In re Murphy's Will

• Decision Date: 12 July 1922
• Citation: 48 N.D. 1267,189 N.W. 497
• Parties: In re MURPHY'S WILL. PETITION OF NORTHWESTERN TRUST CO. APPEAL OF KELLY.
• Court: North Dakota Supreme Court

48 N.D. 1267

189 N.W. 497

In re MURPHY'S WILL. PETITION OF NORTHWESTERN TRUST CO. APPEAL OF KELLY.

Supreme Court of North Dakota.

Jan. 6, 1922.

On Rehearing, July 12, 1922.

Syllabus by the Court.

A testator by his will first directed the payment of the expenses of last sickness, funeral, and just debts; second, devised and bequeathed to his wife one-third of his estate; then made certain general bequests in specific amounts, and bequeathed the residue to a class of more remote relatives. A final report, account, and petition for distribution was allowed and approved in county court, in which the basis for computing the amount of the provision for the widow was taken as the gross estate less all indebtedness and expenses of administration. The widow objected to the basis for the computation of her one-third being reduced by the expenses of administration and claimed interest from the date of the decease. It is held: No objection having been made in the county court to the deduction from the gross estate of the expenses of the last sickness, funeral, and amount required to pay debts and the testator's intention with respect to these items being in doubt the decree of the county court in so far as these items are concerned is not disturbed on appeal.

The will is construed and it is held to disclose an intention on the part of the testator to fix the amount of the gift to his wife at one-third of the estate disregarding the expenses of administration.

A residuary legacy, under section 5720 of the Compiled Laws of 1913, embraces only that which remains after all bequests of the will are discharged; and a general legatee is not required to contribute to the expenses of administration, where the contribution would enhance a residuary legacy and decrease a general legacy.

Where there is no mandatory direction to sell real property and no duty imposed upon the executor requiring sale, no equitable conversion is effected.

Where a provision is made for the widow which is both a legacy and a devise, and where the amount of the gift is dependent upon the value of the estate, including expenses, dividends, and accretions, the widow is not entitled to interest under section 5732, Comp. Laws 1913.

Appeal from District Court, Grand Forks County; Cooley, Judge.

Final accounting of the Northwestern Trust Company, executor of the estate of Richard H. Murphy, deceased, to which Mary E. Kelly, as executrix of the last will and testament of Anna B. Murphy, deceased, filed objections. From a judgment of the district court affirming an order of the county court overruling objections to the final account and approving the report of the executor, objector appeals. Modified and remanded, with directions.

Bronson and Robinson, JJ., dissenting.H. M. Barstow, of Los Angeles, Cal., and McIntyre, Burtness & Johnson, of Grand Forks, for appellant.

Bangs, Hamilton & Bangs, of Grand Forks, for respondent Northwestern Trust Co.

Minahan, Minahan, Minahan & Duquaines, of Green Bay, Wis., and Murphy & Toner, of Grand Forks, for other respondents.

BIRDZELL, J.

This is an appeal from a judgment of the district court of Grand Forks county, affirming an order of the county court, which overruled certain objections to a final account, and approved the report of the executor.

Richard H. Murphy died testate November 6, 1913. His will, which was duly probated, is as follows:

“I, Richard H. Murphy, being of sound and disposing mind and memory, but conscious of the uncertainty of life, do hereby make, publish and declare this my last Will and Testament hereby revoking all former wills at any time made by me.

First, I direct the payment of the expenses of my last sickness and funeral, and any just debts that I may leave owing.

Second, I give, devise and bequeath to my wife Annie R. Murphy one-third of my estate, both real and personal.

Third, I direct my executor hereinafter named to erect a monument on my grave at a cost approximating ten thousand dollars ($10,000.00).

Fourth, I give, devise and bequeath to my brother James Murphy residing near Waseca, Wisconsin, and to my brother John Murphy, residing near Waseca, Wisconsin, each the sum of five thousand dollars ($5,000.00); and to my sister, Margaret Mehan, Manitowac County, Wisconsin, to my crippled nephew whose name I think is Richard, son of my sister Margaret Mehan, residing with his mother, and to my niece Hannah Murphy, daughter of my brother James Murphy, each the sum of ten thousand dollars ($10,000.00).

