Court Opinion

ID: 6375452
Source: CourtListenerOpinion
Date Created: 2022-06-24 23:54:40.034661+00
Date Added: 2024-06-11T15:50:09.445319
License: Public Domain

Lamorelle, P. J.,
The controversy arises over the proper construction of the eleventh item of the will of Isaac C. Price, who died in *4671889. Of the six cestuis que trust named in the will, his wife, his two' daughters and his three grandchildren, two alone survive, Isaac Price Ewing, son of Mary Ewing, a daughter of the first wife of testator, and Mary C. Fourl, surviving child of Eliza P. Cadwallader, a daughter of testator also by his first wife. They claim the right to have the trust terminated, in that, from their viewpoint, no legal reason exists for its continuance. They are entitled to all of the income, either under the will or because of an intestacy as to a certain fraction of such income, and as there is no gift of principal, their argument is that the corpus should forthwith be divided between them. Their contentions are set forth in earnest arguments, both oral and in briefs, submitted at the two hearings. The solution of the problem is by no means simple, yet, after a thorough consideration of their claims, we are not convinced that the auditing judge, who wrote an exhaustive and extended adjudication, erred in his conclusion that the trust continued.
In the circumstances we deem it advisable, in a more or less concise way, to supplement what has already been said in the adjudication.
The entire residuary estate was given to three trustees, who were directed to divide the net income into ten equal parts; three of these parts were given to the widow for life, two other parts, four in all, to each of the two daughters, but without limit in words ;as to' time, and the remaining three parts to three grandchildren, by name, each for life. When, and as, the daughters died, the three grandchildren named took their respective shares of income in “the same proportions.”* Thus, by necessary inference, the daughters’ interests were limited to their lives; this is further emphasized from the fact that their shares of income were to be paid into their own hands and that a spendthrift clause was added. The two daughters are dead; since their death their shares have beén paid in the proper proportions to the three grandchildren. Isaac P. Calwallader, one of the three, also is dead. By his will he attempted to dispose of his share of the income, for, although such income was given him for life, he was authorized to dispose of it for the life of the trust. The will was not executed in accordance with the provisions of the will of the original testator, and we held in Price’s Estate, 27 Dist. R. 561, that the attempted exercise of the power of appointment was invalid. The will of Isaac C. Price, the original testator, made no disposition of this income in event of .the death of his grandson, Isaac P. Cadwallader, except in event of the grandson’s dying leaving descendants him surviving. As there were no such descendants, we held, in the above recited case, that there was an intestacy as to thus much of the income, seven-thirtieths of the whole, as of the date of the death of the original testator in 1889. The result of this ruling was that the two present claimants, because of intervening deaths and devolution, became entitled to the same in equal shares.
The present accounting is had because of the death of the widow, Harriet B. Price, which occurred Dec. 9, 1921. On her decease, the two daughters being then dead, the will directed that the entire net income should be paid to the three grandchildren, if then living, in equal shares, for and during the terms of their respective natural lives. If, however, any of them should be then deceased, intestate, leaving lawful issue alive, such issue was to take the share of the principal as to which the deceased parent was given the income for life. At the time the widow died one of the grandchildren, Isaac P. Cadwallader, as before stated, was deceased, and, although he did not die intestate, he left no descendants him surviving. The auditing judge ruled that the two living grandchildren, the present claimants, took all of the income. *468This, no doubt, they do, but it would seem that they take because there is an intestacy in the original testator of whatever share of income Isaac P. Cadwallader would have taken had he survived his grandmother. The result is the same in either case.
We have, therefore, this situation: Isaac P. Ewing entitled to one-third of the income under his grandfather’s will, Mary C. Pourl entitled to a like third, and the two of them entitled each to a sixth, making up the remaining third, because of the intestacy of original testator, their grandfather, as to one-third of the entire net income of the estate.
We thus lead up to the important question, when does the trust terminate?
As bearing thereon, we quote the concluding sentence in the eleventh item of the will: “Either of my said grandchildren may by last Will or Testament or writing in the nature thereof duly attested dispose of his or her interest in the income of my estate so long as the same shall be held in trust and also of her interest in the principal thereof to take effect upon the partition of my estate.”
