Lansburgh v. Lansburgh

ALPERT, Judge. This appeal involves litigation between the decedent’s widow, on the one hand, and his children from a prior marriage, on the other. Specifically, the decedent’s children, having had summary judgment granted against them (and having had their corresponding cross-motion for summary judgment denied), now ask [w]hether the trial court erred in granting the Motion for Summary Judgment filed on behalf of [the widow] Helen Zeve Lansburgh, Appellee, and failing to grant the Cross-Motion for Summary Judgment filed on behalf of Karen Lansburgh and NationsBank, as Limited Guardian for the Estate of Robert Marcus Lansburgh, Appellants[?] We answer this question in the negative, and therefore affirm. I. On November 10, 1924, Jacob Epstein (the “settlor”) of Baltimore, Maryland, executed a Deed of Trust for the benefit of his then six-year old grandson, Robert I. Lansburgh (the “trust beneficiary”).

All agree that this trust has been administered in Baltimore, under Maryland law, since its creation. The trust beneficiary died on April 12,1991, as a domiciliary of the State of Texas. He was survived by a wife, Helen Zeve Lansburgh (the “widow”), and two children by his prior marriage, Robert Marcus Lansburgh and Karen Lansburgh (collectively, the “children”) 1 . At the time of the trust beneficia ³ ry’s death, the trust corpus had a value of approximately $1,234,549.00.

At issue is the provision in the Deed of Trust that, upon the trust beneficiary’s death, disposes of the corpus of the trust estate. This provision reads, in relevant part, as follows: [U]pon termination of the trust, that the said widow shall receive such portion of the corpus of the trust estate as she would have been entitled to receive had her husband died intestate and had the trust estate been part of his estate at the time of his death. (Emphasis added.) The relevant (ie., 1991) intestacy law of the State of Texas (ie., the trust beneficiary’s state of domicile at the time of his death) differed significantly from that of Maryland (ie., the settlor’s state of domicile at the time of his death, and the state where the trust was created and administered). If the subject provision were to be interpreted pursuant to 1991 Texas law, the widow would receive one-third of the corpus of the trust, and the children would share equally in the remaining two-thirds.

On the other hand, if the subject provision were to be interpreted pursuant to 1991 Maryland law, the widow would receive $15,000.00 plus one-half of the balance of the corpus of the trust, and the children would share equally in the remainder. The subject litigation began on November 6, 1991, when the trustees 2 filed in the Circuit Court for Baltimore City a Petition for Authority to Distribute the Trust. Eventually both the widow and the children filed motions for summary judgment, the former arguing that Maryland law controlled the distribution, and the latter contending that Texas law controlled. A hearing was held on these motions, following ⁴ which, and pursuant to a Memorandum Opinion and Order dated June 26, 1992, the trial court granted the motion of the widow and denied the cross-motion of the children.

The children subsequently filed a timely appeal.

II

The primary question in the case sub judice concerns which law should govern the distribution of the trust estate— the law of the domicile of settlor Maryland), or the law of the domicile of the trust beneficiary (i.e., Texas). The trial court appropriately acknowledged the precedential effect of Geier v. Mercantile-Safe Deposit & Trust Co., 273 Md. 102 , 328 A.2d 311 (1974). In Geier , pursuant to the will of Richard P. Ernst, a trust was created to the benefit of several of Ernst’s relatives. Ernst had had significant ties to the State of Kentucky, where he had resided during his lifetime. 273 Md. at 104-05 , 328 A.2d 311 .

His will (which was executed in his Cincinnati, Ohio law office, just over the border from Kentucky), however, simply described him as being “of the County of Washington, State of Maryland.” Id. at 105 , 328 A.2d 311 . As in the present case, the issue arose as to which law would govern the distribution of the trust estate. “Turning now to the applicable principles of law,” the Court in Geier stated, “it is true that the law of a testator’s domicile usually will control the administration of his estate, including the construction of his will, absent a contrary expression or contrary intent.” Id. at 114 , 328 A.2d 311 . Moreover, as appellants correctly acknowledge, “[pjrimary and paramount is the intent of the testator, to be garnered from the meaning of the words he used throughout the will, as well as in the disputed clause, according to their plain import.” See, e.g., Cole v. Bailey, 218 Md. 177, 180 , 146 A.2d 14 (1958) (concerning whether the heirs were to take per capita or per stirpes). “Intention may be gleaned not only from language or surrounding circumstances but also from the totality of the scheme of disposition.” Madden v. Mercantile-Safe Deposit ⁵ & Trust Co., 262 Md. 406, 412 , 278 A.2d 55 (1971) (citations omitted).

III

In Geier , the Court of Appeals began its analysis by stating the chancellor’s finding of fact that [i]n the absence of designation or expression of intent by the testator to the contrary[,] the law of the domicile of the testator at the time of his death controls. While there may be doubt as to whether he succeeded, the evidence is clear that the testator intended to die domiciled in Maryland or at the minimum to be considered as domiciled in Maryland at his death so that the administration of his estate is governed by the law of Maryland. Id., 273 Md. at 113 , 328 A.2d 311 . In the instant case, the trial court opined as follows: The settlor of the trust undisputely was domiciled in Maryland.

Maryland law is to be used in the trust’s construction, unless a contrary intent to use other law is found. Counsel for the [children] maintains that the [disputed] passage is compelling evidence of contrary intent. They believe the settlor “intended for the trust estate to pass as the estate of [the trust beneficiary].” Because Robert died domiciled in Texas, Texas Law of Construction should be used in construing the trust. This Court disagrees with those conclusions. $ £ :H $ $ $ The approach outlined in the case law, the Restatement [ (Second) Conflicts of Law] and its comments, [leads] this Court to conclude Maryland intestacy law should be used in the distribution of the corpus of the trust.

Maryland is the place of administration of the trust. The list of contacts with Maryland is substantial. The settlor was domiciled in Maryland. The settlor provided for a substitute Maryland Co-trustee.

The trust was funded with the preferred stock of a Maryland corporation. The trust ⁶ identified a Maryland charity as one of the contingent remaindermen. The settlor named the Safe Deposit & Trust Company of Baltimore as a successor corporate trustee. The surrounding circumstances and a totality of the trust scheme leads to conclusion that Maryland law is appropriate.

The trust beneficiary was six years old at the creation of the trust. It is unlikely that the settlor, who carefully provided instruction for many contingencies, would prefer distribution of the corpus be left to which of the (then 48) states his grandson would die domiciled sixty-seven years later. The trial court, in ascertaining the intent of the settlor, properly considered the whole instrument, and not just the disputed provision. See, e.g., Madden, 262 Md. at 413, 278 A.2d 55 ; Jones v. Endslow, 23 Md.App. 578, 590 , 328 A.2d 339 (1974).

The question thus raised is whether the trial court was legally correct. Heat & Power v. Air Products, 320 Md. 584, 591 , 578 A.2d 1202 (1990). Appellants, of course, contend it was not. In support of their position, appellants rely on several cases from other jurisdictions, as well as a creative interpretation and application of Maryland law.

A. Maryland law Appellants cite Cole, supra, as stating what we shall call the ‘Very Faint Glimpse” test. The