MacLean's Estate, In re

Decision Date26 June 1970
Docket NumberNo. 218,218
Citation47 Wis.2d 396,177 N.W.2d 874
PartiesIn the matter of the ESTATE of James D. MacLEAN, Deceased. Harold E. MacLEAN, Dorothy L. MacLean, and Kenneth F. MacLean, Appellants. v. FIRST NATIONAL BANK OF MADISON, Trustee, First Presbyterian Church of Beloit, Christ Presbyterian Church of Madison, Respondents.
CourtWisconsin Supreme Court

This is an appeal from a judgment dismissing a petition which sought a construction of the will of James D. MacLean and from an order which allowed attorney's fees to be paid by the estate. James D. MacLean died testate on November 18, 1962, leaving an estate of $181,323.23. His will, which was dated September 28, 1960, and probated in Dane county, named the respondent First National Bank of Madison as executor and made provisions for the care of Mary M. MacLean, the sister of the testator, during her lifetime and also created a trust, of which the First National Bank of Madison was trustee, and the respondents First Presbyterian Church of Beloit and Christ Presbyterian Church of Madison were beneficiaries. The appellants Harold E. MacLean, Dorothy L. MacLean and Kenneth F. MacLean (appellants) are heirs of the testator and claim the will left an intestacy upon a condition which occurred.

The final decree assigning the assets in the estate to the trust was entered in 1964. Notice was given the appellant of the closing of the estate but not that the will in respect to the trust would be construed. After the death of the sister in 1966, the appellants obtained a copy of the final decree which had construed the will so as to eliminate an intestacy and this petition was filed. The trial court held no notice of construction of the will was necessary and it did not thve the power to reopen the probate proceedings after the expiration of one year from the entry of the final judgment.

Wickham, Borgelt, Skogstad & Powell, Milwaukee, Reuben W. Peterson, Jr., and George N. Kotsonis, Milwaukee, of counsel, for appellants.

Willink & Thompson, Madison, for 1st Nat. Bank.

Blakely & Long, Beloit, for 1st Presbyterian Church of Beloit.

Stroud, Stroud, Stroud & Howard, Madison, for Christ Presbyterian Church of Madison.

HALLOWS, Chief Justice.

The will in its second paragraph gave to the testator's sister Mary M. MacLean the household furniture and personal property a sum sufficient to retire any indebtedness on her home, and the sum of $5,000. The residue of the estate was given in trust to the First National Bank of Madison (First National) as trustee. From the income the trustee was to pay $250 a month to the sister as long as she lived and to take care of any special needs during her lifetime. Upon the sister's death and after the payment of her funeral expenses, the will directed that the corpus 'be divided as follows:

(1) Should such proceeds to be divided be Twenty Thousand ($20,000) Dollars or less, one-half thereof shall be divided in equal shares among those of the following who survive me, namely, my cousins, Alexander E. MacLean and Frank C. MacLean; my nephews, Kenneth F. MacLean and Harold E MacLean; and my niece, Dorothy L. MacLean.

(2) The remainder shall be held in trust by the First National Bank of Madison, Madison, Wisconsin and the income therefrom be paid at least annually, as follows:

a. One-half thereof to the Christ Presbyterian Church of Madison, Wisconsin.

b. One-half thereof to the First Presbyterian Church of Beloit, Wisconsin.'

The will provided in the third paragraph that in the event the testator's sister should predecease him and 'should such estate exceed Twenty Thousand ($20,000) Dollars, Ten Thousand ($10,000) Dollars thereof should be divided in equal shares among' the same persons designated in paragraph two. The remainder was likewise given to the trustee for the ultimate benefit of Christ Presbyterian Church of Madison and the First Presbyterian Church of Beloit. It is to be noted that the second paragraph of the will in providing for the contingency of the sister surviving the testator does not expressly provide what should be done with the estate after her death if it then exceeds $20,000. Likewise, paragraph three, in considering the contingency of the sister predeceasing the testator, is silent on the disposition of the estate if it should be less than $20,000.

Since the sister survived the testator and the assets of the estate exceeded $20,000, the trustee had a problem in making a tax tender, the amount of which depended upon whether the second paragraph disposed of all the estate upon the death of the sister or resulted in an intestacy. The bank and its attorney construed the will to mean that if the balance of the estate after the death of the sister exceeded $20,000 the heirs should share $10,000 and the balance should be held in trust for the two churches. On this theory an inheritance-tax tender of $1,000 was made. The bank did not advise the appellants of this problem of construction or seek to have the court determine it under the procedure of sec. 310.11, Stats., 1 prior to the hearing an its final account.

