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Archer v. Moody

Court of Appeals of Texas, Fourteenth District

December 14, 2017

EDNA ARCHER, HADEN BEARDSLEY, AND SARAH KATHRYN PACHECO, Appellants
v.
JANICE MOODY, LINDA MOODY, ELIZABETH MOODY, W.L. MOODY, V, AND MOODY NATIONAL BANK, AS TRUSTEE, Appellees

         On Appeal from Probate Court Galveston County, Texas Trial Court Cause No. PR-0076077

          Panel consists of Justices Boyce, Jamison, and Brown.

          OPINION

          William J. Boyce Justice

         Three remainder beneficiaries of a trust challenge the Galveston County Probate Court's final judgment interpreting the trust instrument.

         The probate court concluded that the trust instrument directed a per capita distribution of the trust estate to the remainder beneficiaries upon the trust's termination and applied a per stirpes distribution to the descendants of a deceased remainder beneficiary. We reverse and remand because the trust instrument's distribution of the trust estate upon termination "in equal shares per stirpes" contemplates a distribution to the remainder beneficiaries based on their deceased ancestors' shares. Because the beneficiaries descend from three siblings, the trust instrument directs that the trust estate initially must be divided into three shares; the beneficiaries' shares are computed based upon the 1/3 interest of each of the three siblings from whom the beneficiaries are descended.

         Background

         The litigants in this declaratory judgment action are remainder beneficiaries of a trust that W.L. Moody, Jr. created in 1934. The trust corpus is a 15, 000-acre ranch located about 100 miles northwest of San Antonio near Junction, Texas. See generally Myrick v. Moody Nat'l Bank, 336 S.W.3d 795, 796-97 (Tex. App.- Houston [1st Dist.] 2011, no pet.).

         W.L. Moody, Jr.'s son was W.L. Moody, III, who in turn had three children. The last surviving child was W.L. Moody, IV ("Bill Moody"). The parties agree that the trust terminated when Bill Moody died in 2014.

         Bill Moody had four children. His two siblings were Edna Moody and Virginia Moody, each of whom had two children.

         The appellants come from the Edna and Virginia wings of the Moody family. Edna Archer is Edna Moody's daughter.[1] Sarah Kathryn Pacheco is Virginia Moody's daughter; Haden Beardsley is the son of Virginia Moody's other daughter, who is deceased. We refer to them collectively as the "Edna and Virginia Moody Appellants."

         The appellees are Bill Moody's four children: Janice Moody, Linda Moody, Elizabeth Moody, and W.L. Moody, V. We refer to them collectively as the "Bill Moody Appellees."[2]

         The family tree relevant to this appeal appears as follows:

         (Image Omitted)

         The remainder beneficiaries are W.L. Moody, III's grandchildren: David Myrick, Edna Archer, Virginia Beardsley (deceased and survived by Haden Beardsley), Sarah Kathryn Pacheco, Janice Moody, Linda Moody, Elizabeth Moody, and W.L. Moody, V (deceased). The legal dispute focuses on how to calculate the fractional shares of the trust estate allocable to the remainder beneficiaries when the trust terminated in 2014.

         The Edna and Virginia Moody Appellants interpret the trust instrument to distribute the trust estate equally in 1/3 shares among Edna Moody, Virginia Moody, and Bill Moody. Under this interpretation, the Edna and Virginia Moody Appellants each receive a 1/6 undivided interest from Edna Moody's and Virginia Moody's respective 1/3 shares, computed as 1/3 multiplied by 1/2; the Bill Moody Appellees each receive a 1/12 undivided interest in the trust estate from Bill Moody's 1/3 share, computed as 1/3 multiplied by 1/4.

         In contrast, the Bill Moody Appellees interpret the trust instrument to distribute the trust estate equally upon termination so that each of the remainder beneficiaries receives a 1/8 undivided interest in the trust estate.

         The probate court interpreted the operative trust instrument language on cross-motions for traditional summary judgment under Texas Rule of Civil Procedure 166a(c). It granted summary judgment in favor of the Bill Moody Appellees and held that the remainder beneficiaries each receive an equal 1/8 undivided interest in the trust estate. The Edna and Virginia Moody Appellants challenge the probate court's grant of summary judgment in favor of the Bill Moody Appellees and the denial of the appellants' cross-motion for summary judgment.[3]

         Analysis

         The Edna and Virginia Moody Appellants raise two issues on appeal contending that the probate court should have granted summary judgment in their favor and adopted their interpretation of the operative trust instrument language. In practical terms, adopting the appellants' interpretation means that their individual share size increases from 1/8 to ...


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