Court Opinion

ID: 6378521
Source: CourtListenerOpinion
Date Created: 2022-06-24 23:57:52.75805+00
Date Added: 2024-06-11T15:50:16.310103
License: Public Domain

Stearne, J.,
dissenting. — Three of our judges are unable to concur in the judgment of the court. Where a testator by his will modifies the terms of an antenuptial agreement and his widow elects to take under the will, we would rule that she has thereby assented to such modification. Under such circumstances we would decline to permit the widow to accept some of the provisions of the will when to her benefit but reject others when subsequently they operate to her detriment. In our opinion, she must either reject the will in its entirety or remain loyal to all of its directions.
This testator, in his will, recognized his liability under his antenuptial agreement, but directed that the payments thereunder be made out of his income. He also gave his wife half the balance of said income, a large cash legacy and other valuable bequests and benefits. The widow elected to take under the will and has accepted and still retains every legacy and right so given her. Due to shrinkage in value and productivity of securities at present, the income from the estate does not equal the full amount of the antenuptial payments. Irrespective of the widow’s overt acts in electing to take under the terms of the will and her acceptance of all other benefits, she now claims that she is a creditor, unaffected by the provisions in the will concerning her claim *673against the estate. She maintains whenever the income proves insufficient to satisfy the annual antenuptial payments (as it presently is) that such deficit is payable out of principal — even to its exhaustion. This was so ruled by the auditing judge and we deem it error.
The facts are undisputed and are substantially as follows: Testator, an elderly widower, with three adult children, about to remarry, entered into an antenuptial agreement with his intended wife, which provided, inter alia, that he would pay her $15,000 per annum for the term of her life and that such provision should be in lieu of her dower rights in his estate. The marriage was subsequently consummated. Testator died within two years thereafter. Five months after the execution of the antenuptial agreement testator made his will, which was, with a codicil, probated after his death. By the terms of the will testator bequeathed to his wife (1) $10,000 in cash, (2) use and occupancy of his apartment, free of expenses, until termination of lease, (3) all household effects, jewelry, automobiles (except some articles specifically bequeathed). The residue of his estate he directed should be placed in trust, and “out of the income therefrom, to pay over unto my wife the sum of Fifteen Thousand Dollars ($15,000) per year, in equal monthly installments, beginning immediately upon my death, in accordance with the terms of the ante-nuptial agreement entered into between my wife and myself dated May 23, 1928.” (The italics are ours.)
Testator then bequeathed one-half of the balance of the net income to his wife. The remainder of the net income and the principal of his estate, upon the death of the widow, he passed to his children and their issue. Upon his death, according to the inventory filed within a few weeks thereafter, the personal estate (exclusive of real estate valued in the petition for letters at $5000) was appraised at $602,557.53. It is to be observed that the income from this fund, even at four per cent., was ample to carry out testator’s directions to pay the widow “out of income” $15,000 per year and to give her in addition several thousand dollars a year. With this situation before the widow, and within a month after the death, she elected to take under the will. The widow accepted the $10,000 cash legacy, used and still uses, at the estate’s expense, the apartment, and has taken the jewelry, household goods and automobiles in distribution.
Between the time of the filing of the inventory and account the shrinkage in value and income occurred. At present the net income does not equal the payments provided for in the agreement. When such situation became apparent, irrespective of her election to take under the will and regardless of her acceptance and retention of every other legacy and benefit given her by the will, the widow claimed and was allowed the entire net income, and, in addition, out of principal, the amount of the deficit. This we deem error.
Beyond question, the widow was a creditor of her husband. There was nothing which the husband could have done in his lifetime or by his will after his death, without her assent, which could modify or change the written agreement. But testator, by his will, did modify the terms of his contract. His widow, in writing, did assent to the change, both by her written election and by her acceptance of every other term of the will.
When the testator directed by will that the payments to which he was legally committed should be made out of income, its effect was an attempted modification of the agreement. Unless the widow, the other party to the inter vivos agreement, consented, such an attempt to modify would be ineffective. But, by writing, she did accept the terms of the will and received all other legacies. This, as we view it, was as an effective modification as if concluded inter vivos.
*674Parties to an unperformed contract may, by mutual consent, modify it by altering, excising or adding provisions: 13 C. J. 589: But one party to a contract cannot alter its terms without the assent of the other; the minds of the parties must meet as to the proposed modification: 13 C. J. 591. And a written contract may be modified or discharged by a subsequent oral agreement: 13 C. J. 593; Kime v. Ice Co., 240 Pa. 61. No particular form is required to modify a contract; the question of modification depends primarily upon the intent of the parties, and in some cases may even be inferred from their acts: 13 C. J. 590.
There would seem to be no fundamental difference between a modification of the contract inter vivos and a modification by mil of one of the parties, assented to by the other party to the contract. We view the recorded election to take under a will (and actually accepting all benefits thereunder) as an effectual assent to the modifying terms as if the parties themselves, in their lifetime, had executed a written agreement to that effect.
