Shamberger v. Dessel

Prescott, C. J., delivered the opinion of the Court. This appeal involves a construction of the last will and testament of Gertrude Dessel Kratsch, who died on September 17, 1960, a resident of Anne Arundel County, Maryland. Due principally to caveat proceedings and other litigation after her death, 1 certain income, interest, and appreciation accrued to her estate before distribution, 2 and the executors, being uncertain as to the proper disposition to be made thereof, filed suit praying the court’s instructions relative thereto. After the chancellor decreed that the non-residuary legatees (named in Item Two of the will, infra) were entitled to the same, the appellant, in his individual capacity as residuary legatee and as executor, appealed.

The pertinent provisions of Mrs. Kratsch’s will follow: “ITEM TWO: I direct that all my cash monies, including by way of description and not by way of limitation all of my monies deposited in any Building and Loan Association or Savings Bank, or monies on hand and including my United States Savings Bonds which I direct shall be cashed, shall be collected by my Executors hereinafter named, into one fund, which after payment of all my just debts, funeral ex ⁶⁵³ penses, expenses of last illness and all taxes and lawful expenses of administration, the entire balance thereof of said fund, I hereby give, devise and bequeath unto my legatees hereinafter named, in the proportions following each of their said names: [Here the testatrix names 22 relatives and friends and allots them portions of the fund ranging from of 1% to 18%. The appellant receives 8% of this fund as well as the residuary estate.] “ITEM THREE: All the rest, residue and remainder of my Estate of whatever nature, kind or description and wheresoever situate, which I may own at the time of my death, including by way of description and not by way of limitation my land and residence at Bar Harbor, Anne Arundel County, Maryland and the contents thereof and all of my personal belongings, I do hereby give, devise and bequeath absolutely unto my nephew, George Russel Shamberger [the appellant] .” The chancellor found from the evidence and a consideration of the entire will that it was the intention of the testatrix that all of her monies on hand, including deposits in the institutions named in the will and the proceeds of the United States Savings Bonds, form a special fund to be divided proportionately among the legatees named in Item Two, after payment of debts, taxes, and certain expenses. He held that the bequests named therein were specific; and that the provisions of Code (1957), Article 93, § 391, were not applicable to the situation presented. He, therefore, authorized and directed the executors "to distribute the interest, income and appreciation accrued since the death of the [testatrix:] from the special fund set up under Item II” unto the legatees as set forth in Item Two.

Although one subsidiary contention is raised and argued in appellant’s brief, in the view that we take of the appeal, it may be disposed of by answering the following questions: 1. Was the chancellor correct in directing the accrued interest, income and appreciation to be paid to the legatees named in Item Two because said legacies were specific in nature?; and 2, Did the ⁶⁵⁴ provisions of Article 93, § 391, render the chancellor’s conclusions relative to the interest, etc., erroneous ? I Appellant agrees that the fund directed to be created under Item Two should “be construed with reference to the date of [testatrix’] death.” The fund is shown to consist of some $119,-000. 18% thereof was bequeathed to her brother; a like 18% to a sister; 8% to appellant, a nephew; 12% to one niece and 10% each to two other nieces; and then small portions to more distant relatives and friends. Legacies have been traditionally classified as specific, demonstrative, and general; each having different properties and characteristics. 3 In Miller, Construction of Wills, § 126, is found the following (with appropriate Maryland citations to support the text): “Specific legacies; in general, — A specific legacy is defined as a bequest of a particular thing, or money, specified and distinguished from all others of the same kind; as of a horse, a piece of plate, money in a purse, stock in the public funds, a security for money, which would immediately vest with the assent of the executor.

In order to constitute a bequest specific there must be a segregation, of the particular property bequeathed, from the mass of the estate, and a specific gift of a specified portion to the legatee [relative to this last mentioned matter, see Jarman, op. cit. p. 1041, where it is said, * * and similarly bequests of parts of a specific fund are specific’].” Similar definitions are found in 6 Page, Wills (3 ed.), p. 17, and in Sykes, Maryland Practice, § 83; also see Hall v. Elliott, 236 Md. 196 . A general legacy is one which is payable out of the general ⁶⁵⁵ assets of the estate of the testator, being a bequest of money or other thing in quantity, and not separated or distinguished from others of the same kind. For the purposes of this appeal, the following observations as to what constitutes a demonstrative legacy will suffice. Demonstrative legacies partake of the characteristics of both general and specific ones.

