Wachovia Bank and Trust Co. v. Chambless

260 S.E.2d 688 (1979)

44 N.C. App. 95

WACHOVIA BANK AND TRUST COMPANY, N.A., and L. D. Long, Trustees Under the Will of Kate G. Bitting Reynolds, Deceased, Plaintiffs, v. Helen Farish Campbell CHAMBLESS, Annette Thomas Young, Annette Young Brown, William E. Young, Jr., Donna Marie Young, Helen Campbell Blackmun, Virginia Chocolas, Marcie Chocolas, Jeff Chocolas, Julia G. Patterson, Bobby Patterson, Harry A. Campbell, Jr., Teresa Campbell Johnson, Joey Lee Johnson, Benjie Joe Campbell, Jody Lyn Campbell, Jeffery Eugene Campbell, Tammey Gail Campbell, James F. Campbell, Reese Graham Campbell, Robert W. Campbell, Dereck Blake Campbell, James Edward Farish, William Whitaker Farish, Wachovia Bank and Trust Company, N.A., Trustee Under Living Trust Agreement Dated March 22, 1967, With James Edward Farish for the Benefit of Louise C. Farish, Louise C. Farish, Wachovia Bank and Trust Company, N.A., and L. D. Long, Trustees Under Section Five of the Will of Kate G. Bitting Reynolds, Deceased, Rufus L. Edmisten, Attorney General of the State of North Carolina, William Z. Wood, Jr., Guardian Ad Litem for Marcie Chocolas, Jeff Chocolas, Joey Lee Johnson, Benjie Joe Campbell, Jeffery Eugene Campbell, Tammey Gail Campbell and all other natural issue of Helen Farish Campbell Chambless, born or unborn, known or unknown, Defendants.

No. 7821SC1016.

Court of Appeals of North Carolina.

December 4, 1979.

*691 Womble, Carlyle, Sandridge & Rice by W. P. Sandridge, Jr. and Francis C. Clark, Winston-Salem, for plaintiffs-appellees.

Harper & Wood by J. Clifton Harper and William Z. Wood, Jr., Winston-Salem, for Campbell (Chambless) Heirs, defendants-appellants.

Biggs, Meadows, Batts, Etheridge & Winberry by Frank P. Meadows, Jr., Rocky Mount, for James Edward Farish, William Whitaker Farish and Louise C. Farish, defendants-appellees.

MORRIS, Chief Judge.

This action concerns the effect of an extrastate adoption on the law of testamentary disposition in North Carolina. We must first determine whether the Missouri adoption orders are entitled to full faith and credit in North Carolina.

Copies of the decrees, duly authenticated pursuant to Title 28, U.S.C. § 1738 (N.C. Gen.Stat., Appendix IV, Replacement Vol. 1970), were introduced into evidence. The trial court held that "[t]he adoptions of James Edward Farish in 1940 and William Whitaker Farish in 1941 were duly ordered by the Court having jurisdiction over the subject matter and the parties in the State of Missouri and such orders are entitled to full faith and credit by this state." We hold that the court correctly held that the *692 duly authenticated adoption decrees from Missouri are entitled to recognition by the courts of North Carolina under the full faith and credit clause of the United States Constitution.

Adoption was unknown at common law, having evolved purely as a creature of statute. See, e. g., Wilson v. Anderson, 232 N.C. 212, 59 S.E.2d 836 (1950). See generally Fairley, Inheritance Rights Consequent to Adoptions, 29 N.C.L.Rev. 227 (1951). As such, adoption is effected by court proceedings, which usually culminate in a court decree establishing the status of adoption. See, e. g., G.S. 48-12 to 48-22 (Replacement Vol. 1976). The decree of adoption obtained by judicial proceedings is regarded as a judgment of the court, and is given the force and effect of any other judgment. Wilson v. Anderson, supra. Where a problem of recognition of adoption decrees by other jurisdictions exists, it is a conflict of laws problem. In conflict of laws terms, the adopting state has an interest in the validity of its court decree beyond its mere boundaries, whereas other states have a competing interest in regulating the substance and procedure of adoptions which affect their states. Nevertheless, "[a]s a general rule, the status of adoption created under the law of a state . . . by a court having jurisdiction to create it will be recognized and given effect in another state unless the foreign adoption is inconsistent with, or repugnant to, the laws or policy of the other state . . .." 2 C.J.S. Adoption of Persons § 144 (1972); 15A C.J.S. Conflict of Laws § 14(6) (1967). See generally Wurfel, Recognition of Foreign Judgments, 50 N.C.L.Rev. 21 (1971). This general recognition comes under either principles of comity or the full faith and credit requirement of the Federal Constitution, according to the view of the particular court and the circumstances of the case. See Annot., 87 A.L.R.2d 1240 (1963); 2 Am. Jur.2d, Adoption § 116 (1962).

