Appeal from Circuit Court, Multnomah County. Clifford B. Olsen, Judge.
J. David Bennett and Alan L. Schneider, Portland, argued the cause for appellant. With them on the briefs were Kean, Haessler, Harper, Pearlman and Copeland, and David W. Harper, Portland.
Cleveland C. Cory, Portland, argued the cause for respondent. With him on the briefs were Hugh L. Biggs, Jere M. Webb, and Davies, Biggs, Strayer, Stoel and Boley, Portland.
O'Connell, Chief Justice, and Denecke, Holman, Tongue, and Bryson, Justices.
This is a suit in equity brought by the settlor of an express trust against the trustee to terminate the trust and in the alternative to remove the trustee and appoint a successor trustee. Plaintiff appeals from a decree in favor of defendant trustee.
In 1951 plaintiff executed a trust agreement in which defendant was the trustee. The trust was divided into two parts designated as "Fund A" and "Fund B" and both provide that plaintiff is the sole beneficiary of the income for her lifetime with limited rights to withdraw portions of the corpus during her lifetime. The trust provides that at plaintiff's death the trust is to terminate and the corpus is to be distributed as plaintiff appoints in her will or failing such appointment, "then to those persons who are entitled to her personal property under the intestacy laws of Oregon in force at the time of her death."
The trust agreement reserves to plaintiff the
right to revoke the trust during the lifetime of her father and with his consent. Thereafter, the trust purports to be irrevocable. Plaintiff's father died in 1961. The trust was not revoked during his lifetime.
In 1966 plaintiff brought a suit against defendant in which she sought the termination of the trust on the ground that since she was both the settlor and the sole beneficiary of the trust she had power to revoke it. Defendant denied that plaintiff was the sole beneficiary, whereupon plaintiff joined as defendants "any persons who may be existing intestate heirs of the plaintiff * * * and any and all persons born hereafter who would be plaintiff['s] * * * intestate heirs if living at the death of said plaintiff * * * appearing by and through * * * their Guardian Ad Litem."
Before the case was tried the foregoing parties (but not defendant) entered into a written agreement entitled "Agreement and Consent" in which it was agreed that as to Fund B the trust would be terminated and the property in that fund distributed to plaintiff, but that Fund A would be continued to be held in trust during the remainder of plaintiff's life "not subject to revocation." The court embodied the provisions of the Agreement and Consent in a decree.
In March, 1971, plaintiff commenced the present suit against defendant bank to terminate the 1951 trust and in the alternative asked that defendant be removed as trustee and its successor be appointed.
Defendant filed a plea in abatement to plaintiff's complaint on the ground that those persons who would be plaintiff's heirs at law at her death had an interest in the trust as contingent remaindermen and ...