They are general in nature, but a certain fund or piece of property is pointed out as being primarily charged with their payment. The fund or piece of property (subject, of course, under certain circumstances to possible indebtedness, etc., of the testator) is primarily liable for their payment, but, due to their “general” nature, if the fund or piece of property proves insufficient to pay them, the legatee may receive payment out of the general assets of the estate. As in other cases involving the construction of wills, where it becomes necessary to decide into which classification a particular legacy falls, the intention of the testator, as gathered from the four corners of the will, will control, unless inconsistent with preventive principles of law. 1 Sykes, Maryland Practice, § 83; Miller, Construction of Wills, p. 347, and Maryland cases there cited. We have concluded that the legacies named in Item Two are specific ones and the language of the will imperatively requires us to so hold.

Gardner v. McNeal, 117 Md. 27 ; Bristol v. Stump, 136 Md. 236 . There is no doubt that the monies going into, and making up, the fund created therein were owned by the testatrix at the time of her death. Said monies were clearly and explicitly segregated from other portions of her estate, and a specific portion of the fund created therefrom was given to each legatee. The possibility that the property comprising the fund might have fluctuated between the date of the will and the death of the testatrix does not prevent the legacies thereunder from being specific.

Jarman, op. cit., p. 1042. In Sparks v. Weedon, 21 Md. 156 , a bequest of “the amount of the notes of James Sands and Henry H. Bush, [owed to testatrix] or whatever may be due or owing on said notes at the time of my death” was held to be specific. Where a crude will separated and distinguished the money in several banks named from the other property of the testator so that it could be identified as the par ⁶⁵⁶ ticular fund bequeathed, this Court held the legacies were specific. Miller v. Weber, 126 Md. 658 .

And the fact that the testatrix herein exonerated her residuary estate from the payment of debts, expenses and taxes, etc., at the expense of the fund (before any distribution thereof) did not, we think, destroy the specific nature of the bequests. Cf. In re Purfield's Estate, 289 N. Y. S. 297; Malcolm v. Malcolm, 10 A. 2d 255 (N.H.). The above clearly brings said bequests within the scope of the defintion of specific ones quoted above, and we so hold.

We think this conclusion clearly carries out the intention of the testatrix as manifested within the four corners of the will. There are two features of specific legacies, which we have not yet mentioned: first, if such a legacy fails, the specific legatee is not entitled to payment from the assets of the testator’s general estate; second, a specific legacy generally entitles the specific legatee to income and increments from the legacy from the death of the testator. It will be noted that in Item Two there are no general or quantitative designations of the legacies being for certain amounts of money, such as $1,000 to A and $2,000 to B etc. On the contrary, it provides for gifts of certain definite percentages of the corpus of the fund and no other source. 4 In other words, the legacies are couched in language which provides explicitly that if the fund failed, the legacies named therein also necessarily failed. This assuredly does not evince any manifestation on the part of the testatrix to bequeath an amount, or amounts, of money generally, for, as stated above, if the fund failed and amounted to nothing and was therefore non-existent, the percentage given to each legatee would consequently amount to nothing, and the legatees would not be entitled to any payment from general assets.

This is a strong indication, we think, that the testatrix had in mind the creation of specific legacies, rather than general or demonstrative ones. ⁶⁵⁷ In regard to the second feature of specific legacies, mentioned above, it will be noted that the appellant-nephew received, under Item Two, 8% of the fund, and under Item Three he received “all the rest, residue and remainder” of testatrix’ estate “which I [the testatrix] may own at the time of my death,” which consisted of a residence and the contents thereof, the testatrix’ personal belongings, and several ground rents. The use of the above quoted words “which I may own at the time of my death” is some indication, albeit somewhat slight, that the testatrix did not intend the nephew to receive, as residuary legatee, the increments from the major portion of her estate which she had set apart and segregated from the remainder thereof. But of more importance, after limiting appellant’s share of the fund to 8% thereof (some $9,500), it scarcely seems possible the testatrix intended that he receive the increments from the entire fund (about $14,000 now), which she had