In In re Osbourne, 205 N.C. 716, 172 S.E. 491 (1934), the North Carolina Supreme Court ruled that the status of adoption established in another state will be given full faith and credit in North Carolina. In that case, a Virginia adoption judgment was found to be properly entered and based on competent jurisdiction. The Court therefore concluded: "The child was adopted according to the law of Virginia and we must give under the United States Constitution, Article IV, section 1, `Full Faith and Credit'." 205 N.C. at 719, 172 S.E. at 492. For a discussion with respect to granting full faith and credit to foreign judgments, see Thomas v. Frosty Morn Meats, Inc., 266 N.C. 523, 146 S.E.2d 397 (1966).

The granting of full faith and credit may be defeated by showing want of jurisdiction either as to the subject matter or as to the person of defendant, or by showing fraud in its procurement. Thomas v. Frosty Morn Meats, Inc., supra; In re Blalock, 233 N.C. 493, 64 S.E.2d 848 (1951); Courtney v. Courtney, 40 N.C.App. 291, 253 S.E.2d 2 (1979). However, in the absence of such proof, the judgment will be presumed valid. Dansby v. Insurance Co., 209 N.C. 127, 183 S.E. 521 (1936). Defendants have not presented any evidence to indicate that the Missouri court lacked the requisite jurisdiction or that the adoptions were procured by fraud as was the case in Blalock, supra, upon which appellants rely. On the contrary, we find that the Missouri jurisdictional requirements were met, and that the adoption decrees were properly entered in accordance with Missouri law. We find no support for defendants' contention that the Missouri decrees must meet the requirements of G.S. 48-22, and this contention is rejected. We, therefore, conclude that the adoptions of James Edward Farish and William Whitaker Farish are entitled to full faith and credit, and thus given full force and effect in North Carolina.

We next consider the effect of such status on the law regarding inheritance by adopted persons. In North Carolina the legal effects of a final order of adoption are enumerated in G.S. 48-23, which provides as follows:

"§ 48-23. Legal effect of final order. The following legal effects shall result from the entry of every final order of adoption: *693 (1) The final order forthwith shall establish the relationship of parent and child between the petitioners and child, and from the date of the signing of the final order of adoption, the child shall be entitled to inherit real and personal property by, through, and from the adoptive parents in accordance with the statutes relating to intestate succession. An adopted child shall have the same legal status, including all legal rights and obligations of any kind whatsoever, as he would have had if he were born the legitimate child of the adoptive parent or parents at the date of the signing of the final order of adoption, except that the age of the child shall be computed from the date of his actual birth. . . . . . (3) From and after the entry of the final order of adoption, the words `child,' `grandchild,' `heir,' `issue,' `descendant,' or an equivalent, or the plural forms thereof, or any other word of like import in any deed, grant, will or other written instrument shall be held to include any adopted person, unless the contrary plainly appears by the terms thereof, whether such instrument was executed before or after the entry of the final order of adoption and whether such instrument was executed before or after the enactment of this section."

Taken in conjunction with each other, these sections give an adopted person the right to succeed to the estate of the adoptive parent upon intestacy, and to take under the will of the adoptive parent if the parent so provides. This result comes from a recognition of the absolute necessity, given the prevalence of adoptions in modern society, that adoption effect a complete substitution of families.

Clearly, if the children of James T. Farish had been adopted under the provisions of Chapter 48, they would take under the will of Kate G. Bitting Reynolds. See Peele v. Finch, 284 N.C. 375, 200 S.E.2d 635 (1973); Simpson v. Simpson, 29 N.C.App. 14, 222 S.E.2d 747 (1976); Stoney v. MacDougall, 28 N.C.App. 178, 220 S.E.2d 368 (1975), cert. denied, 289 N.C. 302, 222 S.E.2d 702 (1976). Defendants argue that, since the Farish adoptions were out-of-state and did not comply with G.S. 48-22, they do not fall under the provisions of G.S. 48-23(3), inasmuch as the latter statute applies only to North Carolina adoptions. We reject this argument and hold that section 48-23(3) applies to the orders of adoption from Missouri, as well as those under North Carolina law.

