The Pacific commercial advertiser. [volume] (Honolulu, Hawaiian Islands) 1885-1921, 1900-03-06

the usually cited (lfn GHeTdrd 60 Ga 2s4 A Am
r. 700, and Richardson Richardson Ne 500 was merely
that extraordinary dividend not stock declared during the
life tenancy went to the life irrespective of the time when
earned Those had nothing do with
dend though these to incidentally Georgia
the statute expressly provided that stock should attach 10 the
corpus and 60 the remaindeunan And in Maine later
case, Gitkoy Paine Me- 3l9 the court said A rule
supposed have been established ERof r. Paine % Mas
101 and known me Massachusetts rule that stock dividends
are to be regarded principal and cash dividends income
But this has proved be very elastic rule the Of it.
ogn for in Leland Hayden 1O2 Mas 542 while protesting
to adhere it. the did in fact cash dividend CAPT
tai and stock dividend income. The this country
has been generally maintain the integrity of the capital and
to give all surplus earnings in whatever form distributed
life tenant And, perhaps better rule than this b.
adopted Thus the of Maine and Georgia hardly be
eassed thus far supporting this rule Under this rule
der the early English rule though different reasons the dy
dend in question would all be held remandenan
Thirdly the Pcnnsy This is sometimes called but
appropriately the American rule rs have seen, the early
English rule q all extraordinary dividends cash or stock 10
the rcandeman the grounds that the
regarded capital the earnings accumulated before his death and
used actual capital though represented y and that
mpracabc what earned before and
after his death And the later English rule gives all cash dvi
dends to the life and holds all stock dividends
for the remancman because earnings belong the
pOraon and represented by the stock and income
the stockholders aside dividends and dividends when
declared under corporation law the person entitled the
time and the intended earnings should H.
considered capital income according the usual rules Of
poracn law The Penny vania rule holds with the later Eng
sh rule that earnings income the shareholder until
appropriated by the corporation, but does the extent Of
that rule in holding that such appropriation when made
elusive between the life and remandean that the
esator must have intended that the which the
poon appropriated earnings should determine whether they
should 90 the life remainderman and holds the
other hand with the early English rule that the
have regarded the accumulaons of earnings the time of his
death capital be held for the remandeman but does
go the of that rule in holding that mpraccabc
ascertain what earned before and what after his death A
cordngy the Pennsv rule when extraordinary dividend
is declared, whether in cash stock, apportons it,
giving the life tenant what earned during the
life tenancy and holding for the remanderman what
before the life tenancy began EdrpS Apped 2s Pa St $685.
Moss appeal Pa St 269; Biddes AppcaI Pa St 27s
differs Estate 1856 Pa. St 43; Smiths Estate 14O Pa St
344 Esners Appcal, 175 Pa. St 143.
This rule differs from the English rule in that it
cash and stock dividends alike and ) appoons dividends
corling o the time when they earned
this second point Of difference has the support
jersey Van Dorcn OdcH, 10 n. J. Eq 176; AshkHrs
Fields Ad 26 n j. Eq y and Maryland Thomas Gregg,
as Nd SIS, IS Att $3.50 and to extent, far cash
dividends distributions concerned of New Hampshire
ord Brooks 80 n. III. ~ and South Carolina (CoJJ
FGn 36 S. c. J. il s. $3.50 and Of text writers but it Is
opposed Kentucky (He Hite, 80 Ky. 257, 10 l. r. a
1879 well by all the cited in support Of the English
rules including those of Maine and Georgia The three courts
which follow the rule of appOrtonment have found great d
applying and different method of ascertainng how
the apporonment should be made has been adopted by each
This rule open grave objections, both theoretical and prac
ca but need express opinion as to whether they are
more weighty the objections made to the rule Of noaP
portonmen for the present it appears that the profit
ont of which the dividend declared earned during tn
life tenancy and therefore whether the rule OF apPoronment
that of ACKNOWLEDGEMENT should be followed the dividend a
rs It represented earnings would all 60 the life tenants
Foury what has been called the rule of the Middle States
This rule follows the first point of distinction between the Penn
svana rule and present English rule that it treats ca
dividends alike but does not necessarily recognize tn
second point of distinction, namely that in regard to apron
ment This rule has the support only of Pennsylvania Ne
jersey and Maryland which shown above also follow the rul
of apporonment, but also of Kentucky (Hc Hdc supra
which follow the rule Of appoonment and Tennoe