Estate of Weaver, In re
| Decision Date | 28 March 1990 |
| Citation | 572 A.2d 1249,392 Pa.Super. 312 |
| Court | Pennsylvania Superior Court |
| Parties | In re ESTATE OF John H. WEAVER, Deceased Sur Trust, John H.W. Macklin. Appeal of Flora F. MACKLIN, M. Farrell, Macklin Shute, Elizabeth Stacey Macklin, Fidelity Bank, Accountant, Linda S. Macklin Marini, Valerie Macklin Paro, Vivian L. Macklin Megargee, and Floranne Macklin Burns. |
Hugh J. Bracken, Philadelphia, for appellant.
Edward J. Kaier, Philadelphia, for M. Farrell and Shute, participating party.
David M. Jordan, Norristown, for Elizabeth S. Macklin, participating party.
Pamela F. Wilford, Philadelphia, for Fidelity Bank, participating party.
Carl N. Martin, II, Philadelphia, for Linda S. Macklin Marini, Valerie Macklin Paro, Vivian L. Macklin Megargee, and Floranne Macklin Burns, participating party.
Before CAVANAUGH, TAMILIA and KELLY, JJ.
In this case we are called upon to determine whether the Orphans' Court of Montgomery County properly applied the rule against perpetuities to a residuary trust which was formed by a will executed in 1934. The trust provided life estates in the interest income for the testator's widow and his children, then to his grandchildren, with the principal to be liquidated and distributed to each of the testator's great-grandchildren upon the death of their beneficiary parent. The last grandchild, John H.W. Macklin (Heil), died in 1987. The current controversy is whether Heil Macklin's share of the trust principal should be distributed to his children, the testator's great-grandchildren (appellees), or whether the trust corpus became part of Heil Macklin's estate and should be given to Heil's widow, Flora F. Macklin (appellant) as the sole residuary beneficiary under Heil Macklin's will. The appellant contends the original trust was void under the rule against perpetuities in effect at the time of the testator's death which considered possible rather than actual events to determine validity of future interests. The appellees, on the other hand, contend the "actualities test," adopted by the legislature in 1947, and made retroactive by a statutory amendment in 1978, controls the distribution of the trust proceeds. We find the lower court properly applied the "actualities test" to the instant perpetuities problem and correctly ordered the trust corpus be distributed to the testator's great-grandchildren.
The relevant facts and procedural history are as follows. John H. Weaver, the testator, died on April 26, 1934, leaving a will which set up a trust. The trust provided life estates of the trust income for his widow, Ida Weaver, who died on March 26, 1935, his daughter, Phoebe Weaver Macklin, who died on April 21, 1936, Phoebe Macklin's husband John F. Macklin, who died on October 10, 1949, and for the children of the Macklin marriage (the testator's grandchildren), Ida Weaver Macklin Lilley Wark, and Heil Macklin. Separate arrangements were made in the will for the children of the testator's other daughter, Marian Weaver Downes Kampmann, who predeceased the testator. The will created one entire residuary trust which for all practical purposes (except for investment and administrative purposes) was divided into two equal shares--one-half for the Macklin line and one-half for the Kampmann line. In re Weaver's Estate, 390 Pa. 128, 137, 134 A.2d 675, 681 (1957). 1
The following diagram correctly outlines the line of Macklin estates involved:
NOTE: OPINION CONTAINS TABLE OR OTHER DATA THAT IS NOT VIEWABLE
. . . . .
In his will, the testator provided that after the death of his widow, Ida Weaver, the income from the trust and the remainder interests in the principal would be divided into two equal shares, one for the Macklin line and one for the Kampmann line. The testator directed that the income from the Macklin's share be paid to his daughter, Phoebe Weaver Macklin for life. Then, after her death, her share in the trust income was to be paid in accordance with section 7(B)(2)(b) of the will, which provided:
Upon the death of my daughter, Phoebe Weaver Macklin, I direct my trustees to pay the remaining one-half of her share of income to her children then living and the issue of such of her children, if any, as may have died, in equal shares, per stirpes and not per capita, for and during the life of each of such beneficiaries or so long as the payment of such income shall be permitted under the laws of the Commonwealth of Pennsylvania in force at the time of my death. Upon the death of each of such beneficiaries, the issue of Phoebe Weaver Macklin, or upon the earlier termination of said trust as hereinabove provided, then I direct that the portion of the principal of my residuary estate represented by the proportion of income, which such issue of my daughter, Phoebe Weaver Macklin, shall then be entitled to receive, including the proportion of income payable to such issue after the death or remarriage of John F. Macklin, shall be paid over by my trustees to said respective beneficiaries if living, and if dead then to the issue of such respective beneficiaries per stirpes absolutely; and in the event of failure of issue of any such beneficiary, to pay said principal share to the then living issue of my said daughter, Phoebe Weaver Macklin, in equal shares per stirpes.
