Carter v. Martin

• Decision Date: 05 August 1937
• Citation: 122 N.J.Eq. 262,193 A. 704
• Parties: CARTER et al. v. MARTIN et al.
• Court: New Jersey Court of Chancery

193 A. 704

122 N.J.Eq. 262

CARTER et al.

v. MARTIN et al.

Court of Chancery of New Jersey.

Aug. 5, 1937.

Syllabus by the Court.

Testator gave estate to trustees to pay income to his wife, son, and daughter, who were his only next of kin, remainder to son or his issue, and further directed if son should "die before my said daughter and after my said wife, leaving no lawful issue as aforesaid, they are to pay the entire net income of my estate to my said daughter Mary so long as she shall live, and after her death they are to pay over and convey the entire principal of my estate to my heirs at law and next of kin." Held:

1. Where remainder is primarily given to issue of life tenant, gift over in default of issue vests at testator's death, defeasible upon demise of life tenant leaving issue, for the contingency is not in the person but in the event.

2. Where remainder is created by direction to pay and transfer but time of payment is postponed only to let in prior estates, remainder vests when will takes effect.

3. Class of remaindermen described in will as testator's heirs or next of kin is to be ascertained as at death of testator.

4. If tenants for life happen to be some of, or the sole such heirs or next of kin, they are not on that account excluded from the class of remaindermen.

5. But when life tenants are sole heirs or next of kin, they will be excluded if indications that such was testator's intention are found in will, even though indications are not clear.

6. Gift to "my heirs at law and next of kin" in absence of indication of a different meaning, goes to those who take under statute of distribution of personal property including the widow.

7. Where trust is mere device for pre serving estate during life tenancy for benefit of remaindermen, if life interest and re mainder become vested indefeasibly in same person, the trust will be terminated and the beneficial owner will be given possession of estate; but not if the termination would de feat material purpose of testator.

8. Where trustees are given discretion as to payment of income to life tenant and the will forbids her to assign or pledge in come or any part thereof, trustees will not be ordered to turn over corpus to her, though she is also remainderman.

Suit for construction of will by William T. Carter, Jr., and another, executors, etc., opposed by J. H. Thayer Martin, and others.

Decree in accordance with opinion.

Stuart A. Young, of Newark, "for complainants. William A. Moore, of Trenton, for State Tax Commissioner. Henry Young, Jr., of Newark, for Mary T. C. Huston. Robert E. Burke, of Morristown, for All Souls' Hospital. Francis Child, of Newark, for Mary K. Stockton. Ralph E. Lum, of Newark, for George A. K. Sutton. Charles R. Hardin, of Newark, for trustees under the will of Oscar Keen, deceased.

BIGELOW, Vice Chancellor.

The will of Oscar Keen, deceased, dated January 7, 1907, is presented for construction. The pertinent provisions are found in the third item, which reads as follows:

"I give, devise and bequeath unto my said Executors and Trustees, and to the survivor of them, all of my property, real, personal and mixed (except such as is hereinafter mentioned) in trust, however, for the following uses and purposes, that is to say:

"a. They are during the life time of my wife Elizabeth D. Keen to divide the net income of my estate unto three equal parts, and pay one-third thereof to my said wife so long as she shall live; one-third thereof to my son Benjamin Williamson Keen and one-third thereof to my daughter Mary Hampton Stockton.

"b. On the death of my said wife they are to pay over and transfer to my said son Benjamin one-sixth of the principal of my estate, and thereafter during the joint lives of my children they are to pay to my said son Benjamin two-fifths of the income of the remaining principal of my estate and to my daughter Mary three-fifths of said income.

"c. On the death, before my said daughter and after my said wife, of my said son Benjamin leaving lawful issue, or lawful issue born to him after his death, they are to pay over and transfer two-fifths of the then principal of my estate to such lawful issue in equal shares; but if he should so die before my said daughter and after my said wife leaving no lawful issue as aforesaid, they are to pay the entire net income of my estate to my said daughter Mary so long as she shall live, and after her death they are to pay over and convey the entire principal of my estate to my heirs at law and next of kin.

"d. On the death of my said daughter before my said son and after the death of my said wife, they are to pay over and transfer to my said son Benjamin three-fifths of the then principal of my estate; but if at the death of my said daughter he should be already deceased leaving lawful issue or lawful issue born to him after his death, they are to pay over and transfer the remaining three-fifths of the principal of my estate to such lawful issue in equal shares; or if at the death of my said daughter he shall be so deceased, leaving no lawful issue as aforesaid, they are to pay over and transfer the then entire principal of my estate to my heirs-at-law and next of kin."

