Opinion ID: 6491069
Heading Depth: 2
Heading Rank: 2

Heading: Comparison of the Income and Corpus Distribution Provisions

Text: Appellants next argue that, “even though the wording [of the trust] differs between the distribution of the income and corpus, both instructions lead to a per stirpes distribution.” Appellants rely solely on In re Trust Estate of Dwight, 80 Hawai'i 233, 909 P.2d 561 (1995), in support of their argument that “different wording does not necessarily mean a differing distribution.” Although Petitioners emphasize that “their position is neutral in this matter[,]” they point out that the Robinsons “clearly knew how to effect a per stirpes distribution with respect to the income interest, yet used different language with respect to the distribution of the trust corpus.” Petitioners note that, unlike the income distribution provision, the corpus distribution provision includes the phrase “share and share alike[,]” which has the same meaning as “in equal shares.” Petitioners further state that, if the corpus distribution provision was “construed in the same manner as the income distribution provision (which does not include the ‘share and share alike’ clause), then the reference to ‘share and share alike’ would be meaningless.” Petitioners conclude by stating that: It is far more likely that the [Robinsons] intended the [“share and share alike”] clause to have meaning and that its purpose was to make it clear that the grandchildren were to receive an equal share of the trust estate, not just a per stirpes distribution of their parent’s share. Had the [Robinsons] intended a per stirpes distribution or [a] by representation distribution, they could have simply said that the trust estate was to be distributed to their issue by right of representation or to their children’s issue by right of representation. Instead, they identified grandchildren as the applicable generation to “share and share alike.” In Dwight, the testator, Samuel Castle Dwight, executed his last will and testament in 1926. Id. at 234, 909 P.2d at 562. In his will, Dwight created an inter vivos trust that provided, inter alia, that, after his death, income from the trust was to be divided in three equal shares among his daughter (Elsie) and his two grandchildren (Samuel and Harriette), whom Dwight had adopted as his own children. Id. Specifically, the income distribution provision of the trust stated in relevant part: UPON TRUST to pay the net income thereof to my daughter [name] and my lawfully adopted children [names] who are also my grandchildren in three equal shares during joint lives.... ... and on the death of any of them to pay the said net income thereof in equal shares to the [two] survivors during their joint lives.... Id. at 237, 909 P.2d at 565 (ellipses points in original). The income distribution provision went on to state that: [A]nd on the death of any one of the two survivors to pay the whole of said net income to the last survivor during her life provided, however if either of my said adopted children shall die ... leaving a child or children surviving her, then and in every such ease ... child or children shall ... take the share of the said net annual income of my property which his, her or their mother would have taken if she had continued to live. Id. at 237-38, 909 P.2d at 565-66 (some emphases in original and some added) (ellipses points in original). This court noted that Dwight’s “intent was to leave the trust income equally to the two separate families[, ie., Samuel and Harriette’s respective families].” Id. at 238, 909 P.2d at 566. The corpus distribution provision, which was at the center of dispute in Dwight, stated: ... on the death of the last survivor of my said daughter and my said adopted children my Trustees shall convey all of my property to such of the issue of my said adopted children as shall then be living in equal shares per stirpes. Id. (emphasis added) (ellipses points in original). This court determined, inter alia, that Dwight intended distribution of the trust corpus to parallel income distribution and, therefore, held that the corpus distribution provision mandated distribution of the corpus to one-half to Samuel’s issue and one-half to Harriette’s issue. Id. Although the court in Dwight did not specifically articulate how the corpus distribution provision was parallel to the income distribution provision, a comparison of the two provisions shows that Dwight employed similar, rather than differing, language in the two provisions to clearly indicate that he intended a per stirpes distribution of the corpus as well. This court has previously noted that a similar phrase, “ ‘such last mentioned child, or children, shall ... take the share of the ... income which his, her or their parent would have taken[,]’ clearly effected] a per stirpital distribution. In other words, a child or children would take by representation [ 7 ] through their parent.” Lopez, 64 Haw. at 54 n. 7, 636 P.2d at 738 n. 7 (some ellipses in original and some added). As such, the income distribution provision in Dwight, which was nearly identical to the income distribution provision in Lopez, clearly effected a per stirpes distribution, specifically, income to the children of Dwight’s adopted children per stirpes. Thus, inasmuch as the corpus was clearly to be distributed to the issue of Dwight’s adopted children per stirpes, income and corpus were to be distributed in the same manner. As previously stated, the income distribution provision in the instant trust states that, upon the death of the Robinsons, all of the net income is to be distributed to “the children of the said parties of the first and second parts [Mrs. Robinson and Mr. Robinson] born as aforesaid and the issue of any deceased child of theirs born as aforesaid, such issue to take by right of representation.” (Emphasis added.) The foregoing language has been construed by the parties “as meaning that the children take an equal share of the income and, at a child’s death, his or her share of the income goes to his or her descendants by right of representation.” The corpus distribution provision, on the other hand, states that the corpus is to be distributed “between and among the grandchildren of the said parties of the first and second parts [Mrs. Robinson and Mr. Robinson] and the issue of any deceased grandchild of theirs, share and share alike, such issue to take by right of representation.” (Emphases added.) Unlike the trust in Dwight, the instant trust, when read as a whole, does not indicate that the Robinsons intended distribution of the trust corpus to wholly parallel income distribution. Although the income distribution provision essentially states that income is to be distributed to the issue 8 of the Robinsons’ children by right of representation or per stirpes, the corpus distribution provision states that only the issue of any deceased grandchildren of the Robinsons are to take by right of representation. Stated differently, while the income distribution provision implicitly states that the Robinsons’ grandchildren are to take income per stirpes, the corpus distribution provision does not indicate that the Robin-sons’ grandchildren are to take corpus per stirpes. “If the [settlors] intended a per stirpital distribution of the corpus, [they] naturally would have used similar language as in the income provision. The fact that [the settlors] failed to do so is a significant indication of [their] intent for a per capita distribution of the corpus.” Lopez, 64 Haw. at 59, 636 P.2d at 741. Here, the Robinsons clearly knew how to effect a per stirpes distribution with respect to their grandchildren as evidenced by the income distribution provision. Had the Robinsons intended their grandchildren to take corpus per stirpes, they would have used similar language as in the income distribution provision. Moreover, unlike the income distribution provision, the corpus distribution provision includes the phrase “share and share alike.” If the corpus distribution provision were to be construed in the same manner as the income distribution provision, then the reference to “share and share alike” would be rendered meaningless. However, “[i]t is to be presumed that every word is intended by the testator to have some meaning; and no clause is to be rejected to which a reasonable effect can be given[.]” Bookwalter v. Lamar, 323 F.2d 664, 668 (8th Cir.1963) (citation omitted); see also Joyner v. Duncan, 299 N.C. 565, 264 S.E.2d 76, 86 (1980) (“Effect must be given to each clause, phrase[,] and word, if a reasonable construction of the will so permits. Each string should give its sound.” (Citation omitted.)); In re Estate of Mank, 298 Ill.App.3d 821, 232 Ill.Dec. 918, 699 N.E.2d 1103, 1107 (1998) (noting that “a will must be construed as a whole and every word, phrase[,] and clause given effect if possible”) (citation omitted). Thus, contrary to Appellants’ contention, “different wording” does mean a “differing distribution.” Accordingly, we hold that the circuit court correctly concluded that, “[b]ecause the trust wording differed between the distribution of the income and the distribution of the corpus,” corpus is to be distributed differently from income. 9