Scope of trustee's power of sale: whether it extends beyond a life estate to the fee simple
  • Succession of powers: whether a power of sale passes from an original trustee to a successor trustee
  • Interpretation of trust language: meaning of 'trust property' and 'uses, limitations, and trusts' in determining grantor's intent

Procedural posture

A lower court judgment was appealed regarding whether a successor trustee possessed authority to convey the full fee in trust property.

Authorities cited

No cited authorities resolved to law.co cases yet.

Opinion

majority opinion

Cobb, J.

Even though the trust deed vested in the trustee the legal title to only the life-estate of Mrs. Coleman, still the power of sale extended to the fee in remainder as well as the life-estate. The expression “ trust property,” which is used in describing the power of sale, is not to be given a technical meaning which would confine it to the life-estate, if the trust estate created was limited to that estate. The trust property referred to is the fee in the property. As was remarked . by Mr. Chief Justice Bleckley, in Headen v. Quillian, 92 Ga. 223, “To hold that he contemplated restricting the power of sale to the estate for life would attribute to him a technical narrowness utterly strange to his thoughts and at complete variance with his real state of mind.” See also Heath v. Miller, 117 Ga. 857, and cit. So far as the right to exercise the power of sale is concerned, it is immaterial to what •class the remainders belong — whether-legal or equitable, vested ■or contingent. The original trustee and his wife, by their joint action, were authorized to convey the fee in the property for the purpose of reinvesting the proceeds in other property. ‘ See Heath v. Miller, supra. A lawful sale of the fee in the property could be had at any time during the lifetime of Mrs. Coleman, whenever. she and the original trustee saw fit to unite in exercising the power. But it is said that the power of sale was extinguished when the original trustee died, that it was not conferred in terms Upon him and his successors, and that there is no language in the deed which, properly construed, would pass to the new trustee a power of sale, although there is express authority vested in Mrs. Coleman to appoint a new trustee. Neither the word “successor ” nor words of similar import appearing in the clause of the deed conferring the power of sale upon the original trustee have this effect, and unless there is some other language in the deed which would indicate that it was the intention of the grantor that this power should pass to the successor for whose appointment provision is made, the power would be a personal trust and would not pass. Simmons v. McKinlock, 98 Ga. 738. But the deed expressly provides that the successor to the original trustee, when appointed in the manner provided, should take the estate “ subject to the same uses, limitations, and trusts as are hereinbefore expressed.” The power of sale may not be a use or limitation, but it is certainly a trust. As was said in Heath v. Miller, “ The ’■trustee, although a trustee of a power merely, is none the less a trustee.” Under this view of the matter, the power of sale passes to the successor by the very terms of the deed itself. The fact that the deed provides that the power to create a lien shall not pass to the new trustee is a strong circumstance to indicate that it was the intention of the grantor that the power of sale should pass. The deed tendered to Cabaniss conveyed a perfect title to the fee in t¿be property as against any one who might be a claimant under the trust deed. Whatever interest the children and grandchildren have in the property will pass under the deed and will attach to the property in which the reinvestment is made.

Judgment reversed.

All the Justices concur.