Epworth Children's Home v. Beasley, 365 S.C. 157

Summary

The Supreme Court of South Carolina held that a testamentary charitable trust could not be terminated and its assets immediately distributed based on general powers granted to the trustee and personal representative. The court also held that equitable deviation did not apply because no changed circumstances justified altering the trust, and merger did not apply because it would frustrate the testatrix's intent. The court reversed the probate and circuit courts and upheld the trust's requirement that annual interest income be distributed to the beneficiaries.

Holdings

1. Item IX's general grant of powers did not authorize the trustee or personal representative to terminate the testamentary trust and distribute its corpus immediately. Read as a whole, the will required the assets to remain in trust and required annual distribution of interest income.
2. Equitable deviation did not permit termination of the trust because the trustee failed to show changed circumstances or conditions that were unknown to and unanticipated by the testatrix and that would defeat or substantially impair the trust's purposes.
3. The merger doctrine did not terminate the trust because applying merger would defeat or frustrate the testatrix's intent. Epworth, as trustee, held legal title and remained obligated to manage the assets and distribute annual income according to the trust.

Questions Presented

1. Whether Item IX of the will authorized the trustee and personal representative to terminate the testamentary trust from its inception and immediately distribute all trust assets.
2. Whether the equitable deviation doctrine permitted termination of the testamentary trust from its inception and immediate distribution of its assets.
3. Whether the merger doctrine permitted termination of the testamentary trust and immediate distribution of its assets.

Disposition

reversed