Court Opinion

ID: 6383471
Source: CourtListenerOpinion
Date Created: 2022-06-25 00:03:27.588607+00
Date Added: 2024-06-11T15:50:26.817943
License: Public Domain

Bolger, J.,
dissenting opinion, November 28, 1947. —The conclusion that settlor agreed to pay the life tenant the monthly sum of $225 for her life erroneous. The deed of trust recites that it is the trustees’ obligation to make these payments out of income derived from the trust res, if the corpus be inadequate, then to call upon settlor, who has a reversionary right in the res, to make up the deficiency. If after 60 days he has failed to do so, then trustees shall invade principal to make the payments, at the instance of the life tenant.
Resting the full weight of the decision upon the interpretation of the word “call” is fatal error, considering its admitted equivocal meaning, its position being among the enumerated powers of the trustees and not an express promise or obligation of settlor or among the purposes of the trust. This misplaced reli*150anee stems from the failure to place the weight where it properly belongs, i. e., on the language defining the purpose of the trust. The majority opinion recites part of this purpose in its opening paragraph, but fails to state it fully. For emphasis, let me repeat it:
“. . . it being the purpose of this Trust to provide an income of Two hundred and twenty-five Dollars ($225.00) per month to the said Lillian Seixas, beneficiary, for the term of her natural life, and to further provide that in the event of any deficiency of income Trustees shall make up any deficiency out of principal, at the demand of the aforesaid beneficiary, Lillian Seixas.”
The majority enlarges upon this express clause by unjustifiably reading into it a personal obligation of settlor.
In Hild v. Dunn, 310 Pa. 289, 293, are enunciated several principles always employed in the construction of contracts.
“ ‘An agreement is the assent of two minds to the same thing. It should be construed in the light of the facts and circumstances under which the parties contracted. These form a sort of context that may properly be resorted to as an aid in interpreting the contract, to the end that the object and purposes of the parties may be carried into effect. ... It is axiomatic that all contracts must be construed with reference to their subject matter and obvious purposes, and, however general the language may be, their scope and effect are necessarily so limited and controlled.’ ”
In Alcorn Combustion Co. v. Kellogg Co., 311 Pa. 270, the syllabus reads:
“5. The general language of one paragraph of a contract will be limited, where it is necessary so to do, in order to give to other paragraphs their necessary effect.”
In Commonwealth v. Nelson-Pedley Construction Company et al., 303 Pa. 174, 185, “nothing can be in*151ferred which is in direct violation of that which is clearly expressed . . . because ... it cannot be assumed that repugnant or contradictory clauses were intended to be inserted in the contract.” We should not, therefore, give to the word “call” a connotation which is repugnant to, extends, or circumvents the purpose clause, which is clearly expressed.
In Johnson v. Ritter, 111 Pa. Superior Ct. 482, plaintiff sued on a contract in which defendant made him his exclusive agent at a fixed commission to sell a certain piece of real estate at a fixed price whether the property was sold by the agent or by defendant. Defendant sold the real estate at a lower price. Plaintiff sued for the rate of commission on the actual sale price. The Superior Court sustained the nonsuit granted by the lower court stating that the sale as made was not within the written terms of the contract and that the result of adopting the construction of the contract suggested by appellant would be to give the contract a meaning opposed to the obvious purpose of limiting plaintiff’s power to sell at a specified price. In Hild v. Dunn, supra, and Commonwealth v. Nelson-Pedley Construction Co., supra, the courts refused to enforce contracts similarly lacking in express terminology.
Here the parties wanted to dispose definitely and finally of their controversy in a businesslike way. Mr. Wolters, settlor, was settling a claim against his son for damages for breach of promise of marriage and in consideration of the release of the son. It is a contract made to answer for the default of another and should, therefore, be strictly construed. The minds of the parties met on a monthly sum and they fixed a definite manner of determining whence it should be derived — from the UGI stock. As an ordinary prudent person, the life tenant did not want to leave anything to speculation, such as the settlor’s continued solvency, in order to secure that income. She would have insisted *152that the corpus be increased had she felt it were inadequate. Security was her purpose. Settlor naturally did not want to expose himself to future additional liability, but at the same time he desired to secure the return of the collateral when the life tenant died. We can, therefore, reasonably assume that if these parties anticipated the possibility of the collateral being insufficient to yield the stipulated income and that the settlor should become personally liable to make up any deficit they would have said so: Hild v. Dunn, supra, pp. 294, 295. It cannot be denied that such provision would have been an unusual one; it would have left the contract an open one, a possibility which settlor would seek to avoid. Their failure to expressly provide for it is the most eloquent fact in this controversy. In striking contrast is the Estate of Albert R. Gallatin Welsh, 2016 of 1942, now before the court, where the issue involves a separation agreement between husband and wife and the main element is the presence of the express undertaking of the husband to support his wife for the duration of her life or widowhood.1
