Schnackenberg and Castle, Circuit Judges, and Grubb, Senior District Judge.
William Joseph Breault and Bonnie Jo Ellen Kathryn Breault, the plaintiffs-appellants, brought this diversity action in the District Court seeking a declaratory judgment as to their rights as heirs of their grandmother, Kathryn M. Breault, deceased and as heirs of their father, Oscar J. Breault, deceased, whose will they were contesting in an earlier filed and pending diversity action. Plaintiffs also sought an accounting, based on such declaration of rights, from the defendants-appellees, Harold L. Feigenholtz and Richard Dahm, the executors and trustees under the will of Kathryn, with respect to the assets and income of Brolite Company, the stock of which was owned by Kathryn and was part of the corpus of a testamentary trust created by Kathryn's will.
Other defendants-appellees are Feigenholtz as executor and as trustee, and Eugene A. Busch as successor trustee, under the will of Oscar J. Breault. Additional defendants include Oscar's widow, Estelle Angela Breault, Oscar's son by his first wife, Kenneth Breault, and certain charities named in the wills.
The cause was tried as to Count I, which seeks the declaratory relief, on a stipulation of facts, by the Court without a jury.
While the matter was under advisement all of the beneficially interested defendants entered into a settlement agreement with respect to the declaratory judgment action and the related will contest. Plaintiff's petition for approval of the settlement agreement was objected to by the defendant-appellee executors and trustees and was denied by the court on the basis of lack of jurisdiction or authority to terminate the spendthrift trust of which plaintiffs were the beneficiaries under the purported will of Oscar.
Thereafter the court filed a memorandum opinion incorporating its findings of fact and conclusions of law and entered a judgment order decreeing and declaring, in effect, that the trust provisions of the purported will of Oscar were valid; that irrespective of the validity of the probated instrument as the will of Oscar (it being under attack in the pending will contest action as the product of undue influence on the part of Feigenholtz) plaintiffs are entitled to nothing as heirs of Kathryn; and in view of this conclusion dismissing Count II on the ground plaintiffs had no right to the accounting sought therein.
Plaintiffs appealed and assert that the court erred in refusing to approve the settlement agreement, in the declaration of rights made, and in denying plaintiffs the accounting they sought.
Kathryn M. Breault died testate on August 3, 1952. At the time of her death her only heir-at-law was her son, Oscar J. Breault, who was then married to Florence B. Breault. The plaintiffs-appellants are children of the marriage of Oscar and Florence. Defendant Kenneth Breault is a son of Oscar by a prior marriage. Subsequent to Kathryn's death Oscar and Florence were divorced. Oscar then married Estelle Angela Breault.
Kathryn's will, after a specific legacy to Irma Meyers, which has been paid and with respect to which no question is involved herein, gave the very substantial residue of her estate to defendants-appellees Feigenholtz and Dahm as her testamentary trustees. The will created a spendthrift trust for the benefit of Oscar and provided that he should receive the net income from the trust estate quarter annually during his lifetime. The will further provided:
"Upon the death of my son, Oscar J. Breault, the property of the Trust Estate shall be distributed according to the provisions and terms of the Last Will and Testament of my said son, Oscar J. Breault, and if he shall fail to execute a Will, or if such Will shall not be admitted to probate, I hereby direct distribution of the said Trust Estate in the following manner:
One-third (1/3) thereof to the Little Sisters of The Poor of Chicago.
One-third (1/3) thereof to the St. Hedwig Industrial School for Girls, 7135 N. Harlem Avenue, Niles, Illinois.
One-third (1/3) thereof to the Polish Manual Training School For Boys, 7135 No. Harlem ...