Court Opinion

ID: 6377151
Source: CourtListenerOpinion
Date Created: 2022-06-24 23:56:26.063497+00
Date Added: 2024-06-11T15:50:13.201197
License: Public Domain

Henderson, J.,
dissenting. — I must dissent from the action of the majority. The facts relating to these dividends are readily ascertainable and a court of equity should do only one thing — apportion the dividend among those entitled thereto. In Miller’s Estate, January Term, 1909, No. 65, I had a similar question before me, and apportioned the dividend among those entitled, and as no exceptions were filed, the question did not come before the court in banc. I will quote from that adjudication:
“It will be observed that at the time of the death of the widow, March 31, 1919, the surplus of the company was $2,583,950.40, almost enough to pay the stock dividend of $3,000,000. It should further be observed that the earnings, after the death of the widow, were more than sufficient to pay the stock dividend. The question is, therefore, presented for determination, should this stock dividend be awarded to the life-tenants as of the date of its declaration, or should it be apportioned between the life-tenants as of the date of the death of the widow and the present life-tenants in the proportion which the whole surplus bears to the surplus existing at the date of the death of the widow and the surplus earned from that date down to the declaration of the dividend bear to one another. If the dividend is to be apportioned among the succeeding life-tenants as of the date of the death of the widow, two-thirds of the portion payable to the life-tenants as of that date would be awarded to the estate of the widow, and would thence pass to the three daughters alone, and the remaining one-third of this portion would pass under this testator’s will equally to the four children — the three daughters and the son; and then that part of the dividend apportioned to the period after the death of the widow would pass equally to the four children. In other words, if the dividend is to be apportioned, the widow’s estate would be entitled to two-thirds (that being her share of the income under the will) of $6,491496.99 $3,000,000 of the dividend of 4446 shares. On the other hand, if this extraordinary stock dividend is not to be apportioned between *702the succeeding life-tenants, then it would all be awarded to the present life-tenants — the four children. The question now raised — of apportioning an extraordinary stock dividend, payable out of surplus, among succeeding life-tenants — appears largely as one of first impression. ... Of the surplus of over $6,700,000 to the credit of the company on the date of the dividend, over $2,500,000 was earned before the death of the widow on March 31, 1919. Had that amount been earned in the lifetime of the testator and divided after his death, there can be no doubt but that it would have been awarded to the trustee as corpus. If the amount earned in the lifetime of the widow had been dividéd, there is equally no doubt that it would have been awarded to her. If the dividend had been declared one year after her death, wholly of the accumulated earnings in her lifetime, I can see no reason why they should not be awarded to her personal representative. . . . Turning now to the will of the testator, we find that two-thirds of the profits of his estate were given to the widow for life, and the question recurs, shall we go back of the form of the distribution of profits by this corporation, grasp the real facts, and award them to the parties entitled thereto under the will at the time they were earned? There is only one answer a court of equity can make, the one ordered by this adjudication. . . . The stock dividend of 4446 shares of the American Laundry Machinery Company, together with any cash dividends that may have been declared on those shares, is awarded to Mary Miller (the deceased widow), Emma Miller Wood, Caroline H. Miller, Charles J. Miller, and the Land Title and Trust Company, guardians of the estates of Katherine May Sauter and William V. Sauter, Jr., minors, in the proportions directed by this adjudication, the award to Mary Miller to be paid to her personal representative.”
I would follow the same procedure in the instant case.
Van Dusen, J., did not sit.