Sanderson v. Aubrey
472 S.W.2d 286, 1971 Tex. App. LEXIS 2240 (1971)
Rule of Law:
Under Texas law, if a settlor reserves the power to revoke a trust but does not specify a mode of revocation, the power can be exercised by any definitive manifestation of intent to revoke, and such revocation is effective immediately upon manifestation, even if the trustee and beneficiary are not notified until later.
Facts:
- In May 1954, Mrs. Lucas (settlor) created an inter vivos trust, conveying real estate to Mr. Eskridge (trustee) to hold for her grandson (beneficiary) until he reached 21 years of age.
- In July 1965, Mrs. Lucas executed a will.
- The will contained a specific clause revoking the May 1954 inter vivos trust, stating the beneficiary had been a 'bitter disappointment.'
- Mrs. Lucas did not publish her will, and only she and her attorney were aware of its contents; neither the trustee nor the beneficiary received any notice of the revocation clause.
- Mrs. Lucas died in September 1969.
- Later in September 1969, the grandson turned 21, and Mr. Eskridge (trustee) executed an instrument conveying his interest in the subject realty to the grandson.
- Mrs. Lucas's will was admitted to probate in March 1970.
- The will granted the same interest in realty that was subject to the trust to Annie Eva Aubrey (appellee).
- Upon the probate of the will, the trustee and the grandson received their first notice of the trust's revocation.
Procedural Posture:
- Mrs. Lucas created an inter vivos trust.
- After Mrs. Lucas's death, her will was admitted to probate.
- The grandson, the beneficiary of the trust, received an adverse ruling in the trial court, implying the trial court found the trust to have been effectively revoked and the property belonging to Annie Eva Aubrey.
- The grandson, appellant, appealed the trial court's judgment to the Court of Civil Appeals of Texas.
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Issue:
Was the settlor's inter vivos trust effectively revoked by a revocation clause contained within her will, even though the trustee and beneficiary were not informed of the will's contents or the revocation until after the settlor's death?
Opinions:
Majority - Massey, Chief Justice
Yes, the settlor's inter vivos trust was effectively revoked by the clause in her will because the clear written statement constituted a definitive manifestation of her intent to revoke the trust, becoming effective immediately upon the will's execution. Texas law provides that trusts are revocable unless expressly made irrevocable, and the Restatement of Trusts dictates that if no mode of revocation is specified, any manner sufficiently manifesting the settlor's intent to revoke is effective, even without notice to the trustee or beneficiary. The court reasoned that Mrs. Lucas's explicit revocation language in her will was a 'definitive manifestation' of her intent to revoke as of July 1965, when she signed the will. This revocation was not testamentary in its effect, meaning it did not become effective only upon her death, but rather operated 'in praesenti' (immediately). Consequently, the trust was extinguished, the property reverted to Mrs. Lucas, and she was free to dispose of it through her will to Annie Eva Aubrey. The court noted that principles of will revocation support this, where a subsequent will revoking a prior one takes effect immediately upon execution.
Analysis:
This case clarifies the standard for an effective trust revocation in Texas when no specific method is prescribed by the trust instrument. It establishes that a settlor's clear, written intent to revoke, even if contained within a will, can be immediately effective without prior notice to the trustee or beneficiary. This decision emphasizes the settlor's control over a revocable trust and highlights that a document can have both testamentary effects and immediate, inter vivos effects. It serves as an important precedent for understanding the timing and requirements of trust revocation, particularly where the settlor's intent is clearly manifested but not immediately communicated.
