136 Misc. 270 | N.Y. Sur. Ct. | 1930
In this accounting proceeding, the court is asked to construe the testator’s will and codicil thereto, and the effect of a separation agreement made by the testator and his wife, and certain other agreements between the executors and the widow and the adult next of kin. By the will the residuary estate is given to a trustee for the benefit of the widow during her life. Upon her death the trustee is directed to pay over the corpus to a sister and a brother of decedent in equal shares. If either one of these remaindermen die before the termination of the trust, viz., on the death of the widow, then the entire corpus is to be delivered to the survivor; and, if neither- of them survive the widow, then the residuary estate is directed to be paid over and delivered to a class of contingent remaindermen, which will be referred to later in this decision. Subsequent to the execution of the will, testator entered into a separation agreement with his wife whereby he agreed to pay her the sum of $7,500 a year and made the payment thereof a charge upon his estate. The agreement provided that the wife accepted the payment in full discharge of all claims upon the testator, or in case of his death, upon his estate. The day after the execution of the separation agreement, the testator executed a codicil to his will, revoking all provisions contained in the will in favor of bis wife, and substituting a provision creating a trust of a sufficient amount of principal to provide an income of $7,500 annually for her during her lifetime. Upon her death the trust fund is directed to be made a part of bis residuary estate.
There is no reference in the codicil to the separation agreement, and the question arose as to whether the widow might claim the benefits both of the codicil and the agreement. After negotiations between the executors and the widow, an agreement was made wherein the widow renounced all claims under the will and codicil, and the. executors agreed to set aside a fund of $160,000 to meet the payments directed by the separation agreement. This settlement agreement never received the approval of the surrogate. A fund has been created by the executors and is producing income in excess of the $7,500 payable to the widow. On the theory that the residue of the estate, after the setting aside of the above fund, was relieved of all,trust provisions by the codicil, or by the renunciation by the widow of the trust provision for her, the executors have paid over to the brother and sister named in the will the sum of approximately $60,000. All adult parties have consented to this distribution. The trustee named in the will and codicil and the special guardian appointed to represent contingent remaindermen both contend, however, that the language of the codicil does not release any part of the residuary estate from the trust created by the will. An examination of both of these instruments shows that this contention is correct.
In the present case the trustee cannot enable any of the parties in interest to secure the corpus of the residuary estate freed from the trust provisions and in a manner unauthorized by the will. The contingent remaindermen, who are not ascertainable until the death of the widow, cannot be deprived of their rights in the trust fund under any circumstances. That the remainder is contingent and not vested there can be no doubt. No part of the corpus can vest in the brother or sister under the language used unless either or both of them survive the widow. As stated in Matter of Buechner (226 N. Y. 440, at p. 444): “ We need no canon of construction to justify that holding except, indeed the primary one, to which all others are subordinate, that the intention of the testator is to be sought in all his words, and, when ascertained, is to prevail.” At this time it is unnecessary to determine the effective date for the ascertainment of the class of contingent remaindermen if the sister and brother should both predecease the widow. It may be those
The executors are also in error in their contention that the widow takes her income as a creditor under the settlement agreement and not as beneficiary under the codicil. They are to be commended for avoiding the possibility of double payments, but the testator’s action in executing the codicil the day after the separation agreement was made, and the clarity of its terms, place the duty of making the payments upon the trustee. The direction in the codicil that the trustee pay to the widow annually the sum which, by the settlement agreement, was made a charge upon testator’s estate after his death, takes this obligation out of the hands of the executors.
I hold, therefore: (1) That the executors should transfer to the trustee the residuary estate, including the funds set aside for the payment of the $7,500 a year to the widow; (2) that the excess income should be paid to the sister, Fannie, and the brother, William, as the persons presumptively entitled to the next eventual estate; (3) that the payments made out of the corpus of the residuary estate to the sister, Fannie, and the brother, William, were improper and should be recovered by the executors and then paid over to the Bankers’ Trust Company as trustee; and (4) that the trustee should hold the entire residuary estate until the death of the widow and should then distribute it in accordance with the provisions made for survivorship in the codicil. Submit decree on notice construing the will and settling the account accordingly.