Court Opinion

ID: 9751381
Source: CourtListenerOpinion
Date Created: 2023-08-28 16:23:06.90239+00
Date Added: 2024-06-11T07:26:44.119776
License: Public Domain

OPINION OF THE COURT
ROBERTS, Justice.
In November 1944, Dr. Stephen Tracy (settlor) established a revocable inter vivos trust. It provided that income be paid to settlor and his wife for the remainder of their lives; after their death, the income was to be paid, in equal shares, to settlor’s children, Margaret Tracy Ritteman and Stephen Tracy, Jr. Upon the death of either child, “the share of such child shall be paid over to his or her issue per stirpes.” The question presented in this case is whether the natural daughter of Stephen Tracy, Jr. (Stephen Jr.), who was adopted by one unrelated to settlor in 1951, is entitled to share in the distribution to the “issue” of Stephen Jr. The orphans’ court concluded that she is entitled to share in that distribution and this appeal ensued.1 We affirm.
Most of the facts in this case were stipulated. A daughter Stephanie (the appellee) was born to Stephen Jr., and his then wife, Cora Hepburn Tracy, on December 25, 1938. Stephen Jr. and Cora were divorced on August 21, 1942, and Cora took custody of Stephanie. On January 9, 1943, Stephen Jr. married his second wife, Thelma Budd Tracy. On November 28, 1944, settlor exe*303cuted the deed of trust now before us.2 Stephen Tracy IV (appellant) was born to Stephen Jr. and Thelma on December 28, 1945. Stephanie’s mother Cora married her second husband, Harlow Culbertson on May 30,1946.
On April 14, 1949, settlor was declared incompetent and a guardian was appointed for his estate. From at least this time until his death on February 22, 1956, he lacked the capacity validly to amend or revoke the deed of trust. On June 21, 1951, Stephanie was adopted by her stepfather, Harlow Culbertson, with the consent of Stephen Jr. All life estates in the half of the trust allotted to the issue of Stephen Jr. terminated with his death on March 14, 1972.
The corporate fiduciary filed an account and requested instructions whether, by reason of Stephanie’s adoption, she was precluded from taking under the trust as “issue” of Stephen Jr. Stephanie (now, by marriage, Stephanie Kerns) appeared before the orphans’ court to assert her right to participate in the distribution and Stephen IV, the only other child of Stephen Jr., appeared to oppose her participation.
The orphans’ court received, subject to an objection concerning its relevance, testimony from Stephanie and her mother regarding Stephanie’s relationship with the settlor, her grandfather.3 The orphans’ court concluded that this evidence was inadmissible because irrelevant and therefore disregarded it. Nevertheless, we believe that we may consider certain facts as admitted.4 At various times, even after her parents were divorced in 1942 *304and prior to the execution of the deed of trust in 1945,5 Stephanie received Christmas and birthday gifts from settlor. From 1942 to 1945 settlor paid the tuition for Stephanie’s attendance at nursery and elementary school. During the period between the divorce of Stephanie’s parents and the execution of the deed of trust, settlor entertained Stephanie as a visitor in his home from 10 to 12 times per year. While at their summer home in the summers of 1944, 1945, and 1946, settlor and his wife frequently picked up Stephanie at her family’s nearby cottage for visits with them.
The orphans’ court concluded, without reference to this evidence of an affectionate relationship between Stephanie and her grandfather, that the provision for the “issue” of Stephen Jr. clearly and unambiguously included Stephanie, notwithstanding her adoption by Harlow Culbertson in 1951. From the decree directing that she be permitted to share in the distribution of the portion of the corpus allocated to such “issue” Stephen IV appeals, urging that only he is entitled to take under that provision of the deed of trust.
The principles applicable to the construction of trust instruments are essentially the same as those used in the construction of wills.6 The intent of the settlor, if not contrary to law, must prevail.7 Canons of construc*305tion may be applied if the intent of the settlor is otherwise unclear.8 However, as we said in Chambers’ Estate, 438 Pa. 22, 24, 263 A.2d 746, 747 (1970):
“ [A] rtificial rules of testamentary construction have been legislatively and judicially created merely to aid in what is always the primary goal — to ascertain and to give effect to the testamentary purposes of the testator. Therefore, where the testator’s actual intent can be ascertained, such intent must prevail over any artificially-deduced ‘intent’ which the rules of construction might dictate.”
The pertinent provision of the deed of trust provides that, after the death of the settlor and his wife, Stephen Jr. was to receive one-half of the trust income. At his death, his share “shall be paid over to his issue per stirpes.” Had settlor, his wife, and Stephen Jr. all died before Stephanie’s adoption in 1951, there would be no question that she would have been entitled to participate in this distribution as the daughter of Stephen Jr. The terms of the trust instrument clearly identify Stephanie as one of the objects of settlor’s bounty. It is unlikely that settlor would have desired to exclude Stephanie from benefits under the trust merely because his son gave his consent to her adoption by her stepfather. Absent any evidence of an intent to exclude Stephanie be*306cause of an unanticipated adoption, and given the clear evidence in the trust instrument of an intent to include her, we are not prepared to apply legal rules of construction to thwart settlor’s intent. Our conclusion is reinforced by the basic equality of treatment adopted by settlor for his descendents of the same generation.
In Taylor Estate, 357 Pa. 120, 53 A.2d 136 (1947), a testimony trust was established providing income for life to the testatrix’ brother. Upon the death of the brother, the corpus was to be distributed among his “issue.” The brother had five children, two of whom predeceased him. Of the two children who predeceased the brother, each left a child. One of these grandchildren of testatrix’ brother was adopted, before the death of the brother, by a person unrelated to testatrix or her brother. When the brother died, the question arose whether this grandchild, adopted “out” of the family of testatrix’ brother, was entitled to participate in the distribution as “issue” of the brother. This Court held that the adoptee was entitled to share in the distribution notwithstanding his adoption by a stranger to his! grandfather’s blood.
We find that settlor’s intent was to include Stephanie as “issue” of Stephen Jr. Further, to the extent that legal principles are needed to construe this deed of trust, we find Taylor Estate to be persuasive authority for including Stephanie in the trust distribution.
Decree affirmed. Each party pay own costs.
JONES, C. J., filed a concurring opinion.
NIX, J., concurs in the result.

