Estate of Northcutt

In Estate of Northcutt (1940) 16 Cal.2d 683, which concerned the phrase "personal property" the testator's estate consisted of two parcels of real property, $ 7,250.75 cash in a bank account and household furniture and personal effects. The fourth paragraph of the will directed that "all my personal property" be sold and divided between the testator's sister and one of her nephews. The fifth paragraph directed that the residue of the estate, "real and personal," be placed in trust for 20 years, with the income and (at the termination of the trust) ownership of the two pieces of real property going to the sister and nephew respectively. In another paragraph of the will, the testator stated her intention to make no provision for a different nephew. The trial court interpreted "all my personal property" in this will to include the bank account, meaning that this sum of money would be paid to the sister and nephew named in the fourth paragraph. On appeal, the executor argued "personal property" was intended to mean only the testator's furniture and personal effects because the provision that the personal property be "sold" would not apply to cash in a bank account. This interpretation of the will would have meant the cash would pass to the trust established in the residuary clause rather than being paid to the sister and nephew under the fourth paragraph of the will. Northcutt first noted that this result would be inconsistent with the gift of "all my personal property" to the sister and nephew, as it would result in the largest portion of the "personal property" going to the residuary. It further noted that because the trust provisions dealt only with the real property and did not designate a beneficiary for the funds in the bank account, the executor's interpretation would mean that when the trust terminated, the funds would pass by intestate succession. This would thwart the testator's wishes because it would entitle the second nephew, who had been expressly disinherited under the will, to a proportionate share of the funds.