Silverman Trust

¶1Dissenting Opinion

¶2March 1, 1957. — There is no doubt that the term “heirs” refers to “the heirs as ascertained by the statutes of distribution, unless a contrary intention *207is indicated by the conveying instrument”.1 There is real question, however, as to what statute of distribution applies. The Act of June 29, 1923, P. L. 914, 21 PS §11, specifies that “heirs” of a donor or testator are to be determined at the time of 'distribution. This act does not apply here, however, because the instant case involves the heirs of a life tenant.

¶3Prior to 1947 there was no statutory provision as to the time for determining heirs of a life tenant and little case authority. Kohler’s Estate, 199 Pa. 455, held that “a testator who commits the distribution of his estate to the law, upon the happening of an event necessarily future, must reasonably be presumed to have contemplated the possibility of a change in the law in the meantime”. However, the will in that case expressly incorporated by reference the Intestate Act in effect on life tenant’s death in these words: “Remainder to ‘such person or persons as would be entitled thereto if my said son John F. Kohler had survived his wife and died intestate, and possessed thereof and in such shares and proportions as such person or persons would in such case be entitled by law.’ ” This case is not on point. No other cases have been cited or discovered by independent research. Therefore, this question appears still to be undecided in Pensylvania.

¶4Prior to 1947, there was grave doubt as to whether the spouse of a decedent, other than a testator or an intestate, was entitled to the $5,000 allowance provided in the Intestate Act of 1917, as part of the spouse’s intestate share.2 In Wetherill’s Estate, 4 D. & C. 667, this court awarded $5,000 plus one half the net estate to the surviving spouse of a deceased life tenant. There appears to be little other precedent on this difficult legal problem.

¶5*208On April 24, 1947, there were enacted three companion statutes: The Wills Act of 1947, the Intestate Act of 1947, and the Estates Act of 1947, which by express provision were to take effect on January 1, 1948, and were not to apply retroactively. In framing these acts, the Joint State Government Commission intended (1) to raise the amount of the spouse’s allowance from $5,000 to $10,000; (2) to define “heirs” and specify that “heirs” are determined at the time “when the conveyance to the class is to take effect in enjoyment”; and (3) to resolve the doubt existing in the law as to the right of a spouse other than the spouse of testator or conveyor to the $10,000 allowance by including an express proviso clause in section 14(4) of the Wills Act of 1947:

¶6“Provided, however, That the share of a spouse, other than the spouse of the testator, shall not include the ten thousand dollar allowance under the intestate laws”, and a similar proviso clause in section 14(1) of the Estates Act of 1947: “Provided, That the share of a spouse other than the spouse of the conveyor, shall not include the ten thousand dollar allowance under the intestate laws.”

¶7This purpose is clearly set forth in the comments of the Joint State Government Commission,3 and we *209properly consider those comments in deciding this case: Martin Estate, 365 Pa. 280.

¶8The majority opinion reasons (1) “the use of the word ‘heirs’ has been held to be the heirs as ascertained by the statutes of distribution unless a contrary intention is indicated by the conveying instrument”; (2) the applicable statute of distribution is the one in effect at life tenant’s death; (3) section 2 of the applicable Intestate Act of 1947 gives the surviving *210spouse $10,000, plus one half of the estate, and (4) the Estates Act of 1947 which excludes the right of a spouse other than the spouse of the conveyor to the $10,000 allowance does not apply in this case because . . this Court has considered the application of the Estates Act to a conveyance made prior to the effective date of the Act and has determined that the Act cannot apply: McKean Estate, 366 Pa. 192, affirming 71 D. & C. 429”.

¶9The majority opinion overlooks the fact that, except for Kohler’s Estate, supra, which I do not consider in point for the reasons stated, there is no case authority to support the legal .proposition that the statute of distribution in effect at the life tenant’s death governs; but, more important, it overlooks the fact that section 17 of the Intestate Act of 1947 has an express provision similar to that of the Estate Act of 1947, namely: “This act shall take effect on the first day of January, one thousand nine hundred forty-eight, and shall apply to real and personal estates of all persons dying on or after that day. The existing laws shall remain in full force and effect for the real and personal estates of all persons dying before that day”. In fact, Abraham Silverman, the conveyor in the instant case, died January 16, 1927. Therefore, under the express terms of section 17 of the Intestate Act of 1947 that act cannot apply in this case.