(Emphasis added).
After Phoebe Weaver Macklin's death in 1936, her children, Ida Weaver Macklin Lilley Wark and John H.W. Macklin (Heil) began receiving income from the trust. Upon John F. Macklin's death in 1949, Ida Weaver Macklin Lilley Wark and Heil Macklin each received one-half of the Macklin line's share of the trust income. Ida Weaver Macklin Lilley Wark died in 1953. Her share of the trust principal was distributed to her four surviving children, the great-grandchildren of the testator. However, the trust continued to provide income for the testator's last surviving grandchild in the Macklin line, Heil Macklin. In re Weaver's Estate, supra, 134 A.2d at 676.
When Heil Macklin died in 1987, the trust purpose (to provide support for the testator's widow, children, and grandchildren) ended. The surviving trustee, Fidelity Bank, filed an account and requested the Orphans' Court of Montgomery County to approve its proposed distribution of the trust principal to the testator's great-grandchildren. In its Petition for Adjudication, Fidelity Bank proposed the trust principal be distributed to Heil Macklin's five daughters, M. Farrell Macklin Shute, Linda Macklin Marini, Valerie Macklin Paro, Vivian L. Macklin Megargee, and Floranne Macklin Burns as well as a share to Elizabeth Macklin, the daughter of John H.W. Macklin Jr., Heil Macklin's son who predeceased him. The above mentioned group are the appellees.
The appellant, Flora F. Macklin, Heil Macklin's widow, filed timely objections to the account and the proposed distribution to the appellees. 2 The appellant contended that according to the rule against perpetuities in effect in 1934, the remainder to the great-grandchildren was void and the trust principle was part of Heil Macklin's residuary estate to which the appellant was entitled as sole beneficiary under Heil Macklin's will. Following an agreement by counsel for all concerned parties and the court, the objections were submitted to the court for a decision on the briefs. The objections were dismissed and the account was confirmed nisi by the decision and order of the Orphans' court. Thereafter, the appellant filed Exceptions to Adjudication. After oral argument, the Orphans' court, sitting en banc, dismissed the exceptions and confirmed the adjudication absolutely. This timely appeal followed.
On appeal, the appellant has raised the following three issues for our consideration:
I. WHETHER THE TESTATOR INTENDED THAT THE DURATION OF CERTAIN INCOME INTERESTS IN THE TRUST BE LIMITED TO THE TIME ALLOWED UNDER THE RULE AGAINST PERPETUITIES IN EFFECT IN 1934?
II. WHETHER THE APPLICATION OF THE RULE AGAINST PERPETUITIES IN EFFECT IN PENNSYLVANIA IN 1934 WAS CONTROLLED BY POSSIBLE RATHER THAN ACTUAL EVENTS?
III. WHETHER THE TRUST TERMINATED DURING THE LIFETIME OF HEIL MACKLIN OF WHOM THE APPELLANT IS WIDOWED?
Before we reach the issues raised by the appellant, we must first review the development of the perennially troublesome rule against perpetuities in Pennsylvania. Professor John Chipman Gray, a leading authority in the field stated:
There is something in the subject which seems to facilitate error. Perhaps it is because the mode of reasoning is unlike that with which lawyers are most familiar.
* * * * * *
A long list might be formed of the demonstrable blunders with regard to its questions made by eminent men, blunders which they themselves have been sometimes the first to acknowledge; and there are few lawyers of any practice in drawing wills and settlements who have not at some time either fallen into the net which the Rule spread for the unwary, or at least shuddered to think how narrowly they have escaped it.
Gray, The Rule Against Perpetuities, xi (4th ed.1942); see also Leach, Perpetuities Legislation 67 Harv.L.Rev. 1349, 1349 (1954) ().
Professor Gray's definitive statement of the rule against perpetuities, "no interest is good unless it must vest, if at all, no later than twenty-one years after some life in being at the creation of the interest" has been adopted by nearly every court which has decided a perpetuities case. Gray, The Rule Against Perpetuities, supra, at 191. Moreover, we note that,
The common law rule against perpetuities is a rule against remoteness of vesting. A contingent future interest is invalid under the rule, if at the time of the creation of the interest, the circumstances are such that the contingency may go unresolved for too long a time. The rule is...
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