DELAWARE TRUST CO.
DELWARE TRUST CO. et al.
David F. Anderson (of Berl, Potter & Anderson), Wilmington, for plaintiff.
Thomas Cooch (of Morford, Bennethum, Marvel & Cooch), Wilmington, for defendant Mary S. Rakestraw.
Clair J. Killoran and Clyde M. England, Jr., Wilmington, for defendants Elwood S. Garrett, Victor Garrett, Helen G. Smith, Alice G. Hall, and Thomas Stirn Garrett.
Howard L. Williams (of Hering, Morris, James & Hitchens), Wilmington, for defendant Hilborn Darlington.
BRAMHALL, Vice Chancellor.
On June 14, 1929, the trustor, Kate C. G. Darlington, entered into an inter vivos trust agreement with Delaware Trust Company, a corporation of the State of Delaware. On the same day she also executed her last will and testament. On December 18, 1933, trustor amended the trust agreement. However, we are not concerned here with the amendment.
At the time of the execution of the above instruments, trustor was 71 years of age. Her husband, Dr. Horace H. Darlington, and her only son, C. Canby Darlington, were then living.
The trust agreement provided that the trustee should pay to the trustor during her life the net income therefrom. Upon her [33 Del.Ch. 137] death, provided her husband survived her, the income should be paid to him for life. Upon the death of trustor and her husband, her son, C. Canby Darlington surviving, the entire net income was to be paid to the said C. Canby Darlington for his life. Upon the decease of the trustor, her husband and son, the trustee was directed to pay over the corpus of the fund to the then living issue of the son, per stirpes. Should the son die without issue surviving, the trustee was directed to pay the corpus to the heirs-at-law of trustor under the intestate laws of the State of Delaware.
The trustor died on May 12, 1944, a resident of Delaware County, Pennsylvania. Her husband, Dr. Darlington, died on December 16, 1947. Her son, C. Canby Darlington, died on December 20, 1950, without issue, leaving a last will and testament, in which he provided that the whole of his residuary estate should go to the defendant Mary Rakestraw.
The pertinent part of the trust agreement is as follows:
'(f) Upon the decease of the survivor of the party of the first part and Dr. Horace H. Darlington and C. Canby Darlington, and in default of issue of said C. Canby Darlington, then living, to pay out of the principal of the Trust Fund hereby created to such one or both of Catherine S. Darlington and Hilborn Darlington, niece and nephew respectively of said Dr. Horace H. Darlington, as may then be living absolutely, the sum of One Thousand Dollars each, and, in like event, to pay over, transfer and convey the whole of the remainder of the capital or corpus of said Trust Fund absolutely, clear of all Trusts, unto the heirs-at-law of the party of the first part in the manner provided by the laws of the State of Delaware for intestate personal property.'
Under the will of the trustor, executed on the same date, she gave certain personal property to her husband, if living at the time of her decease; she devised certain real estate in New Jersey to her son, C. Canby Darlington, absolutely; the remainder of her estate was devised and bequeathed to Delaware Trust Company, as trustee, to be held, administered and disposed of in all respects subject to the terms and conditions of said trust agreement. Testator further provided, with respect to certain real estate in Delaware County, Pennsylvania, that if her son, C. Canby Darlington, should die without issue after the termination of the life estate of Dr. Darlington, the trustee should convey said real estate, or if it had been sold, to pay the amount realized therefrom, without[33 Del.Ch. 138] interest, to the heirs-at-law of her husband, Dr. Horace H. Darlington, per stirpes and not per capita, absolutely. The pertinent part of the will is as follows:
'* * * provided, however, that in the event my son, C. Canby Darlington, shall not leave lawful issue living at the time of the decease of the survivor of myself, my husband, Dr. Horace H. Darlington, and my said son, then I direct said Trustee, Delaware Trust Company, upon the death of the survivor of myself, my said husband, and my said son, to convey the real estate situated in the township of Concordwille, Delaware County, Pennsylvania, which was conveyed to me under the name of Kate Canby Garrett Darlington, by Matthew Buchanan by deed dated June 10, 1895, and recorded in Delaware County, Pennsylvania, in Deed Book H-9, at page 117, etc., to the heirs-at-law of my said husband, Dr. Horace H. Darlington, per stirpes and not per capita, in fee simple; and provided further, however, that in like event, if my said Trustee shall have sold said real estate under the power of sale contained in said Indenture of Trust, of June 14th, 1929, then to pay over, transfer and convey an amount equivalent to that realized from said sale, but without interest, to the heirs-at-law of my said husband, Dr. Horace H. Darlington, per stirpes and not per capita, absolutely.'
The Pennsylvania real estate referred to was sold on October 20, 1944, for the sum of $12,000 by the Delaware Trust Company as trustee. At the time of the death of the son, C. Canby Darlington, Dr. Darlington having pre-deceased him, the only heir-at-law of Dr. Darlington was the defendant Hilborn Darlington.
Delaware Trust Company was named executor under Mrs. Darlington's will and qualified as such in the Orphans' Court of Delaware County, Pennsylvania, where Mrs. Darlington resided at the time of her death. Upon the death of C. Canby Darlington, the trust then terminating, Delaware Trust Company, as trustee, filed its final accounting in said court. By a decree of that court it was ordered that the proceeds of the sale of the Pennsylvania real estate should be distributed to the defendant Hilborn Darlington as the sole remaining heir-at-law of Dr. Darlington and that the trustee should distribute the balance of the property which it had received under the will of Mrs. Darlington pursuant to the laws of this state and in accordance with the trust agreement. Delaware Trust Company, trustee, in compliance therewith, paid over the proceeds realized from the sale of the real estate in Pennsylvania to Hilborn Darlington. It thereupon filed this action to determine who is entitled to the residue in its hands as trustee.
[33 Del.Ch. 139] Defendant Rakestraw, sole beneficiary under the residuary clause of the will of C. Canby Darlington, contends that the heirs-at-law should be determined as of the date of the death of Mrs. Darlington. She has also filed a claim, designated as a counterclaim and cross-claim, alleging that the proceeds from the sale of the Pennsylvania real estate should have been administered under the terms of the trust, that the Orphans' Court of Delaware County, Pennsylvania, did not have jurisdiction to administer the trust and that therefore the trustee should have ...