¶10It follows that neither the Intestate Act of 1947, nor the Estates Act of 1947, expressly govern this case. Therefore, we are required either (1) to apply the Intestate Act of 1917, and rule that under Wetherill Estate, supra, the spouse receives $5,000, plus one half the net estate, or, because of the paucity of authority, decide that the spouse is not entitled to the $5,000 allowance; or (2) we must apply the statutory law in effect at the date of life tenant’s death as *211expressing the legislative intent, as we did in Vederman Estate, 78 D. & C. 207.

¶11Love Estate, 362 Pa. 105, is in point. There testator died in 1926. By his will he gave the residue of his estate upon the death of the survivor of his widow and daughter “unto the heirs and legal representatives of my brother James Love and my sister Emily B. Stone living at that time”. Testator’s daughter, the surviving life tenant, died in 1948. The Supreme Court adopted the opinion of our distinguished colleague, Judge Hunter, which states, inter alia (page 107) :

¶12“There are two statutes which require that ‘heirs’ be determined at the time of distribution, the Act of June 29,1923, P. L. 914, 21 PS §11, and the Wills Act of 1947, P. L. 89, sec. 14(4), 20 PS §180.14, neither of which has a direct application to the instant case, the Act of 1923 because it applies only to the ‘heirs’ of the testator himself, and the Wills Act of 1947, which applies to the ‘heirs’ of all persons but is not retroactive.

¶13“These acts do, however, throw light on the problem of a gift to ‘heirs’, because as was said by Mr. Chief Justice Maxey in Laughlin’s Est., 336 Pa. 529 (536), they may be: ‘referred to as a legislative establishment of a statutory presumption, and it is reasonable to believe that the presumption is “a conclusion firmly based upon the generally known results of wide human experience .” ’ ”

¶14Applying this reasoning, section 2 of the Intestate Act of 1947, as modified by section 14(1) of the companion Estates Act of 1947 is applicable. Any other interpretation produces the anomaly that the life tenant’s spouse receives retroactively the benefit of the Intestate Act of 1947, which was adopted many years after the date of the conveyance and after the date of the conveyor’s death, without being bound by the limitations of the Estate Act of 1947, which was intended *212by the draftsmen as a complement and limit to the Intestate Act of 1947.

¶15For these reasons, I believe the exceptions should be dismissed. Accordingly, I dissent.

¶25Dissenting Opinion

¶26March 1, 1957. — I dissent. I agree with the conclusion reached by Lefever, J., in his dissenting opinion, but for different reasons.

¶27My views are contained in the following extract taken from my supplemental adjudication filed on January 2, 1957:

¶28“5. Spouse’s Allowance Limited to Distribution of a Decedent’s Estate.

¶29“Neither the Intestate Act of 1947 nor the Act of 1917 declares that whenever a surviving spouse receives any bequest or devise he or she is entitled to an allowance by virtue of the fact that he or she is a surviving spouse. It is only when a decedent’s estate is distributed in accordance with the statute rather than under the terms of a will or deed that a surviving spouse is given an allowance, and then it is only the surviving spouse of the decedent whose estate is being distributed. The Act of 1947 expressly declares, ‘The real and personal estate of a decedent, whether male or female, subject to payment of debts and charges, and not disposed of by will or otherwise, shall descend as hereinafter provided.’ Act of April 24, 1947, P. L. 80, sec. 1, 20 PS §1.1.

¶30“The Act of 1917 similarly declared ‘That the real and personal estate of a decedent, whether male or female, remaining after payment of all just debts and legal charges, which shall not have been sold, or disposed of by will, or otherwise limited by marriage settlement, shall be divided and enjoyed as follows; . . . ’. Act of June 7, 1917, P. L. 429, sec. 1.

¶31*213“These statutory provisions do not establish a general rule that the surviving spouse of every legatee shall receive an allowance. They necessarily recognize that the provisions of the Intestate Act, by definition, apply only to property not otherwise disposed of by the decedent.

