Court Opinion

ID: 9444381
Source: CourtListenerOpinion
Date Created: 2023-08-03 20:58:55.319031+00
Date Added: 2024-06-11T17:29:50.837799
License: Public Domain

SWAN, Circuit Judge
(dissenting in part). -
I agree that the judgment must be reversed because of error in the admission of evidence relating to events subsequent to the testator's death, but I am unable to agree with my brothers’ conclusion that the .cause should be remanded for a new trial.. ■ In my view the complaint should be dismissed.
The problem, as we all agree, is whether the testamentary provisions giving the trustee power to invade principal set up “a definite and fixed standard for the exercise of the trustee’s discretion, and thus makes it possible to predict with ,reasonable accuracy whether the right of invasion will . or -\yill not be exercised.” Lincoln Rochester Trust Co. v. Commissioner, 2 Cir., 181 F.2d 424,. 425. My brothers construe the Seventh Paragraph of the will as authorizing invasion only to insure that the widow will continue to enjoy her accustomed standard of living. I am unable to give the testamentary provisions so restricted an interpretation. The trustee is authorized to take from .the principal such “sums as in its sole discretion may be necessary to meet any unusual demands, emergencies, requirements or expenses for her [the widow’s] personal needs that may arise from time to time.” Her request by letter is “sufficient authority” for the trustee to exercise its discretion to invade principal. No doubt the widow’s request must show that the -sum requested is required for her “personal needs” but I see nothing in the Seventh Paragraph up to this point which would limit “personal needs” to expenses necessary to maintain her accustomed standard of living. For instance, if she requested payment of a principal sum to pay the expenses of a proposed trip to Europe I would say that it would be within the trustee’s discretion to grant her request unless some later provision of the Seventh Paragraph further restricts the trustee’s discretion. It is not, in my opinion, so restricted by the provision: “This clause is intended to provide for emergencies arising from sickness, accident or failure of investments.” “Failure of investments” is not expressly limited to investments by the trustee, and should reasonably, be construed to include investments by the widow as well as by the trustee. Suppose, .for example, that the widow’s request for money for a European trip stated that she had expected to pay for the trip out of her own savings bank account but the bank had failed. In my opinion the trustee would have discretion to invade principal to provide the sum needed for her proposed. trip. I think the case at bar is more closely akin to De Castro’s Estate v. Commissioner, 2 Cir., 155 F.2d 254 than it is to our Lincoln Rochester Trust Co. decision, supra. Accordingly, I would direct dismissal of the complaint.