In Re Howard Marshall Char. Remainder Annuity Trust
709 So. 2d 662, 1998 La. LEXIS 1101, 1998 WL 94426 (1998)
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Rule of Law:
For purposes of establishing succession jurisdiction over a non-domiciliary, the legal situs of an incorporeal movable property, such as the right to receive undisbursed trust income, is the decedent's domicile under the doctrine of mobilia sequuntur personam ('movables follow the person'). Consequently, a Louisiana court lacks jurisdiction over the succession of a non-domiciliary whose only connection to the state is such an incorporeal movable right.
Facts:
- J. Howard Marshall, II, was domiciled in Houston, Texas, and died there on August 4, 1995.
- Prior to his death, Marshall had transferred his assets into two Louisiana-based inter vivos trusts, the Living Trust and the Howard Marshall Charitable Remainder Annuity Trust.
- Marshall was the income beneficiary of both trusts, with Finley L. Hilliard, a Louisiana resident, serving as trustee.
- The Charitable Trust's principal was designated for distribution to Haverford College, George School, and Yale University upon Marshall's death, with a provision to first satisfy any outstanding pledges.
- After Marshall's death, Haverford College and George School asserted that Marshall owed them millions of dollars in outstanding pledges, an amount exceeding the trust's principal.
- At the time of Marshall's death, approximately $160,000 in income had accrued in the trusts but had not yet been disbursed to him.
- Marshall's executors claimed this undisbursed income constituted movable property situated in Louisiana.
Procedural Posture:
- The co-executors of J. Howard Marshall, II's estate filed a petition to open his succession in the 14th Judicial District Court in Calcasieu Parish, Louisiana, a state trial court.
- The trustee of the Charitable Trust then filed a 'Petition for Instructions' in the same court concerning the distribution of the trust's principal.
- In response to claims made by the Louisiana Succession in that proceeding, Haverford College and George School filed a declinatory exception of lack of jurisdiction, challenging the court's power to open the succession of a Texas domiciliary.
- The trial court denied the exception of lack of jurisdiction.
- The Third Circuit Court of Appeal initially denied writs, but the Supreme Court of Louisiana remanded the case to the appellate court for briefing and opinion.
- On remand, the Third Circuit Court of Appeal affirmed the trial court's denial of the exception.
- George School, as applicant, sought and was granted a writ of certiorari from the Supreme Court of Louisiana to review the jurisdictional issue.
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Issue:
Does a Louisiana court have jurisdiction over the succession of a Texas domiciliary whose only alleged property in Louisiana at the time of death consisted of an incorporeal movable right to undisbursed income from two Louisiana-based trusts?
Opinions:
Majority - Knoll, J.
No. A Louisiana court does not have jurisdiction over the succession because the decedent's only property interest in the state was an incorporeal movable, the situs of which is the decedent's domicile. The court reasoned that an income beneficiary's interest in a trust is not a right to the trust's underlying assets (the corpus), but rather a right to receive money, which is classified as an incorporeal movable. Applying the legal fiction of mobilia sequuntur personam ('movables follow the person'), the court determined the legal location, or situs, of this intangible right was at Marshall's domicile in Texas, not in Louisiana where the trustee resided. Because Marshall owned no property situated in Louisiana, the statutory prerequisite for jurisdiction over a non-domiciliary's succession under La. Code Civ. P. art. 2811 was not met.
Concurring - Lemmon, J.
I concur with the judgment. The issue is one of jurisdiction over property (in rem), not subject matter jurisdiction. The proper inquiry is under La. Code Civ. Proc. art. 8, which requires property to be located within the state. Since the asset that formed the basis for asserting jurisdiction had its legal situs in Texas, the Louisiana action was correctly dismissed.
Dissenting from denial of rehearing - Lemmon, J.
The majority's reliance on the ancient doctrine of mobilia sequuntur personam is erroneous in the modern context. The situs of an incorporeal debt for succession purposes should be where the debtor is located, as this is the only jurisdiction where the debt can be effectively enforced. Citing the Uniform Probate Code and the Restatement of Conflict of Laws, the dissent argues that because the debtor (the trustee) resides in Louisiana, the state has in rem jurisdiction over the asset under La. Code Civ. Proc. art. 8, and the succession could be properly opened there.
Analysis:
This decision reaffirms the traditional jurisdictional principle that a decedent's estate, particularly intangible assets, should be administered primarily in the decedent's state of domicile. By applying the mobilia sequuntur personam fiction to an income beneficiary's right, the court prevents the fragmentation of succession proceedings across any state where a decedent's debtor might be located. This ruling enhances predictability for estate planners and promotes the orderly, centralized administration of estates. It clarifies that a mere 'chose in action' against a Louisiana resident is insufficient to establish ancillary succession jurisdiction in the state.
