17 N.E.2d 833 | Ind. | 1938
This is an appeal from a declaratory judgment construing the last will and testament of Dr. Edward B. Long and giving directions concerning the disbursement of certain income arising from his estate. The action was commenced by the appellee bank, as *3 trustee of certain trusts created by the will, and all other parties in interest were named as defendants.
Item five of the will created ten separate trusts, one for each of nine named relatives and servants of the testator, and the tenth to be known as the "Doctor Edward B. Long Foundation." It directed that the net income of each of said separate trusts (other than the foundation) was for the sole use and benefit of the respective beneficiary "so long as" said beneficiary "shall live." The language creating the nine individual trusts was identical excepting as to that in favor of Lillie Long, an invalid sister, which directed, among other things, that the fund set aside for her benefit should be used toward the payment of the expenses of her last sickness and funeral and for the erection of a suitable marker at her grave. In the case of the eight other individual trusts, any balances remaining in the funds at the death of the beneficiaries were to be turned over to the foundation. Said item five further provided:
"Upon the deaths of such of the respective persons aforenamed for whose respective uses and benefits the respective aforesaid trusts from one to nine, both inclusive, are created as aforesaid as shall become effective in the contingencies aforesaid, then said respective trusts shall terminate and the Trustee shall as soon as practical thereafter settle and close such respective trusts and pay, turn over and/or deliver the respective balances thereafter remaining in said respective trusts or said respective lots, blocks or parcels, to the Trustee for the use and benefit of said trust, lot, block or parcel ten and the same shall become, be and constitute a part thereof or a part of the trust to be known as the `Doctor Edward B. Long Foundation.'
"The trust to be known as the `Doctor Edward B. Long Foundation' is and shall be for the charitable *4 uses and purposes of the institution or association known as St. Mary's Hospital at Evansville, in the County of Vanderburgh, and State of Indiana, the same being incorporated under the name of St. Mary's Hospital of the City of Evansville, Indiana, and its successors.
* * *
"Out of the income of the property of the trusts the Trustee shall first pay all taxes, if any, and the ordinary costs and expenses of administration of the trusts, including reasonable compensation to the Trustee and the Trustee's attorneys and counsel, and pay the net income thereafter remaining to the respective beneficiaries of the respective trusts monthly, quarterly, semi-annually or annually as the Trustee and said respective beneficiaries may agree, but in case of inability or failure to agree respecting the time of payment thereof the said net income shall be paid by the Trustee as soon after receipt and as often as it deems practical and convenient, the Trustee having due and proper regard for the interests of the beneficiaries."
All of the beneficiaries survived the testator and they agreed with the trustee for quarterly settlements of the income account. The date of the testator's death was May 22, 1930. The trust funds were segregated in December, 1933, and the trustee distributed the quarterly income as of March 10, 1934. Rebecca Long, one of the beneficiaries, died on May 7, 1934, and a controversy arose between her sole heir and the trustee with reference to the disposition of the income from that part of the trust fund set apart for her, earned and accrued since March 10, 1934, and unpaid at the time of her death. On the occasion of the oral presentation it was suggested that other beneficiaries had since died and that the issues were so formulated that the disposition of the question under consideration would be controlling *5 with respect to their interests, as well as to those still surviving.
The items of income in controversy fall into three groups, namely, income collected and on hand prior to Rebecca Long's death; interest coupons matured prior to her death, but delinquent and not collected until after her death; and income maturing and collected after her death. It is the contention of appellant that all the income, accumulated, earned, and accrued, but undistributed, at the death of Rebecca Long became and constituted a part of the Doctor Edward B. Long Foundation, while appellees assert that such income should be apportioned as of the date of Rebecca Long's death and paid to her sole heir at law.
The cardinal rule in the interpretation of wills, to which all other rules must bend, is that the intention of the testator shall prevail, provided that it is consistent with the 1, 2. rules of law. Dickey v. Citizens State Bank of Fairmount (1933),
Annuities are fixed sums payable at stated times *6
(not necessarily annually) and it may be stated as a general rule that an annuity cannot be apportioned, since there is 3-5. nothing earned and nothing due until the day for payment arrives. See Heizer v. Heizer, Admr. (1880),
In support of its contention, the appellant relies uponNading v. Elliott, Trustee (1893),
Appellant calls attention to a provision in item five of the will, quoted in the forepart of this opinion, wherein it is stipulated that the "respective balances" remaining in the 6. several trust funds at the deaths of the beneficiaries shall become a part of the Doctor Edward B. Long Foundation. We cannot agree that the words "respective balances" have reference to the principal trust funds and the accrued but undistributed income therefrom. We think it more logical to conclude that "respective balances" refer to the trust funds proper. Our view is strengthened by the fact that, as already pointed out, the other provisions of the will contemplate that the net income shall not be retained by the trustee longer than is practicable. In support of the construction sought to be placed upon the term "respective balances," the appellant has cited Kounse v. Dronberger (1932),
Brunson, Admr. v. Martin et al., Exr. (1899),
Taking into consideration all of the provisions of Dr. Long's will hereinbefore pointed out and discussed, and the further fact that the several beneficiaries are to be entitled to the 7. net income "so long as they shall live," we cannot escape the conclusion that the meaning of the will is clear upon its face and that *9 the income earned, accrued, and accumulated, but undistributed, at the time of the death of Rebecca Long, became the property of her sole heir and should not be added to the corpus of the trust that then passed to the Doctor Edward B. Long Foundation. Since we have reached this conclusion, it becomes unnecessary for us to consider further the problem that is presented by a will that is indefinite or silent upon the subject of apportionment. Neither is it necessary for us to consider the nature and character of the securities constituting that part of the trust estate set aside for the benefit of Rebecca Long, since the character of the investments would have no controlling effect on the disposition of the income.
The trial court's conclusions of law, upon which errors were predicated, are in harmony with our views as above expressed.
Judgment affirmed.