Trust, Construction. Income, Apportionment on death of beneficiary of trust. Under the provisions of a trust deed, the trustees were directed to pay a certain portion of the net income to A. during her life and after her death to other beneficiaries, interest on mortgages to a certain amount was to be charged against A.'s income, which after her death was to be charged to other beneficiaries, and a certain amount was to be deducted annually from A.'s income for a sinking fund to be applied to the reduction of the principal of the mortgage debt. It also was provided that the distribution of income "shall be made quarterly or oftener at the convenience of the trustees, upon the written order or receipt of the persons entitled thereto, . . . and not by way of anticipation; and said income shall not be assignable or alienable by [the beneficiaries], or liable for their debts, contracts or engagements. The quarter days for payment as established by the trustees are to be considered as the dates of distribution in determining the persons who are entitled to said income." The trustees made payments of fixed sums of income to beneficiaries on the first days of April, July and October in each year, and a payment of the balance due according to a statement then rendered on the first of January. A. died on a March 4. Held, that the income must be treated as accruing from day to day, and that the administrator of A.'s estate was entitled to A.'s proportional part of such income as had accumulated at the time of her death, less such portion of interest on the mortgage and of the payment for the sinking fund as should be apportioned to her according to the date of her death.
BRALEY, J.
The trustees at the death of Mary S. Apthorp, the beneficiary for life, either had received or were entitled to receive as due and payable although not yet collected a sum representing a quarter of the annual income from the estate. But, her death having occurred shortly before the day fixed by them for quarterly payments, the succeeding beneficiary contends that no part of this amount is payable to her administrator. We are of opinion that this position cannot be maintained. In the plan of distribution Mrs. Apthorp received nine fifteenths of the net income, but instead of absolutely fixing the times of payment, paragraph 29 provides, that payments "shall be made quarterly or oftener at the convenience of the trustees." If it is also provided, that the quarter days for payment as established by them are to be considered as the dates of distribution in determining the persons who are entitled to the income, the periods would still be movable as they might decide, although they must pay from time to time during the year. If this paragraph is read in connection with paragraph 27, whereby one third of the entire net income is to be paid to her for life, it is reasonably plain that the principal purpose as to income was to provide for her maintenance, especially as she had contributed to the trust estate not only her title in fee acquired by inheritance from her deceased sons, but her right to dower in the premises. The necessity of support being manifestly implied, it was not intended that, if death intervened before the end of the period fixed by the trustees, she should lose the benefit conferred and be cut off from a means of subsistence, even if the allowance could not be anticipated by orders drawn on them, or whether it could have been reached by a creditor's bill in payment of her debts. It furthermore may be said, that the closing sentence of this clause was not intended to limit the rights of the beneficiaries for life as between themselves and the remaindermen but only, as between themselves and any persons who may claim under them upon orders or assignments.
The defendant urges that the decision in Hemenway v. Hemenway, 171 Mass. 42, is decisive against this view. But the cases are clearly distinguishable. In Hemenway v. Hemenway, the testator directed that the income should be paid in equal semiannual payments, "the first payment thereof to be made at the end of six months next after my death . . . to such of the said four persons, namely, my wife and three children, as may be living at the time of payment," and, the right given having been expressly made dependent upon the times of payment, it was held to have been limited to those in existence on the dates fixed. In the case at bar, the income as we have said was for the life of Mrs. Apthorp, and must be treated as accruing from day to day, although the trustees, who are authorized to pay it oftener, may for their own convenience make the payments quarterly. The income having been earned, even if at her death the whole had not been actually collected, should be apportioned as of that date, and the amount then coming to her, less the proportionate deductions for interest on the mortgage, and charges for the sinking fund called for by the deed, are to be paid to the administrator of her estate.
Decree accordingly.