TERRY W. BRADLEY, Appellant
DARLENE SHAFFER, INDIVIDUALLY, AND VERLON REID, NOLETA RICE, AND S. CLINTON NIX, CO-TRUSTEES OF THE W.S. SHAFFER FAMILY TRUST, Appellees
Appeal from the 350th District Court Taylor County, Texas
Trial Court Cause No. 09673-D
consists of: Wright, C.J., Willson, J., and Bailey, J.
M. BAILEY JUSTICE
appeal presents the question of whether an extension
provision in a family trust violates the rule against
perpetuities. Family members placed mineral interests they
inherited into the trust. The trust instrument contained a
spendthrift provision precluding the beneficiaries of the
trust from anticipating or assigning their interests in the
trust. A subsequent beneficiary of the trust executed deeds
purporting to convey his share of the mineral estate to a
third party. The trustees of the trust obtained a summary
judgment declaring the deeds to be invalid with respect to
the beneficiary's interest in the trust. We affirm.
Shaffer (husband) and E.S. Shaffer (wife) owned the minerals
associated with approximately 1, 765 acres of land located in
Taylor County. As a result of their deaths in the 1960s,
their mineral interests were devised to two testamentary
trusts that remained in existence until 1993. At that time,
the beneficiaries of the two testamentary trusts conveyed
their interests in the testamentary trusts to the "W.S.
Shaffer Family Trust."
trustors/settlors were the initial beneficiaries of the
trust. The trust instrument set out their respective
ownership interests in the trust based upon their
relationship to W.S. Shaffer and E.S. Shaffer. The trust
instrument stated that W.S. Shaffer and E.S. Shaffer had four
children. Their two surviving children received a one-quarter
beneficial interest in the trust. The remaining settlors were
the grandchildren of W.S. Shaffer and E.S. Shaffer whose
parents had died prior to the execution of the trust
instrument. They each received a proportionate share of their
deceased parent's one-quarter beneficial interest.
Shaffer was a settlor and an original beneficiary of the
trust owning a one-quarter beneficial interest in the trust.
The trust provided that, upon the death of a settlor/initial
beneficiary, that beneficiary's interest in the trust
"shall immediately vest and pass directly to his or her
children." Clarence died in 1999. Pursuant to the terms
of the trust, Clarence's one-quarter beneficial interest
in the trust passed at his death to his children, Darell
Shaffer and Darlene Shaffer.
trust instrument named three trustees and granted them broad
powers that could be exercised at any time, including the
power to sell the mineral estate or lease it for exploration.
Specifically, the trust provided that the trustees were
authorized "[t]o act at all times, to do all the acts,
to take all the proceedings and to exercise all the rights,
powers and privileges which an absolute owner of the property
would have, subject always to the discharge of the
Trustees' fiduciary obligations." The trust also
contained a spendthrift provision that provided as follows:
7.22 LIMITATION OF AUTHORITY OF TRUSTEES AND
BENEFICIARIES. No Trustee nor beneficiary of this Trust
shall have any right or power to anticipate, pledge, assign,
sell, transfer, alienate or encumber his or her interest in
the Trust in any way; nor shall any such interest in any
manner be liable for or subject to the debts, liabilities, or
obligations of such Trustee or beneficiary or claims of any
sort against such Trustee or beneficiary.
trust contained the following provision pertaining to its
duration: "This Trust shall be for a term of twenty (20)
years from the latest date of execution by an initial
Trustor. This Trust may be continued upon unanimous agreement
of all beneficiaries hereunder . . . ." The latest date
of execution of the trust by an initial trustor/settlor
occurred on June 23, 1993. Accordingly, the trust would have
expired on June 23, 2013, if not extended.
owned the surface estate of the subject property. It is
undisputed that Darell's ownership of the surface estate
was not subject to the trust. Darell conveyed the subject
property to Terry W. Bradley by warranty deed in 2004. The
warranty deed did not contain a reservation pertaining to
Darell's one-eighth beneficial interest in the minerals
held in the trust. Darell subsequently executed a mineral
deed in favor of Bradley in 2006. The mineral deed
specifically referenced Darell's beneficial interest in
the trust, and it contained language conveying both his
mineral interest held in the trust as well as any mineral
interest held in the trust that he may acquire in the future.
to the twenty-year anniversary of the trust, the trustees and
Darlene filed the underlying suit against Bradley seeking a
declaratory judgment that the conveyances from Darell to
Bradley were void with respect to the mineral interests held
by the trust. The twenty-year anniversary was
subsequently reached during the pendency of this litigation.
March through June of 2013, the current beneficiaries of the
trust, including Darell and Darlene, executed an extension of
the trust that provided as follows: "Pursuant to Article
VIII, Paragraph 8.07, the undersigned beneficiaries
unanimously agree that the W.S. Shaffer Family Trust shall be
extended for a term of twenty (20) years. ...