Opinion
321780.
Decided on December 19, 2007.
In this accounting proceeding, the objectants have moved for summary judgment with respect to objections numbered "Third" and "Fourth." The executor has cross-moved for summary judgment also with respect to objections numbered "Third" and "Fourth." For the reasons that follow, the objectants' motion is denied and the executor's cross-motion is granted.
The decedent, Herbert J. Braverman, died on December 27, 2001, a resident of Nassau County, leaving a will dated October 18, 2001. The will was admitted to probate by decree of this court dated January 18, 2002, and letters testamentary issued to Rita Cole, one of the decedent's daughters. The decedent was also survived by his daughter, Paula Braverman.
The decedent's will provides in Article VI, as follows:
"All of the rest of my estate, of whatsoever kind and wheresoever situated, including funds in checking and savings accounts, certificates of deposit and money market accounts in banks, not heretofore given and bequeathed to my daughter RITA COLE or otherwise, I give as follows:
A. Upwards of Five per cent (5%) of such property, but in no event more than Ten Thousand ($10,000.00) Dollars, to Molecular Mechanisms of Cancer, in care of Dr. DONALD ANTHONY, University Hospital of Cleveland, Ohio, for its medical research and charitable purposes.
B. Forty per cent (40%) of such property to my daughter PAULABRAVERMAN SCHACHAT if she survives me, and if she does not survive me, then to her issue who survive me, such issue to take per stirpes.
C. Ten per cent (10%) of such property to my niece ROSALYN FLORENCE HERMAN if she survives me, and if she does not survive me, then to her issue who survive me, such issue to take per stirpes.
D. All of the rest and residue of my estate, including any lapsed
dispositions hereunder, to my daughter, RITA COLE if she survives me, and if she does not survive me, then to her issue who survive me, such issue to take per stirpes."
In addition, Article X of the will provides, as follows:
"I direct that all taxes and duties of any nature which may be assessed or imposed, either by the United States, the State of New York, or by any other jurisdiction, upon or with respect to property passing under the provisions of this Will or upon or with respect to property not passing under the provisions of this Will but upon which property such taxes are assessed or imposed, including all such taxes assessed or imposed upon the proceeds of any policies of insurance upon my life, be paid out of my residuary estate. Unless my residuary estate is insufficient to pay the taxes in full, no claim shall be made by my Executors for a contribution toward the payment of taxes against any beneficiary of this Will, other than the residuary beneficiary, or against any person who, by reason of my death, receives property outside this Will, or against any person who receives the proceeds of life insurance contracts."
The executor has filed an account of her proceedings for the period January 18, 2002 to March 9, 2007. The decedent's daughter, Paula Braverman, and niece, Rosalyn Herman, have filed objections to the account. The objectants object to Schedule H, the Statement of Interested Parties, because they contend that Rita Cole is not a 50% residuary beneficiary as described therein but instead the sole residuary beneficiary (Objection Third). The objectants claim that the dispositions in Paragraphs A, B and C of Article VI are pre-residuary legacies and not part of the residuary estate. The objectants also object to the manner in which the executor has allocated estate taxes(Objection Fourth). Objectants argue that the estate taxes should be borne entirely by Rita Cole since she is the "sole residuary beneficiary under Paragraph D of Article VI of the Will."
Specifically, objectants argue that Article X contains a clear direction that estate taxes are to be paid out of the residuary estate, and that, pursuant to Paragraph D of Article VI of the will, Rita Cole is the sole residuary beneficiary of the estate. In support of their position, objections point out that Paragraph D contains the language "[a]ll the rest and residue of my estate, including all lapsed dispositions hereunder, to my daughter, RITA COLE . . ." Objectants argue that the dispositions in Paragraphs A, B and C of Article VI were intended merely as "legacies" and that only Paragraph D, the disposition to Rita Cole, constitutes the true residuary estate. Objectants assert that Paragraph D is the true residuary clause because it includes lapsed bequests. Objectants argue that, for example, if the bequest in Article V to Donald Anthony, M.D. of all of the decedent's shares of stock in Northcoast Golfstyx, Inc. were to lapse, the bequest would pass only through Paragraph D of Article VI. Objectants also claim as further support for their position that the language of the will directs that the bequests to Paula Braverman, Rosalyn Herman and Molecular Mechanisms of Cancer (Paragraphs A, B and C)are to be funded with the "funds in checking and savings accounts, certificates of deposit and money market accounts in banks, not heretofore given and bequeathed to . . . Rita Cole . . ."Objectants argue that the location of these bequests in Article VI, the same article they claim contains the residuary clause, is irrelevant and that the $10,000 ceiling placed on the bequest to the charity is entirely inconsistent with the concept of a residuary estate. Lastly, objectants argue that Article X expressly directs that if the decedent's residuary estate is insufficient to pay estate taxes, the taxes must be borne by "the residuary beneficiary." According to the objectants, this reference in Article X to "the residuary beneficiary" as opposed to the residuary beneficiaries further establishes that Rita Cole is the sole residuary beneficiary under the will.