As we have said before, while there is no gift of the principal, it would seem clear that the intention was to defer distribution until after the death of the three grandchildren, except that if any one of them should die intestate in the lifetime of the widow leaving lawful issue, such issue might then demand such grandchild’s share. Apparently the trust as to one-third terminated on the happening of this contingency, but the one grandchild who died did not die intestate, nor did he leave descendants. The .power given to the grandchildren to dispose of income provided that the legatee should have the same “so long as the same was to be held in trust,” and the legatee should have the share of the principal, which was to take effect upon the partition of the estate. Partition of the estate manifestly referred to ultimate distribution, and it would, therefore, seem that the trust must continue as long as any reason therefor existed.
While from the language of the will it would appear that the three grandchildren may have vested interests in the principal, at least in event of their surviving the widow and the two daughters of testator, because each might by will dispose of his or her interest in the income of the estate, and also of his or her interest in the principal, it does not necessarily follow that the right of disposition was intended to effect a termination either in whole or in part of the trust. In fact, the wording of the particular paragraph justifies a different conclusion. It negatives a purpose to terminate the trust as to income while any of the grandchildren named in the will are alive, and also implies that, no matter what the then distribution of income might be, or who should be in receipt of the same,-the principal should remain intact and as an entity until the time was ripe for a division thereof, which time, so fixed, was, in effect, the death of the survivor of the three grandchildren.
The auditing judge was undoubtedly correct in his application of the principle of Aubert’s Appeal, 119 Pa. 48; Wilen’s Appeal, 105 Pa. 121, and kindred authorities. In Aubert’s Appeal, 119 Pa. 48, a trust was created as to one-half of the estate, the income being payable to a brother and sister, share and share alike, for life, with substitution of children in event of the death of either, and with distribution of principal upon the death of both; the brother died without issue, and the sister being alive, the court refused to divide the fund and to award the one-half. Mr. Justice Paxson (page 53), delivering the opinion of the court, said: “As was said in Wilen’s Appeal, 105 Pa. 121, we cannot say that a moiety of the income of the whole may not be more valuable to the surviving life-tenant than the whole of the income of a moiety. In any event, it is enough for us know that the testator, in clear *469language, designated the time when distribution should be made, and it is not our province to change his directions.” In Wilen’s Appeal, 105 Pa. 121, the court upheld a family agreement, wherein the widow was to have one-half of the entire income for life, and other parties in interest sought thereafter to have one-half of the principal distributed and to give her all of the income from the other one-half of the principal. ,
In the instant case the entire estate was to be held by the trustees, among other things, to pay the shares of the two daughters and the one granddaughter “into their own hands respectively upon their own receipts,” and not to be subject to their debts and without power to sell or assign. Thus were spendthrift trusts created. There can, therefore, be no doubt that the trust as to one-tenth of the income in the granddaughter, Mary Cadwallader (now Fourl), is impressed with such trust, and, in our opinion, this applies also to the shares in income she takes because of the death of her grandmother (Harriet B. Price, widow of testator) and the death of her mother (Eliza P. Cadwallader, daughter of testator). This follows from the wording of the will: “The amounts herein directed to be paid to each of my said daughters and to my said granddaughter, I direct,” shall not be subject to their debts. This is found in the item creating and defining the terms of the trust hereinbefore referred to. The doctrine pf “accrued shares” is one of intention; it may occur by express direction-or upon clear inference. The inference, however, is not one of law, but of language on the particular case. Here we have both. The “amounts to be paid” meant all sums original and to accrue. This will is readily distinguishable- from that in Mifflin’s Estate, 232 Pa. 25, in that there were no “original shares” given grandchildren, and, hence, nothing to accrue.
Admittedly there is no spendthrift clause as to the share of income which Isaac Price Ewing, the other living grandchild, receives, and as far as his share is concerned, there is no distinction to be drawn between the part he takes by the will and that which he received because of the death of Isaac Price Cadwallader and the ensuing intestacy as to that share of income. All that he does get, however, is subject tó and controlled by the dominant thought of testator that the trust should endure until the time fixed for a division of the principal.
As we view the matter, it can make no difference who is now entitled to income, who may be ultimately entitled to principal, or what share of the estate passes from the original testator under the will or under the intestate law, or whether his widow, Harriet B. Price, takes any further share (as to which see Jackson’s Estate, 126 Pa. 105; Rogers’s Estate, 24 Dist. R. 824), or whether a legatee under the will of Isaac Price Cadwallader may receive as part of his own estate that which he attempted by appointment to give her as part of his grandfather’s estate. The one, question which we decide is that the trust as to principal may not now, either in whole or in part, be terminated.
And for that reason all exceptions, original and supplemental, are dismissed and the adjudication is confirmed absolutely.