Opinion
Hearing Granted July 12, 1940.
Appeal from Superior Court, Los Angeles County; Jess E. Stephens, Judge.
In the matter of the estate of Philip E. Lawrence, deceased. From a decree directing distribution of the whole estate among Charles Lawrence and others, testator’s heirs at law, the Church Home for Children of the Protestant Episcopal Church in the Diocese of Los Angeles and another appeal.
Affirmed.
COUNSEL
Waldo & Waldo, of Pasadena (G.E. Waldo, of Pasadena, of counsel), for appellant Church Home for Children.
Ticknor & Maxwell, of Pasadena, for appellant David and Margaret Home.
Thomas W. Cochran and E.D. Yeomans, both of Los Angeles, for respondent heirs.
OPINION
PER CURIAM.
The testator, a single man, eighty years of age, died on July 1, 1938, leaving a last will and testament which was admitted to probate on August 26, 1938, and letters testamentary issued to J.J. Farnsworth and Ezra Farnsworth, who were named therein as executors.
Said last will and testament provided for the disposition of testator’s estate in the following terms:
"Third: I direct that all the residue and remainder of money and property left by me at the time of my death (after payment of all my just debts and funeral expenses), shall be, by my executors used to purchase or contract for an annuity in favor of and payable to my friend Walter C. Black, now residing at 200 West Avenue 33rd, Los Angeles, California, during the remainder of his life. I recommend that such annuity be purchased from the Equitable Assurance Company of New York but if in the judgment of my executors it is unwise at the time such annuity is purchased to so deal with said company, my executors are to use their judgment in that event as to where they will purchase such annuity. I further recommend that such annuity contract shall be one that will provide for repayment to my executors of the principal unused in the payment of annuities in event of the death of the said Walter C. Black before all of the money thus used in purchasing annuity has been consumed under such contract.
"Fourth: In event that refund of principal, as provided in the Third paragraph hereof, is made, I give, devise and bequeath all of such moneys so refunded, to the Church Home for Children of the Protestant Episcopal Church of the Diocese of Los Angeles, now located at 940 North Avenue 64th, Los Angeles, California, and to David and Margaret Home, now located at LaVerne, California, in equal parts, share and share alike.
"In Witness Whereof, I have hereunto set my hand and seal this 1st day of April, 1937, in Los Angeles, California.
"Phillip E. Lawrence."
The annuitant Black predeceased the testator, he having struck testator on the head with a hammer and then shot himself, dying instantly. Testator never regained consciousness and died the following day.
During the course of administration certain of the heirs at law of testator petitioned the superior court sitting in probate for a distribution of the entire estate to them, whereupon the two charitable institutions named in the will appeared in opposition to said petition and sought distribution of the estate to themselves, each claiming one-half thereof. When the aforesaid petition of the heirs, the objections thereto, and the final account and petition for distribution "to persons entitled thereto" filed by the executors came on for hearing in April, 1939, the superior court made its order and decree that neither of the charitable institutions was entitled to any part of the estate, and directed distribution of the whole estate, with the exception of certain sums set aside for payment of inheritance taxes and other legal obligations, to the heirs at law of testator.
Both charitable institutions appealed from said order and decree which was entered on April 25, 1939. After said appeals had been perfected, the David and Margaret Home for Children, Inc., on August 8, 1939, entered into a compromise and settlement agreement with the heirs, by the terms of which it was agreed that the sum of $4,500 should be paid out of the assets of the estate to this one appellant, and in consideration thereof said appellant assigned to the heirs the balance of the estate and agreed to dismiss its appeal. Thereafter, said appellant David and Margaret Home for Children, Inc., made a motion in this court for a dismissal of its appeal and for an order directing the lower court to enter a judgment for partial distribution in accordance with a stipulation signed by said appellant and the respondent heirs, pursuant to the compromise and settlement agreement of August 8th. Said motion was granted by this court and remittitur therein issued on December 30, 1939. Estate of Lawrence, __ Cal.App. __, 97 P.2d 850. As result of that proceeding, the David and Margaret Home for Children, Inc., has been eliminated as a party to this appeal.
Appellant Church Home for Children of the Protestant Episcopal Church in the Diocese of Los Angeles was given an opportunity to participate in the compromise and settlement agreement heretofore referred to, but apparently preferred to rely upon its appeal from the decree of distribution. As the case now stands, it involves the claim of appellant Church Home for Children as against the heirs at law of testator, Philip E. Lawrence.
Said appellant claims that the fourth paragraph of the will provides for a residuary legatee; that the legacy to Black under the terms of the third paragraph of the will constitutes a limited interest, i.e., a life estate in an annuity; and that the death of the legatee of a limited interest before the testator’s death does not defeat the interest of the remainderman who survives the testator (Probate Code, sec. 140); also, that the gift to the charities was not a contingent remainder, but vested upon the death of the testator.
In support of its contentions, appellant cites the case of Estate of Gregory, 12 Cal.App. 309, at page 312, 107 P. 566, at page 568, in which the court held: "In paragraph fifth of the will, as we have seen, the testator gave, devised, and bequeathed all the rest, residue, and remainder of his estate to the trustee in trust for the benefit of his wife, and the residue of that fund, which would be the residue of the estate, he directed to be delivered and paid over [upon the death of his wife] to his two grandchildren in equal shares, and in the same paragraph he directed that all the trust fund and the residue of his estate be paid over and delivered to his said grandchildren. The testator’s wife having died before him, she never became entitled to the trust fund. The provision as to her lapsed; but, as there were residuary legatees designated in the will, the property out of which the trust fund was to be constituted must go to them [the grandchildren], and not descend to the heirs."
