Callnon v. Winrott

tions of the principal as the trustee deemed necessary, to John^[1] during the latter’s life.

The final paragraph of article Thirdly of the will provided: “Upon and at the time of the demise of my said son, John W. Callnon, this trust shall cease and terminate and the entire trust estate shall go to and vest in my said Trustee.” (Italics added.)^[2]

On November 16, 1936, the executor filed his final account and petitioned for final distribution. In its reference to the distribution of the corpus of the trust upon the death of the life beneficiary, the petition repeated word for word the above quoted final paragraph of article Thirdly except that it omitted the pronoun “my” and added Anna’s name at the end of the provisions.^[3] On November 30, 1936, the court made its “Order and Decree op Settlement op Account and Final Distribution. ’ ’ The provisions of this decree relating to the final distribution of the residue of the estate to the trustee, repeated word for word the corresponding paragraphs of article Thirdly of the will dealing with the powers of the trustee and the distribution of the income and principal of the trust except that in the provisions dealing with the termination of the trust and the distribution of the corpus, the court added certain language not found in the final paragraph of article Thirdly or in the petition for final distribution. In this respect the decree provided: “It Is Further Ordered, Adjudged and Decreed that upon and at the time of the demise of said son, John W. Callnon, this trust shall cease and terminate and the entire trust estate shall go to and vest in said Trustee, Anna Elliott if said Anna Elliott survives said John W. Callnon.” (Italics added to indicate additional language.)^[4] The decree made no provision for distribution of the

corpus if Anna did not survive the life beneficiary. No appeal was ever taken from the decree of final distribution and it has long since become final. On December 9, 1936, an order fixing inheritance tax was made in the probate proceedings in which the value of the life estate was assessed to John and the value of the remainder to Anna.

Anna Elliott served as trustee under testator’s will until March 1955 when she resigned. She died later the same year. Charles 0. Busiek was appointed as alternative trustee pursuant to the will, (see fn. 2, ante); he acted as trustee until his death in 195.7. Thereafter John G-. Callnon, the son of John W. Callnon and the grandson of testator, was appointed to fill the vacancy; he served as trustee until the termination of the trust.

The trust continued until March 21, 1966, when John W. Callnon, the life beneficiary, died. On June 3, 1966, John G-. Callnon the trustee and appellant herein filed his ‘ Eighth Annual and Pinal Account and Report op Trustee and Petition por Settlement, por Allowance op Compensation and por Pinal Distribution. ’ ’ The petition prayed for distribution of the trust estate to the heirs of E. W. Callnon according to the laws of intestate succession.^[5] The basis of the prayer was that the decree of final distribution provided that Anna Elliott was to have the remainder only “if said Anna Elliott survives said John W. Callnon”; that Anna died in 1955 and John W. Callnon in 1966; that no provision was made in the decree for distribution of the corpus of the trust in the event Anna predeceased John; and that, therefore, the trust estate must pass as intestate property of E. W. Callnon.

Respondent Maxine Winrott, a daughter of Anna Elliott and administratrix of her estate, filed her objections to the trustee’s final account and petition for distribution.^[6] Respondent’s position was that the decree of distribution did not dispose of the trust estate in the event of Anna’s death

prior to the termination of the trust and was, therefore, incomplete. Invoking the rule that resort may be had to the will if the decree of distribution is uncertain, vague or ambiguous, she claimed that because the decree was incomplete, it was uncertain and ambiguous thus allowing the court to refer to the will to find testator’s intent. According to respondent, the will clearly showed that Anna was to have a vested remainder which could not be defeated by Anna’s predeceasing the life beneficiary. Since Anna died intestate respondent prayed that the trust estate be distributed to her as administratrix.

