Shattuck v. Crocker-Anglo National Bank

DRAPER, J. Legatees and heirs at law separately appeal from decree settling second account and of final distribution. The appeal of the legatees raises the question of the proper order of resort to a lapsed legacy for payment of expenses of administration and specific legacies.

The holographic will bequeathed $20,000 to Nat Sehmulowitz, $25,000 to F. P. Gray, $10,000 to Mrs. F. P. Gray, $8,000 to the Bide-A-Wee Home for homeless dogs, $3,000 to Fleishhaeker Zoo, and provided that “all the rest, residue and remainder” of the estate go in equal shares to Mr. Schmulowitz and Mr. and Mrs. Gray. Mr. Gray predeceased testatrix. Since he was not related to testatrix, both the legacy of cash and the residuary bequest to him lapsed. (Prob. Code, § 92.) The probate court found that the property of the estate “not disposed of by the will” consisted of the $25,000 bequest to Mr. Gray and the one-third of the residue bequeathed to him. It ordered resort, for payment of debts, expenses of administration and pecuniary legacies, first to the $25,000 bequest, and then to the intestate one-third of the residue. The effect of this order is to prevent the lapsed cash bequest from increasing the shares of the surviving residuary legatees. Appellant legatees contend that the lapsed cash bequest falls into the residue, that only one-third of this enhanced residuary legacy is “property not disposed of by the will,” and that it is this third to which resort should be had for payment of expenses and legacies. The estate is ample to pay all costs and cash bequests and leave a substantial residue. However, the [42]course followed by the probate court reduces the share of each of the surviving residuary legatees by $8,333.33, which amount they would receive under their contention.

Where, as here, the will makes no provision for payment of debts and expenses of administration, resort for payment thereof is to be first to "that portion of the estate not disposed of by the will,” and only when such property is insufficient is resort to be had to the "property given to residuary legatees.” (Prob Code, § 750.) Legacies are to be paid in like order. (Prob. Code, § 751.) If the lapsed bequest of $25,000 became a part of the residue, two-thirds of it clearly is effectively disposed of by the residuary clause of the will, and is not to bear the burden of expenses and legacies until after resort to property not disposed of by the will (one-third of the residue) has been subjected to that burden. Thus the question is whether the residuary clause operated upon the lapsed cash legacy.