IN RE: RATTRAY'S ESTATE.*

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District Court of Appeal, Second District, Division 1, California.

IN RE: RATTRAY'S ESTATE.* MURPHY v. RENNIE et al.

S.C. 66

Decided: September 08, 1938

Lloyd R. Massey and Ralph Edgington, both of Los Angeles, for appellants. Louis Thomsen, of Los Angeles, for respondents Mary Ann Rennie and David Rattray. Duque & McKinley, of Los Angeles, for respondent William Rattray, as administrator.

This is an appeal from a decree of partial distribution, distributing to the respondents, Mary Ann Rennie and David Rattray, sister and brother of the predeceased husband of decedent herein, who died intestate without issue. The appellants are a brother, sister, and several children of a predeceased sister and two predeceased brothers, of said decedent, in whose behalf Hon. Matthew Murphy, consul of the Irish Free State, appears by his attorneys.

Appellants, appearing in the court below, filed objections to the partial distribution of property in the estate of Elizabeth Rattray, also known as Lizzie M. Rattray, hereinafter referred to as decedent, to the relatives of her predeceased husband, upon the ground that the portion of the estate affected by the petition for partial distribution, consisting of the sum of $18,307.03, was the separate property of the decedent, and that appellants, as her sole heirs, should receive the whole thereof.

With reference to the money here involved, there was evidence before the probate court that at the time of the death of her husband in 1930, decedent had on deposit with a bank in her own name, as shown by her bank books, the sum of $16,618.90. It was also established that decedent during her married life, extending from 1908 to 1930, held title in her own name to several parcels of real estate. The aforesaid cash standing in the name of decedent at the time of her husband's death in 1930 was not inventoried in nor accounted for as part of his estate. The court found in effect that all of the estate of decedent, including the aforesaid bank account and cash in addition thereto consisting of the increment thereof, totaling in all $18,307.03, was community property of decedent and her previously deceased spouse, James W. Rattray, and came to her “by gift, devise and bequest”; by reason of which the court decreed that respondents, as sister and brother of decedent's predeceased husband, are heirs of decedent under the provisions of section 228 of the Probate Code, and entitled thereunder to share in the estate of decedent. Overruling appellants' objections, the court ordered that partial distribution of the estate of decedent be made as prayed for by respondents.

It is undisputed that the descent of property is governed by the law in force at the time of the death of the person whose property is to be distributed. Estate of Putnam, 219 Cal. 608, 28 P.2d 27. The provisions of section 228 of the Probate Code, as enacted in 1931, therefore govern and control the distribution of the property in the estate of Elizabeth Rattray, who died intestate July 25, 1936. The pertinent section of the Probate Code reads as follows: “If the decedent leaves no issue, and the estate or any portion thereof was community property of the decedent and a previously deceased spouse, such property goes in equal shares to the children of the deceased spouse and to their descendants by right of representation, and if none, then one-half of such community property goes to the parents of the decedent in equal shares or if either is dead to the survivor, or if both are dead in equal shares to the brothers and sisters of the decedent and to their descendants by right of representation, and the other half goes to the parents of the deceased spouse in equal shares, or if either is dead to the survivor, or if both are dead in equal shares to the brothers and sisters of such deceased spouse and to their descendants by right of representation.”

The first contention advanced by appellants is that the evidence is insufficient to support the finding that all of the estate of decedent was community property of said decedent and her previously deceased husband, James W. Rattray, and came to decedent from her husband by gift, devise and bequest. Also in this connection it is urged that there is an insufficiency of evidence to support the finding that respondents, as heirs at law of the predeceased husband of the decedent herein, constituted them heirs of decedent under the provisions of section 228 of the Probate Code and that by reason thereof they are entitled to succeed to the estate of decedent.

In considering these claims of appellants, it is necessary to epitomize the testimony presented to the probate court. This was furnished in the main by William Rattray, a brother of the predeceased husband, who testified he first met decedent two years after her marriage to his brother; that he resided with decedent and her husband for “some little time” and thereafter saw them at intervals over a period of several years. This witness testified that he discussed with decedent and her husband their financial affairs; that his brother had no property at the time of his marriage to decedent, and inherited none during his lifetime; also that at the time of her marriage to his brother, decedent had no property, and so far as the witness knew, she never inherited any property during her lifetime. It was testified that the predeceased husband of decedent shortly after his marriage commenced to work for the Los Angeles Water Company and continued in the employ of said company and its successors up to a short time prior to his demise in 1930. The evidence indicates that decedent and her husband were frugal in their habits and mode of living, and that at the time the husband left the service of the water company his occupation was that of foreman and his salary approximated $200 per month. The record further indicates that during the entire married life of decedent and her husband the former's exclusive occupation was that of housewife in their home, and that after the death of her husband decedent engaged in no gainful employment. Upon this state of the record, we have no hesitancy in saying that the trial court was justified upon the foregoing facts in concluding that all of the property was acquired by the joint efforts and frugality of decedent and her husband during coverture. The wife had no separate property; her husband worked continuously; they were frugal and saving over a period of 22 years of married life; and the fruits of their efforts totaled an amount entirely commensurate with the savings and investments based upon the earnings and income of the husband.