. See Appellate Court Jurisdiction Act of 1970, Act of July 31, 1970, P.L. 673, art. II, § 202(3), 17 P.S. § 211.202(3) (Supp.1975).

. The deed of trust was amended on February 13, 1945. The terms of the amendment’ are not material here.

. Stephen IV offered no evidence designed to illuminate the intent of the settlor, relying solely upon what he regarded as the proper construction of the words of the instrument.

. Before the orphans’ court rendered its adjudication, Stephanie submitted a request for findings on these facts in accordance with her evidence at the hearing. Stephen filed a response to the request for findings stating that he had no objection to the re*304quested findings “except for relevancy.” We therefore conclude that these facts are undisputed, the disagreement between the parties being confined to their legal significance.

. Because the question presented in this case involves construing a deed of trust executed in 1944 and amended in 1945, the evidence of Stephanie’s relationship to settlor was largely confined to the period prior to and immediately surrounding the execution of that instrument.

. In re Girard Corn Exchange Bank, 418 Pa. 112, 115 n. 4, 208 A. 2d 857, 859 n. 4 (1965); Pew Trust Estate, 411 Pa. 96, 106-97, 191 A.2d 399, 405 (1963); see Erny Trust, 415 Pa. 8, 202 A.2d 30 (1964).

. E. g., Thomas Estate, 457 Pa. 546, 551-52, 327 A.2d 31, 34 (1974); Pew Trust Estate, 411 Pa. 96, 106-07, 191 A.2d 399, 405 (1963), and authorities cited by those cases.

. The function of canons of construction is well stated in 5 American Law of Property § 21.2, at 129 (A. J. Casner ed. 1952):
“When the construction process goes into operation to give preciseness of meaning to language that is not clear and unequivocal, the basic search is for the intention of the transfer- or. By hypothesis, however, he has not manifested his intention with respect to the particular difficulty. Thus, the search for the intention of the transferor must of necessity be changed to a search for the intention it is reasonable to attribute to the average transferor with respect to the particular situation. A rule of construction which may be established as a guide to the interpretation of a donative transaction is nothing more than the formulation of the intention it is thought reasonable to attribute to a transferor in giving preciseness of meaning to language he has employed.”