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David B. Tuttle Trustee v. Cohen

Supreme Court of New Hampshire

June 1, 1971

David B. Tuttle Trustee U/A dated June 1, 1971
v.
Nicholas B. Cohen

UNPUBLISHED OPINION

The defendant, Nicholas B. Cohen, appeals a superior court order that, inter alia, terminated his interest in a trust and ordered him to vacate the trust premises, awarded damages and a penalty assessment against him for timber trespass, found him in contempt for failing to comply with a court order to remove vehicles from the premises, and awarded the trustee, David B. Tuttle, reasonable attorney's fees and costs for the contempt action. We affirm.

We will affirm the trial court's factual findings unless they are unsupported by the evidence and we will affirm the trial court's legal rulings unless they are erroneous as a matter of law. Osman v. Gagnon, 152 N.H. 359, 361 (2005).

We will assume, without deciding, that the issue of the continued existence of the trust was preserved for appellate review. Although a May 5, 1976 notice indicated that the trustee intended to resign effective September 3, 1976, the trustee and other beneficiaries controlling 7/9ths of the trust agreed on July 1, 1976, that the trustee would sell the property owned by the trust on or before December 31, 1976. This agreement provided that the sale would be executed in accordance with the trust agreement whether or not the current trustee tendered his resignation, and whether or not said resignation became effective prior to the date of sale. The agreement further provided that the trustee would be relieved of his obligation to tender deeds to the beneficiaries upon his resignation, as stated in the trust agreement, if his resignation became effective prior to December 31, 1976. There was evidence before the court that after the attempt to sell the trust property failed in December 1976, Tuttle was re-elected as trustee by the other beneficiaries.

Paragraph 6 of the trust agreement provides in part as follows:

This Trust Agreement shall terminate and legal title shall vest in the beneficiaries according to their interests upon the . . . resignation of the Trustee. Notice of intent of the Trustee to resign shall be sent to the beneficiaries . . . and . . . shall be effective on the date stated in the notice . . . . However, the owners . . . of 5/9ths interest in the premises, may select a successor trustee . . . within sixty days of the date of . . . resignation of the Trustee, who shall then serve under this Agreement and according to its provisions. In the event the Trustee resigns, and a successor is not selected, he shall deliver to the beneficiaries a deed to the legal title to their respective interests, unless he is directed to sell the premises in accordance with Paragraph 4 hereof. The Trustee or his personal representative will execute all instruments necessary to convey legal title to a successor Trustee selected in accordance with this Paragraph.

Paragraph 4 provides that the Trustee shall sell the premises upon the direction of the beneficiaries owning no less than 7/9ths interest.

Under paragraph 6, if the trustee resigns, the trust terminates and a deed to the legal title is to be delivered to each beneficiary unless a successor trustee is selected within sixty days or the trustee is directed to sell the premises in accordance with paragraph 4. In this case, before the trustee's resignation took effect, he was directed to sell the premises in accordance with paragraph 4. We construe paragraph 6 as continuing the trust under these circumstances so as to permit the sale to be completed. Were it not so, then the trustee would have no authority to convey title of the property to a buyer upon direction of beneficiaries owning only 7/9ths interest, since legal title would previously have vested in the several beneficiaries. See Lyford v. Laconia, 75 N.H. 220, 222 (1909) (instrument should be construed so as to give effect to all its provisions).

The trust agreement is silent as to the consequences of a failure to sell the premises pursuant to paragraph 4 after the trustee was directed to do so pursuant to paragraph 6. The evidence supports a finding that the beneficiaries re-elected Tuttle as trustee, and that all beneficiaries, including the defendant, thereafter recognized the continued existence of the trust and that Tuttle was the trustee. Indeed, in his answer to the petition in this case, the defendant admitted that Tuttle is the trustee of a trust agreement dated June 1, 1971, and that the defendant is a beneficial owner of a 2/9ths interest in said trust. See Super. Ct. R. 133 (all facts well alleged in the petition and not denied or explained in the answer will be held to be admitted). Under these circumstances, we reject the defendant's argument that the trial court erred by not ruling that the trust terminated in 1976.

Pursuant to the operating agreement of the trust, beneficiaries holding at least 6/9ths interest in the premises can force a beneficiary who has not paid his share of expenses or rent to sell his share of the premises. The evidence supports the trial court's findings that the value of the defendant's 2/9ths share is substantially less than the amount that he owed to the trust for his share of expenses and rent. We find no error in the trial court's order terminating the defendant's 2/9ths share due to his failure to pay his share of expenses and rent.

The defendant next argues that the trial court erred by rejecting his claim of adverse possession. Whether a use of property is adverse is an issue of fact. Town of Warren v. Shortt, 139 N.H. 240, 242 (1994). The trial court's findings are supported by the record, and we find no error in its ruling that the defendant failed to carry his burden of proving adverse possession.

With respect to the 1997 timber trespass, we agree with the trustee that the defendant had no right under the trust agreement to unilaterally sell any portion of the trust property, including timber. With respect to the statute of limitations, the trial court found that the defendant hid his actions from the trustee and the other beneficiaries. The trustee testified that the defendant did not inform him that he intended to timber the property. The area that was timbered was not obvious from the road, and the trustee was not sent copies of the report of wood or timber cut by either the defendant or the town prior to the litigation. Thus, assuming, as the defendant argues, that the three-year statute of limitations applied, we conclude that the evidence supports the trial court's finding that the defendant's acts were not discovered, and could not reasonably have been discovered, by the trustee within three years of the cutting by the defendant. See RSA 508:4, I.

Finally, we also agree with the trustee that the record supports the trial court's finding that the defendant failed to comply with the court's temporary order requiring the removal of vehicles from the property. Accordingly, we find no error in the trial court's ...


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