Appeal, No. 92, March T., 1951, from decree of Orphans' Court of Erie County, Feb. T., 1950, No. 83, on Estate of Violet Dowler, deceased. Decree reversed; reargument refused November 27, 1951.
Gerald A. McNeils, for appellant.
Armin H. Friedman, with him J. Leonard Ostrow, Cecil D. Elfenbein and Ostrow & Elfenbein, for appellee.
Before Drew, C.j., Stern, Stearne, Jones, Bell, Ladner and Chidsey, JJ.
OPINION BY MR. JUSTICE LADNER
Violet Dowler died December 16, 1947, intestate, leaving to survive her, the appellant, who was her husband, and children by a former marriage who are the
appellees. The appellant is also the administrator and surviving tenant by entireties of a property at 348 N. Third Street, in Erie.
At the audit the appellant sought contribution from decedent's estate of one-half of five obligations paid by him. Four of these arose out of the ownership of the entireties property and the other out of a bailment lease for a Frigidaire. The learned court below disallowed all five claims. As we have concluded there was error in so doing as to some of these claims, it becomes necessary to review each one separately. The facts being without dispute, the liability of the estate depends upon the proper application of the relevant principles of law.
1. The first claim is for one-half of the balance due on a purchase money mortgage of $4,000 executed by the appellant and the decedent at the time the mortgagors acquired title as tenants by entireties to the real estate on which it was secured, viz., 348 N. 3rd St., Erie. The mortgage and accompanying bond, jointly executed, are payable in installments of $40.00 per month, and the balance due at the time of decedent's death, December 16, 1947, was $3,667.57. This sum was paid by the appellant and he sought to recover one-half thereof from the estate of his joint obligor. The learned court, holding that such claim could only be made against the estate if the equity in the mortgaged property was insufficient to discharge the obligation secured thereon (a situation absent in the instant case), dismissed the claim. This disallowance we conclude is error.
The case here is ruled in principle by Kershaw Estate, 352 Pa. 205, 42 A.2d 538 (1945), where, as here, the decedent and his spouse had executed jointly a bond and mortgage on property held by them by entirety, and it was held that one-half of the mortgage and bond was a deductible debt in computing the inheritance
tax because to that extent the joint obligation was a debt of the estate of the deceased spouse. In so ruling, Mr. Justice HORACE STERN cogently said, (p. 206) "It is wholly immaterial that the mortgaged property, passing to the wife as surviving tenant by the entireties, did not constitute one of the assets of decedent's estate. The controlling fact is that he, together with his wife, was personally liable on the bond; that liability continued after his death and therefore constituted a debt of his estate.... Prima facie the payment of an indebtedness by one of ...