We come now to a consideration of the question whether under the provisions of section 228 of the Probate Code, as construed by the decisions of the appellate courts of this state, one-half of the sum of money here involved goes to the heirs of the predeceased husband of decedent. To answer this question in the affirmative, we must conclude that the money in question came to decedent by “gift” from her husband during his lifetime out of the community funds. And if we conclude that decedent received the money as a gift from her husband out of their community funds, before we can hold that his heirs are entitled to inherit from the estate of his surviving wife, we must read into section 228 of the Probate Code the provision that any portion of community property received by one spouse from the other by gift and remaining the property of such spouse after the death of the donor spouse and at the time of the death of the donee spouse, in the event the latter dies intestate, is divided equally between the heirs of both the parties to the community.

Deciding as we have that the trial court was justified in concluding that the money here in question was community property, we hold that in view of the fact that it was taken from community funds and deposited in the bank in the name of the wife and was not accounted for nor inventoried in the husband's estate, the sums so deposited in the wife's name were gifts made to her by the husband of his community interest therein. Having determined that the money here in question came to the decedent by gift from the community funds, we are confronted with the specific question—are the words “came to the decedent from such spouse by gift, descent, devise or bequest”, which appear in section 229 of the Probate Code regulating the disposition of the separate property of a deceased spouse who died intestate, read into section 228 of the Probate Code, in which latter section those words do not now and never did appear? In the determination of this question, the decision in Estate of Simonton, 183 Cal. 53, 190 P. 442, is helpful. That case involved the construction of what are now sections 228 and 229 of the Probate Code at a time when (in the year 1920) those sections were section 1386, subdivision 8, of the Civil Code. At that time the word “gift” did not appear anywhere in said subdivision 8 of section 1386, said word having been added to section 229 of the Probate Code when the Probate Code was enacted in 1931. Subdivision 8 of section 1386 of the Civil Code, at the time of the Simonton decision and for many years prior thereto, and up to 1931, read:

“If the deceased is a widow, * and leaves no issue, and the estate, or any portion thereof, was common property of such decedent and * her deceased spouse, while such spouse was living * one half of such common property goes * in equal shares to the brothers and sisters of such deceased spouse. *

“If the estate, or any portion thereof, was separate property of such deceased spouse, while living, and came to such decedent from such spouse by descent, devise, or bequest, such property goes *” (all to the heirs of the predeceased spouse).

From the foregoing it will be noted that the manner in which the property had to come from the predeceased spouse to the last decedent was not stated in the first paragraph of subdivision 8 of section 1386 (the paragraph dealing with common or community property), but that in the second paragraph (dealing with separate property) the manner in which the property had to come to the last decedent from the predeceased spouse was specified, namely, that it had to come “by descent, devise or bequest”, that is, will or succession. While the Civil Code section so read the Estate of Simonton, supra, was decided by the Supreme Court. The property involved in that decision was community property, largely. The facts in that case were very similar to the facts in the case at bar, but we must keep in mind that the law (section 1386, subdivision 8, Civil Code) was not the same then as it now appears in part in section 229 of the Probate Code. In 1931 the word “gift” was added to section 229 of the Probate Code (which was formerly the second paragraph of subdivision 8 of section 1386, Civil Code). Section 228 of the Probate Code, with which we are mainly here concerned, remains the same as the first paragraph of the old subdivision 8 of section 1386, and that section of the Probate Code deals with community property.

In the Simonton Case, supra, one of the questions presented was whether property which had at one time been community property, and had been “given” by the predeceased husband to his wife during his lifetime, came within the purview of what was then subdivision 8 of section 1386, Civil Code; that is, whether any part of such property would go to the heirs of the previously deceased spouse. The Supreme Court held in the negative under the law as it then read, saying (page 57, 190 P. page 444): “Literally, this would include any property which had once been community property, no matter if it were not such at the time of the husband's death, as, for example, where the husband had in his lifetime given it to his wife for her separate property. But such a meaning is clearly not what was intended, and it has already been held that it is not the true meaning. Estate of McCauley, 138 Cal. 546, 71 P. 458.”