¶32“In the instant casé the ‘heirs’ of the life tenant take not as distributees under the Intestate Act but as remaindermen under the deed. The distinction between a substitutionary gift to heirs and a distribution of a deceased spouse’s estate was recognized in the opinion of the lower court in Simpson’s Estate, 304 Pa. 396 (1931), appearing in the record at pages 32a-33a, where it was stated ‘the widow does not take through her husband but directly under the will as his substitute’.

¶33“In the controversy now pending before this court the husband as the surviving spouse had the standing only of a substitutionary legatee. The statute which would apply if the estate of the deceased wife were being distributed is not applicable.

¶34“It is contended that although the Act of 1947 by its terms applies only to the distribution of a decedent’s estate any use of the term ‘heirs’ nevertheless incorporates all the provisions of that act by reference. It is said that this is established by the decision in Patterson v. Hawthorn, 12 S. & R. 113 (1824). In the brief filed the following excerpt from the opinion is set forth:

¶35“ ‘What did the testator mean by the words, or their heirs? I understand it, as if he had said, to be paid to them, or such persons as would be entitled to it, as their representatives by the law of the country; that is to say, it was not, in case of the death of one, to go to the survivors, but to be considered as if vested in the deceased child.’

¶36*214“The excerpt from the opinion fails to include the final determination made by the court, namely:

¶37“ T am of opinion, that the legacy was vested, and therefore, the plaintiff is entitled to it, as administrator of his wife.’ (12 S. & R. at p. 114.) (Italics supplied.)

¶38“The effect of this decision- was to refuse to give effect to the word ‘heirs’ as a word of purchase. The court did not award the fund to the heirs but to the personal representative of the estate of the deceased legatee to become part of her general estate. As such it would be subject to the claims of creditors of the estate and only one spouse’s allowance from the general estate would be allowed. If this were followed in the pending controversy the fund now before the court would be awarded in toto to the personal representative of the estate of the deceased daughter and no award would be made by this court to either claimant in his respective individual capacity. The case, however, is inapposite as it related to a predeceasing legatee and not to distribution upon the death of a life tenant.

¶39“It has also been stated that the Acts of 1917 and 1947 are not limited to the distribution of decedents’ estates and that Stevenson’s Estate, 47 D. & C. 215 (1948), so decided. The brief of counsel cites the syllabus of the District and County Reports that this argument was ‘specifically overruled’. It is first to be noted that a syllabus prepared by the District and County reporter is not the decision of the court. Secondly, even the syllabus goes no further than to state that ‘where a testatrix makes a substitutionary bequest to the “heirs” of a named person the word must be construed in the light of the Intestate Act’. Thirdly, the court divided the share of a deceased life tenant equally between her husband and her daughter. This is not a holding that if there had been no issue sur*215viving the court would necessarily make an award of a spouse’s allowance. It may be conceded that a logical extension of the theory of the court would have reached that conclusion but a logical extension of a theory to facts not before a court is of even less authority than an express dictum on facts not before the court.

¶40“Conceding for the purpose of argument that the Pennsylvania Intestate Act governs the distribution of the remainder upon the death of the life tenant, it seems clear that all the provisions of the Intestate Act must apply. A claimant cannot seek the benefits of the act and refuse to accept the burdens.

¶41“If the Intestate Act is the law to which resort is to be made, it must be first noted that the life tenant died domiciled in New York and that the fund in controversy is personalty. What distribution does the Intestate Act direct in such case? The Act of 1917 declares that ‘Nothing in this act contained relative to a distribution of personal estate among kindred shall be construed to extend to the personal estate of an intestate, whose domicile at the time of his death was out of this Commonwealth’: Act of June 7, 1917, P. L. 429, sec. 25. The Act of 1947 declares ‘Nothing contained in this act with respect to a distribution of personal estate shall extend to the estate of a decedent whose domicile at his death is out of the Commonwealth’ : Act of April 24, 1947, P. L. 80, sec. 14.