We think practicality and common sense require that a forum state should not treat a child adopted in another state differently from one adopted locally when the incidents of the relationship are substantially the same in both states. Goodrich, Conflicts of Law § 147 (1964). Once recognized, the status acquired by a valid decree in one state will be given the same effect by the courts of another state in determining rights of inheritance as would be given if the status of adoption had been created by a valid decree of a court in the latter state. See generally Annot., 73 A.L.R. 964 (1931); 2 Am.Jur.2d Adoptions § 114 (1962). Restatement (Second) of Conflicts of Law, § 290 (1971), provides:

"An adoption rendered in a state having judicial jurisdiction . . . will usually be given the same effect in another state as is given by the other state to a decree of adoption rendered by its own courts."

It follows that the Missouri adoptions should be given effect as if they were entered pursuant to the requirements of Chapter 48. The language "final order of adoption" in G.S. 48-23, therefore, applies to the Farish adoptions. We thus agree with the trial court that although G.S. 48-23(3) was enacted as a part of the general adoption law of this State, the provisions of the statute are applicable not only to children adopted pursuant to orders entered by the courts of this State, but are also applicable to children properly adopted under the laws of other states. The practicality of this result is obvious when we recognize *694 that we live in a highly mobile society, that adoptions are being increasingly utilized for the creation of a family unit, and that adoptive parents and adopted children, in planning the disposition of their estate, are entitled to rely on the expectation of uniform treatment. Applying G.S. 48-23(3), we hold that the term "descendant", as used in the will of Kate G. Bitting Reynolds, includes the adopted children of James T. Farish.

Appellants argue that even if the adopted children of James T. Farish are deemed "descendants" under paragraph eight, section one of Mrs. Reynolds' will, those children do not share under the will because a contrary intent appears by the terms of the will. A "cardinal principle in the construction of a will is to give effect to the intent of the testator as it appears from the language used in the instrument itself, subject to the limits imposed by statute or decision." Stoney v. MacDougall, 31 N.C.App. 678, 681, 230 S.E.2d 592, 593 (1976), cert. denied, 291 N.C. 716, 232 S.E.2d 208 (1977). Section 48-23(3) provides that "descendant" includes any adopted person, "unless the contrary plainly appears by the terms thereof." In this regard, section 48-23(3) provides a "clear and certain rule of construction to be applied unless a contrary intent plainly appears from the terms of the instrument." Stoney v. MacDougall, supra, 31 N.C. at 681, 230 S.E.2d at 594. In Trust Co. v. Andrews, 264 N.C. 531, 142 S.E.2d 182 (1965), the Court dealt with this exclusionary language. The Andrews Court stated that "[t]he Legislature made it abundantly clear that the Act did not apply to instruments in which it clearly appeared testator did not intend for an adopted child to stand on the same footing with a blood relative." 264 N.C. at 537, 142 S.E.2d at 187. The Court held that since the number of beneficiaries of the trust in question could be increased only if those children were born within a prescribed period after testator's death, section 48-23(3) was ineffective to include adopted persons under the terms of the trust. In the Court's words, "[b]irth is not synonymous with adoption. 264 N.C. at 538, 142 S.E.2d at 187.

However, the Court reached a different result in Peele v. Finch, 284 N.C. 375, 200 S.E.2d 635 (1973). In that case, the Court faced the question of whether an adopted child whose adoption occurred after the death of the testator, was "issue" of her adoptive parent within the meaning of the will in question. The Court found that by G.S. 48-23(3), the adopted child would take under a limitation to a "child", in that no contrary intent plainly appeared in the terms of the will or conveyance. The Court concluded as follows:

"Nothing in the devise made by the will. . . throws any light whatever upon his intent with reference to this matter. Therefore, we are required by the statute to hold that the adopted child . . . is `issue' . . . within the meaning of this will and takes thereunder . . .." 284 N.C. at 383, 200 S.E.2d at 641.

It is apparent, then, that absent an express limitation, such as in Andrews, which specifically refers to the bloodline of the testator to the exclusion of adopted persons, the terms delineated in G.S. 48-23(3) will be deemed to include any adopted person. See Peele v. Finch, supra; Stoney v. MacDougall, supra; Simpson v. Simpson, supra.

