
    Matter of the Estate of Margaret M. Adams, Deceased.
    
      (Surrogate’s Court, New York County,
    
    
      April, 1915.)
    Wills—Construction of Bequests- of Personal Property—Corporations—What Passes Under Bequest of Certain Shares of Stock.
    A -bequest of “my one hundred and sixty-six shares of St. Jo Lead Mining Company” and “thirty-three -shares of Cattle Co.” is a specific bequ-est and the -will in its relation1 thereto must be construed as of the date of its execution.
    When testatrix made her will she was the owner of 166 shares of mining stock -and 33 shares of the stock of a cattle company. At a reorganization of both companies she received 16 shares of mining Stock in exchange for her holdings in the cattle company. Thereafter, because of her ownership of .the original 166 -shares she received 472 shares in stock dividends all of which resulted from the distribution of the surplus accumulated by the mining company, and at the time of .her death she was the owner of 654 shares of the mining stock. Held, that they all passed under the bequest of “ my 166 shares,” etc.
    
      Proceeding upon the judicial settlement of the accounts of executors.
    William R. Brinckerhoff, for petitioners.
    Steele & Otis (Harold Otis, of counsel), for Rosalie Fanshawe and Margaret M. Clarke.
    Frank B. Washburn, special guardian.
   Fowler, S.—

The executors of decedent’s estate have filed their account, and they ask the court to construe a certain clause of the will so that proper distribution of the estate may be made among the legatees.

After appointing her son to succeed her as trustee of a trust fund created by the will of her mother for the benefit of Rosalie Fanshawe and Margaret McGregor Clarke, and directing that he pay the income to them in equal shares, the testatrix provided:

To this I wish added my one hundred and sixty-six shares of St. Jo. Lead Mining Company’ and thirty-three shares of Cattle Co.’ to make up to them the money their father borrowed from their grandmother which they would have had, and to keep my promise to their grandmother that they should not lose anything.”

The will was executed on November 26, 1900. At that time the testatrix was the owner of 166 shares of stock of the St. Joseph Lead Mining Company and 33 shares of -stock of the Bonne Terre Farming and Cattle Company. Subsequently there was a reorganization of these companies and the testatrix received 16 shares of stock of the St. Joseph Lead Mining Company in exchange for her 33 shares of stock in the Bonne Terre Farming and Cattle Company. After the execution of the will and prior to the date of decedent’s death, the St. Joseph Lead Mining Company declared stock dividends so as do provide for the distribution abong its stockholders of the surplus which had been accumulated by the company. The testatrix, because of her ownership of the original 166 shares of stock, received 472 shares in stock dividends, so that at the time of her death in 1913 she owned 654 shares of stock of the St. Joseph Lead Mining Company.

The question propounded by the executors on this accounting is, whether the 654 shares of stock of the St. Joseph Lead Mining Company owned by the testatrix at the time of her death pass under the clause of the will above quoted, or whether that clause disposes of only 166 shares, and the remaining 472 shares go to the legatees mentioned in the residuary clause of the will.

The bequest of my one hundred and sixty-six shares of St. Jo. Ijead Mining Company ” is a specific bequest, because the testatrix refers to particular property and describes its nature and quantity. (Walton v. Walton, 7 Johns. Ch. 258 ; Crawford v. McCarthy, 159 N. Y. 519.) In the case of specific legacies the will speaks as of the date of .its execution. (Matter of Delaney, 133 App. Div. 409 ; affd., 196 N. Y. 530.) The bequest of the 166 shares of the St. Joseph Lead Mining Company stock being a specific bequest, the will must be construed in -its relation to that bequest as of the date of its execution. It was evidently her intention to give to the persons mentioned in the clause above quoted the shares of stock which she owned in the St. Joseph Lead Mining Company at the time of the execution of the will, and that that legacy was intended as compensation for the money which their father had borrowed from their grandmother, and which would have been bequeathed by their grandmother to them, if it had not been so borrowed.

At the time the will was executed the St. Joseph Lead Mining Company had accumulated a large surplus. This surplus was reflected in the market value of the stock, and it constituted a substantial part of its intrinsic value. Subsequently when this surplus was distributed to the stockholders in the, form of stock dividends, the intrinsic value of the original shares of stock was diminished, but the value of the additional shares received as a stock dividend when added to the value of the original shares would make a total closely approximating the value of the original shares before the declaration of the dividends. The declaration of a stock dividend did not add anything to the intrinsic value of the stock of the company upon which the dividend was declared; it was merely a distribution of accumulated surplus, and the advantage to the stockholders consisted principally in the fact that the increased number of shares of stock would necessitate the annual distribution of surplus in the form of dividends instead of the accumulation of such surplus by the company. The 166 shares held by the testatrix at the time she executed the will had, because of the surplus accumulated at that time, a potential value equal to the actual value of the 638 shares owned by her at the time of her death. Rone of these 638 shares was purchased by her after the execution of her will; they all resulted from the distribution of the surplus accumulated by the company, and were derived from the original ownership of the 166 shares.

The decision in Brundage v. Brundage (60 N. Y. 544), is distinguishable from the matter under consideration in the important particular that the bequest considered by the court in the Brundage case was a general bequest and not a specific one. I have had occasion to consider a similar question in Matter of Leavitt (86 Misc. Rep. 609), and am inclined to think that the reasons given for the conclusion at which I arrived in that matter apply with equal force and relevancy to the matter now under consideration.

I will therefore hold that the bequest of 166 shares of the “ St. Jo. Lead Mining Company ” stock and 33 shares of the Cattle Co.” was a specific bequest, and that the legatees to whom that bequest was made are entitled to the 654 shares of St. Joseph Lead Mining Company stock held by the decedent at the time of her death.

Decreed accordingly.  