No. 462 January Term, 1977, Appeal from the Order of the Commonwealth Court at No. 993 C.D. 1974
Philip C. Herr, II, Philadelphia, for appellants.
Robert Patrick Coyne, Vincent J. Dopka, Deputy Attys. Gen., for appellee.
Eagen, C. J., and O'Brien, Roberts, Nix, Manderino, Larsen and Flaherty, JJ. Manderino, J., did not participate in the decision of this case. Flaherty, J., dissents.
This is an appeal from a decision of the Commonwealth Court*fn1 affirming the refusal of the Commonwealth Board of Finance and Review to refund certain income taxes paid by a trust known as "Phoebe W. Haas Charitable Trust 'A.'" Phoebe W. Haas created a trust by deed, dated August 24, 1961, which provides, inter alia :
1. The income from the trust is to be paid to charity for a period to end twenty years after the death of the survivor of the settlor's sons, F. Otto Haas and John C. Haas.
2. If the annual income from the trust is not equal to three and one-half percent of the principal, the deficiency must be made up from the principal.
3. Each son of the settlor has a power of appointment over one-half of the assets of the trust, by which he may determine who will receive the assets upon termination of the trust.
. The powers need not be exercised in favor of charitable beneficiaries.
In 1972, because of differing ideas between the sons as to how the income should be expended, the trust was divided into two parts: Trust "A" was allocated to F. Otto Haas and is subject to his power of appointment; and Trust "B" was ...