After a hearing on the petition and objections thereto, the trial court found that the decree of final distribution made on November 30, 1936, was “ambiguous insofar as the ownership of the trust remainder is concerned” necessitating reference to the testator’s will and concluded on the basis of the will that “Anna Elliott was vested with ownership of the remainder and that such ownership was not conditioned upon her survival of the life beneficiary.” The court accordingly ordered all of the assets remaining in the trust, after payment of fees and expenses, distributed to respondent Maxine Winrott, as administratrix. On December 28, 1966, the court entered judgment ordering distribution of the remainder to “Maxine Winrott, as Administratrix of the Estate of Anna Elliott, Deceased.” Appellant individually and as trustee appeals from that portion of the judgment^[7] ordering distribution of the trust. (Prob. Code, § 1240.)^[8]

The positions of the parties on appeal may be summarized as follows: Appellant contends that the 1936 decree of final distribution is the measure of the rights in dispute and, being free of ambiguity or uncertainty, clearly makes Anna’s interest in the remainder of the trust subject to the express condition that she survive John. Respondent on the other hand, as Anna’s representative, maintains that the decree is ambiguous as to whether Anna’s ownership of the remainder is or is not contingent upon her surviving John, that the trial court properly referred to decedent’s will in order to clarify and interpret the survivorship condition, and that upon such reference it clearly appeared that Anna was given a vested remainder

which could not be defeated by her failure to survive the life beneficiary.

“ The administration of a decedent’s estate involves a series of separate proceedings, each of which is intended to be final . . . (Estate of Loring (1946) 29 Cal.2d 423 , 428 [ 175 P.2d 524 ]; accord: Estate of Van Deusen (1947) 30 Cal.2d 285 , 290 [ 182 P.2d 565 ].) A decree 'of distribution is a judicial construction of the will arrived at by the court ascertaining the intent of the testator. (Whittingham v. California Trust Co. (1931) 214 Cal. 128 , 132 [ 4 P.2d 142 ]; Estate of Scrimger (1922) 188 Cal. 158 , 165 [ 206 P. 65 ]; Wills v. Wills (1913) 166 Cal. 529 , 532 [ 137 P. 249 ]; Toland v. Earl (1900) 129 Cal. 148 , 152 [ 61 P. 914 , 79 Am.St.Rep 100 ]; Williams v. Marx (1899) 124 Cal. 22 , 24 [ 56 P. 603 ]; Cunha v. Hughes (1898) 122 Cal. 111 -112 [ 54 P. 535 , 68 Am.St.Rep. 27 ]; Jewell v. Pierce (1898) 120 Cal. 79 , 82 [ 52 P. 132 ]; Matter of Trust of Trescony (1898) 119 Cal. 568 , 570 [ 51 P. 951 ]; Goad v. Montgomery (1898) 119 Cal. 552 , 557 [ 51 P. 681 , 63 Am.St. Rep. 145 ].) Once final, the decree supersedes the will (Estate of Easter (1944) 24 Cal.2d 191 , 194 [ 148 P.2d 601 ]; Keating v. Smith (1908) 154 Cal. 186 , 191 [ 97 P. 300 ])^[9] and becomes the conclusive determination of the validity, meaning and effect of the will, the trusts created therein and the rights of all parties thereunder. (Estate of Careaga (1964) 61 Cal.2d 471 , 475 [ 39 Cal.Rptr. 215 , 393 P.2d 415 ]; Estate of Loring, supra, 29 Cal.2d 423 , 427; Estate of Scrimger, supra, 188 Cal. 158 , 164; § 1021.)^[10]