In the same case, the Supreme Court further said: “The only rational construction which can be given the provision is that it applies only to community property received by will or inheritance or retained by virtue of its character as community property. * If the wife be the survivor, it applies to such of the community property as she receives either by will or as her share of the estate. *”

On page 58, 190 P. on page 444, of the opinion in the Simonton Case, supra, the following appears: “The correctness of this construction” (placed by the court upon the first paragraph of subdivision 8 of the Civil Code) “is made doubly evident by the language of the second paragraph of the Code subdivision, that which deals with property which was the separate property of the predeceased spouse. There the language is that such property as ‘came to the decedent (the surviving spouse) by descent, devise or bequest’ from the spouse first dying shall go to the latter's relatives. This language is specific as to how the property must come to the decedent in order that the provision apply. The equivalent provision in the case of community property would be one limited to property received or retained by the survivor of the community either by will or by inheritance or by virtue of its character as community property. *”

In other words, the Supreme Court in the Simonton Case held that the provisions of the second paragraph of subdivision 8 of section 1386 of the Civil Code, specifying the manner in which the property had to come to the decedent from the predeceased spouse, must be read into and form a part of the first paragraph of said subdivision. That being true, we hold that notwithstanding the fact that at the time section 1386, subdivision 8, was “lifted” from the Civil Code and reenacted into the Probate Code it was divided into two separate sections, the two named sections must be considered together, in conformity with the provisions of section 2 of the Probate Code, reading as follows: “The provisions of this code, so far as they are substantially the same as existing statutes, must be construed as continuations thereof, and not as new enactments.”

Remembering that when section 229 was enacted into the Probate Code the legislature added the word “gift” to the words “descent, devise or bequest” as originally contained in the second paragraph of subdivision 8 of section 1386 of the Civil Code, we conclude from the reasoning in the Simonton Case, supra, that the only logical construction which can be given to the provisions of section 228 of the Probate Code is that it applies to property received out of community property by gift, descent, devise, or bequest. We are fortified in this construction by the language of section 229 of the Probate Code, which deals with property that was the separate property of the predeceased spouse. There the language is that such property as “came to the decedent from such spouse by gift, descent, devise or bequest” from the spouse first dying shall go to the latter's relatives. This language is specific as to how the property must come to the decedent in order that the provisions of section 229 shall apply. An equivalent provision affecting what was community property during the lifetime of both spouses would require equal distribution to the heirs of both spouses of any property received or retained by the surviving spouse of the community property which came to such survivor by gift, will, or by inheritance. Peculiarly applicable to the situation before us as to the intent of the legislature in reenacting section 228 of the Probate Code, is the language used by the Supreme Court in Estate of Simonton, supra, at page 58, 190 P. at page 444: “There is a fair presumption that upon this point the provisions with regard to community and separate property were intended to be equivalent, for no reason for a difference exists.”

Coming to her from her husband during his lifetime as a gift out of the community property, Elizabeth Rattray, the surviving spouse, was during her lifetime the absolute owner in her own right of all the property with which we are here concerned. She could give it away or will it away. But when she died intestate and without issue, the right of the relatives of her predeceased spouse to inherit that part of the estate which had come to her from him by gift out of community funds came into existence. Estate of Harris, 9 Cal.2d 649, 72 P.2d 873. The Probate Code in cases like the one now before us makes the origin of the property and not the closeness of the relationship to the decedent the test of succession in the particular situation covered by it. Where the property, either in whole or in part, has its origin in the joint efforts of the members of the community, the statute contemplates that upon the death of the survivor of the community intestate, the property shall go in equal shares to the objects of the bounty of both. Such fair and equitable distribution undoubtedly was the intention of the legislature when it adopted the provisions of section 228 of the Probate Code. The money here in question, having been received by the surviving spouse through gift from her predeceased husband out of their community property, was rightly distributed by the probate court under the provisions of section 228 of the Probate Code when the surviving spouse died intestate.

Appellant next contends that the findings of the trial court are in irreconcilable conflict, in that the court found that all of the estate of decedent was community property of decedent and her predeceased spouse, which came to her by gift from James W. Rattray, and further found that said property came to her by devise and bequest from the estate of her predeceased husband. We find no merit in this contention, for the reason that whether it came to her by gift, devise or bequest, distribution should be made in accordance with the provisions of section 228 of the Probate Code.

Lastly, appellants contend that the finding of the court in the Estate of James W. Rattray, deceased, was a conclusive determination that the said James W. Rattray had no community interest at the time of his death in the money standing in the name of Elizabeth Rattray. The predeceased husband during his lifetime having made a gift of such money to his wife, it was only necessary for respondents to prove that the money going into the bank accounts was community property at the time of the gifts, and not at the time of his death. It is by reason of the origin of these moneys and the increment thereof that they remain subject to the provisions of section 228 of the Probate Code.

For the reasons stated, the decree of distribution is affirmed.

WHITE, Justice.

We concur: YORK, P.J.; DORAN, J.