Fifth, the rest and residue of my estate I give, devise and bequeath to the Northwestern Trust Company of Grand Forks, North Dakota, as trustee, however, in trust, for the equal use and benefit of my nephews and nieces other than my nephew Richard and my niece Hannah hereinbefore provided for, to hold, manage, invest and reinvest the same and to pay over the income arising therefrom in equal shares to my said nephews and nieces until they shall respectively reach the age of twenty-five years, at which time a pro rata share of the principal of said trust estate as then invested shall be paid and transferred to the person reaching such age.

Sixth, I hereby make, nominate and appoint the Northwestern Trust Company of Grand Forks, North Dakota, executor of this will and trustee of the trusts herein created, hereby giving to said Northwestern Trust Company, in whichever capacity it may be acting, power to sell, transfer, convey and assign any and all real estate when in its judgment it shall be for the best interests of the parties interested in this will, and to invest and reinvest the trust estate hereinbefore devised and bequeathed to it. Provided, however, that the stock in the Farmers' National Bank of La Moure, North Dakota, held by me at the time of my death, shall be held intact for a period of ten years and not sold in whole or in part during such period.”

The will was admitted to probate in January, 1914, and soon thereafter an inventory of the estate was filed, in which the real property was appraised at $15,000 and the personalty at $135,276.88; total, $150,276.88. A final report and account was duly presented for approval covering the receipts and disbursements of the executor from January 3, 1914, to May 12, 1919, and in November, 1919, an amended final account was presented making some slight changes in the original account, which were made necessary by a subsequent transaction. The amended report shows receipts aggregating $180,082.11 and disbursements as follows: Administration expenses, $10,302.85; taxes and insurance, $834.04; expenses of last sickness and funeral, $1,646; widow's allowance, $5,250; debts and claims, $13,768.51; total, $31,801.40. Partial distribution to Annie B. Murphy, $46,800; payment in full to all legatees whose legacies are provided for in definite amounts, $40,000; expenditure for monument (directed by will), $9,473.43; partial distribution to residuary legatees, $40,000; leaving a balance of cash on hand, $11,932.20.

The county court arrived at the amount of the legacy of Annie B. Murphy by subtracting from the total receipts the total of the debts, taxes and insurance, expenses of last sickness, widow's allowance, and expenses of administration, and dividing the remainder by three. The amount of distributable estate by this calculation was $148,280.71, and the legacy of the widow, $49,426.90. Objections and exceptions to the final account and petition for distribution were filed by the widow, in which it was claimed that the basis for computing her share was the total estate, as shown by the final account, less the expenses of last illness, and funeral, and the total debts and claims (minus a bank stock assessment of $750, which it is claimed was not properly allowed as a debt), or $164,917.60, and specific objection was made to reducing this basis by the further subtraction of expenses of administration, taxes and insurance, the widow's allowance, amounting in all to $17,060.39. It is further objected that the account does not include interest on the widow's legacy. To quote the exceptions:

“First. This respondent assigns these deductions (expenses of administration) as errors, and claims that by the law itself she is made a preferred legatee, is entitled to one-third of the estate after deducting the expenses of last illness, funeral and amount of all debts and claims paid. * * * Second. Such final account does not include interest upon the legacy so given to this respondent. * * *”

Notwithstanding that no exception was taken to that part of the account which deducted expenses of last illness and total debts and claims paid from the gross estate before computing the widow's share, and that the objector, in fact, submitted as a basis for computing such share the gross estate less these same expenses and debts, it is now asserted in this court that the gross estate is the proper basis for computation.

The controversy in this case, as will be seen from the foregoing statement, arises over the question of the basis upon which to compute the widow's legacy. Is she entitled to one-third of the gross estate; to one-third of the estate after subtracting the expenses of the last sickness, funeral, and debts, or is she entitled to one-third of the net or distributable estate; that is, one-third of what is left after the payment of all debts and expenses of administration? In addition, a minor question is presented as to whether or not interest should be allowed upon the legacy.

[1] In view of the fact that no issue was presented in the county court concerning the debts generally, that the counsel for the objecting legatee and appellant expressly recognized the propriety of deducting expenses of last sickness, funeral, and debts from the gross estate and leaving the remainder as the basis upon which to compute the legacy of one-third, and in view of the doubt as to the intention of the testator upon this subject this court will refrain from...