If the decree erroneously interprets the intention of the testator it must be attacked by appeal and not collaterally. (Estate of Easter, supra, 24 Cal.2d 191 , 194; Miller v. Pitman (1919) 180 Cal. 540 , 543 [ 182 P. 50 ].)^[11] If not corrected by appeal an 11 erroneous decree ... is as conclusive as a decree that contains no error.” (Estate of Loring, supra, 29 Cal.2d 423 , 432; accord: Estate of Eckstrom, supra, 54 Cal.2d 540 , 545; Estate of Goldberg, supra, 10 Cal.2d 709 , 713; Whittingham v. California Trust Co., supra, 214 Cal. 128 , 132.) It is well settled that “where the decree of distribution is contrary to the provisions in the will, the decree controls and prevails over the terms of the will with respect to the distribution of the property.” (In re Ewer (1918) 177 Cal. 660 , 662 [ 171 P. 683 ]; accord: Estate of Eckstrom, supra, 54 Cal.2d 540 , 545; Estate of Scrimger, supra, 188 Cal. 158 , 165; Wills v. Wills, supra, 166 Cal. 529 , 532; Luscomb v. Fintzelberg, supra, 162 Cal. 433 , 438-439; Keating v. Smith, supra, 154 Cal. 186 , 191; Matter of Trust of Trescony, supra, 119 Cal. 568 , 570.) Only if the language of the decree is “uncertain, vague or ambiguous” (In re Ewer, supra, 177 Cal. 660 , 662) may resort be had to the will to interpret but not to contradict the decree. (Estate of Goldberg, supra, 10 Cal.2d 709 , 713; Bixby v. Security-First Nat. Bank, supra, 7 Cal.2d 424 , 428; McCloud v. Hewlett, supra, 135 Cal. 361 , 368; Goad v. Montgomery, supra, 119 Cal. 552 , 557.) However, “if the distributive portions of the decree are free from ambiguity, . . . resort may not be had to the provisions of the will . . .’’in order to create an ambiguity. (Estate of Norris (1947) 78 Cal.App.2d 152 , 160 [ 177 P.2d 299 ].)

We have concluded that the decree of distribution is not ambiguous or uncertain. It clearly provides that on the death of the life beneficiary the trust estate “shall go to and vest in said Trustee, Anna Elliott if said Anna Elliott survives said John W. Callnon.” (Italics added.) The italicized

portion is unmistakably an express condition of survival that limits the circumstances under which the remainder is to pass to Anna. G-iving effect to the substance of the provision as we are required to do when construing judgments (Civ. Code, § 3528; Schisler v. Mitchell (1959) 174 Cal.App.2d 27 , 29 [ 344 P.2d 61 ]), the decree provides nothing more than if it were worded^[11] residue in trust to John for life remainder to Anna if she survives John.” Such a provision unquestionably devises nothing to the remainderman who predeceases the life tenant.

Our views find support in the many treatises on the subject as is illustrated by the following passage from 2 Tiffany, Real Property (3d ed. 1939) section 322, page 29: “As examples of a contingent remainder in favor of a person or persons ascertained, that is, of a remainder subject to a condition precedent other than the ascertainment of the remainderman, may be mentioned the case of a gift to A for life with remainder to B provided B survives A (Accord: 5 American Law of Property (1952) § 21.31, p. 177; Ogden’s California Real Property Law (1956) § 2.12, p. 23; 5 Page on Wills (Bowe-Parker ed. 1962) § 43.12, p. 369; 1 Simes and Smith, The Law of Future Interests (2d ed. 1956) § 135, pp. 114-115; 2 Witkin, Summary of Cal. Law (7th ed. 1960) p. 979. See § 122; Rest., Property, §§ 157, 250; Estate of Washburn (1909) 11 Cal.App. 735 , 741 [ 106 P. 415 ]; Phayer v. Kennedy (1897) 169 Ill. 360 , 364 [ 48 N.E. 828 , 829-830]; Dickey v. Citizens’ State Bank of Fairmount (1932) 98 Ind.App. 58 , 63-64 [ 180 N.E. 36 , 38]; Shaw v. Eckley (1897) 169 Mass. 119 , 121 [ 47 N.E. 609 , 610]; Bamforth v. Bamforth (1877) 123 Mass. 280 , 282.) We need not determine whether the wording here used created a contingent remainder or a vested remainder subject to complete defeasance. The result will be the same regardless of the technical form of the remainder; Anna takes nothing unless she survives the life tenant.^[12]

