Grim's Appeal, No. 145

No. 145 | Pa. | Oct 5, 1885

Mr. Justice Gordon

delivered the opinion of the court,

John Grim, by his last will, devised and bequeathed as follows : “ I give, devise and bequeath all the rest, residue and remainder of my estate, real, personal and mixed, wheresoever and whatsoever, unto my executors hereinafter named, and the survivor of them, and the heirs, executors, administrators and assigns of such survivor, upon trust, to take, collect and receive the rents, issues and profits of my real estate, and the income of my personal estate, and to pay out of said rents, issues, profits and income of my said residuary real and personal estate, the sum of twelve hundred dollars per annum in equal quarterly payments, the first payment to be made within three months after my decease unto my said wife, Sophia Grim, for and during all the time she shall remain my widow; and if there should be any surplus income of my said real and personal estate in the hands of my said executors after payments to be made as aforesaid by them to my said wife of twelve hundred dollars in each and every year in quarterly payments as aforesaid, I do order and direct them, my said executors, and the survivors and survivor of them, to invest such surplus income from time to time, and to call in, convert, and re-invest the same as often as they or he shall deem proper or necessary, in such securities as they, my said executors or the survivor of them, maj1-, in their or his discretion, deem most advantageous to my estate, until the decease or marriage of my said wife, whichever event may first happen.”

That under the Act of 1853, accumulations as directed in the above recited testamentary clause, are void and of no effect, is no longer an open question: Washington’s Estate, 25 P. F. S., 102; McKee’s Ap., 15 Nor., 277; Stille’s Estate, 4 W. N. C., 42; Carson’s Ap., 3 Out., 325. It follows, that as by reason of the provisions of the Act mentioned, all accumulations except for minors and charities are void, the provision above set forth, by which the accumulations are expressly reserved for the residuary estate, is unlawful and nugatory.

The only question left for our consideration is, to whom does the accumulating fund thus left, undisposed of, belong ? Not to the residuary legatees, for they are not the persons who, “ under the uses or trusts of the deed, will or other conveyance, directing such accumulation, would for the time being, if of full age be entitled to the rents, issues, interests and profits so directed to accumulate.” They cannot take presently, but only after the death or marriage of Sophia Grim, and as the accumulations can never form part of the residuary estate, these residuary legatees can have no interest in them, present or prospective. The case is very much like McKee’s Ap., supra. In this case there was no disposition whatever made by the testator of the surplus rents, issues and profits which, after his death, arose from his estate, and it was therein held that, “ under the operation of the will before us there is no direction in favor of any person or persons; on the other hand, if accumulation is allowed at all, it must be allowed to swell the general estate until the death of Mrs. McKee, when, as part of the corpus, it must go to whomsoever at that time may be entitled. No ingenuity can reconcile a piovision of this kind with the statute, and it must, therefore, fall.” The result was that the surplus increase of the estate was, as in Washington’s Estate, decreed to the heir at law. To whom then, shall the rents, issues and profits out of which the accumulations, directed by the will, were to arise, be awarded? The Act itself answers this question as follows: ‘•And in every case where any accumulation shall be directed otherwise than as aforesaid, such direction shall be null and void, in so far as it shall exceed the limits of this Act; and the rents, issues, interests and profits so directed to be accumulated, contrary to the provisions of this Act, shall go to and be received by such person or persons as would have been entitled thereto, if such accumulation had not been directed.” In other words, to the testator’s widow and heirs or next of kin.

This disposes of the main matter in dispute, but there is another of minor importance, and which, though arising in the form of an exception, has not been thought worthy of a discussion by the counsel on either side. The exception is, that the court erred in awarding the entire balance of the present account to the widow. This is answered by the auditing judge of the court below in this manner : “ As the heirs and next of kin. under the distribution made alreadjq have received more than one half the surplus accrued, the entire balance shown by the present account has been awarded to the widow.” There can be no valid objection to the judgment here announced; the first account was but partial, embracing only the rents, issues and profits then accrued, and whilst the decree of confirmation was conclusive on all therein contained, yet as the widow’s claim was not embraced in that account, the decree can in no wise affect her rights; Leslie’s Ap. 13 P. F. S., 355 Shindel’s Ap., 7 Id., 43; Kline’s Ap., 5 Nor., 363. The question involves not so much the previous account, which has been closed up, and is now out of the way, as the equitable status of the parties with reference to the fund in hand. The doctrine held in Williams’ Law of Executors, 1088, (7th ed.) is undoubtedly the true one; that is, whore a creditor goes into the Master’s office to establish his debt, he must not only show what was due at the time of the death of the debtor, but also what has been received since that time; and this for the reason, that it being a leading equitable maxim that equality is equity, the creditors who have been paid in part ought not to receive any other part either of the legal or equitable assets, until the other creditors have been paid the same proportion of their debts. The question thus being one simply of payment, it does seem to us that it cannot make much difference how the payment was made, whether by the executor, on his own responsibility, or by distribution of a previous fund under the decree of the court, and this rule must undoubtedly apply to the claims of the present distributees. How stand these several claims; what proportion has been paid on each? And the manner of payment is a question of minor consequence. The previous decree neither altered the character of the claims nor the equities of the parties.

When that decree was made the widow was entitled to the one half of all the accumulations, not only of those which had then accrued, but that'had and would accrue between the date of the death qf the testator, and her own death or marriage, and the heirs were entitled to the other half. How then, did or could the decree, which related only to a partial fund alter or destroy this right established by the law of the Commonwealth? By paying to the heirs that which the widow ought to have had? An equitable conclusion truly; a conclusion that would enlarge the share of the heirs at the expense of the widow! This will not do. If we but remember that the former decree operated upon nothing but what was then in hand, and that the order then made was but a direction to pay what the executor then had for distribution on account of the shares of the heirs, and that the court neither did, nor intended to, pass upon the rights of the parties, we will at once see, that what the distributees then received were but payments upon the claims, which, by the decree, were made absolute,'but which, nevertheless, left the equitable status untouched, and to be adjusted on final account. For example: let us suppose the accumulations to finally net $100,000; of this the heirs at law are entitled to $50,000, and. the .widow is entitled to the balance. About this proposition there is no doubt; so reads the law. But the appellants say, no; the widow is entitled to but $25,000, and this because on a former distribution they were allowed to take $50,000. And the widow’s claim not being presented, she took nothing. Now, say thej’', we are to come in pro rata with the widow on the present fund, being held to no account for what we have received, and so are to raise our own shares of the estate to $75,000, and reduce her share to $25,000. A rule of this kind being not only inequitable and unjust, but contrary to the provisions of the Act of Assembly, cannot be sustained.

The decree of the court-below is affirmed, and it is ordered that the appellants pay the costs.