The decree should be affirmed. This appeal involves the proper allocation between the trust and the life beneficiary of 660 shares of common stock of Ohio Edison Company. Decedent, a New Jersey resident, died April 3, 1939, leaving a will dated July 3, 1929, which was admitted to probate on May 12, 1939.
The sixth paragraph of the will devises the residuary estate to trustees to pay the net income to the widow during her lifetime and upon her death the principal is directed to be divided into shares equal to the number of living and previously deceased children of the decedent, one share to be paid to each of the living children and the descendants of deceased children to take the share of their parent.
The eighth paragraph of the will provides: ‘ ‘ I direct that all stock dividends, extraordinary cash or scrip dividends shall be deemed income under the terms of the trusts herein created.”
The trustee initially acquired 200 shares of Ohio Edison Company stock on October 24,1949. Prior to May 11, 1960 the trust owned 330 shares. On said date the trustee received as a dividend from Ohio Edison Company 330 shares of said stock. Prior to said receipt Ohio Edison Company took the following-steps :
1. The authorized shares were increased from 8,000,000 to 20,000,000.
2. It increased the par value of the common shares from $12 to $15.
3. It transferred from the earned surplus account to the capital account $39,146,822; from the capital surplus account to the capital account $75,814,660. Prior to said transfers the capital account stood in the sum of $76,640,988. The additions to the capital account above described brought its total to $191,602,470.
4. It authorized an increase of the issued shares from 6,386,749 to 12,773,498 which enabled the company to issue one additional share for each outstanding- share. The number of issued shares multiplied by the par value of $15 is equal to the amount of capital set up on. the books of the companv, to wit, $191,602,470.
Decedent having died resident in New Jersey, the law to be applied is that of New Jersey. (Decedent Estate Law, § 47.) *445The law of New Jersey looks to the intent of the testator as expressed in the will (Matter of Fisher, 115 N. J. Eq. 329), and is in accord with the law of New York (Matter of Fosdich, 4 N Y 2d 646). The will would seem to express the intent of the testator to make available to the income beneficiary, his widow, all stock or cash dividends of any nature, kind or description. The bases for this conclusion are: (1) the content of paragraph eighth; (2) the close relationship of the testator and the life beneficiary; (3) the fact that the testator was not concerned about immediate provision for anyone except the life beneficiary (it will be noted that the provision for disposition of principal is contingent in that the remaindermen are to be ascertained at the time of death of the life beneficiary); and (4) an additional external fact is that the decedent was a stockbroker and presumably aware of the implications of the terminology of paragraph eighth.
The rule of allocation announced in Matter of Osborne (209 N. Y. 450) applies when the testator has not expressed any contrary intent. (See Matter of Lloyd, 292 N. Y. 280, 285.)
It will be noted that prior to the stock dividend here involved the number of shares held by the trust was 330. The effect of the allocation made by the learned Surrogate is to reduce the number of shares now held by the trust to 264. The reduction reflects the increase of the par value of shares from $12 to $15. In other words, the total of 264 shares at $15 per share is equal to the total of 330 shares at $12 per share.
In Matter of Payne (Bingham) (7 N Y 2d 1) the parties accepted the applicability of the rule of Matter of Osborne (supra). Assuming its relevancy on a question governed by New Jersey law, the holding would appear to be inapplicable where, as here, the testator’s intention is to make available to the life beneficiary all stock or cash dividends of any nature, kind or description.
Rabin, J. P., and Eager, J., concur with Steuer, J.; McNally, J., dissents in opinion in which Stevens, J., concurs.
Decree modified on the law and the facts and the trustee is directed to make distribution in accordance with the directions given in the opinion of this court filed herein, with costs payable out of the estate to all parties submitting briefs on this appeal. Settle order on notice.