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LYMAN ESTATE (11/22/50)

November 22, 1950

LYMAN ESTATE


Appeals, Nos. 156 and 174, Jan. T., 1950, from decree of Orphans' Court of Philadelphia County, 1948, No. 3659, in Estate of Fannie C. Lyman, Deceased. Decree reversed.

COUNSEL

W. Horace Hepburn, Jr., with him Barry H. Hepburn, for appellants.

Wm. Barclay Lex, with him Alfred W. Putnam, Warren S. Spalding, Norris, Lex, Hart & Eldredge and Fell & Spalding, for appellees.

Before Drew, C.j., Stern, Stearne, Jones and Chidsey, JJ.

Author: Jones

[ 366 Pa. Page 165]

OPINION BY MR. JUSTICE JONES

William R. Lyman, a resident of Philadelphia, died testate on October 23, 1928, leaving to survive him his widow, Fannie C. Lyman, but no issue. By his will, dated June 15, 1926, he left certain pecuniary legacies to collateral relatives and a charity; made an outright devise and a bequest to his wife of certain real estate and personal property; and devised and bequeathed his residuary estate to his wife for life with power to consume. The remainder "left at the time of her decease," he bequeathed to seven named collaterials and a charity in equal shares. He appointed Mrs. Lyman executrix of his will which was duly probated.

The presently material portion of William R. Lyman's will is as follows:

"IX. All the rest, residue and remainder of my estate, real, personal and mixed, whatsoever and wheresoever situate at the time of my decease, I give, devise and bequeath unto my dear wife, FANNIE C. LYMAN, for and during the term of her natural life, with full power and authority to use so much of my residuary estate from time to time as may be necessary for her support

[ 366 Pa. Page 166]

    and maintenance, should the income therefrom prove insufficient; the true intent and meaning of this provision of my Will is not to give to my dear wife either a fee simple in the real estate of this my residuary estate, or an absolute estate in the personal property passing under this my residuary clause, and no such construction shall be placed thereon. That my true intent and meaning of this clause is to give to my wife a life estate only in this my residuary real and personal property, and also to enable her to use so much of the principal as may be necessary for her support, in the event that the income from my residuary estate proves insufficient to supply her wants, and in the determining of what are necessary wants she is to be the sole judge.

"And from and immediately after the decease of my dear wife, I give, devise and bequeath all the rest, residue and remainder of my said residuary estate, real, and personal, that may be left at the time of her decease unto [seven named collaterals and a charity], in equal shares or parts, that is to say: to be equally divided among the above named legatees share and share alike, absolutely and in fee simple."*fn1

[ 366 Pa. Page 167]

Upon the audit of the account of Fannie C. Lyman as executrix of her husband's will, the Orphans' Court of Philadelphia County entered a decree on November 29, 1930, awarding to her, as life tenant, the residuary estate of her deceased husband at an appraised valuation of $187,378.01 as of that date. Mrs. Lyman died testate on April 28, 1948, having consumed in her lifetime, as found by the learned court below, $22,824.53 in value of her husband's residuary estate. There was thus left of that estate, on the basis of the 1930 appraisal, property of the value of $164,553.48. However, the unconsumed property was actually worth only $104,118.47 as of the date of the life tenant's death. The indicated loss in value, to wit, $60,435.01, was due entirely to depreciation in market value. For the most part, the securities and cash, comprising the unconsumed property, continued to stand at the date of Mrs. Lyman's death in her name, as executrix, or in the name of her deceased husband, William R. Lyman.

The remaindermen, contending that the life tenant was indebted to them for the value of the unconsumed portion of the residuary estate at the appraised value thereof as of the date of the original distribution, made claim accordingly against Mrs. Lyman's estate at the audit of the account of her executors; and, the court below so decreed on the assigned authority of

[ 366 Pa. Page 168]

    pointedly declared for this court that, "A testator may give a legal life estate and provide that the debtor-creditor rule shall not be applied but that the remaindermen shall take the risk of depreciation in value." And, it was there further recognized that a testator may so provide by implication as well as by direct expression. It is true that in DuPuy's Estate the will there involved constituted the life tenant a trustee for the remaindermen while, here, the testator did not employ technical terms from which a trust could be inferred. But, that distinction does not make the cardinal rule of construction as to the conclusiveness of the testator's indicated intent any less applicable.

What, then, was William R. Lyman's testamentary intent? As the law stood in 1926 when he executed his will, a life tenant with power to consume had never been held to be a debtor of the remaindermen. Such a life tenant was then spoken of as a "quasi trustee" for herself and the remaindermen: Watson's Estate, 241 Pa. 271, 280, 88 A. 433; and, he remainderman was not a creditor of a life tenant having a right of consumption: see Metz's Estate, 323 Pa. 241, 242, 185 A. 740. The rule of debtor-creditor relationship, which has pertained to an ordinary life tenancy,*fn2 was not extended to a life tenancy with power of consumption until the decision in Powell's Estate in 1941. The testator cannot, therefore, be presumed to have intended to impose a legal liability upon his wife, as life tenant, which extant rules of construction did not then ...


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