Court Opinion

ID: 8301587
Source: CourtListenerOpinion
Date Created: 2022-10-17 11:13:32.876425+00
Date Added: 2024-06-11T16:44:21.362005
License: Public Domain

ON PETITION TO REHEAR.
When the original opinion in this case was handed down, we were of opinion that, though errors were assigned on the point, it was not necessary to pass upon the question as to the date from which interest should be allowed on the pecuniary legacies. A petition to rehear calls attention to the fact that a lot in the city of Memphis, reckoned by us to be of value $20,000, may probably bring more when put to sale on a rising market and enough to make the question of "interest more than academic. In that event the orphan asylum would have become a participant in the distribution as residuary legatee, and its portion would be augmented should the question as to interest he solved in accordance with its contention.
By the general rule of the common law interest was allowable on general pecuniary legacies after one year from the death of the testator, unless the will contained a provision to the contrary. Ensley v. Ensley, 105 Tenn., 107, 58 S. W., 288, and cases cited.
*565The rule is an artificial one, borrowed from the English courts, where it was based upon another rule which allowed one year to executors within which to settle estates. We need not inquire whether, since the time for settlement has been changed in Tennessee by statute to two years, the change in the basic reason would not cause the rule itself to be changed. On this point it was said in Chappel v. Theus, 3 Tenn. Cas., 460:
“In this state the executor would have two years within which to settle the estate, and it would seem the sounder rule that interest should accrue according to the exigencies of the estate in regard to its debts and the situation of.its assets.”
In this State the rule has not been conformed to as applicable in every situation. There is no reason why interest in such case should be allowed when in other instances the court would in the exercise of discretion deny interest or postpone the date from which it should be calculated. Interest allowance should not be made on such legacies, treating the general rule as inflexible,. when the same facts would impel the court to rule to the contrary in the case of claims other than legacies. That no such distinction should be made is indicated by our decisions.
Thus in Darden v. Orgain, 5 Cold. (45 Tenn.), 211, 214, it was said:
“Interest is payable on money in general, on the ground of- delay in liquidation of the principal; so also, with respect to legacies, it may be stated as a *566general rnle that it is payable on them.from the time at which the principal becomes actually due. 2 Roper on Leg., 184. . . . They [general legacies], in their nature, carry interest as in the case of other claims, with that incident, but the interest is computed from the time the principal is due and payable, if such time can be inferred from the will; but, if not, and no time of payment is fixed, the law, for convenience, has prescribed the general rule that interest shall be computed from the end of one year from the testator’s death.”
In some jurisdictions the general rule has been adhered to even in cases where the delay in the settlement of the estate, by reason of a contest, was shown to have been' participated • in by the legatees who claim the interest. Kent v. Dunham, 106 Mass., 590; In re Woodward, 78 Vt., 254, 62 Atl., 718, 6 Ann. Cas., 524.
In this State, contrary to the decisions in those States where that rigid rule is applied, it is held that delay in payment due to the fault of the legatee operates to deny interest under the general rule. The court said that:
“Interest in such cases is not a matter of positive law; and whether it shall be allowed . . . must depend upon the circumstances of such case.” Laura Jane v. Hagen, 10 Humph. (29 Tenn.), 332.
It is a question on which the courts are divided whether' the fact that payment of legacies is delayed *567by a contest of the will should affect the right of the legatee to interest under the general rule. 40 Cyc., 2104. We believe that the juster rule is that interest in such event should be allowed only from the date of the termination of the contest. State v. Adams, 71 Mo., 620; Church Home v. Morris, 99 Ky., 317, 36 S. W., 2. And see Wheeler v. Ruthven, 74 N. Y., 433, 30 Am. Rep., 315; Cobb v. Stratton’s Estate, 56 Colo., 278, 138 Pac., 35, Ann. Cas., 1915C, 1166.
The contest is not to be deemed to have been in the mind of the testator when he formulated the proportions for his provisions for the pecuniary legatees, on the one part, and the residuary legatee, on the other. The fairer inference is that he anticipated that a distributon would be made within "the statutory period, and in due, usual, and unobstructed course. To allow the fixed legacies to be paid, with interest calculated under the general rule, would probably be to deny the residuary legatee any part of the bounty the testator intended to bestow upon that charity. The general rule is too rigid to produce a just result when it would thus frustrate the testator’s intention.
The rule was adopted as one of convenience, and when in operation it tends to' work out an inequitable result, an exception to it should be raised. That which was intended to serve as a mere convenience in ordinary circumstances should not govern where the situation is different.
*568In the pending ease the distribution was delayed hy a long and hard-fought contest of the will, without fault on the part of the residuary legatee; and we hold that interest on the general pecuniary legacies accrued from the date on which the final decree was entered in the chancery court terminating the contest in favor of all the legatees.
The petition to rehear is granted, and a decree will be entered in accord with this ruling.