Hollowell v. Hollowell
420 S.E.2d 827, 107 N.C. App. 166, 1992 N.C. App. LEXIS 674 (1992)
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Rule of Law:
When a will creates a contingent remainder for a class of persons, such as 'issue', conditioned upon an event like the death of a life tenant without issue, the class of beneficiaries is determined at the time the contingency occurs. A potential beneficiary who predeceases the contingent event has no vested interest to devise or bequeath.
Facts:
- A testator's will (the Langston Will) devised land to two brothers, Milford Hollowell and Clarence Hollowell, 'in equal portions' for the duration of their lives.
- The will stipulated that upon each brother's death, his respective share would pass to his 'issue' per stirpes.
- The will also provided a contingency: if either brother died without issue, his share would go to the surviving brother for life, and then to that surviving brother's issue.
- Milford Hollowell died in 1971, survived by his two sons, Milford Edgar Hollowell and James Rodney Hollowell, who each received a one-quarter fee simple interest in the land.
- Subsequently, Milford Edgar Hollowell died, devising all his property, including his interest in the land, to his wife, the plaintiff.
- After Milford Edgar Hollowell's death, Clarence Hollowell died without ever having any issue.
- At the time of Clarence Hollowell's death, Milford Hollowell's only living issue were his son, James Rodney Hollowell, and James's children (Teresa Williams, Cathy Pearce, and Debra Hollowell).
Procedural Posture:
- The plaintiff, widow of Milford Edgar Hollowell, filed a declaratory judgment action in a North Carolina trial court to construe the Langston Will.
- Both the plaintiff and the individual defendants (James Rodney Hollowell and his issue) filed motions for summary judgment.
- The trial court granted partial summary judgment in favor of the defendants, determining the distribution of the contested property interest.
- The trial court certified its judgment for immediate appeal.
- The plaintiff appealed the trial court's grant of summary judgment to the North Carolina Court of Appeals.
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Issue:
Does a contingent remainder interest in property, designated for the 'issue' of a person upon the death of a life tenant without issue, vest only in those issue who are living at the time of the life tenant's death, thereby excluding the devisees of any issue who predeceased the life tenant?
Opinions:
Majority - Wells, Judge
Yes. A contingent remainder interest designated for a class of 'issue' vests exclusively in the members of that class who are alive at the moment the contingency occurs. The court reasoned that the Langston Will created a tenancy in common for life for Milford and Clarence Hollowell. The provision for what happens if one dies without issue created a contingent remainder. The court cited North Carolina statute G.S. § 41-1, which dictates that such a contingent limitation takes effect when the person (Clarence) dies without issue. This death is the 'triggering event' that vests the remainder. The gift over to 'the issue of Milford Hollowell' is a gift to a class. The members of that class are determined at the time the gift vests, which is at Clarence's death. Since Milford Edgar Hollowell was not alive at the time of Clarence's death, he was not a member of the class, his contingent interest never vested, and he therefore had no interest in Clarence's share to devise to his wife, the plaintiff. Consequently, Clarence's one-half interest passed per stirpes to the issue of Milford who were living at the time of Clarence's death: James Hollowell and his children.
Analysis:
This decision reinforces the principle that survivorship is a condition for taking a class gift under a contingent remainder unless the testator specifies otherwise. It clarifies that the class of beneficiaries is determined at the moment the contingency is fulfilled, not when the will is created or at any earlier time. This ruling provides certainty in property law and estate administration by establishing a clear point in time for the vesting of such future interests, preventing the heirs of predeceased potential beneficiaries from claiming an interest that never actually materialized.