In the cited case the will clearly provided for a vested remainder in the grandchildren upon the death of the wife, such remainder not being contingent or limited in any manner whatsoever, and while the ruling is definitely based upon the provision in the will which made the two grandchildren the residuary legatees it is strictly in accord with the terms of section 92 of the Probate Code (formerly sections 1310 and 1343 of the Civil Code), for the reason that the bequest being to relatives of the testator, it portrays a situation which falls within the exception provided by said code section, to-wit: "If a devisee or legatee dies during the lifetime of the testator, the testamentary disposition to him fails, unless an intention appears to substitute another in his place; except that when any estate is devised or bequeathed to any kindred of the testator, and the devisee or legatee dies before the testator, leaving lineal descendants, or is dead at the time the will is executed, but leaves lineal descendants surviving the testator, such descendants take the estate so given by the will in the same manner as the devisee or legatee would have done had he survived the testator." (Italics added.)
In the instant case, the bequest was to a stranger to the blood of testator with a contingent remainder to the charities; therefore, upon the death of said stranger to the blood before the death of the testator, a situation was created which likewise falls within the purview of said section 92 of the Probate Code, above quoted.
In Estate of Kunkler, 163 Cal. 797, 127 P. 43, it was held that legacies to strangers in blood who predeceased the testator became a part of the undisposed residuum of the estate and passed to the heirs at law of testator, and that the legacies to predeceased relatives who died leaving lineal descendants passed to such descendants under section 1310 of the Civil Code, now section 92, supra.
The phraseology of the will clearly indicates that it was testator’s intention that the entire residue and remainder of his estate should be used to purchase an annuity for his friend Black, who, therefore, became the residuary legatee of said estate.
According to the holding in Estate of Fritze, 85 Cal.App. 500, at page 505, 259 P. 992, at page 994: "No particular mode of expression is necessary to constitute a residuary legatee. It is sufficient, if the intention of the testator be plainly expressed in the will, that the surplus of the estate, after payment of debts and legacies, shall be taken by a person there designated."
There is nothing in the will which would indicate that testator desired to give to the charities anything more than an unascertained balance of a particular fund, if any remained at the time of the death of the beneficiary thereof. What testator’s intent may have been after conditions were changed by the death of the proposed annuitant, we have no means of knowing. In any event, the interest of the charities was limited and uncertain and apparently was not intended by testator to be a complete gift of the residue of his estate, as was provided in the Gregory case, supra.
Estate of Griggs, 98 Cal.App. 119, 276 P. 394, cited by appellant, was decided upon the authority of section 140 of the Probate Code: "The death of a devisee or legatee of a limited interest before the testator’s death does not defeat the interest of persons in remainder who survive the testator." In that case the will provided that Anna Hardman should have the income from the sum of $5,000 during the term of her natural life, and upon her death the principal sum of $5,000 should go to her son. There is no point of similarity between that case and the case now under consideration.
An analysis of the provisions of paragraphs third and fourth of the said will reveals that testator’s main purpose was to provide for the welfare of his friend Black. With such purpose in mind, he directed his executors to take all the residue and remainder of his estate, after all his just debts and funeral expenses were paid, and purchase or contract for an annuity in favor of said Black. Had testator stopped at this point, the question involved herein would not have arisen, because the wording of the will constitutes an absolute bequest of the entire residue of his estate.
The type of annuity which is ordinarily purchased for a person of the age of Black, i.e., thirty-nine years, is one which provides for the payment of the maximum income during the lifetime of the annuitant for the amount of principal invested. However, testator directed his executors to purchase the refund type of annuity: one which would provide for the repayment to them of the principal unused in the payment of annuities in the event of the death of the beneficiary before all of the money used in the purchase thereof should be consumed; thereby reducing the income of the beneficiary under the annuity. He then provided: "In event that refund of principal *** is made, I give, devise and bequeath all of such money so refunded" to the charities named.
Looking at the will from all four corners, it would appear that the bequest to the charities was made contingent upon the happening of the following events:
1. The purchase by executors of a refund type of annuity.
2. The annuitant’s death before all of the money used in the purchase of such annuity had been consumed.
3. The possible refund of such unused principal.
Further, the purchase of the annuity itself, regardless of the type, was contingent upon the death of the testator during the life of the proposed annuitant, and the refund to the charities was contingent, not only upon the annuitant’s death, but also upon the condition that such death occur before all of the money used in the purchase of the annuity had been consumed. Testator could not be expected to anticipate that his friend Black, who was approximately forty years younger than he was, would predecease him, and he made no provision for such contingency. For all that appears, the most that testator contemplated when he gave to the charities the sums remaining after the death of annuitant, was that said charities should receive the remaining portion of a particularly designated fund which might remain at the end of Black’s life, and only then in the event that the refund type of annuity had been purchased and that a refund of such remaining portion of the principal could be made to his executors.
The lapse of the gift to the residuary legatee Black destroyed any remainder which might have gone to the charities, for the reason that such remainder was so inextricably interwoven with, subordinate to, and dependent upon, the preceding estate that it could not be given effect without destroying the entire testamentary scheme expressed by the will. 69 Cor.Jur., § 2320, pp. 1083, 1084.
For the foregoing reasons, the decree appealed from is affirmed. The appeal from the order denying motion for new trial is dismissed.