March 19, 1984
Subject:
Estates; Testamentary trustees.
Requested By:
Major A. Jones Clerk of the Superior Court Burke County
Question:
Where a will relieves a testamentary trustee from the necessity of filing inventories and annual and final accounts, is it necessary for the testamentary trustee to qualify?
Conclusion:
Yes, provided the will was executed after January 1, 1978.
The relevant statutory provision was first enacted as Chapter 804 of the 1907 Session Laws (C.S., s. 51). As enacted the section only required that the testamentary trustee file inventories and accounts and made no reference to qualification before the clerk of superior court. The last sentence in the section read "This section shall not apply to any will in which a different provision is made for filing inventories and accounts," [emphasis added]. Thus a testator was authorized to excuse his testamentary trustee from the requirements of the statute regarding filing inventories and accounts, and there was no statutory requirement for the trustee to qualify.
Chapter 519 of the 1961 Session Laws, effective July 1, 1961, added the requirement that the testamentary trustee shall "first qualify under the laws applicable to executors" to the previous requirements regarding inventories and accounts but did not amend the third sentence of the section which continued its specific reference to only inventories and accounts.
Chapter 1176 of the 1965 Session Laws did rewrite the third sentence to read "This section shall not apply to the extent that any will makes a different provision.", and also made the requirement for qualification inapplicable to wills executed prior to July 1, 1961, Lentz v. Lentz, 5 N.C. App 309, 168 S.E. 2d 437 (1969). Thus the 1965 General Assembly provided that the testator had the authority to waive any or all of the requirements of the section. The revision of the third sentence was undoubtedly intended to extend the testator’s authority to allow him to excuse his trustee from the requirement of qualifying which had been added in 1961.
Section 4 of Chapter 1329 of the 1973 Session Laws made no changes to the section and merely recodified the 1965 version of the section.
Senate Bill 153 of the 1977 General Assembly, as introduced, also made no changes to the 1965 version of the section. However, a House Committee Substitute for Senate Bill 153, adopted May 17, 1977, added the language "in regard to the requirements for filing inventories and accounts" to the third sentence of the section. The Committee Substitute was enacted as Chapter 502 of 1977 Session Laws effective January 1, 1978, and the section, now codified as G.S. 36A-107 reads as follows:
"36A-107. Trustees in wills to qualify and file inventories and accounts.
Trustees appointed in any will admitted to probate in this State, into whose hands assets come under the provisions of the will, shall first qualify under the laws applicalbe to executors, and shall file in the office of the clerk of the county where the will is probated inventories of the assets which come into his hands and annual and final accounts thereof, such as are required of executors and administrators. The power of the clerk to enforce the filing and his duties in respect to auditing and approving shall be the same as in such cases. This section shall not apply to the extent that any will makes a different provision in regard to the requirements for filing inventories and accounts." [Emphasis added].
The underlined language which was added by the Committee Substitute must be given some import if possible, In Re Watson, 273 N.C. 629, 161 S.E. 2d 1 (1968). In addition, there is a presumption that the General Assembly was aware of the existing law. "It is always presumed that the legislature acted with care and deliberation and with full knowledge of prior and existing law." [Emphasis added]. State v. Benton, 726 N.C. 641, 658, 174 S.E. 2d 793 (1970). Based upon the principles stated above it can only be concluded that the intent of the General Assembly in adding the language "in regard to the requirements for filing inventories and accounts" was to limit the authority the 1965 version of the statute had given the testator to relieve his trustee of any or all of the requirements of filing inventories, filing accounts or qualifying. Further, the maxim "expressio unius est exclusio alterius" dictates the conclusion that by specifically listing the requirement for qualification the General Assembly expressed its intention not to authorize the testator to override the statute’s express requirement that a testamentary trustee must qualify. "Where a statute excludes from its general operation a single specific circumstance, it is evidence of the legislative intent not to exempt other circumstances not expressly provided for." 12 Strong’s N.C. Index 3d, Statutes § 5.8.
Similar to the 1961 Act, the current statute provides that a trustee must qualify before the clerk, but may be excused from supplying to the clerk the information necessary to determine if the trustee is performing his duties, a situation which is anomalous at best. However, two points should be noted, first the current statute does not serve to deter circumvention of the provisions of G.S. 55-132(b) prohibiting foreign corporations from serving as testamentary trustees except under certain well defined circumstances, and second, the statute in no way interferes with the inherent right of the court to supervise a fiduciary relationship, Lichtenfels, et. al. v. North Carolina National Bank, 260 N.C. 146, 132 S.E. 2d 360 (1963). The law of estates is an area of the law which is peculiarly within the legislative sphere, Vinson v. Chappell, 275 N.C. 234, 166
S.E. 2d 686 (1969); Wilson v. Anderson, 232 N.C. 212, 59 S.E. 2d 836 (1950); 26A C.J.S., Descent and Distribution § 2. The language of the statute is clear and the General Assembly’s intent is clear and neither the logic nor the wisdom of the General Assembly’s actions are subject to challenge in such areas.
RUFUS L. EDMISTEN ATTORNEY GENERAL
Charles J. Murray Special Deputy Attorney General Revisor of Statutes