Opinion ID: 2383573
Heading Depth: 1
Heading Rank: 3

Heading: The Post-Death Agreement

Text: Mary Lea died, a resident of Suffolk County, New York, on May 3, 1990. She was survived by Martin Richards (her husband) and six adult children from the prior marriage: Eric Bruce Ryan, Seward Johnson Ryan, Roderick Newbold Ryan, Hillary Armstrong Ryan, Alice Ryan Marriott and Quentin Regis Ryan (the six children). She was also survived by one adult grandchild, Heathyr Nelson Ryan, and numerous minor grandchildren. By her will dated April 17, 1990, Mary Lea exercised her special power of appointment over the 1944 Trust to resolve their respective claims to the trust property. Mr. Richards and the six children entered a Stipulation and Compromise Agreement dated June 12, 1990 (the Agreement) that set forth the manner in which the principal and income of the 1944 Trust were to be distributed. Only a few of the provisions of the Agreement are relevant here. In paragraph 5 of the Agreement, all of the signers agreed that $6.5 million in cash would be distributed to Mr. Richards from the principal of the trust. In paragraph 8, they agreed that $100,000 in cash and 800 shares of stock in Johnson & Johnson Corp. would be distributed from trust principal to each of the six children. Certain other paragraphs of the Agreement provided for the distribution of various specific dollar amounts, while paragraphs 6, 10 and 12 through 15 provided for the division into fractional shares of the balance of the trust principal remaining after the distribution of the fixed items was made. Under these provisions, Mr. Richards was to receive approximately 47 per cent of this balance, while the six children and Mrs. Richard's grandchildren were to receive among them about 53 per cent. Paragraph 16 of the Agreement specifically set forth the manner in which the income of the 1944 Trust that accumulated after Mrs. Richard's death would be allocated. Essentially, paragraph 16 provided that this income would be divided among the beneficiaries in the same proportions as were established for the shares of the trust principal under the fractional share provisions. Accordingly, Mr. Richards was to receive approximately 47 per cent of the 1944 Trust's income, while the remaining 53 per cent of that income was allocated among the other beneficiaries. With respect to whether the specific dollar amounts, including the $6.5 million that was to go to Mr. Richards and the $100,000 in cash that was to go to each of the six children, were intended to be paid out of the trust's income, paragraph 16 provided: No recipient of a cash distribution under paragraphs 3, 4, [$6.5 million to Mr. Richards], 7, 8 [$100,000 and 800 shares of stock to each of six children] or 9 hereof shall be entitled to any income of the 1944 Trust with respect to such cash distribution. [1]