117 Misc. 794 | N.Y. Sur. Ct. | 1921
The objections to the trustees’ accounts raise the question as to the apportionment of an extraordinary stock dividend between the life tenant and remaindermen. The account shows that on May 2, 1920, the trustees received a stock dividend of sixty-nine shares of the Nicholson File Company, which has been accounted for as principal. All of this stock dividend is claimed as income by the life tenant, the widow of decedent. Under the authorities in this state the tests to be applied are (1) the source of the property paid out in the form of an extraordinary dividend and whether there has been a distribution or division of the earnings, profits or accumulations of the corporation; (2) the language of the will. Matter of Osborne, 209 N. Y. 450; United States Trust Co. v. Heye, 224 id. 242, 255; Matter of Schaefer, 178 App. Div. 117; affd., 222 N. Y. 533. The account discloses that the entire amount of the stock dividend was paid from profits accumulated by the company after the death of decedent on September 13, 1907, from which time the widow is entitled to the income of the trust. The stock dividend should, therefore, be
As the entire surplus from which the stock dividend was paid was accumulated during the trust period, the corpus of the trust fund will not be impaired by paying the stock dividend to the life beneficiary.
Decreed accordingly.