To be sure, a debtor may, by will, make a testamentary gift to his creditor. Where the amount of the legacy is equal to or greater than the debt, it is presumed to be in satisfaction, but this presumption may be overcome by the facts and circumstances: 40 Cyc. 1885 et seq. It is not disputed, under the facts in this case, that had the will remained silent as to the method of satisfaction of the debt the widow would have been entitled to both the annuity and the legacies.
What this testator really did was to reaffirm his obligation under the agreement, but to direct how and from what source it should be liquidated. His obligation and debt unquestionably was paramount to the rights of his beneficiaries. His will was, therefore, attempting to dispose of something in his own estate but which was already vested in law in his wife. She had a valid claim against his estate which decedent, except in payment or consent of his wife, could not affect. Yet the decedent did assay to change and alter this right, but in the same instrument gave his wife substantial benefits.
As we understand the law, where a widow has or asserts a claim to property disposed of by the will, adverse to testator, she must, like any other claimant, elect whether she will take under or against the will: 40 Cyc. 1964 and 1957 et seq.; Zimmerman v. Lebo, 151 Pa. 345; Cox v. Rogers, 77 Pa. 160.
Exactly the reverse of the above proposition is illustrated in the case of Watterson’s Appeal, 95 Pa. 312. There.decedent insured himself for $10,000, naming his wife as sole beneficiary. Subsequently, decedent made his will and stated that, with his wife’s consent, the proceeds from this insurance policy should form part of his estate and made certain dispositions of it. He stipulated, however, that in case his wife refused to consent, then he would make no provisions for her and that the wife should keep the $10,000. The wife declined to turn the $10,000 into the estate, and elected to take against the will. It was contended that the widow could not take her dower rights because she had kept the insurance moneys. It was very properly held that she was entitled to her dower rights because the $10,000 referred to never formed part of her husband’s estate. The widow asserted no claim adverse to the husband and neither did she take anything under his will.
Apparently, the case upon which counsel for the widow chiefly relies is Bowman v. Knorr, 206 Pa. 270. From the mere reading of the printed report it would seem to be almost parallel. However, our examination of the paper books and record reveal facts which, considered with the opinion, convinces us that it has no application. There the antenuptial agreement provided for income for life. The will gave the income to the widow for widowhood only. As *675the widow elected to take under the will by qualifying as executrix and enjoying the estate for some years, it was claimed that she took for widowhood only. But the distinction is here: in the Bowman case the will stated that its provisions were in accordance with the contract hereto attached. It was in fact attached, formed part of the will, and was probated as part of it. Mr. Justice Fell sought the testamentary intention. He recognized the difference in the two writings, which he said might have been an accident or oversight. However, he stated that the testator had construed his own will, inasmuch as he declared in his will that “both instruments were in accordance with each other.” In the circumstances of that case, as a question of construction, the Supreme Court decided that what testator intended to give the widow was exactly what the agreement gave her, evidenced by his declaration and by constituting it a part of his will — and probated as such.
Contradistinguished from the Bowman case, this testator did, by his will, modify the contract. Neither is there the slightest question of construction. True, testator recognized his liability under his contract, but stipulated that it should be paid out of income, and in addition gave his wife substantial legacies. As we view it, when the widow elected to take under the will and accepted and retained all its advantages, she must be held to have assented to testator’s modifications of the contract and should be bound by her election.
Whether the election of the widow is statutory or equitable would seem to be wholly immaterial. Election is the obligation imposed upon a party to choose between two inconsistent or alternative rights or claims in cases where there is a clear intention of the person from whom he received one that he should not enjoy both. The doctrine, which is purely equitable and was originally derived from the civil law, finds its most frequent illustration in cases of wills, the principle being that one shall not take any beneficial interest under a will and at the same time set up any right or claim of his own, even if legal and well founded, which would defeat or in any way prevent the full effect and operation of every part of the will: 40 Cye., See. 1959.
We do not consider that the execution of the antenuptial agreement barred the widow from electing to take under or against the will. In fact, she did elect to 'take under the will. True it is that the widow may have bargained away her rights to a spouse’s share under the intestate law and the Wills Act. Yet situations readily suggest themselves where a will may prove detrimental to such a widow. In our opinion, under such circumstances, she may still elect to take against the will and receive her share under the intestate law, except in so far as she may have legally modified or affected such share by her contract. However, when a widow does in fact elect to take under the will, she ought not to be permitted to take under and against it at the same time.
While the rights and interests of a decedent’s widow are entitled to first consideration, yet hers are not the only interests to be considered. Testator’s children certainly should be protected. They, too, are chief beneficiaries. It is for them and their issue that decedent is preserving, by his will, the principal of his estate. It seems manifestly unfair to permit this widow to elect, at the expense of the children, to take under the terms of the will when obviously to her great advantage (and in fact to take and retain everything that is given to her by the will), and still at the expense of the children (and not her own children) , to subsequently reject a single provision in the will which ultimately and perhaps temporarily works to her detriment. This does not appeal to us as either good sportsmanship or sound law. She should reject the will in its entirety or be bound by all its terms. We would sustain the exceptions.
Henderson and Sinkler, JJ., join in this dissent.