The parts of the contract upon which the adjudication and the majority opinion rest deal only with the operation of the contract and not with its purpose. “Call” is included among the powers of the trustees and is declared ambiguous by the adjudication and the majority opinion and its meaning is extended to an expansion of the purposes of the trusts. I disagree with that construction. The word is sometimes used in the same sense of assessment or of notice or privilege. But all of the authorities that I have examined, including the Wisconsin and New York cases cited in the majority opinion, give it the meaning of assessment only when it is tied to some primary express obligation — that is in a relative, independent or conditional sense. For instance, in 1 Webster’s International Dictionary, 2nd edition, 880:
*153“13. Finance, (a) A demand for the payment of money; esp. a notice to a stockholder, member of a mutual insurance company, etc., to pay an installment of subscription ... or a contribution toward certain losses, etc.; an assessment, (b) a demand for presentation for payment, as of a bond.”
Another connotation of “call” and one which accords largely with the use employed in the majority opinion and which is consistent with my conclusion is “demand” but only in the sense of election or option. When a “call” was made upon settlor, it created in him an election to make up any deficiencies of income from his private means or to suffer the invasion of the corpus in which he had the reversionary right. In either event he would suffer the detriment that the majority opinion finds inherent in the term, but it does not follow that settlor had to supply further funds. If this process resulted in the exhaustion of the corpus, there does not appear to be any other recourse against settlor. The situation is like that of a collateral loan, lacking however the primary obligation of a promissory or judgment note upon which suit could be brought. In many cases when the phrase stands alone, it is given the connotation of notice or of privilege. It is conceded that here there is no independent or primary obligation of settlor to respond to the call or any correlative express right of the trustees or of the life tenant which is tied to or to which it relates. It cannot, therefore, be said to bind settlor to respond to the call other than as above outlined. Under the authority of Alcorn, etc., v. Kellogg, supra, the interpretation of this word must be limited to demand in the sense of election or option, because such limitation is necessary to give effect to the express intention of the parties in the purpose clause.
The majority opinion attaches great importance to the phrase binding settlor’s successors to the deed. This clause is of secondary importance and must like*154wise be subordinated to the main purpose of the parties. Flying in the face of the foregoing authorities, the majority opinion maintains that this clause implies an obligation on the part of the appointees or of the next of kin of the settlor to make up any deficit in income or principal, otherwise the provision is without meaning. This clause was plainly inserted to serve a very real purpose, to act as a protection for the trustees against surcharge and to insure them adequate powers to function. These powers are, among others, to invade principal in order to meet delinquencies in monthly payments when, as and if settlor failed to meet “calls”, to sell, invest and reinvest in “non-legals”, to fix the trustees’ commissions, to purchase at premium or discount, to subscribe for stock or bond privileges, etc.
This settlor must have had a peculiar liking for UGI stock as an investment, a perfectly normal belief. He, therefore, attempted to give himself the opportunity to protect his reversionary right in that investment by requiring that he receive notice of any default of income yield from the stock and that he have 60 days in which to protect that interest if he so desired. The parties employed the word “call” to protect that right. It is ironic that the word is now employed as a weapon of attack upon him when it was intended to afford him a measure of protection. The majority opinion dismisses this contention without full consideration of its importance. The reason is clear why the majority opinion characterizes the trust as a poorly drawn instrument. However, when it is given the construction herein portrayed, it becomes a well drawn instrument. Therefore, the present interpretation is to be preferred.
Even though the language of this deed be susceptible of the two constructions, it is submitted that the foregoing one is the more reasonable and it is, therefore, to be preferred: Navarro v. Pittsburgh School District, 344 Pa. 429. In Hempfield School District v. Cavalier *155et al., 309 Pa. 460, it is held that a construction which makes one of two possible results fair, customary and such as prudent men would naturally execute, while the other makes it inequitable, unusual or such as reasonable men would not be likely to enter into, that interpretation which makes the natural and probable agreement must be preferred.
The exceptions should be sustained.
President Judge Van Dusen joins in this dissent.

 Welch’s Estate, 61 D. & C. 47.