The executor opposes the motion for summary judgment and has cross-moved for summary judgment. Counsel for the executor affirms that he was the attorney/draftsman of the decedent's will and knew the decedent for over thirty-five (35) years. The attorney/draftsman states that the objectants are taking a word or phrase in the will out of context and not looking at the will as a whole. In addition, counsel argues that the objectants' contention that Paragraphs A, B and C of Article VI are legacies and only Paragraph D is the residuary is unavailing since the opening sentence of Article VI states in unequivocal terms that it is disposing of "[a]ll of the rest of my estate, of whatsoever kind and wheresoever situated, including funds in checking and savings accounts, certificates of deposit and money market accounts in banks, not heretofore given . . ."
SUMMARY JUDGMENT
Summary judgment may be granted only when it is clear that no triable issue of fact exists ( see e.g. Alvarez v Prospect Hosp., 68 NY2d 320, 324; Phillips v Joseph Kantor Co., 31 NY2d 307, 311). The court's function on a motion for summary judgment is "issue finding" rather than issue determination ( Sillman v Twentieth Century-Fox Film Corp., 3 NY2d 395, 404), because issues of fact require a hearing for determination ( Esteve v Abad, 271 App Div 725, 727 [1st Dept 1947]). Consequently, it is incumbent upon the moving party to make a prima facie showing that he is entitled to summary judgment as a matter of law (CPLR 3212 [b]; Zuckerman v City of New York, 49 NY2d 557, 562; Friends of Animals v Associated Fur Mfrs., 46 NY2d 1065, 1067; Zarr v Riccio, 180 AD2d 734, 735 [2nd Dept 1992]). The papers submitted in connection with a motion for summary judgment are always viewed in the light most favorable to the non-moving party ( Marine Midland Bank, N.A. v Dino Artie's Automatic Transmission Co., 168 AD2d 610, 610 [2nd Dept 1990]). If there is any doubt as to the existence of a triable issue, the motion must be denied ( Hantz v Fishman, 155 AD2d 415, 416 [2nd Dept 1989]).
If the moving party meets his burden, the party opposing the motion must produce evidentiary proof in admissible form sufficient to establish the existence of a material issue of fact that would require a trial ( see Zuckerman v City of New York, 49 NY2d 557, 562). In doing so, the party opposing the motion must lay bare his proof ( see Towner v Towner, 225 AD2d 614, 615 [2nd Dept 1996]). "[M]ere conclusions, expressions of hope or unsubstantiated allegations or assertions are insufficient" to overcome a motion for summary judgment ( Zuckerman v City of New York, 49 NY2d 557, 562; see Prudential Home Mtge. Co., Inc. v Cermele, 226 AD2d 357, 357-358 [2nd Dept 1996]).
CONSTRUCTION
SCPA 1420 authorizes the surrogate to determine the validity, construction or effect of any provision of a will. It is within the court's power to construe a will to effectuate the testator's intent (Matter of Fabbri, 2 NY2d 236). The first and paramount objective of the court is to read the will to ascertain the testator's intent ( Matter of Gustafson, 74 NY2d 448; Matter of Fabbri, 2 NY2d 236; Matter of Jones, 38 NY2d 189). It is the testator's wishes that control, not the intent of the drafter or other interested persons ( Matter of Cord, 58 NY2d 539). The intention of the testator is to be gleaned from the four corners of the instrument ( Matter of Martin, 255 NY 248; Matter of King, 198 AD2d 115 [1st Dept. 1993]) and from a sympathetic reading of the entire instrument in view of the facts and circumstances under which it was written ( Matter of Larkin, 9 NY2d 88).