Here follow similar provisions, in the event either child should predecease Mrs. Keen. Then this paragraph:

"The income hereinbefore directed to be paid by my said Executors and Trustees to my said son and daughter is intended for their proper maintenance and support, and is to be paid to them in such sums and at such times as said Executors and Trustees may think proper, or they may, for good and sufficient reasons, withhold the whole or any part of said income. Neither of my said children shall assign or pledge said income or any part thereof, nor are my said executors and trustees to recognize any assignment or other disposition thereof by either of my children."

Testator died in 1913, survived by his widow, Elizabeth D. Keen, and two children, Benjamin W. Keen and Mary Keen Stockton. His nearest of kin, excluding his widow and children, was his nephew, George A. K. Sutton. Benjamin, about 34 years old, was unmarried. Mrs. Stockton was childless and, as a result of a severe illness, was incapable of bearing children. This fact was known to her father when he made his will.

Mrs. Keen died in 1926, leaving a will by which she gave her entire estate to her sister Mary T. C. Huston. Benjamin, still unmarried, died August 17, 1935, leaving a will under which the residuary legatee is All Souls' Hospital of Morristown. So the last clauses of paragraph "c" and "d" of the will become effective.

Mrs. Stockton, All Souls' Hospital, and the state tax commissioner contend that on testator's death, his son and daughter each took a vested remainder in one-half of five-sixths of the estate, subject to divestment if Benjamin should die leaving issue. As Benjamin died without leaving issue, the event on which defeasance depended cannot happen. The other one-sixth part of the estate is that which was payable to Benjamin and was paid to him upon the death of Mrs. Keen.

Mrs. Huston takes the same position except that she says that Mrs. Keen should be included as one of the next of kin under the statute and as a remainderman.

Mr. Sutton claims the whole estate, subject to the life tenancy of Mrs. Stockton. He argues that the next of kin and heirs at law should be determined by excluding the widow and children of testator.

Although the remainder was primarily given to the issue of Benjamin, the gift over vested immediately on testator's death, defeasible upon demise of the life tenant leaving issue, for the contingency was not in the person, but in the event. Miers v. Persons, 92 N.J.Eq. 17, 111 A. 638; Durand v. Ward, 105 N.J.Eq. 274, 147 A. 548. Where remainders are created by directions to pay and transfer, but the time of payment is postponed only for the purpose of letting in the prior estates, the remainder vests when the will takes effect. Redmond v. Gummere, 94 N.J.Eq. 216, 119 A. 631. A class of remaindermen described in a will as testator's heirs or next of kin, is to be ascertained as at the death of testator. Guild v. Newark, 87 N.J.Eq. 38, 99 A. 120; In re Buzby's Estate, 94 N.J.Eq. 151, 118 A. 835. Such are the general rules applicable.

The difficulty arises because the life tenants also constituted the class to whom the remainder was given. A similar situation was considered carefully by Vice Chancellor Emery in Tuttle v. Woolworth, 62 N.J.Eq. 532, 533, 50 A. 445, 448, "The objection from incongruity supposed to arise against holding that the previous tenant is entitled to any interest in an estate as next of kin after the estate specially given to him by the will has terminated, is, as it seems to me, met and answered by the consideration that, when the testator limits an estate to one of his next of kin and his children or issue, and then directs that on failure of this limitation his heirs or next of kin shall take according to law, he discloses clearly that, if the special and immediate limitation fail, as it may, then he had no intentions or wishes to change the disposition which the law itself would have made for him in regard to this part of his estate, and that on the failure of his special purpose he desires that he should be considered as making no provisions of his own about the disposition of his estate, but as expressly leaving that disposition to be made by the laws, as if he had died intestate." He held that the remainder had vested at testator's death in his three children including the life tenant and that the fund was distributable among them or their personal representatives.

In Oleson v. Somogyi, 90 N.J.Eq. 342, 107 A. 798, affirmed 93 N.J.Eq. 506, 115 A. 526, Vice Chancellor Stevens construed a will bequeathing a life estate to testatrix' son, her only next of kin, and directing her executors at his death "to distribute my estate among my legal heirs and...