In the present case, we find no evidence that the testatrix intended to exclude adopted children from those normally taking as "descendants" under paragraph eight, section one of her will. Appellants insist that the will of Mrs. Reynolds places a great emphasis on the family bloodline, and, therefore, her intent was to exclude all adopted children from sharing in her estate. Although that intention may have existed in Mrs. Reynolds' mind at the time she made her will, we are unable to locate any expression of such an intent within the terms of the will of Kate G. Bitting Reynolds. Therefore, we are required under section 48-23(3) to include the adopted sons of James T. Farish in the class of "descendants" entitled to take upon the death of James T. Farish.

In addition, appellants argue that, under the laws of adoption as they existed at the time of the drafting of Mrs. Reynolds' *695 will, the adopted sons would not have been allowed to take, and, therefore, application of G.S. 48-23(3) would contradict the supposed knowledge of the testatrix as to the statute's limitations and her subsequent intent to that effect. This issue was recently raised in Stoney v. MacDougall, supra, wherein this Court concluded:

"Appellant . . . argues that at the time the will was drafted and at testator's death, the word issue did not include adopted children, and therefore merely by its use at that time an intent contrary to the provisions of G.S. 48-23(3) plainly appears . . .. Were this argument to be adopted it would vitiate the effect of G.S. 48-23(3) on all instruments drafted before its enactment, contrary to the clearly expressed intent of the legislature." 31 N.C.App. at 681, 230 S.E.2d at 593.

This contention is also rejected here.

Finally, appellant argues that application of G.S. 48-23(3) to the terms of the will in this case unconstitutionally and artificially enlarges the class of beneficiaries entitled to take under the will. In this regard, we find the Court's interpretation of G.S. 48-23(3) in Peele v. Finch, supra, applicable:

"We find no provision in either the State Constitution or the Federal Constitution which takes from the Legislature the power to do what the Legislature clearly undertook to do in the enactment of G.S. 48-23(3). At the time of the enactment of this statute, no brother or sister of Laura Brown Finch and no issue of a deceased brother or sister had any vested interest in the property in question, their rights at that time being contingent, as above noted. Retrospective statutes destroying or diminishing contingent interests in property do not, per se, deprive the holder thereof of property without due process of law, in violation of the Fourteenth Amendment to the Constitution of the United States or Article I, § 19, of the Constitution of North Carolina, or violate any other constitutional limitation upon legislative power." 284 N.C. at 382, 200 S.E.2d at 640.

In the case at bar, the interests given to the "descendants" by paragraph eight, section one of Mrs. Reynolds' will, were conditioned upon their surviving the income beneficiary under whom they were to take. This condition of survivorship made the remainder contingent, in that the "descendants" entitled to take could not be determined until the death of James T. Farish, the income beneficiary. "Where words of futurity are used or implied in making the gifts, or where the gift is dependent upon a future event, the gift is usually determined to be contingent." G. Bogert, The Law of Trusts and Trustees § 182, pp. 413-14 (Rev.2d Ed.1979). In North Carolina, the general rule as to this question is as follows:

"When under the language of the instrument there is uncertainty as to the person or persons who are to take, and the uncertainty is to be resolved in a particular way or according to conditions at a particular time in the future, the estate is contingent." 13 Strong's N.C. Index 3d, Wills § 35.2 (1978).

See White v. Alexander, 290 N.C. 75, 224 S.E.2d 617 (1976); Wachovia Bank and Trust Co. v. Schneider, 235 N.C. 446, 70 S.E.2d 578 (1952); Wachovia Bank and Trust Co. v. Waddell, 234 N.C. 34, 65 S.E.2d 317 (1951); First Security Trust Co. v. Henderson, 225 N.C. 567, 35 S.E.2d 694 (1945). Cf. Purifoy v. Mercantile-Safe Deposit and Trust Co., 567 F.2d 268 (4th Cir. 1977). (Statute creating presumption that terms "child", "heir", "issue", and "descendant" included adopted persons held not an unconstitutional retroactive divestiture of interests in view of fact that, under Maryland law, those interests did not absolutely vest until the death of life tenant.) Thus, the survivorship condition in Mrs. Reynolds' will gave the "descendants" of the income beneficiaries only a contingent interest.

The interests created by paragraph eight, section one of Mrs. Reynolds' will in favor of the "descendants" should they survive the income beneficiaries were not, under Peele v. Finch, unconstitutionally divested. *696 Thus, we hold that G.S. 48-23(3) controls, and we reject defendants' argument in this respect.

Since we conclude that the trial court made no error in the application of G.S. 48-23(3) or in the administration of paragraph eight, section one of the will of Kate G. Bitting Reynolds, the judgment below is hereby

Affirmed.

PARKER and HARRY C. MARTIN, JJ., concur.