Where the terms of the will are clear and unambiguous, however, a court is without power to change them ( Matter of Watson, 262 NY 284). In addition, the court may not consider extrinsic evidence unless the parties can show that an ambiguity exists which cannot be resolved without resort to such evidence ( Matter of Ragone, 58 NY2d 864; Matter of Jones, 38 NY2d 189). If the terms of the will are clear and unambiguous, extrinsic evidence will not be admitted to contradict those terms ( Matter of Ragone, 58 NY2d 864; Matter of Cord, 58 NY2d 539).
ANALYSIS
The issue before the court is whether the disposition under Paragraph D of Article VI is the "true" disposition of the residuary estate and should be responsible for bearing the entire tax burden of the estate. Objectants do not dispute that Article X exonerates all non-testamentary bequests from the payment of estate tax in the event the residuary estate is sufficient to satisfy the tax burden nor do they dispute that Article X is a clear direction against apportionment with respect to pre-residuary testamentary bequests. The gravamen of the objectants' position is that Paragraphs A, B and C of Article VI cannot be considered residuary dispositions as evidenced by (i) the introductory language of Paragraph D, and the reference to lapsed bequests therein; (ii) the introductory language of Article VI directs that the dispositions in Paragraph A, B, and C be funded with funds in checking and savings accounts, certificates of deposit and money market accounts in banks; (iii) the reference in Article X to "the residuary beneficiary," and (iv) the pecuniary nature of the charitable bequest in Paragraph A of Article VI.
Considering first the language of Article VI, the court notes that Article VI begins with the language "[a]ll of the rest of my estate, of whatsoever kind and wheresoever situated." Paragraph A then gives 5% to a charity, 40% to Paula Braverman Schachat and 10% to Rosalyn Florence Herman. Paragraph D of Article VI goes on to bequeath to the petitioner "[a]ll of the rest and residue of my estate, including any lapsed dispositions hereunder . . ." A residuary clause of a will is that provision therein which effectively devises and bequeaths all of a decedent's testamentary estate not otherwise disposed of by the terms of such will ( Morton v Woodbury, 153 NY 243; In re Brooklyn Trust Company, 179 App Div 262 [2nd Dept 1917]; Matter of Van Deusen, 24 Misc 2d 686 [Sur Ct, Columbia County 1960]). The location of the residuary clause is not controlling. "While the clause is usually placed at the end of the disposing provisions of a will, the fact that it is not the last is not of controlling consequence and can have no effect as it depends upon the questions of the testator's intent" (citation omitted) ( Matter of Gagliano, 75 Misc 2d 965 [Sur Ct, Nassau County 1973]). Moreover, it is not necessary that the exact words "rest, residue and remainder" be used "since the intention of the testator is the governing factor and any language which indicates an intention to pass the residue is sufficient" (citation omitted) ( Matter of Gagliano, 75 Misc 2d 965 [Sur Ct, Nassau County 1973]).
According to 11 Warren's Heaton on Surrogate's Court Practice (§ 198.02, 7th ed):
The most commonly used and clearest words passing the general residue are "all the rest and residue of my property of every kind and description whatsoever and wheresoever situated," since the word "residue" includes everything remaining after the payment of legacies, debts and expenses. It is not necessary that the exact words just mentioned be used, however, since the intention of the testator is the governing factor. Any language which indicates an intention to pass the residue is sufficient. Words in common usage such as "rest," "residue," or "remainder" are not indispensable to a residuary gift, and in various instances words and expressions, which are informal, have been given this effect in light of the testator's obvious intention. There is no necessity for the use of formal words or expressions. In fact, a gift of the balance' of an estate has been interpreted to describe the general residue in the estate. So likewise has the word surplus.'
In some instances, such as here, there may be disagreement over which of multiple dispositions constitute the residuary clause ( Matter of Olson, 77 Misc 2d 515 [Sur Ct, Kings County 1974]). In Matter of Markus, 188 AD2d 361 [1st Dept 1992]), the First Department, noted, as follows:
"It is not uncommon for residuary clauses to contain multiple gifts, and in their ultimate paragraph to direct the disposition of the balance of the residuary estate ( see e.g. Matter of Kindermann, 21 NY2d 790, revg on dissent of Christ, J., 27 AD2d 856, 857). In such cases, the question arises whether the ultimate paragraph is the "true" residuary clause, or whether there is a "residuary within a residuary" (supra, at 857). It is apparent that specified gifts of sums of money, or specific bequests are indicative of an intent on the part of the testator to benefit the legatee only to the extent set forth. In these instances, it is clear that the testator would not have intended other, lapsed "residuary" bequests to vest in that legatee. This is so because the demonstrative bequest of a specific sum of money, even if set forth within the residuary clause, is contrary to the obvious purpose of a residuary estate to pass all property not otherwise disposed of. It may plausibly be argued that such a bequest is not part of the "true" residuary clause."
