The will of the testatrix among its provisions contained the following:
“ Seventh. I give and bequeath to my executors hereinafter named the 30 shares of stock of the Standard Oil Co., owned by me, m trust, to receive the income thereof, and apply $600 per annum of the same in monthly installments of $50.00 per month to the use of my brother Alexander Leavitt of Oka, Canada, during his life, and I authorize and empower them to increase the sum of said payments if in their discretion they deem it necessary owing to his serious and prolonged illness or other grave cause.
“ Eighth. Upon the death of my said brother I direct that the 30 shares of Standard Oil Co. stock aforementioned be sold and the proceeds divided in the manner following: together with whatever income may have accumulated thereon after the payment of the annuity as directed in clause seventh of this will. * * *
“ Ninth. All the rest, residue and remainder of my estate, including any legacy which may for any reason lapse or be void I give and bequeath to Mrs. Boy Johnston * *
*802At the time of making the will practically all of the property the testatrix owned was the thirty shares of the stock of the Standard Oil Company of New Jersey (then valued at about $19,000), and this stock she continued to hold until her death. But intermediate the execution of her will and her death the Standard Oil Company was declared an illegal combination by reason of the fact that it controlled by stock ownership many subsidiary companies. To remedy this situation the company distributed among its stockholders pro rata the stock which it held of these subsidiary companies, and the testatrix by reason of her ownership of the thirty shares of Standard Oil stock received certain of those distributed shares. The value of the thirty shares of Standard Oil Company of New Jersey was thereby reduced so that after her death it realized on a sale only $12,734.40 and the shares received by her on the distribution sold for $18,872.47.
This appeal is from that portion of the decree which holds that the proceeds of these shares of the subsidiary companies belong to the legatee of the thirty shares.
The bequest of the thirty shares was specific, as it refers to “ the 30 shares of stock of the Standard Oil Co., owned by me.” A specific bequest is construed with reference to the situation at the time of the drawing of the will. (Matter of Delaney, 133 App. Div. 409; affd., 196 N. Y. 530.)
It is, of course, axiomatic that the controlling factor in the construction of a will is the intent of the testator if expressed, and, therefore, if any such expressions of intent are present in this will or codicil they must govern.
It appears that at the time of the execution of the will the testatrix disposed of practically her entire estate by means of specific legacies, leaving the residuary clause almost a purely formal part of the will. After the distribution of additional shares the testatrix also was entitled to pre-emptive rights to purchase new stock in certain of the subsidiary companies. She exercised these rights and the stock realized on the administrator’s sale about $2,000. On September 18, 1912, the testatrix executed a codicil to her will making specific bequests of a portrait and of small sums of money amounting in all to $1,700. At the time of the execution of this codicil the stock *803purchased under the rights was valued at about $1,700. In order to make the purchase of these stocks the testatrix borrowed $600 on a note. The amount of the legacies contained in this codicil so closely approximates the value of the stock purchased under the above-mentioned rights that the indications seem to be that the codicil was intended as a disposition of this undisposed of portion of her estate. There will remain a surplus of $438.14 out of the proceeds of this purchased stock after satisfying the legacies in the codicil, and this added to about $200 cash which she had in banks will meet the $600 note. It would seem fair to assume that the testatrix regarded the $1,700 of stock as a part of her capital which she would leave at her death, and that she contemplated meeting the $600 note which she made to enable her to purchase this capital out of her current income, prior to her death. In any case it hardly seems that this item of a $600 note should be allowed great weight in ascertaining the testatrix’s intent with regard to the disposition of $18,000 of her estate. The expenses of administration do not seem to have been provided for by leaving any undisposed of residue under the original will, and so it hardly seems that the necessity of their satisfaction should be considered in respect of the codicil for the purpose of discovering* the testatrix’s intention. On the whole, it would seem that a reasonable construction of the testatrix’s testamentary acts would be that which would not impute to her in the execution of her codicil an intent to leave undisposed of property to-the value of about $18,000 which if undisposed of would go to a residuary legatee who under the will was given merely illusory benefits, nor an intent to-effect a reduction of a gift of $19,000 under the will to about $12,000 under the codicil.
If, however, * in order to determine where the distributed shares should go, it should be necessary to rely on the nature of the property itself unaided by deductions as to the intent of the testatrix as disclosed by her testamentary acts, the question will then be whether the new shares represented merely a changed form of the thirty shares as they stood at the time of drawing the will or whether they represented income consequent on the ownership of the thirty shares. It is claimed that the distributed shares were dividends since they were a
*804portion of the surplus of the company. If all distributions of surplus among stockholders are dividends, then these were such in form, but in view of the reason for the distribution, and the situations before and after it, I do not think that fact determinative. The stockholders in the Standard Oil Company, of which this testatrix was one, were, if the corporate fiction be laid aside for a moment, owners of all the company’s property, including these shares, and, through the ownership of these shares, owners of the property of the subsidiary companies also. The form of corporate organization was a mechanism simply. This mechanism resulted in illegality, and it was discarded to the extent of making the ownership more direct by transferring the shares of the subsidiary companies from the Standard Oil Company to the shareholders in that company who had been their real owners all along. Thus, where the ownership had previously been evidenced by the thirty shares of the Standard Oil stock, it was evidenced after the distribution by the thirty shares together with the distributed shares. The change was purely formal from the point of the ultimate ownership, and so, when the testatrix bequeathed the thirty shares of Standard Oil stock, she in effect bequeathed also the shares in question of the subsidiary companies. Brundage v. Brundage (60 N. Y. 544) is in no way in point, as there the bequest was clearly not specific, but general. Of course the principle above outlined does not apply to ordinary dividends, as. they merely represent current income, arid when they are paid they fall as a matter of course into the general estate irrespective of their source.
The decree is affirmed, with costs to the respondents appearing separately and filing briefs on this appeal.
Clarke, P. J., and Dowling, J., concurred; Page and Davis, JJ., dissented.