APPEAL FROM THE MISSISSIPPI COUNTY CIRCUIT COURT, OSCEOLA DISTRICT. NO. CV-11-101. HONORABLE RANDY F. PHILHOURS, JUDGE.
Sanford Law Firm, PLLC, by: Josh Sanford, for appellant.
Branch, Thompson, Warmath & Dale, P.A., by: Robert F. Thompson III, for appellee/cross-appellant.
Rose Law Firm, by: Craig S. Lair and Bourgon B. Reynolds, for cross-appellee SunTrust Bank.
BRANDON J. HARRISON, Judge. VIRDEN and HIXSON, JJ., agree.
BRANDON J. HARRISON, Judge
This appeal presents a dispute between church entities about who takes what under a testamentary trust. The circuit court ruled for First Baptist Church. Covenant Presbytery appeals that decision. We agree with Covenant Presbytery and therefore reverse on direct appeal, which moots First Baptist's cross-appeal.
Stanley Carpenter died testate in 1967. His last will and testament was administrated through the Mississippi County Probate Court, and the court appointed National Bank of Commerce in Memphis, Tennessee, as the executor and trustee of the estate. From 1967 to 2005, National Bank of Commerce managed some farmland that Carpenter owned at his death. The farmland is 238 acres located near Osceola, Arkansas. Since 2005, Sun Trust Bank has managed the farmland as National Bank's successor.
National Bank of Commerce distributed annual income produced from the farmland to Stanley Carpenter's family members--Ruth Carter Love, Carolyn Schabel, Mary Greenway, and Henry and Mae Carpenter--after the probate case closed in the late 1960s. By 2003, some of Carpenter's family members who were trust beneficiaries had died, and National Bank of Commerce distributed the farm's net income this way: (1) one-fourth to Carolyn Schabel; (2) one-fourth to Mary Greenway; (3) one-fourth to First Presbyterian Church of Osceola, Arkansas; and (4) one-fourth to First Baptist Church of Osceola, Arkansas. Carolyn Schabel is the only surviving family member who still receives net income from the farmland.
First Presbyterian Church of Osceola existed from the mid-1800s until April 2004, when it dissolved because of a decline in membership. The minutes of a church meeting reflect that all assets and property that had not previously been sold or distributed were to be transferred to Covenant Presbytery. Covenant Presbytery is the appellant. And in May 2004, Covenant Presbytery approved First Presbyterian's request to dissolve; a commission was appointed to receive any remaining assets of First Presbyterian Church.
After First Presbyterian's dissolution and the transfer of its assets to Covenant Presbytery, National Bank of Commerce began paying First Presbyterian's share of the farm income to Covenant Presbytery. First Baptist Church and Covenant Presbytery received cover letters, quarterly statements, and annual distribution checks from National Bank of Commerce and Sun Trust Bank showing how the farm income had ...