This case involves the construction of a will. Mrs. Dorothy Sifford of Pine Bluff, Arkansas, died on November 29, 1978. Her will, dated March 29, 1976, was admitted to probate on December 1, 1978. On June 25, 1979, appellant Medora S. Jennings filed a petition to construe paragraph X of the will, which provides:
I give, devise, and bequeath 18 1/6 shares of common stock of the Gloster Lumber Company, of Gloster, Mississippi, and also any right, title or interest which I may have in the Lester Land Company, Inc. of Camden, Arkansas, including any real or personal property owned by the corporation in the State of Arkansas, and any and all real or personal property passing to me pursuant to the Last Will and Testament of J. Gaylord Sifford, my deceased husband, his estate having been probated in Jefferson County, Arkansas, to Medora Sifford Jennings, TO HAVE AND TO HOLD the same absolutely and in fee simple.
J. Gaylor Sifford had been a stockholder in Lester Mill Company, which was dissolved in 1932 and all of its assets were conveyed to Lester Land Company, Inc., of Camden, Arkansas. Mr. J. Gaylord Sifford received and owned 23.33 shares of stock in Lester Land Company, the successor corporation. Upon his death in 1934 this stock passed under his will to Dorothy Sifford, his wife. In 1944 the Lester Land Company was dissolved and the land owned by it was transferred to a trust for the individuals who had been the former stockholders. Mrs. Dorothy Sifford then held a 23.34/406 interest in the trust.
On October 13, 1978, Mrs. Sifford assigned all her rights, title and interest in the trust (which had succeded to the assets of the former Lester Land Company, Inc., consisting of land or an interest in land) to Mary Daniel of Camden and to Medora S. Jennings, the appellant here, for the cash consideration of $66,825. Appellant’s pteition requested that the court construe paragraph X of the will of Dorothy Sifford, deceased, to vest the ownership of the $66,825 cash proceeds in her.
This appeal is from a decision of the Jefferson County Probate Court finding that paragraph X of the will provided for a specific bequest to appellant which was adeemed by the sale by Mrs. Sifford of her trust interest on October 13, 1978.
The common stock of the Gloster Lumber Company is not involved in this appeal. The question involved on this appeal is what effect should be given to the language in paragraph X pertaining to the Lester Land Company, Inc., and more specifically the following language:
. . . including any real or personal property owned by the corporation in the State of Arkansas, and any and all interests which I may own in any and all real or personal property passing to me pursuant to the last will and testament of J. Gaylord Sifford, my deceased husband ... to Medora Sifford Jennings, TO HAVE AND TO HOLD the same absolutely and in fee simple.
The issue here is whether the aforesaid specific bequest to appellant was adeemed by the sale of the trust interest during the lifetime of the testatrix. In our opinion the issue presented is controlled and must be resolved against appellant under the principles announced in Mee v. Cusineau, Executrix, 213 Ark. 61, 209 S.W. 2d 445 (1948). In that case the Arkansas Supreme Court said:
At § 341, 28 R.C.L. 345, appear statements of the law to the following effect. The distinctive characteristic of a specific legacy is its liability to ademption. If the identical thing bequeathed is not in existence, or has been disposed of so that it does not form a part of the testator’s estate, at the time of his death, the legacy is extinguished or adeemed, and the legatee’s right are gone.
The Court then set out the basis for the above rule of law:
The reason for this rule as stated in the numerous cases cited in the note to § 543, 68 C.J. 844, is that as the testator no longer owns the property specifically devised, there is no property for the devisee to take, and also that subsequent conveyance of the property by testator after having made a specific devise of it indicates conclusively a change of testimentary intent as to that property.
The above reasoning is applicable to the facts of this case because the thing bequeathed at the time the will was made was an interest in land, subject to a trust. The wording of paragraph X of the will does not include the proceeds. Mrs. Sifford did not own the land specifically devised at the time of her death. It had been sold by her for a cash consideration before her death, and she took no actions whatsoever to indicate that she intended for the cash proceeds, which represented a change in form, to go to appellant under the terms of her will. Mrs. Sifford died, of course, without having made any change in her will. She permitted the trustee bank, in handling her affairs, to invest the money without any indication from her that it was intended to go to appellant at her death. The proceeds had been commingled with other funds.
There is a thorough discussion of ademption in the case of Pepka v. Branch, 155 Ind. App. 637, 294 N.E. 2d 141 (1973),1 and the applicable rules. Some of the Arkansas cases have not made it clear what rule was being applied, and have discussed at length In re Estate of Brown v. Schaffer, 145 Ind. App. 591, 252 N.E. 2d 142 (1969). However, it seems clear to us that the Arkansas Supreme Court, except for one case,2 has actually applied the more modern rule involving the form and substance test, discussed in Pepka v. Branch, supra, in determining whether there has been ademption, by extinction, of a specific legacy. It is also our opinion that the “Modern Rule” is more logical, less cumbersome, and easier to apply. Be that as it may, the result reached in the case before us would be the same regardless of which test was applied. Mrs. Sifford had a very substantial interest in the trust real estate at the time she made the will, and devised her interest in this realty to the named beneficiary, the appellant here. After she sold her interest in the trust land, she owned no interest whatsoever in the property; and, therefore owned no interest or equity in the property devised at the time of her death. The wording of the will did not include the proceeds from the land, and Mrs. Sifford took no action to indicate in any way that she intended the proceeds to pass to appellant under the will. Appellant correctly points out that the proceeds, i.e., the amount of money received from the land, are readily traceable into a certificate of deposit purchased by the trustee bank. We conclude, however, that this is immaterial under the facts here because there had been a change in the form of the devise, from land to money, and Mrs. Sifford did nothing subsequently to show that she intended to pass the proceeds to the original devisee. It follows that there was an ademption as to the bequest in question, and that the probate judge was correct in so holding.
The decree of the court below is therefore affirmed.
Hays, J., dissents.This case overruled In re Estate of Brown v. Schaffer, supra, in Indiana, and adopted the form and substance test.
Williamson v. Merritt, 257 Ark. 489, 519 S.W. 2d 767 (1975), is the exception.