IN RE: WALLACE'S ESTATE.† (1937)

By the will of William W. Wallace a trust was created consisting of the residue of the estate, the Farmers & Merchants National Bank being named trustee. The trustee was directed to pay to Harriet M. Wallace, wife of the testator, the sum of $50 per month during her lifetime, and to two daughters, Jessie W. Buchanan and Margaret W. O'Mara, the balance of the net income. The will provided: “Upon the death or remarriage of my said wife, the said trustee shall turn over and deliver the balance remaining in said trust fund to my said two daughters above named, in equal proportions, share and share alike, that is to say: one–half to each.” Upon the death of Mr. Wallace the will was admitted to probate, the administration of the estate was completed, and the final decree of distribution entered on December 7, 1926. The decree followed the directions contained in the will concerning the creation of the trust, provided for the payment by the trustee of $50 per month to Mrs. Wallace during her lifetime, and the balance of the net income to the two daughters, and further provided: “Upon the death or remarriage of said widow, the said trust shall terminate and said trustee shall distribute the balance remaining in said trust fund to the two above–named daughters of decedent, in equal proportions, share and share alike.” One of the daughters, Margaret W. O'Mara, died on July 31, 1932, and Harriet M. Wallace died on September 24, 1936. The trial court held that the estates left to the two daughters were contingent remainders and did not vest until the termination of the life estate in Harriet M. Wallace; that by reason of the death of Margaret W. O'Mara prior to the death of Harriet M. Wallace the remainder in favor of Margaret W. O'Mara lapsed and that this interest should descend to the heirs at law of William W. Wallace. The appeal is prosecuted by the heirs of Margaret W. O'Mara and the administrator of her estate.

We must look to the decree of distribution to determine the rights of the respective parties. The decree supersedes the will and prevails over the provisions in the will. Keating v. Smith, 154 Cal. 186, 97 P. 300; Goad v. Montgomery, 119 Cal. 552, 51 P. 681, 63 Am.St.Rep. 145. The decree of distribution entered by the court provides that upon the death of the widow the trustee “shall distribute the balance remaining. * * *” A number of decisions have been made by the reviewing courts of California in which a fine distinction is drawn between those testamentary provisions which create vested remainders and those which create contingent remainders. In Re Estate of Fair, 132 Cal. 523, 60 P. 442, 456, 64 P. 1000, 84 Am.St.Rep. 70, the testator devised certain property to trustees to hold during the lives of the testator's children “and upon the death of such survivor to transfer and convey” the property to certain persons named. In holding that the words used in the will did not create a vested estate in the beneficiaries, the court said that “the whole estate was to go to the trustees, to be by them conveyed, and there are no operative words to create an estate in remainder.” The court further pointed out that, if the testator “had made a direct devise in remainder to the persons of the classes named in the will, those of the latter who were alive at the testator's death would have immediately taken vested estates.” In Re Estate of Hamon, 136 Cal.App. 517, 29 P.(2d) 326, the testator devised certain property to a trustee: “To invest * * * and pay the income * * * to my daughter, Edith I. Brown. At the end of twenty (20) years from the date of this will * * * said Trustee shall deliver said trust fund to my said daughter, Edith I. Brown, to be her sole and separate property.” Within the period of twenty years Edith I. Brown died and her husband, as executor of her will, petitioned the court to terminate the trust and distribute the trust estate to him as executor. The reviewing court pointed out that “nowhere in the trust clause nor elsewhere in the will is any language used indicating an intention on the part of the testatrix to vest present title to the trust property in Edith I. Brown.” The court quoted from Re Estate of Troy, 214 Cal. 53, 3 P.(2d) 930: “It may be taken as settled by the decisions in this state that the beneficiary of a trust takes no estate in the property itself, and that title vests in the trustee with the right in the beneficiary to enforce performance of the trust.” A similar ruling was made in Re Estate of Willson, 171 Cal. 449, 153 P. 927, 928, wherein the testamentary clause in dispute provided: “Upon the death of both the said Fred Kuhnle and Mary E. Kuhnle, his wife, said trustee shall convey and transfer said property absolutely to Mary S. Hayward.”

To create a vested remainder it is necessary that there be a present conveyance of a future estate to the beneficiary. The present title was vested in the trustee with the requirement that independent action on the part of the trustee be taken before title passed to the beneficiaries. No language is used giving to the daughter a present vested interest in the corpus of the estate. The words used in the decree providing that upon the death or remarriage of the widow the trustee “shall distribute the balance remaining” to the daughters are similar in import to the words used in Re Estate of Hamon, supra, “shall deliver,” and to the words used in Re Estate of Fair, supra, in which upon the happening of a certain event the trustee was directed “to transfer and convey.” As said in Re Estate of Fair, there are no operative words to create a vested estate in remainder.

The decree is affirmed.

WOOD, Justice.

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