## Facts

- Henry H. Houston died in 1895 leaving a will that placed the residue of his estate in trust.
- The will directed the trustees to pay the net income of the trust to Houston’s wife and children in equal shares during their lives.
- The will further provided: “On the death of my last surviving child, I direct the whole of the principal of the trust estate shall be distributed in equal portions to and among my grandchildren.”
- At Houston’s death, he had six living grandchildren; six additional grandchildren were born after his death, for a total of twelve.
- When the last surviving child later died, some of the twelve grandchildren were alive, and others had died before the distribution date; at least one deceased grandchild left children, while others died without children.
- A dispute arose over whether the remainder interest for each grandchild vested when the grandchild was born (so that the principal would be divided into twelve shares, including shares passing through the estates of deceased grandchildren), or whether each grandchild had to be alive when the last child died (so that only the lines of living grandchildren, and any deceased grandchild with surviving children, would share—effectively nine shares).
- The Orphans’ Court held that the gift to “my grandchildren” vested upon the birth of each grandchild and ordered distribution on a twelve-share basis.
- Parties favoring a survivorship requirement appealed to the Supreme Court of Pennsylvania.

## Issues

1. Did the will’s direction to distribute trust principal to “my grandchildren” upon the death of the last surviving child create vested remainder interests (vesting at death/birth), or contingent interests requiring a grandchild to survive to the distribution date?

## Decision

- The Supreme Court of Pennsylvania affirmed the Orphans’ Court decree.
- The Court held the remainder to the grandchildren was vested (or vested subject to divestment) rather than contingent on survivorship to the death of the last surviving child.
- For grandchildren living at the testator’s death, the interests vested at death; for grandchildren born afterward, the interests vested upon birth.
- Because the class consisted of twelve grandchildren, the principal was properly divided into twelve equal shares, with shares of deceased grandchildren passing through their estates rather than being reallocated to surviving grandchildren based on survival alone.

## Legal Principles

- A will is construed to carry out the testator’s intent, determined from the entire instrument (the “four corners” of the will).
- Pennsylvania law favors early vesting; a future interest will be treated as vested unless the will shows a clear intent to make survival a condition precedent.
- A provision fixing a future time for distribution commonly postpones possession and enjoyment, not the creation of the interest.
- A class gift to “grandchildren” can vest in members as they come into existence (including afterborn grandchildren) when the will indicates a gift to the class and does not plainly require survival to the distribution date.
- If a grandchild’s interest is vested, the death of that grandchild before distribution does not defeat the share; absent a stated forfeiture or survivorship condition, the share passes under the deceased grandchild’s estate.

## Conclusion

In re Estate of Houston held that a testamentary direction to distribute trust principal “to and among my grandchildren” at the death of the last surviving child created vested remainder interests in each grandchild at death or birth, and did not require the grandchild to be alive at the time of distribution; accordingly, the trust principal was distributed in twelve equal shares rather than being reduced based on survivorship.


In re Estate of Houston, 201 A.2d 592 (1964)