ALFRED P. PUTNAM & others, executors, vs. ALFRED P. PUTNAM & others, trustees, & others.

WILKINS, J. We are here presented with the question whether, in the funding of a testamentary trust for his wife, Stephen Phillips (Phillips) intended that his estate take advantage of the maximum marital deduction allowable under the Federal estate tax law. If we conclude that Phillips had such an intention in the funding of the marital trust, we must then resolve the apparent conflict between that intention and a provision in his will which by its terms places the burden on the marital trust to satisfy inheritance taxes on future interests in that trust. [Note 1] The Internal Revenue Service has taken the position that the maximum marital deduction allowable with respect to the Phillips estate must be reduced by the amount of the largest possible inheritance taxes on future interests which might be payable out of the marital trust. [Note 2]

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Phillips died a resident of Salem in 1971, survived by his widow and their three daughters. His estate was substantial, having a value of many millions of dollars. [Note 3] He left a will which he executed in 1957 and three codicils, dated 1958, 1959, and 1964. The third codicil was prepared by counsel for Phillips seemingly for the purpose of meeting the Federal tax requirements underlying Revenue Procedure 64-19. See 1964-1 C. B. 682. The will and codicils reflect substantial thought by Phillips concerning the disposition of his property.

In article 6 of his will Phillips provided that if his wife survives him, "I give, devise and bequeath to my Trustees hereinafter named that fractional share of my residuary estate (as defined above) which will equal the maximum marital deduction allowable in determining the Federal Estate Tax by reason of my death, diminished by the aggregate value of all other property which qualifies for such marital deduction and which passes or has passed to my said wife under other articles of this will or otherwise than under this will" (emphasis supplied). The balance of the introductory paragraph of article 6 of Phillips's will is set forth in the margin. [Note 4] Article 6 continues with trust provisions which require the payment of income to Mrs.

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Phillips at least as often as quarterly during her life; give her an inter vivos power of appointment over up to "one-half of the trust fund determined as of the date of the creation of this trust"; give her a general power of appointment by will over the trust property; and add any trust property not so appointed to property held in trust under article 8 of the will. [Note 5]

In addition to provisions already quoted or described in this opinion, [Note 6] Phillips's will contains language which is designed to assure that the marital trust will qualify for the marital deduction. He provided that in the event of simultaneous death, his wife would be presumed to have survived him (except as to the distribution of certain real estate and certain tangible personal property). He denied to the trustees of the marital trust the power to allocate receipts between income and principal, a power otherwise available to his trustees.

The executors of Phillips's estate seasonably filed a Federal estate tax return in which an amount equal to the maximum marital deduction allowable to Phillips's estate was claimed as a deduction from the decedent's adjusted gross estate. An agent of the Internal Revenue Service assigned to audit the Federal estate tax return advised the Phillips executors that he disallowed a portion of the marital deduction claimed. The amount of the disallowance was determined by assuming that circumstance

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which would lead to the imposition of the largest possible Massachusetts inheritance tax on the assets of the marital trust, that is, an appointment by Mrs. Phillips of the property in the marital trust to a single individual not closely related to Phillips. [Note 7] The plaintiffs have preserved their rights of administrative appeal within the Internal Revenue Service. In turn, we are advised that representatives of the Internal Revenue Service are awaiting the results of this proceeding.

During the month following the examination report of the revenue agent this bill for declaratory relief was filed in the Probate Court for Essex County by the executors of the Phillips estate against Mrs. Phillips, the trustees under article 8 of the will and the Attorney General, who has submitted his rights. No trustee of the marital trust has yet been appointed. The plaintiffs sought a binding declaration, under G. L. c. 231A, whether any Massachusetts inheritance taxes which become payable with respect to future interests in the property held in the marital trust are to be borne by property in that trust or by the property held in trust under article 8 of the Phillips will. Mrs. Phillips filed an answer praying that the court decree that such Massachusetts inheritance taxes in respect of article 6 assets as may arise on her death should be borne by the property held under article 8. The article 8 trustees answered that declaratory relief was appropriate but took no position on the issue presented by the bill for declaratory relief. In their brief and argument before this court,

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however, the article [Note 8] trustees have agreed that the burden of any inheritance taxes as to future interests in the marital deduction trust should be borne by the assets held by them under article 8.8 The matter was submitted to the Probate Court on a statement of agreed facts and reserved and reported by the judge to the Appeals Court on the pleadings and the statement of agreed facts. We granted an application for direct review in this court. G. L. c. 211A, Section 10.

The fundamental object in the construction of a will is to ascertain the testator's intention from the whole instrument, attributing due weight to all its language, considered in light of the circumstances known to the testator at the time of its execution, and to give effect to that intent unless some positive rule of law forbids. See Fitts v. Powell, 307 Mass. 449, 454 (1940); Hill v. Aldrich, 326 Mass. 630, 632 (1951). If a will is not ambiguous, extrinsic evidence to explain its terms is inadmissible (Moffatt v. Heon, 242 Mass. 201, 205 [1922]), even where the language involved has a legal consequence either not likely to have been understood by the testator (see Harvard Trust Co. v. Frost, 258 Mass. 319, 322 [1927]; Mahoney v. Grainger, 283 Mass. 189, 191-192 [1933]; Agricultural Natl. Bank v. Schwartz, 325 Mass. 443, 448 [1950]) or contrary to his intention expressed orally. See Smith v. American Missionary Assn. 240 Mass. 26, 29 (1921); Boston Safe Deposit & Trust Co. v. Prindle, 290 Mass. 577, 581-582 (1935). If, however, there is an ambiguity in a will, such as a conflict of terms, extrinsic evidence may be resorted to in order to show the circumstances

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known to the testator under which he viewed that ambiguous language. Gould v. Chamberlain, 184 Mass. 115, 121 (1903). Mahoney v. Grainger, supra, at 192. Boston Safe Deposit & Trust Co. v. Prindle, supra, at 582.