¶42“If the court is to conjecture that the settlor intended the Pennsylvania Act to apply with the exception of the above exclusionary clause, it may conjecture with equal justification and facility that he did not intend the spouse’s allowance provision to be' opertive. Decisions should not rest on conjecture or the law becomes the subject of whim and fancy.

¶43“6. Applicability of Act of 1917 or 194.7.

¶44“Having reached the conclusion that the mere use *216of the word ‘heirs’ by itself does no more than designate the manner of determining the identity of. the distributees, it is immaterial whether reference is made to the Intestate Act of 1917 or 1947 for both claimants are heirs of the deceased life tenant under each of these acts. In view of the fact that the pending controversy was referred back to me to consider which act would be applicable in the event that the Intestate Act should define the quantum of the distribution to be made to such claimants, it is proper now to consider that point, although it would otherwise have been rejected, as moot.

¶45“If the dictum in Bowen’s Estate, 139 Pa. Superior Ct. 523 (1939), is to be followed the conclusion should be that the Intestate Act in force at the time of the life tenant’s death is applicable. In that case the original decedent died February 26, 1879, and the surviving life tenant died September 20, 1936. The court clearly indicated that it contemplated distribution under the Act of 1917 for it stated that the life tenant’s ‘widow unless otherwise barred (Act of June 7, 1917, P. L. 429, §6; 20 PS §42), is within the class entitled to share in the fund’, and at a later point in the opinion the court stated: ‘This conclusion is reasonable, since, under the statute of distribution, a surviving spouse in addition to a specific sum, now takes a share of the estate along with the heirs at law’: 139 Pa. Superior Ct. at page 529.

¶46“This indication of the applicability of the Act of 1917 is deemed dictum for the reasons already noted in connection with this case. Moreover, this point was not raised by any party as far as the record and the briefs show. In any case, the conclusion declared in Bowen’s Estate, and implicit in such cases as Hickson’s Estate, 25 York 62 (1911) ; Wetherill’s Estate, 4 D. & C. 667 (1924), and Diehl Estate, 66 D. & C. 530 (1949) is erroneous.

¶47*217“A distinction must be made between (1) changes of law made between the time of the execution of a will and the death of the testator, and (2) changes made after the death of the testator. In the case of the former, no rights have vested as the instrument is merely ambulatory. Both the death of a decedent and the delivery of a deed of trust are binding definitive acts which give rise to, or create, vested interests. In the case of the change of law made while the testator was living it can also be assumed that the testator, by not changing his will, intended that it should be interpreted in accordance with the law as modified. Because of the distinction above noted, such decisions as Farmers’ Trust Co. v. Wilson, 361 Pa. 43 (1940), are not here controlling, for here the question is whether a statute adopted after a deed of trust was delivered can modify rights arising under that deed.

¶48“Once an instrument becomes effective a change of law cannot operate to modify the rights of the parties thereto, even though the parties are merely remaindermen, and even though their interests are contingent. It is now well established that a statute relating to principal and income cannot constitutionally apply to a trust created by deed or by will before the effective date of the statute: Crawford Estate, 362 Pa. 458 (1949) ; Pew Trust, 362 Pa. 468 (1949) ; Steele Estate, 377 Pa. 250 (1954); Warden Trust, 382 Pa. 311 (1955) ; Arrott Estate, 383 Pa. 228 (1955).

¶49“In the Crawford, Pew, Warden and Arrott cases a trustee ad litem had been appointed by the court. The Supreme Court, in describing the vested interests of life tenant and remaindermen which could not be modified by subsequent legislation, did not make any distinction between remaindermen who held vested remainders and those whose rights in remain*218der were contingent and represented by a trustee ad litem.

¶50“If these cases hold that a subsequent statute cannot modify the rules of law governing the distribution of a fund between life tenants, on the one hand, and all kinds of remainder interests on- the other, how can a subsequent statute change the membership of the class of remaindermen as by defining ‘heirs’, or alter the proportions to be received by members of the remainder class, as by changing the distribution among heirs? It is therefore concluded that the legislature could not constitutionally declare an intestate act applicable to the definition of ‘heirs’ of a life tenant under an instrument becoming effective prior to such act of the legislature. If this be so, the court should not by interpretation achieve a result which the legislature could not achieve without violating the constitution.

