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Keywords

plaintifftrustwill
plaintiffdefendanttrustwillbad faith

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National Shawmut Bank of Boston v. Cumming, 325 Mass. 457, 91 N.E.2d 337

Facts

The plaintiff bank is the surviving trustee under a trust declaration executed by the settlor, William Gray Cumming, who died in 1947. The trust was established to benefit the settlor's widow and other family members, with specific provisions for income distribution and principal use. The widow contested the trust's validity, claiming it was created to defraud her of her rights under Vermont law. The court examined the trust's creation, the settlor's intentions, and the applicable laws of Massachusetts and Vermont.

The plaintiff bank is the surviving trustee under a declaration of trust, dated August 25, 1944, in which the bank and the settlor, William Gray Cumming, of Barre, Vermont, were named as trustees. The settlor died on August 19, 1947. The defendants are the settlor's widow, Cora Mann Cumming, and the mother, brother, and three sisters of the settlor, and constitute all the surviving life beneficiaries under the trust instrument.

Issue

Was the trust valid, and did the widow have any claim to the trust property beyond her status as a beneficiary?

The widow's answer sets up that the trust was created in bad faith with intent to defraud her of rights under Vermont law after waiver of the will, and that the validity of the trust is to be determined by the laws of the State of Vermont.

Rule

The validity of the trust is determined by the law of the Commonwealth of Massachusetts, as the trust was executed and intended to be administered there, despite the settlor's domicile in Vermont.

The last paragraph reads, ‘This instrument shall be construed and the provisions thereof interpreted under and in accordance with the laws of the Commonwealth of Massachusetts.’

Analysis

The court applied Massachusetts law to determine the trust's validity, finding no evidence that the settlor created the trust with fraudulent intent towards his widow. The judge's findings indicated that the settlor intended for the trust to benefit his family equally and that he meticulously arranged his affairs to ensure this outcome. The court concluded that the trust was valid and not illusory, as it was executed properly and intended to be administered in Massachusetts.

The judge stated: ‘I find that the settlor meticulously and designedly arranged his holdings and his business affairs so that his mother, wife, brothers and sisters would share the income, or principal, if necessary, equally after his death. That he knew that but for this arrangement his widow would have been entitled under the laws of Vermont to $4,000 and one half of his estate. But I do not find that in doing what he did * * * he was actuated by bad faith, or that he sought to accomplish something which he under all the circumstances considered to be unjust or unfair to his wife. I do not find that he set up the trust with the fraudulent intent of preventing his wife from obtaining her distributive share of his property. I find and rule that the trust is valid.'

Conclusion

The court affirmed the decree, ruling that the trust was valid and that the widow had no claim to the trust property except as a beneficiary under the trust instrument.

Decree affirmed.

Who won?

The National Shawmut Bank of Boston prevailed in the case because the court upheld the validity of the trust and rejected the widow's claims of fraud.

The plaintiff contends that the validity of the trust is to be determined by the law of this Commonwealth, and, in the alternative, that should the question be determined by Vermont law, the trust would still be valid on the judge's findings.

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