In support of her contention that the decree is ambiguous respondent asserts that it is not clear from the language “shall go to and vest in said Trustee, Anna Elliott if said Anna Elliott survives said John W. Callnon” whether the condition of survival refers to Anna’s ownership of the remainder interest or merely to her possession of that interest. Respondent argues that the condition of survival can be construed in three different ways: 1) that both ownership and possession by Anna are conditioned upon her survival; 2) that the condition modifies only the words “shall . . . vest in” which grant possession to Anna and the words “shall go to” grant ownership and are not subject to the condition; and 3) that the entire italicized provision refers only to Anna’s possession of the remainder and it alone requires survival. Respondent cites several cases which have involved the disposal of future interests by language similar to “shall go to and vest in.“^[13] Some of these eases have held that such language controls the devolution of ownership of the property in question while others have held that the language controls only its possession. Respondent asserts that these cases give rise to the three interpretations of the remainder clause in the instant ease.

This argument is without merit. Whatever interest Anna was to have in the remainder of the estate was derived from the provision of the final decree here in issue; no other provision of the decree purported to dispose of any portion of the remainder. Whether the clause gave her ownership or possession she was required by an express condition to survive the life beneficiary in order to take anything. Since she predeceased John W. Callnon any interest she had in the remainder “vanished into thin air.” (Estate of Haney, supra, 174 Cal.App.2d 1 , 8.) The cases cited by respondent are easily distinguishable. The absence of an express condition of survival in those cases made it necessary for the courts to construe the specific language in order to determine if a condition of survivorship was contained by implication. In the instant ease, however, the language of “shall go to and vest in” is found in the context of a provision containing an express condition

conclusive interpretation of the testator’s intent and is binding on all interested parties. Resort may not be had to the will thereafter unless the provisions of the decree are ambiguous. Where, as in the instant ease, the decree was not challenged on appeal and is not ambiguous, we must insist that it remain unassailable against any attempt to attack it collaterally. In this way, we preserve the finality and conclusiveness of such decrees and guaranty the integrity and stability of titles to property.

Respondent finally asserts that the probate court in making the decree of distribution did not intend to require that Anna survive in order to take the remainder because the order fixing inheritance tax shows Anna as the sole owner of the remainder and the court’s minute order does not mention a condition of survival.^[14] Neither of these orders has significance in the determination of the devolution of the remainder. “The order fixing inheritance taxes, which may incidentally determine questions in regard to succession and beneficial ownership, is not binding except for tax purposes as between those who claim the estate, whether as heirs, legatees, or beneficiaries of a trust extrinsic to the will.” (Estate of Rath (1937) 10 Cal.2d 399 , 406 [ 75 P.2d 509 , 115 A.L.R. 836 ]; accord: O’Farrell v. American Trust Co. (1957) 149 Cal.App.2d 691 , 695 [ 309 P.2d 60 ].) The minute order merely ordered the entry of the decree of distribution and was not the decree itself. (Estate of Olsen (1935) 9 Cal.App.2d 374 , 382-383 [ 50 P.2d 70 ].) “An order for a judgment is not a judgment” (United Taxpayers Co. v. San Francisco (1921) 55 Cal.App. 239 , 243 [ 203 P. 120 ]) and as such is of no force in the construction of the decree of distribution. (See Estate of Spreckels (1913) 165 Cal. 597 , 606 [ 133 P. 289 ].)

We conclude that the court below erred in distributing upon John’s death the balance of the trust estate to Anna’s representative. Since the 1936 decree provided for distribution of the trust estate to Anna only if she survived John and made no provision for distribution of the trust estate if Anna predeceased John, it is clear that as to the balance of the trust estate E. W. Callnon must be deemed to have died intestate. Since John was the sole heir of the decedent such intestate property which was the separate property of decedent (see fn. 5, ante) passed to John under the laws of succession (§ 222; see Estate of Wilson (1920) 184 Cal. 63 , 67