Thatcher v. Thatcher

• Decision Date: 26 August 1918
• Parties: THATCHER et al. v. THATCHER et al.
• Court: Maine Supreme Court

104 A. 515

THATCHER et al.

v. THATCHER et al.

Supreme Judicial Court of Maine.

Aug. 26, 1918.

Report from Supreme Judicial Court, Penobscot County, in Equity.

Bill for instructions by Charlotte W. Thatcher and others, trustees under the will of Benjamin B. Thatcher, against Charlotte W. Thatcher and others. Case reported upon bill and answer. Decree rendered.

Argued before CORNISH, C. J., and BIRD, HANSON, and PHILBROOK, JJ.

Charles H. Bartlett, of Bangor, for plaintiffs.

Charlotte W. Thatcher, pro se.

George T. Thatcher, pro se.

Charlotte M. Thatcher, pro se.

BIRD, J. In equity. The plaintiffs are trustees under the last will and testament of Benjamin B. Thatcher, deceased. The will was executed March 26, 1906. After sundry bequests the residue and remainder are given in trust to the plaintiffs, who, after the payment of certain annuities therefrom, are directed to pay the balance of the income in equal shares to Charlotte W. Thatcher, wife of the testator, George T. Thatcher, his son and Charlotte M. Thatcher, his daughter. The will further provides that the trust for these last-named beneficiaries shall cease on the 1st day of January, 1920, if any of them live so long, and, if not, upon the death of the last survivor, and upon the determination of the trust "as a whole" the remainder is disposed of by giving the widow one-third for life discharged of the trust, and the other two-thirds outright to the said son and said daughter, or to the survivor, or his or her heirs outright, in case either should die without lineal descendants.

Of the three annuitants, one is already dead, and the two surviving are unaffected by the solution of the question presented.

The plaintiff trustees received from the testator as part of the trust estate, and are owners of 150 shares of the capital stock of the Orono Pulp & Paper Company. On the 16th day of November, 1916, the directors of that company declared from earnings a stock dividend of 33 1/3 per cent. and 50 shares of its capital stock, representing that percentage, have been delivered to the trustees. The trustees, expressing doubt as to the disposition of this stock dividend as between life tenants and remaindermen, ask the instructions of this court. Such, briefly, are the allegations and prayer of the bill of complaint. The defendants by their joint and several answer admit the allegations of the bill of complaint and join in its prayer. The case is reported to this court upon bill and answer.

As in other cases, the intention of the testator must govern. Gibbons v. Mahon, 136 U. S. 549, 559, 10 Sup. Ct. 1057, 34 L. Ed. 525.

But we find in the will no indication of the intention of the testator, either express or implied from any of its terms.

Under such circumstances, the court must be governed by such rules of law as have been established to meet the circumstances of the case. Unfortunately the courts are not in agreement. But it would be unwise, in the face of such disagreement, for this court to endeavor to declare a new rule or discover a new method of dealing with the situation. We conceive our duty to be to ascertain the rule supported by the most authoritative decisions and best supported by reason.

Three so-called rules have been evolved to meet the situation—the Kentucky rule, the Pennsylvania rule, and the Federal or Massachusetts rule. Roughly, the Kentucky rule gives to the life tenant all dividends accruing from earnings, whenever made and in whatever form declared, while the Pennsylvania rule makes the same disposition of such dividends, except those accruing from earnings made before the death of the testator, when apportionment is made. The third rule, known as the Massachusetts rule, holds that ordinarily cash or money dividends are the property of the life tenant, and that stock dividends belong to the remainderman. Minot v. Paine, 99 Mass. (1868) 101, 96 Am. Dec. 705; Rand v. Hubbell, 115 Mass. 461, 475, 15 Am. Rep. 121. In this rule, the courts of Connecticut, Rhode Island, Illinois, Ohio, the Supreme Court of the United States, and the English courts concur. Brinley v. Grou, 50 Conn. (1882) 66, 76, 47 Am. Rep. 618; Mills v. Britton, 64 Conn. (1894) 4, 12, 29 Atl. 231, 24 L. R. A. 536; Smith v. Dana, 77 Conn. (1905) 543, 550, 60 Atl. 117, 69 L. R. A. 76, 107 Am. St. Rep. 51; Boardman v. Boardman, 78 Conn. (1905) 451, 455, 62 Atl. 339, 12 L. R. A. (N. S.) 779; Boardman v. Mansfield, 79 Conn. (1907) 634, 639, 66 Atl. 169, 12 L. R. A. (N. S.) 793, 118 Am. St. Rep. 178; Green v. Bissell, 79 Conn. (1907) 547, 551, 65 Atl. 1056, 8 L. R. A. (N. S.) 310, 118 Am. St. Rep. 156, 9 Ann. Cas. 287; Boardman v. Mansfield, 79 Conn. (1907) 634, 639;¹ Brown et al., Pet'rs, 14 R. I. (1884) 371, 372, 51 Am. Rep. 397; Greene v. Smith, 17 R. I. (1890) 28, 30, 19 Atl. 1081; Newport Trust Co. v. Van Rensselaer, 32 R. I. (1911) 231, 237, 78 Atl. 1009, 35 L. R. A. (N. S.) 563; Bouch v. Sproule, L. R. 12 App. Cas. (1887) 385, 379; Jones v. Evans, L. R. 1 Ch. Div. (1918) 25, 32 (see In re Heaton's Estate, 89 Vt. 561, 562, 96 Atl. 21, L. R. A. 1916D, 201); Gibbons v. Mahon, 136 U. S. (1889) 549, 559, 564, 10 Sup. Ct. 1057, 34 L. Ed. 525; Towne v. Eisner, 245 U. S. (1918) 418, 426, 38 Sup. Ct. 158, 62 L. Ed. 372; De Koven v. Alsop, 205 Ill. (1903) 309, 314, 315, 68 N. E. 930, 63 L. R. A. 587; Billings v. Warren, 216 Ill. (1905) 281, 287, 74 N. E. 1050; Wilberding v. Miller, 88 Ohio St. 609, 106 N. E. 665, L. R. A. 1916A, 718 (opinion 90 Ohio St. [1913] 28, 54, 55, 106 N. E. 665, L. R. A. 1916A, 722).

In Richardson v. Richardson 75 Me. (1884) 570, 574, 46 Am. Rep. 428, Peters, C. J., states that the decided preponderance of authority probably concedes the point that dividends of stock go to the capital under all ordinary circumstances. If the decided preponderance of authority probably conceded this point in 1884, in the opinion of the learned Chief Justice, we think we are justified in saying now that we believe the Massachusetts rule is supported by the weight of authority, and we...