In Matter of Kindermann ( 21 NY2d 790), Article SIXTH of the decedent's will at issue bequeathed to her executors "all the rest, residue and remainder" of her estate and directed them to pay therefrom various sums of money to various persons and institutuions specified in subparagraphs within Article SIXTH. The will then directed the executors to divide the "balance of . . . [her] residuary estate" into two equal shares and pay one of said shares to each of two charitable institutions. The will required that all estate taxes "be paid from . . . residuary estate, and that no part thereof be charged against any legatee, devisee or beneficiary other than those receiving my residuary estate." The Court of Appeals decided that the cash bequests in Article SIXTH were exonerated from the payment of taxes. In a concurring opinion, Judge Breitel opined, as follows:
"On the other hand, the residuary is divided into two parts, the first consisting of a series of gifts to individuals who are obviously her primary beneficiaries and the "balance" to named charities. The estate is large and the tax is great enough to reduce the gifts to the individuals to half or less, still leaving vast sums to the charities. Construction can save the testatrix' intention, but it is construction that was forbidden, until now, by the decisional glosses on the statute.
Since it is evident that the whole will, the relationships of the donees to the testatrix, and the financial consequences that the primary intra-residuary gifts were not intended to bear a tax burden, it is right that the testatrix' intention be obeyed. In doing so, however, it is equally evident that a tax clause which requires looking to the whole will, the relationship of the donees, and the financial impact of the tax burden is not clear and unambiguous but literally to the contrary, at worst, or, at best, ambiguous." (Matter of Kindermann, 21 NY2d 790, 792-93)
Thus, Judge Breitel pointed out that, in determining the decedent's intention, the will must be looked at as a whole.
In Matter of Jaret ( 44 Misc 2d 262 [Sur Ct, Kings County 1964], affd 24 AD2d 479 [2nd Dept 1965], affd 17 NY2d 450), the court was faced with a similar question. There, Article THIRD of the will created a marital trust for the decedent's wife. Article FOURTH provided that the taxes should be paid out of the residue. Article FIFTH of the will read: "The rest, residue and remainder of my estate after satisfaction of the foregoing provisions shall be disposed of in the manner set forth in the following articles." Article SIXTH went on to bequeath certain real properties. Articles SEVENTH and EIGHTH made bequests of money and personal property. Article NINTH divided the "balance" of the estate "after satisfaction of the foregoing bequests" into seven parts to be distributed to named individuals, including the executor, who was also the draftsman of the will. The executors insisted that the testator wanted the taxes apportioned against the devisees in Articles SIXTH, SEVENTH, EIGHTH and NINTH, which would have benefitted the executor. The court found that the will actually contained four different descriptions of the residuary estate, but that it was the decedent's intention "to have the taxes paid out of the true residuary estate under Article NINTH' rather than the artificial residuary clause set forth in Article FIFTH' ( Matter of Jaret, 44 Misc 20 262 [Sur Ct, New York County 1964], affd 24 AD2d 479 [2nd Dept 1965], affd 17 NY2d 450).
In Matter of Markus ( 188 AD2d 351 [1st Dept 1992]), Article THIRD of the will read, as follows:
"All the rest, residue and remainder of my real and personal property of which I shall die seized or possessed, or to which I may in any wise be entitled at the time of my death, of whatsoever nature, I give, devise and bequeath as follows:
A. Four (4%) percent hereof to my husband's niece GISELA RITTER GAIL.
B. The entire balance of my said property to my sisters, ILSE, HILDE, and ANNE, in equal shares, share and share alike."
The decedent was predeceased by her sisters and survived by Gisela Ritter Gail and two cousins. The cousins claimed that Ms. Gail should not be the sole remaining residuary beneficiary. The court recognized that 4% was not a large portion of the residuary estate. Despite this, the court held that "since Ms. Gail was bequeathed not a stated sum of money or specific property but a percentage of the residuary estate, subparagraph A should be considered an integral and inseparable part of the residuary clause, and it is not contrary to reason or justice that Ms. Gail should inherit the whole as the sole surviving residuary beneficiary" ( Matter of Markus, 188 AD2d 361, 362 [1st Dept 1992]).
