Shepherd v. Peratino, 10297.

• Decision Date: 03 May 1950
• Docket Number: No. 10297.,10297.
• Citation: 182 F.2d 384
• Parties: SHEPHERD et al. v. PERATINO et al.
• Court: U.S. Court of Appeals — District of Columbia Circuit

182 F.2d 384 (1950)

SHEPHERD et al. v. PERATINO et al.

No. 10297.

United States Court of Appeals District of Columbia Circuit.

Argued March 14, 1950.

Decided May 3, 1950.

Mr. H. Cecil Kilpatrick, Washington, D. C., with whom Mr. Frederick A. Ballard, Washington, D. C., was on the brief, for appellants.

Mr. Walter M. Bastian, Washington, D. C., with whom Mr. Louis P. Maniatis, Washington, D. C., was on the brief, for appellee, Charlotte S. Peratino.

Messrs. Arthur P. Drury, John M. Lynham and John E. Powell, Washington, D. C., entered appearances for appellee, National Savings & Trust Co.

Before WILBUR K. MILLER, FAHY and BAZELON, Circuit Judges.

WILBUR K. MILLER, Circuit Judge.

When Azemia Shepherd executed her will on March 14, 1915, she had three living sons and one grandson, who was the child of a fourth son, then dead. The three sons, A. M. Shepherd, W. J. Shepherd and R. D. Shepherd, and the grandson, Henry, survived when Mrs. Shepherd died in October, 1915.

The second paragraph of the will, the pertinent portion of which is reproduced in the margin¹ because it gave rise to this litigation, required the executors to place with a trust company of their choice not more than twenty-five per cent and not less than twenty per cent of her net estate, to be held in trust as in that paragraph directed. Other provisions of the will bequeathed and devised to the three living sons the remainder of the estate, which was, of course, the bulk of it.

Pursuant to the testamentary injunction, the executors placed in trust with the National Saving and Trust Company of the District of Columbia assets worth some $16,000. The trust company complied strictly with the conditions of the trust. It paid the income to A. M. Shepherd and W. J. Shepherd in equal shares until A. M. Shepherd died in 1939, after which the entire income was paid to W. J. Shepherd until his death in September, 1943. Following the death of W. J. Shepherd, the trust company paid the income to the last surviving son, R. D. Shepherd, as long as he lived. R. D. Shepherd died in June, 1948, unmarried and without issue, leaving a will which bequeathed and devised his entire estate, except for a minor bequest, to one Viola May Kidwell. Henry Shepherd, Jr., grandson of the testatrix, died in 1942, thus predeceasing his uncles, W. J. Shepherd and R. D. Shepherd. Henry was and is survived by four children.

In this state of affairs, the life estates having ended and the time for distribution of the principal having arrived, the National Savings and Trust Company, uncertain as to what course it should take, filed suit in the United States District Court against the four children of Henry Shepherd Jr., against Charlotte S. Peratino, only child of W. J. Shepherd, and against Viola May Kidwell, as executrix of and residual legatee under the will of R. D. Shepherd, deceased,² asking the court to construe the will of Azemia Shepherd and to instruct the trustee as to the proper distribution to be made thereunder. The situation was aptly described in the following paragraph of the complaint:

"7. Plaintiff is informed and believes, and therefore avers, that Henry Shepherd, the grandson of the testatrix neither survived the three sons of testatrix, nor died during their lifetime without leaving children, which contingencies are expressly provided for by said will, but that the said Henry Shepherd died during the lifetimes of two sons of the testatrix and left children him surviving, which contingencies are not expressly provided for by the will, and therefore plaintiff is unable to determine whether the property in its possession should be distributed to the heirs at law of said testatrix as intestate property, or to the children of the aforesaid Henry Shepherd, or whether the same should pass under the will of the said R. D. Shepherd as the last surviving son of testatrix."

The four children of Henry Shepherd, Jr., grandson of the testatrix, answered and asked that the trust fund be divided equally among them, relying upon the second item of the will. They also moved for summary judgment. Viola May Kidwell, beneficiary of the will of R. D. Shepherd, the last of the three sons, did not appear and asserted no claim. Charlotte S. Peratino, only child of W. J. Shepherd, pleaded that the funds held in trust should be distributed to the surviving heirs and next of kin of Azemia Shepherd as though she had died intestate. Then she abandoned that position and moved for summary judgment to the effect that the trust fund should pass to the residual legatees named in item fourth of the will.³

The District Court, granting Mrs. Peratino's motion for summary judgment, directed the trust company to distribute the principal of the trust estate and the accumulated interest thereon according to the provisions of item fourth, which is shown in footnote 3. In other words, the trial court awarded the principal to the estates of the three dead sons of the testatrix, and held the grandson's children should not take the fund because their father had died before the termination of his uncles' life estates. The four children of Henry Shepherd, grandson of the testatrix, appeal.

In our opinion the District Court erred in construing the will as it did. Foremost among several reasons for reaching that conclusion is that we find testamentary language which not only justifies but requires the holding that, in the situation which developed, the trust fund passes to the appellants, the four children of Henry, the grandson of the testatrix.⁴

In item second, the portion of the will which establishes and governs the trust, Mrs. Shepherd gave the income from the trust fund to her three sons for their lives, with remainder to her grandson, Henry, if he should be thirty years old when the life estates ended; if not, when he reached that age, or to his children if he should die before attaining it. All this presupposed that Henry would survive the life tenants and therefore would himself be the remainderman, with possession immediate or deferred, according to his then age.

Having so provided, the testatrix wrote the following crucial sentence which we regard as determinative of the question before us:

"If my said grandson Henry die during the lifetime of any of my said sons and not leave child or children,⁵ then and in that event I grant unto my last surviving son the power to dispose of said trust fund by his last will." (Emphasis supplied.)

Under a principle of construction⁶ which we employ because it is soundly based on common sense, there is implicit in the sentence just quoted a testamentary intention as to the disposition of the trust fund if Henry were not childless when he predeceased one or more of his uncles. The rule to which we allude requires the sentence to be read as though the testatrix had added to it the following:

"* * * But if my grandson...