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SJC-11651

          BANK OF AMERICA, N.A. & another,1 trustees,2   vs.
                     VICTORIA BABCOCK & others.3


                          October 28, 2014.


Trust, Taxation. Taxation, Marital deduction.     Practice, Civil,
     Declaratory proceeding.


     The trustees of the Indenture of Trust of Hollis W.
Plimpton, Jr., dated June 24, 1964, as amended, also known as
the Hollis W. Plimpton, Jr. Family Trust (trust), filed a
complaint in the county court, pursuant to G. L. c. 231A,
seeking a declaration that the trust as drafted correctly
expresses the intent of Hollis W. Plimpton, Jr. (settlor) that
his estate be eligible to obtain the optimal benefit of
allowable Federal and State estate tax marital deductions.4

     1
         Peggy L. Plimpton.
     2
       Of the Indenture of Trust of Hollis W. Plimpton, Jr.,
dated June 24, 1964, as amended.
     3
       Priscilla Morphy; Hollis W. Plimpton, III; Charles
Babcock; John Babcock; Caroline Baptista; Sarah Babcock; Calvin
Morphy; Katherine Morphy; Victoria Morphy; Hollis W. Plimpton,
IV; Christopher Plimpton; Elizabeth Catherine Morphy; the
Attorney General; the Commissioner of Internal Revenue; and the
Commissioner of the Department of Revenue. Neither the Attorney
General nor the commissioners have appeared in the case.
     4
       It is undisputed that the trust, as amended, was intended
to qualify as a qualified terminable interest property (QTIP)
trust, pursuant to 26 U.S.C. § 2056(b)(7). Because of the
settlor's failing health and a concern that at some point he
                                                                   2


Alternatively, the trustees seek an order rewording a portion of
the trust to ensure that it accomplishes the settlor's intent,
pursuant to G. L. c. 215, § 6. A single justice of this court
reserved and reported the case to the full court.

     Litigants have sought reformation of trusts, and judicial
declarations of rights in will and trust cases, from this court
in a variety of situations under the Bosch rubric. See
Commissioner of Internal Revenue v. Estate of Bosch, 387 U.S.
456 (1967). The cases raise issues of State law, which the
parties have asked us to resolve because of their Federal tax
implications. See Walker v. Walker, 433 Mass. 581, 582 (2001);
Kirchick v. Guerry, 429 Mass. 215, 217 (1999) (court decides
State law issues in Bosch cases, not Federal law issues). "We
have decided [such] cases . . . not only when the parties have
been actively engaged in disputes with the Internal Revenue
Service, but also, on occasion, when the parties have sought
decisions that would enable them to plan their estates correctly
and to prepare effectively for future tax consequences." Walker
v. Walker, supra at 582-583 (2001). See Shawmut Bank, N.A. v.
Buckley, 422 Mass. 706, 709-710 (1996); Billings v. Fowler, 361
Mass. 230, 233-234 (1972). In the latter category, our cases
have involved situations where there is a clear mistake in the
drafting or some real uncertainty about the meaning of an
instrument that would lead inevitably to adverse tax
consequences in the future. See, e.g., Hillman v. Hillman, 433
Mass. 590 (2001). See also Linehan v. Linehan, 453 Mass. 1017,
1018 (2009), and cases cited.

      These features are noticeably absent from the case before
us.   There is no indication of any adverse ruling or position


might no longer possess the physical and mental capacity to make
gifts as he had throughout the years, the trust was amended
during his lifetime to authorize the bank trustee to make
certain gifts from the trust in his behalf. The amendment
allowed the bank, during the settlor's lifetime, to make gift-
tax free "annual exclusion" gifts; taxable gifts to the
settlor's descendants; and gifts to charities that he had
supported throughout the years. After the settlor died, the
bank became concerned that, because the amendment authorized
gifts to the settlor's children and to charities during his
lifetime, and distributions to his surviving spouse after his
death, the trust might be misconstrued to permit distributions
to the children and charities after his death. It is this
possibility that the trust might be misconstrued that the
trustees seek to eliminate by way of this action.
                                                                   3


taken by the Internal Revenue Service; nor is there any claim of
a mistake in drafting or a real uncertainty concerning how the
instrument is to be interpreted. To the contrary, the drafting
attorney and the parties take the position that there was no
mistake, in other words, that the instrument was drafted exactly
as planned and that a careful reading of the instrument leads to
the desired result consistent with the settlor's intent. They
do not claim to be in any serious doubt about how properly to
administer the estate under the language of the instrument. See
Linehan v. Linehan, supra at 1018 (dismissing complaint and
declining to grant declaratory relief; noting absence of any
actual or likely dispute with Internal Revenue Service, and
absence of any claim of uncertainty or that trustees would be
unable to fulfil their duties without judicial guidance).
Contrast Shawmut Bank, N.A. v. Buckley, supra at 709-710 ("Here,
the parties explain that the current uncertain state of Mary's
will has an impact on their present decision-making. The
executors of Mary's will claim that if we do not provide them
with a definitive construction of the troubling language in
Mary's will, they will be unable to fulfil their present
duties").

     The trustees in this case claim only to be concerned that
the trust language might be misconstrued (presumably by the
taxing authorities) in the future and, as a preemptive measure,
they ask this court to declare that it operates in the manner
they understand it to operate. Far from there being any
controversy, mistake, or uncertainty of the type that we have
historically considered under the Bosch rubric, there is an
affirmative belief that there has been no mistake; there is no
demonstrated problem with the language of the trust as drafted
and no real uncertainty on the part of the trustees as to how to
proceed under it; there is only a claimed possibility that the
trust language might be misconstrued by others in the future.

     This is not an appropriate situation for a declaratory
judgment or instructions on how to proceed, since the trustees
are not in doubt as to their interpretation of the trust or how
to effectuate it. Nor is it an appropriate situation for a
reformation, there being no proof of a mistake of any kind. The
apparent objective of the parties -- to insure by declaration or
reformation that no one in the future misconstrues the document
-- while understandable as a precautionary measure, is not
something that justifies judicial involvement under the guise of
Bosch.
                                                                  4


     A judgment shall enter in the county court declaring that
this is not a suitable occasion for the type of relief sought,
and dismissing the complaint without prejudice.5

                                   So ordered.

    The case was submitted on briefs.
    Barry C. Klickstein & Jillian B. Hirsch for the plaintiffs.




    5
       In the future, cases such as this adequately can be
resolved in the Probate and Family Court. See O'Connell v.
Houser, ante      ,      (2014).
