Pickelner v. Adler
229 S.W.3d 516, 2007 WL 1844922, 2007 Tex. App. LEXIS 5049 (2007)
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Rule of Law:
When a will indicates an intent to create a trust but fails to specify essential terms such as the beneficiaries, it creates a failed express trust known as a 'semi-secret trust.' Parol evidence is inadmissible to supply the missing terms, and the property passes to the testator's heirs at law through a resulting trust.
Facts:
- In May 1997, Shirley Alpha executed a will drafted by her long-time friend and attorney, Robert S. Pickelner.
- The will named Pickelner as the sole devisee of her entire estate, with the clause that it was 'to be distributed in accordance with the specific instructions I have provided him.'
- These distribution instructions from Shirley to Pickelner were given verbally and were never put in writing.
- The verbal instructions directed Pickelner to give one of Shirley's homes to himself and another home to Ian Hurwitz, Shirley's close friend.
- Shirley's verbal instructions did not account for the disposition of her entire estate.
- Neither Pickelner nor Hurwitz were related to Shirley and were not her heirs at law.
- Shirley died in January 1999, unmarried and without children.
Procedural Posture:
- David Adler, the executor of Shirley's will, filed a declaratory judgment action in a probate court to seek an interpretation of the devise to Pickelner.
- Ian Hurwitz intervened in the lawsuit.
- The trial court, after a bench trial, rendered a declaratory judgment that the bequest to Pickelner was void and that Shirley's property passed by intestate succession to her heirs at law.
- Pickelner and Hurwitz filed a joint motion for a new trial and, alternatively, to enforce a partial settlement agreement, which the trial court denied.
- Pickelner and Hurwitz (appellants) appealed the trial court's judgment to the intermediate court of appeals.
- The court of appeals initially abated the appeal and remanded the case to the trial court for entry of a final judgment, after which the appeal was reinstated.
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Issue:
Does a devise in a will that grants property to a person 'to be distributed in accordance with the specific instructions' provided orally by the testator create an enforceable trust for the intended beneficiaries, or does the devise fail, resulting in the property passing to the testator's heirs at law?
Opinions:
Majority - Justice Tim Taft
No, such a devise creates a failed 'semi-secret trust,' and the property passes to the testator's heirs at law. The court reasoned that the language 'to be distributed in accordance with the specific instructions' unambiguously shows the testator's intent to create a trust, not to make an outright gift to the devisee. However, because the will fails to name the beneficiaries or other essential terms, it is a failed express testamentary trust. Following long-standing Texas precedent established in cases like Heidenheimer v. Bauman, the court held that parol (oral) evidence is inadmissible to supply the missing essential terms of a semi-secret trust, as doing so would undermine the formal statutory requirements for executing a will. When an express trust fails and there is no residuary clause, the law imposes a 'resulting trust' for the benefit of the testator's heirs. Therefore, Pickelner held the property in trust not for the intended beneficiaries of the oral instructions, but for Shirley's legal heirs.
Analysis:
This decision reaffirms the strict distinction in Texas jurisprudence between 'secret trusts' (where the devise appears absolute on its face) and 'semi-secret trusts' (where the will indicates a trust but omits terms). By rejecting the modern approach of the Restatement (Third) of Trusts, which would impose a constructive trust for the intended beneficiary, the court entrenches a formalistic rule that prioritizes the statutory requirements of wills over the demonstrated intent of the testator. This holding provides clarity that testamentary dispositions must be fully articulated within the four corners of the will or a properly incorporated document. For legal practitioners, it serves as a stark reminder that relying on oral instructions for the disposition of property in a will is legally ineffective and will result in the trust failing in favor of the testator's heirs.