¶51“It is therefore held that whether a reference is made to an intestate act for the limited purpose of determining who are the heirs of the deceased life tenant, or for the broader purpose of also determining what amounts such heirs should receive, that reference must be to the intestate act which was the law when the deeds of trust were delivered and became effective, in 1926.

¶52“On its facts Love’s Estate, 362 Pa. 105 (1949), is not applicable to the pending controversy. There the decedent’s will directed that the ‘heirs’ be those who were living at the death of the life tenant, and the life tenant predeceased the testator. The statement in the decision of the lower court that ‘The rule generally recognized by the courts prior to the death of this testator was that the heirs of a person other than testator must be determined at that person’s death . . .’ (set forth in 362 Pa. 105, at page 107) is not controlling here, for the court was not there considering the effect *219or validity of a change of the law between the date of the decedent’s death and the date of the life tenant’s death.

¶53“The following portion of the commentary under section 245 of the Restatement of Law of Property has been cited to the court:

¶54“ ‘When a will describes the takers of a gift as the “heirs” of the testator or of some other living person, or when a will describes the size of the gift as the “intestate share” of some relative of the testator, the selected phraseology connotes a dependence upon the rules of law operative at a date subsequent to the execution of the will and defining the persons entitled and shares taken, on intestate succession. Thus in a limitation so phrased, a testator is construed to have intended, respectively, his donees, or the size of his gift, to be subject to alteration by changes of law which occur after the execution of his will’.

¶55“This excerpt is not convincing authority with respect to the issues before the court, because

¶56“(1) it assumes that a gift to ‘heirs’ and a gift of an ‘intestate share’ are to be treated the same without indicating that a question of interpretation is involved in equating one term to the other;

¶57“(2) it makes no reference to a spouse’s allowance;

¶58“ (3) it speaks of the alteration of the size of the gift and does not indicate that' it means more than a proportionaté modification based upon the admission of new members to the class of heirs;

¶59“ (4) it confines the observations to a will and makes no reference to a deed of trust, and

¶60“ (5) it refers to changes of law made after the execution of the will, and thus gives rise to the inference that no expression is intended as to changes made after the death of the testator.

¶61*220“7. Conclusion

¶62“It is, of course, permissible for a settlor or a testator to provide for a gift to the heirs of a person and specify that they shall receive such amounts or shares as they would be entitled to under the ‘intestate acts’. The question now before the court is whether ‘heirs’ by itself means simply heirs, that is, a term of identification, or whether there is to be automatically read into that word, ‘in such shares as they would be entitled to receive under the Intestate Act’. Words should be taken at their face value, and a gift to heirs should be regarded merely as a gift to a class of persons, membership in that class being determined on the basis of relationship to the decedent. ,

¶63“If the owner of land conveys it to ‘A’ for life, with remainder to the heirs of ‘A’, are the interests of the respective heirs to be determined by the Intestate Act, or will they hold as members of a class? The deeds before the court were carefully drawn. The omission of a direction that the heirs should receive their intestate shares should serve as an indication that that was not intended.

¶64“Much has been made of the argument that, by using the word ‘heirs’, the settlor indicated that he was not greatly concerned with the identity of the persons to whom the property was to pass upon the life tenant’s death, and that accordingly he must have intended distribution to be made according to the intestate act. It may be equally conjectured that the settlor was so little concerned with the ultimate distribution that he was content to allow the property to pass to the heirs as a class. Having contented himself with creating a remainder for the ‘heirs’, the settlor stopped and did not direct distribution in accordance with the intestate act. A court, interpreting, rather than reforming an instrument, should likewise stop with the words of the settlor.

¶65*221“In any event, the decision is . one. which is not controlled by precedent. As noted in the original adjudication, and in this supplemental adjudication, statements or decisions of the appellate courts, where relevant, have been dicta. The lower court cases which have referred to the Intestate Act for the distribution to be made have not rested on authority, for none of the cases cited by them supports the conclusion reached by them. And, finally, caution should be exercised in expanding the meaning of ‘heirs’ when existing titles to property may be affected thereby.”