296 N.Y. 201 | NY | 1947
Upon this appeal we are to construe the following paragraph of the will of Harry Maybaum who died March 1, 1944:
"Fifth: All the rest, residue and remainder of my estate, both real, personal or mixed, I hereby direct my executor to divide the same after the payment of all administration expenses into three parts, one part consisting of sixty per cent (60%) which I hereby give and bequeath to my common-law wife, Mollie Goodheart, and direct that my executor pay the same to her in monthly payments of Thirty-five ($35.00) Dollars; the second part consisting of thirty per cent (30%) which I give and bequeath to my sister Fannie Rothstein; the third part consisting of ten per cent (10%) which I give and bequeath to the following children of my deceased brother David, share and share alike; Milton Maybaum, Sol Maybaum, Esther Maybaum, and Lillian Maybaum.
"In the event Mollie Goodheart dies before her share of the sixty per cent (60%) is paid to her in monthly installments as aforesaid, then in that event the balance of her share remaining is to be paid to her son, Joseph Goodheart."
The paragraph quoted above was construed by the Surrogate to be a bequest to the petitioner-respondent, Mollie Goodheart Maybaum, of an annuity of $35 a month to be paid during her lifetime from the income, or principal, or from both, of 60% of the residuary estate, and that any balance remaining at her death is to be paid to her son. Incidental to his ruling that she is not entitled to elect to receive the capital sum necessary to produce such an annuity, the Surrogate also decreed that, by reason of the fact that the petitioner's son, Joseph Goodheart, had predeceased the testator, any portion of 60% of the residuary estate which remained after the death of *204 the petitioner, shall be paid to the testator's distributees as intestate property.
Upon appeal by the petitioner the Appellate Division modified on the law the Surrogate's decree and ruled that the testator's bequest to the petitioner was absolute, except as modified by the provision for monthly payments, and that the petitioner may elect to receive the capital sum necessary to produce the monthly payments which the testator directed should be paid to her. The basis for the Appellate Division's ruling is indicated by the following statement in its memorandum of decision: "Such a construction avoids the partial intestacy which would be caused by the lapse of the attempted gift to appellant's son and is therefore, to be favored".
We reach a different conclusion. As we read the "Fifth" paragraph of the testator's will it sets forth in unambiguous language a testamentary plan according to which he directed that his residuary estate should be administered. The scope of our inquiry permits us to disregard as irrelevant the several outright bequests which dispose of 40% of the residuary estate. The balance — comprising 60% of that residuum — is bequeathed by the testator to his wife, the petitioner herein but that bequest is qualified by the direction that "* * * my executor pay the same to her in monthly payments of Thirty-five ($35.00) Dollars * * *". That such bequest was not intended to be an absolute gift to his wife is, we think, clearly indicated by the succeeding sentence in the will — "In the event Mollie Goodheart dies beforeher share of the sixty per cent (60%) is paid to her in monthly installments as aforesaid, then in that event the balance of her share remaining is to be paid to her son, Joseph Goodheart." (Emphasis supplied.) We regard as significant the use by the testator of the phrase "her share" of 60% of the residuum. Contrary to the construction urged by the petitioner and adopted by the Appellate Division — that the testator intended his bequest to the petitioner to be an absolute gift of a stated percentage of his residuary estate — we think the testator's use of the phrase "her share" in connection with that stated portion of the residuary expresses his intent that only so much of sixty percent (60%) of the residuary estate shall be paid to his wife as equals at her death the total sum which then shall have been *205 "paid to her in monthly installments as aforesaid" — viz., "monthly payments of Thirty-five ($35.00) Dollars". If the total of those monthly payments made to her prior to her death does not exhaust 60% of the residuary estate — against which they are made a charge — the balance will be distributed as intestate property to the distributees of the testator.
Concluding, as we do, that the testator chose language which clearly defines his testamentary plan we cannot now approve a different plan by resorting to the rule which indulges a presumption that the testator did not intend to die intestate as to a portion of his estate. (Matter of Disney,
We also disagree with that part of the decree entered upon the order of the Appellate Division which rules that the petitioner is entitled to elect to receive whatever capital sum may be necessary to produce the monthly payments for which the "Fifth" paragraph of the testator's will makes provision. The common-law rule governing an annuitant's right to elect to take the capital sum in lieu of an annuity as directed to be paid distinguishes between (1) cases where the will directs the executor to pay the annuity out of the estate and (2) cases where he is directed topurchase an annuity. Where, as in the present case, the testator directs an annuity to be paid out of the estate with a valid gift over of any remainder, the beneficiary may not elect to receive in lieu thereof the capital sum necessary to produce the payments directed. (28 Halsbury's Laws of England [2d ed.], pp. 188-191; Wright v. Callender, 2 De. G.M. G. 652 [1852];In re Cottrell, Buckland v. Bedingfield, [1910] 1 Ch. 402;In re Hill, Westminster Bank Limited v. Wilson, [1944] Ch. 270; 3 Scott on Trusts [1939 ed.], § 346, p. 1897; and, see,Matter of Proctor,
The order of the Appellate Division should be reversed and the decree of the Surrogate's Court affirmed, with costs in the Appellate Division and in this court to the appellant, payable out of the estate.
LOUGHRAN, Ch. J., CONWAY, DESMOND, THACHER, DYE and FULD, JJ., concur.
Ordered accordingly. [See
