Estate of Stratton, Matter of, 88-1
| Decision Date | 28 June 1988 |
| Docket Number | No. 88-1,88-1 |
| Parties | In the Matter of the ESTATE OF Robert A. STRATTON, Deceased. ESTATE OF Paul O. STRATTON, Betty L. Stratton, Executrix, Appellant (Petitioner), v. Signe M. STRATTON, A.D. Fulton, Joseph B. Stratton and Donald N. Stratton, Appellees (Respondents). |
| Court | Wyoming Supreme Court |
Mason F. Skiles, Laramie, for appellant.
Catherine MacPherson of Johnson, MacPherson & Noecker, Rawlins, for appellees.
Before BROWN, C.J., and THOMAS, CARDINE, URBIGKIT, MACY, JJ.
After a hearing upon the objections of certain legatees to the executor's proposed apportionment of taxes the court ruled:
" * * * all taxes occasioned by the death of Robert A. Stratton shall be paid from the residue of the estate, and shall not be apportioned among all person in the estate."
Appellants raise two issues:
We will affirm.
Robert A. Stratton died testate on September 12, 1986. Under the terms of the will certain devises and bequests were made to individuals and nonprofit entities. The residuary clause (Article Thirteen) of decedent's will provided:
"All of the rest, residue and remainder of my estate, after paying all expenses, costs of administration and taxes, not hereinbefore devised or bequeathed, I give, devise and bequeath unto Donald Norman Stratton Seventy-five (75) percent thereof, and unto Paul O. Stratton, Twenty-five percent thereof."
On July 17, 1987, a first accounting and petition for partial distribution was filed seeking partial distribution, subject to each beneficiary paying "his proportionate share of the federal estate and state inheritance taxes." Appellees objected to the proposed apportionment of taxes. The trial court ruled that the residuary estate should pay the taxes rather than the legatees.
In their appeal appellants contend that § 2-10-103, W.S.1977 (July 1980 Replacement), mandates that taxes must be apportioned. That statute provides in part:
"Unless the will otherwise provides, the tax shall be apportioned among all persons in the estate. * * * "
Appellees contend that Article Thirteen, supra, is a clear and unambiguous directive against apportionment. We agree.
Sections 2-10-101 through 2-10-110, W.S.1977 (July 1980 Replacement), provide for a statutory scheme for apportionment of federal estate taxes. However, these federal estate tax apportionment statutes do not apply when the will establishes the manner or fund from which the payment of taxes is to be made. § 2-10-103; Taggart v. United States, 306 F.Supp. 430, 433 (D.Wyo.1969) aff'd sub nom.; In Rennies Estate, 430 F.2d 1388 (10th Cir.1970).
"A will should be read in the ordinary and grammatical sense of the words employed, in their usual and legal significance, in their usual and most known signification, according to their natural and reasonable meaning, or in their general and popular meaning as understood by the testator who employed them." Annotation, Construction and Effect of Will Provisions Expressly Relating to the Burden of Estate or Inheritance Taxes, 69 A.L.R.3d § 4(e) at 208-209 (1976).
"A direction that all taxes shall be paid out of the general estate as part of the expenses of administration is sufficiently broad to exempt every form of legacy, pecuniary, demonstrative, or specific, and a direction for payment out of the residue of any and all estate or inheritance taxes levied upon the estate or any part thereof exonerates dispositions made in the will prior to the disposition of the residue, but has been held not to exonerate those who share in the residue. * * * " Id., § 6(A) at 221.
With respect to the statute apportioning taxes 1 we said in In re Ogburn's Estate, Wyo., 406 P.2d 655, 657 (1965):
The Ogburn case dealt with an apportionment problem similar to the problem here. The will in Ogburn provided:
"FIRST, I direct the payment of all my just debts, taxes, funeral expenses...
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