Opinion
03-11-1936
BENNETT et al. v. FIDELITY UNION TRUST CO. et al.
King & Vogt, of Morristown, for complainants. Hood, Lafferty & Campbell, of Newark, for defendant Fidelity Union Trust Co., trustee, etc. Charles S. Smith, of Newark, for defendant Ida Melisse Bennett. J. Albert Homan, of Trenton, for guardian ad litem of infant defendants.
Bill by Robert E. Bennett and others against the Fidelity Union Trust Company, executor and trustee under the last will and testament of William H. Bennett, and others.
Decree in accordance with opinion.
Decree affirmed, 192 A. 232.
King & Vogt, of Morristown, for complainants. Hood, Lafferty & Campbell, of Newark, for defendant Fidelity Union Trust Co., trustee, etc. Charles S. Smith, of Newark, for defendant Ida Melisse Bennett. J. Albert Homan, of Trenton, for guardian ad litem of infant defendants.
BERRY, Vice Chancellor.
The bill seeks the construction of the will of William H. Bennett, who died November 19, 1913, and a decree directing the distribution of the proceeds of sale of certain stock owned by the testator at the time of his death. The only portions of the will pertinent to this inquiry are portions of the fifth paragraph of the will and the second paragraph of the codicil, which are as follows:
"Fifth: All the rest, residue and remainder of my estate, both real and personal, I give, devise and bequeath to Fidelity Trust Company, my executor hereinafter named, in trust nevertheless, to and for the following uses and purposes, viz: * * *
"d. To pay the net income from the balance of the residue of my estate to my said wife and my said two sons in equal shares, that is, one-third to each, for and during the natural life of my said wife, and then to divide all of the said residue equally between my said two sons except the shares of the capital stock of the Newark Milk & Cream Company, of which I may be possessed at the time of my decease, which said shares of stock shall be held by my trustee until the younger of my said sons shall attain the age of fifty years, when the same shall be equally divided between my said sons. If my younger son shall die before attaining the age of fifty years, the division shall be made when my older son attains the age of fifty years, but if both should die before attaining that age the division shall be made upon the date at which my younger son would have attained the age of fifty years had he lived so to do. Should however in the discretion hereinafter imposed, my said executor and trustee sell the said stock, the proceeds, as part of the residue of my estate shall be administered as though I myself had parted with the said stock prior to my decease and shall be released from the special direction as to the retention of the said stock, it being intended that such direction shall apply only to the stock itself. * * *
"Second: I direct that if my executor or trustee shall sell my shares of the capital stock of Newark Milk and Cream Company as provided for in sub-paragraph 'd' of Paragraph Five of my said Will, the proceeds of the sale thereof shall be held under the same trust as I directed the said shares to be held and shall not be distributed until the period when the shares themselves would have been distributed under the terms of that sub-paragraph. This direction contradicts and nullifies the direction of the last sentence in the said sub-paragraph."
The widow and the two sons of the testator who are entitled to the income on the "balance of the residue" are still living and the younger of the two sons has attained the age of fifty years. The stock of the Newark Milk & Cream Company was sold by the trustee on December 29, 1921 or 1922, for the sum of $200,000, which sum, constituting the bulk of the trust estate at the present time, is held by the trustee under the provisions of the will above recited. The total value of the trust estate is now $203,457.11, except for the sum of $6,000 representing the proceeds of the sale of real estate held by the trustee under the provisions of subsection "c" of paragraph "Fifth" of the will. The two sons of the testator now seek a decree directing the trustee to divide the proceeds of this stock equally between them. At the conclusion of the final hearing, I held that the proceeds of the sale of that stock were not presently distributable, but must be held as a part of the residue of the estate and not distributed until the death of the widow. From the final decree advised pursuant to that finding, the complainants have appealed and this memorandum is written for the purposes of that appeal.
An inspection of the will, copy of which is attached to the bill of complaint, indicates, I think, that the primary purpose of the testator was to provide an income for his father and mother (both of whom are now deceased), and his wife and two children during their lives, and I think it is quite obvious that the distribution of practically the whole residuary estate between two of the life tenants, to the exclusion of the third life tenant, at this time, would defeat one of the primary purposes of the bill and would deprive the widow ofthe income during the balance of her life which the testator sought to secure for her, and make her dependent for support upon the generosity, will, or whim of her two sons, who now seek this distribution. The whole controversy revolves around the proper interpretation to be placed upon the second paragraph of the codicil above quoted. I think it plain that under the will itself the testator must be held to have intended that the "balance of the residue" mentioned in subsection "d" of paragraph "Fifth" of the will should be held intact during the lifetime of his widow and that the income thereof should be divided equally among the widow and the two children until the death of the widow; and that upon her death all of the residue, except the stock of the Newark Milk & Cream Company, should then be distributable between the two sons, but that the stock itself should not be divided until after the death of the wife and until the younger of the two sons arrived at the age of fifty years. The will authorized the sale of the stock and provided that if sold, the proceeds should be administered as though the testator himself had sold it prior to his death. Under that provision, the "balance of the residue," including the proceeds of the sale of the stock, would be distributable immediately upon the death of the widow, and this was conceded by all counsel at the final hearing. Distribution was not dependent, under such circumstances, upon the younger son attaining age fifty. The remaining question is, What change of intention is indicated by paragraph "Second" of the codicil? In my judgment, testator intended that paragraph to apply the limitation previously applicable only to the stock itself, to tire proceeds of the sale of that stock as well. In other words, he intended that the money received for the stock should not be distributed until the time when the stock itself would have been distributable if retained, that is, until after the death of the widow, and the younger son had attained the age of fifty years. At the final hearing it was also conceded by all counsel that this would be the correct interpretation of the will and codicil, except for the last sentence of paragraph second of the codicil, which reads as follows: "This direction contradicts and nullifies the direction of the last sentence in said sub-paragraph." In my judgment, the "direction" referred to in this sentence is "the special direction as to the retention of said stock" contained in said subsection "d" and it is only that special direction, applying to the stock itself, which is nullified and contradicted by the second clause of the codicil. By the codicil, the testator merely imposed upon the distribution of the proceeds of the sale of the stock the same limitation which he had previously placed upon the distribution of the stock itself.