Claflin v. Claflin
149 Mass. 19, 20 N.E. 454, 3 L.R.A. 370 (1889)
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Rule of Law:
A trust cannot be terminated prior to the time specified by the settlor, even if the beneficiary has an absolute and vested interest and all beneficiaries consent, if a material purpose of the settlor in creating the trust has not yet been accomplished.
Facts:
- Wilbur F. Claflin's will established a trust for the residue of his personal estate.
- The will directed trustees to pay one-third of the trust proceeds to his son, Adelbert E. Claflin.
- The payment schedule was stipulated as: $10,000 at age 21, $10,000 at age 25, and the balance at age 30.
- After his father's death, Adelbert E. Claflin reached the age of 21 and received the first $10,000 payment from the trust.
- Before reaching the age of 25, Claflin sought the immediate payment of the entire remaining trust fund.
- Adelbert E. Claflin's interest in the trust fund is vested and absolute, and no other person has any interest in it.
Procedural Posture:
- Adelbert E. Claflin, the plaintiff, filed a bill in equity in a Massachusetts trial court against the trustees of his father's will.
- The plaintiff sought an order compelling the trustees to terminate the trust and pay him the entire remainder of the fund.
- The trial court entered a decree against the plaintiff, refusing to terminate the trust.
- The plaintiff appealed the trial court's decree to the Supreme Judicial Court of Massachusetts.
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Issue:
Is a trust provision that postpones payment of the principal to a sole beneficiary with a vested interest, until the beneficiary reaches a specified age beyond majority, legally enforceable?
Opinions:
Majority - Field, J.
Yes. A trust provision that postpones payment of the principal to a sole beneficiary with a vested interest until a specified age is legally enforceable. The court rejected the English rule that would void such a provision as an invalid restraint on alienation. Instead, it reasoned that a testator has the right to dispose of his property with such restrictions and limitations as he sees fit, provided they are not repugnant to law or public policy. The testator's intention to delay payment is a material purpose of the trust that has not yet been accomplished. The court found no public policy reason to frustrate the testator's clear intent, noting that the restriction could serve the useful purpose of protecting the beneficiary from his own improvidence.
Analysis:
This case establishes the 'Claflin' or 'material purpose' doctrine, which has become the majority rule in the United States. It represents a significant departure from the English rule of Saunders v. Vautier, which allows beneficiaries to terminate a trust once their interests have vested. The Claflin doctrine prioritizes the settlor's intent over the beneficiary's desire for immediate control of the property. This principle grants settlors greater control over their dispositions and has profoundly influenced modern trust law, reinforcing the idea that a trust's terms will be upheld as long as a material purpose, such as asset protection or delayed enjoyment, continues to exist.