In January, 1964, the standard order and the notice for hearing on the final account and for the assignment of the residue of the estate was sent to the appellants. In the accompanying letter, it was stated: I believe each of you has received a copy of Dr. MacLean's will and the estate will be distributed in accordance with the terms of that will.' It also stated the notice 'does not require your attendance at that hearing.' The hearing was held on March 24, 1964. The petitioners did not appear. The hearing was held in the judge's chambers and no record of the proceeding was made. The final decree provided that upon the death of the sister Mary M. MacLean the trust would terminate, $10,000 of the corpus would be divided among the designated heirs of the testator and the remainder held in trust by the First National for the benefit of the two churches. A copy of this final decree was not sent to the appellants.

When a probate court enters a final decree which assigns property to a trustee of a testamentary trust without incorporating the terms of the trust therein by reference or without repeating verbatim the language of the will, such a construction of the will results which requires a petition and notice of the proposed construction. In the Estate of Lyons (1924), 183 Wis. 276, 197 N.W. 710, we held that sec. 379la (now sec. 310.11), Stats., requiring notice for a construction of a will was not applicable to a hearing on a final account and for distribution of the assets of the estate on the theory 'the court cannot assign the estate without construing the will.' In Will of Brandstedter (1929), 198 Wis. 457, 224 N.W. 735, we stated at p. 459, 224 N.W. at p. 736, the probate court 'had the power to construe a will in its final judgment so far as necessary in order to assign the estate.'

In the mine run of cases, especially those not involving a testamentary trust, the final decree construes the will only in the sense it follows the plain, unchallenged and explicit commands of the will. Most lawyers and lay persons do not consider this a construction but rather a compliance with the express directions of the will. When a will creates a trust, future events may create problems unappreciated at the time of the final decree and a construction of such problems ought not to be unknowingly solved or even knowingly determined without a hearing on the issue and upon a notice specially keyed to that purpose.

The doctrine of the Lyons Case that the final decree always construes a will whether the terms of the final decree vary from the will or incorporate the language of the will has had its difficulties. It was held that where the final decree incorporates language of the will it did not construe the will and thus a construction of the will could be made later. Will of Inbusch (1927), 193 Wis. 10, 212 N.W. 634. In the dissenting opinion in Estate of Fritsch (1951), 259 Wis. 295, 304--305, 48 N.W.2d 606, it is said Inbusch incorporates but does not construe the will and nothing is res adjudicata and a bar to a future construction. But this theory did not square with the strict language of Lyons and in the Estate of White (1950), 256 Wis. 467, 41 N.W.2d 776, it was said Inbusch construed the final judgment incorporating the will rather than the will. This devotion to semantics was somewhat strained in logic at least and made necessary the subsidiary doctrine that when the final decree incorporates the language of the will in reference to trusts or repeats verbatim the language of the will it is proper in construing the final decree to go back to the circumstances surrounding the execution of the will to aid in the construction of the decree. This was pointed out in Will of Yates (1951), 259 Wis. 263, 271, 48 N.W.2d 601, and such other cases as Estate of Horkan (1956), 273 Wis. 442, 446, 78 N.W.2d 767; Will of Greiling (1953), 264 Wis. 146, 149, 59 N.W.2d 241; Will of Dolph (1951), 260 Wis. 291, 296, 50 N.W.2d 448; and most recently repeated in Will of Wehr (1967), 36 Wis.2d 154, 180, 152 N.W.2d 868.

The instant case presents a serious defect in our probate practice and procedure whereby am important construction of a will can made in a most informal and casual manner and without any real or adequate notice to the interested parties or a hearing in open court with a record made. The notice given in this case does not apprise a lay person that his rights under a testamentary trust are going to be adjudicated because of the transfer of the trust assets to the trustee. 'For the assignment of the residue of the estate' hardly tells a problem exists of what beneficiaries of the trust are to receive the residue and when. The final account is a separate matter from the distribution of assets. The letter to the appellants from the attorney for the executor is not a notice of a construction of a will and enclosed...

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