In Matter of Paine ( 7 Misc 2d 795 [Sur Ct, New York County 1956], affd 3 AD2d 736 [1st Dept 1957], affd 3 NY2d 741), the will directed that all death taxes be paid out of the residuary estate. The will divided the residuary into three equal parts: one part in trust for the decedent's wife for life and then to her appointees; one part to the decedent's son, after first giving $50,000.00 out of it to the son's children; and one part in trust for the decedent's other son, after first giving $50,000.00 out of it to the son's children. The court found that "[t]he legacies to the grandchildren carved out of the residuary estate should likewise bear their proportionate share of the taxes for as indicated no exoneration within the residuary estate is directed by the will."
The objectants also argue that Article VI directs that the dispositions in Paragraphs A, B and C are only to be funded out of specified property which is contrary to the concept of a residuary disposition. The phrase "including funds in checking and savings accounts, certificates of deposit and money market accounts in banks", however, is merely descriptive and does not impose a limitation on the source of payment of these dispositions ( see Matter of Magee, 175 Misc 423 [Sur Ct, New York County 1940]).
Objectants also assert that the location of a charitable cash bequest in Paragraph A further demonstrates that Paragraph D is the true residuary clause. The bequest to the charity, however, is not a cash legacy, but rather a percentage of the residuary with a ceiling or cap. Moreover, one can argue that the nature of the disposition in Paragraph A (a percentage with a ceiling) is the reason why the bequest to Rita Cole in Paragraph D could not be expressed as a percentage. Since the percentage of the bequest to the charity is indefinite, Paragraph D disposes of "[a]ll of the rest and residue of my estate, including any lapsed dispositions." The reference to "lapsed dispositions" is equally unhelpful to objectants' position as there is a distinction between "a lapse occurring in the residuary clause of a will and a lapse occurring in an earlier clause of a will" (11 Warren's Heaton on Surrogate's Court Practice § 198.02 [7th ed]). Here, it appears that, contrary to objectants' assertion, lapsed bequests in earlier parts of the decedent's will — i.e., the bequest to Dr. Donald Anthony in Article V — would pass under Article VI, in its entirety, and not just Paragraph D. Only a lapsed disposition within the residuary clause of Article VI would pass under Paragraph D.
Concerning objectants' argument regarding the reference to "the residuary beneficiary" in Article X, the court finds that the reference is nothing more than inartful language ( cf Matter of Alexander, 58 NY2d 1066). "Where inaccurate language is used, such language is subordinate to the intention ( Roe v Vingut, 117 NY 204)" ( Matter of Orrell, 5 Misc 2d 340, 343 [Sur Ct, Kings County 1957]).
The court agrees with the objectants that there is no need to resort to extrinsic evidence such as the decedent's relationships with his daughters and his statements to the attorney-draftsman as the language of the will is clear. Therefore, it is not necessary to address the arguments raised by the objectants concerning CPLR 4519. The court, however, finds that the entire will clearly evidences the decedent's intent to dispose of the remainder or rest of his estate in Article VI not just Paragraph D of Article VI. The words "rest" of the estate and "of whatsoever kind and wheresoever situated" in the preamble to Article VI evidence the decedent's intent to dispose of the surplus of his estate therein. The use of percentages in Paragraphs A, B and C is also indicative of the decedent' intent to dispose of the balance or rest of his estate in Article VI. Contrary to objectants' argument, there is no direction in the will that the dispositions in Paragraphs A, B and C are to be paid out of particular funds. The testator's intention as gleaned from the "whole will taken together and not from detached portions alone, together with all the parts construed in relation to each other forms a consistent whole . . ."( Matter of Orrell, 5 Misc 2d 340, 342 [Sur Ct, Kings County 1957]). Article VI in its entirety, not just Paragraph D, constitutes the true residuary estate under the decedent's will.
For the foregoing reasons, the motion for summary judgment is denied and the cross-motion is granted.
Settle order.