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District Court of Appeal, Second District, Division 2, California.




Civ. 10931.

Decided: May 08, 1936

Call & Murphey and Walter E. Bennett, all of Los Angeles, for appellants. L. R. Brigham, of Los Angeles, for respondents.

Defendant Ethel Carman–Ryles appeals from specific portions of a judgment in favor of plaintiff decreeing that monthly payments under a decree of distribution constitute an annuity and are payable from the date of testator's death.

The conceded facts are:

Earl A. Fraser, deceased, by his will bequeathed all of his property to defendant Ethel Carman–Ryles, née Ethel Fraser Prentiss, in trust. His will provided in part as follows: “And I further direct that in the administration of said trust my said sister Ethel Fraser Prentiss shall use the income from said property as her own, with the exception of Three Hundred Dollars ($300.00) monthly thereof, which said Three Hundred Dollars ($300.00) monthly thereof she shall pay to my now wife, Lillian R. Fraser, until the said Lillian R. Fraser remarries or dies.”

The final decree of distribution appropriately provided for the creation of the trust designated by the testator and contained, among others these, clauses:

“It is further ordered, adjudged and decreed that in pursuance of and according to the provisions of the Last Will and Testament of decedent, the said property, and all other property belonging to said estate, whether described herein or not, is distributed as follows, to wit: * * *

“* * * in the administration of said trust, said Ethel Fraser Prentiss to use the income of said property as her own with the exception of $300.00 monthly thereof, which said $300.00 monthly thereof said trustee to pay to decedent's wife, Lillian R. Fraser until the said Lillian R. Fraser remarries or dies, or said trust terminates, * * *

“* * * that said bequest to said Lillian R. Fraser of $300.00 per month is an annuity * * *.”

The only questions necessary for us to determine are these:

First: Under the above circumstances may the will be considered in construing the decree of distribution?

Second: Did the decree of distribution in legal contemplation create an annuity of which plaintiff was the beneficiary?

The first question must be answered in the affirmative, since the decree of distribution contained the following language: “It is further ordered, adjudged and decreed that in pursuance of and according to the provisions of the Last Will and Testament of decedent * * *.”

In construing a decree of distribution, where, as in this case, the will by apt language is incorporated, the decree should be considered in its entirety and not one phrase at a time. Where, as here, there is a conflict between a part of the decree which is expressed in the will itself and another clause thereof, the decisions hold that the clause in the will must govern.

Our Supreme Court in the case of In re Ewer's Will, 177 Cal. 660, 171 P. 683, had this identical question for decision and held in considering similar wording in a decree of distribution that the will might properly be examined in construing ambiguities in the decree of distribution. Mr. Justice Shaw says (177 Cal. 660, at page 662, 171 P. 683):

“The respondent claims that by virtue of the reference in the decree to the last will of Warren B. Ewer the court may look to said will to determine the nature of the trust upon which Naylor was to hold the money distributed to him.

“We are of the opinion that the contention of the respondent is correct. * * * The finding that the residue remaining in the hands of the executor should be distributed ‘in accordance with the provisions of the last will and testament of said deceased,’ together with the other references in the decree, sufficiently incorporated the provisions of the will into the decree for the purposes of reference to aid the decree and ascertain the nature of the trust. * * * The rule that the decree of distribution prevails over the provisions of the will where the two are in conflict is one of necessity. It should not be applied in cases where the necessity does not exist, and if reasonably possible the decree should be construed so as to be consistent with the will, and so as to incorporate the will into it as a part of its directions, rather than to give it a meaning which conflicts with the provisions of the will. There was no controversy as to the meaning of the will, and we cannot ascribe to the court any purpose or intent to dispose of the estate contrary to its terms.”

Mr. Justice Lorigan, in Horton v. Winbigler, 175 Cal. 149, 158, 165 P. 423, 427, says:

“In the decree of distribution it is recited ‘that in pursuance of, and according to the last will of said deceased, the agreements of the heirs and legatees, and deeds and conveyances on file herein, the said property is distributed as follows, to wit,’ followed by the distributive clause in favor of Lucy J. Brown of one half of the money of the estate in the terms relied on by appellant and the other half of the money to plaintiff, together with certain real estate.

“In making a decree of distribution a court may incorporate the provisions of the will therein or a contract or agreement entered into between the heirs and which is called to the attention of the court with a view of having it incorporated in the decree; and the court may, by express terms or by apt reference thereto, incorporate said will or contract in the decree so as to constitute it a portion of its distributive terms. This is what was done in the decree of distribution under consideration. The court incorporated the will and the contract between plaintiff and Mrs. Brown as to the respective interests which each should take on distribution and pursuant thereto made distribution accordingly. When a necessity arose thereafter to construe said decree, the court was not limited to a consideration of the particular provision of it, as claimed by appellant, but it was the duty of the court to look to the will and the contract which were made a part of the decree, together with the other terms, in order to ascertain just what the terms of the distribution were, because the distribution as declared by the court was in accordance with the provisions of the will and the agreement of the heirs. This declaration and reference to the will and agreement made them a part of the decree as effectually as though set forth in it. The court was not, as appellant asserts, allowing the admission of the will and contract as matters extraneous to the terms of the decree for the purpose of modifying or changing the decree of distribution. The court was admitting these instruments, which were in effect part of the decree of distribution because referred to therein and declared to be the basis of the decree itself, not to modify it or change it in any particular, but for the purpose of construing it in its entirety and determining just what was meant by all its distributive provisions. The right of the court to incorporate provisions of a will or agreement by express reference in a decree of distribution and thereafter in an action involving a consideration of the decree to resort to said will and agreement as part of the decree in construing its terms, as was done in this case, is well settled in this state.”

As to the second question, the gift of a specified portion of the income of a trust fund does not constitute an annuity. 3 Cor. Jur. 201; In re Estate of Brown, 143 Cal. 450, 455, 77 P. 160.

Mr. Justice Shaw in the case last cited (143 Cal. 450, at page 455, 77 P. 160, 162) states the rule thus: “A gift of an income from a certain fund is not an annuity, and interest does not begin thereon until one year from the death of the deceased.”

The declaration in the final decree of distribution that the bequest was an annuity is not conclusive in determining its character. The determinative factor is whether the entire decree, including the will which was incorporated therein by apt language, made a distribution in such manner as to meet the requirements of section 161, subd. 3, of the Probate Code, defining an annuity. In the instant case it did not, in view of the decisions of our Supreme Court, supra. Therefore, since the decree of distribution did not create an annuity, the bequest to plaintiff of income from the trust fund was not payable from the date of testator's death but commenced upon receipt from the trust fund of income by defendant Ethel Carman–Ryles.

The portions of the judgment appealed from are reversed, and the lower court is ordered to enter a modified judgment in accord with this opinion.

McCOMB, Justice pro tem.

We concur: CRAIL, P. J.; WOOD, J.

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