With these principles in mind, we turn then to a consideration of the Phillips will as a whole to ascertain whether he intended to take full advantage of the marital deduction and, if he did, how the apparent conflict with the tax apportionment provision in article 12 of his will should be resolved.

We believe that the Phillips will should be read as expressing an intention to take full advantage of the marital deduction. The will provides for the funding of the marital trust with "that fractional share of my residuary estate . . . which will equal the maximum marital deduction allowable in determining the Federal Estate Tax by reason of my death," reduced by the value of other property which qualifies for the marital deduction. This language standing alone shows that Phillips intended to have his estate utilize the maximum permissible marital deduction in computing the Federal estate tax payable on his death. [Note 9] Other provisions in his will show that his attention was directed to compliance with various requirements of the Federal estate tax law relating to marital deductions.

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While most of those provisions were related to the qualification of the trust under article 6 for the marital deduction (and not to the maximization of that deduction), [Note 10] they do show an intention to adjust the provisions of his will so as to meet what he clearly regarded as a desirable tax objective. From the timing and the nature of the changes made by the codicil executed by Phillips in 1964, the inference is warranted that these changes were designed solely to conform the provisions of his will to the Federal tax requirements of Revenue Procedure 64-19.

The accomplishment of identifiable tax objectives may be an aid to the interpretation of a will (see New England Trust Co. v. Faxon, 343 Mass. 273, 276, n.3, and 281 [1961]), and to the extent it is reasonably consistent with the language of the will and applicable legal principles, effect should be given to that intention. State Tax Commn. v. Loring, 350 Mass. 568, 571 (1966). The objective of achieving the maximum allowable marital deduction is certainly identifiable in Phillips's will. There is no legal principle with which such an objective is inconsistent, and there is only one provision in Phillips's will with which that objective appears to be inconsistent.

In the view we take of this question, we reject the literal result that could be obtained by funding the marital trust with the amount necessary to obtain the maximum marital deduction as directed and then having inheritance taxes on future interests under the marital trust paid out of the marital trust. That result, if the present position of the Internal Revenue Service is correct, destroys the maximum marital deduction. The concept that the terms of the funding provision of the marital trust can be coordinated compatibly with the provision that certain inheritance taxes on future interests should be paid from that trust does violence to the precision and purpose of the funding provision, a provision by which the testator intended to obtain the maximum marital deduction allowable. These

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testamentary provisions are mutually repugnant and not reconcilable in any reasonable sense. [Note 11] Cf. Northeastern Pa. Natl. Bank & Trust Co. v. United States, 360 F. Supp. 116 (M.D.Pa. 1973).

We turn next to the resolution of the conflict presented by the language of the Phillips will. Unlike the will considered in Mazzola v. Myers, 363 Mass. 625 (1973), the Phillips will contains no language which gives directions concerning the resolution of such a conflict. In undertaking to resolve the conflict we advert, as we may in light of the ambiguity, to additional facts which were known to Phillips at the time he executed his will in 1957. Phillips had substantial assets, and his wife's assets were comparatively negligible. From a memorandum prepared by his attorney prior to the execution of his will it appears that Phillips may have viewed his assets as having a value of approximately $6,000,000. That memorandum showed the consequences of the adoption of full marital deduction provisions in his will. His counsel explained orally the tax consequences of using the maximum Federal estate tax marital deduction.

Prior to the execution of Phillips's will, a will for Mrs. Phillips had been prepared. Phillips reviewed that will extensively in the course of its preparation. That will contained provisions for several trusts, not all of which necessarily would terminate at the same time. The will also contained a tax apportionment provision substantially the same as that which later appeared as article 12 of Phillips's

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will. See fn. 1 above. The second sentence of the tax apportionment provision -- placing the burden of paying inheritance taxes on future interests in an established trust on the principal of that trust -- was wholly appropriate in the context of Mrs. Phillips's will. That will had no marital deduction trust, and there was a possibility of inheritance taxes being payable as to certain trust interests long after the general assets of the estate had been distributed pursuant to the residuary clause in Mrs. Phillips's will.

When Phillips's will was prepared shortly after Mrs. Phillips's will was executed, the general administrative provisions of Mrs. Phillips's will were copied with modifications to adapt them to Phillips's will. It is clear, however, that the adverse Federal tax consequences of the tax allocation provisions of Mrs. Phillips's will as applied to Phillips's will were overlooked by counsel and in all reasonable likelihood were beyond detection by the client. Thus the testamentary conflict of provisions was created.

In order to resolve the conflict between the provisions of Phillips's will, our task is to ascertain and to carry out his over-all intent, rendering ineffective any conflicting provision in his will to the extent necessary in order to fulfil that over-all intent. See Schaffer v. Wadsworth, 106 Mass. 19, 24 (1870); Williams v. Thacher, 186 Mass. 293, 300 (1904); Taylor v. Albree, 309 Mass. 248 (1941); Brummett v. Hewes, 311 Mass. 142, 147 (1942); Clark v. Boston Safe Deposit & Trust Co. 315 Mass. 97, 100 (1943). We know from relevant extraneous evidence that Phillips had a large estate and his wife a comparatively small one. The situation cried out for the maximum utilization of the marital deduction.

On the other hand, there is no indication of any reason why Phillips would be seriously concerned about the allocation of inheritance taxes on future interests in the marital trust. He imposed the substantial obligation to pay all Federal estate and all other inheritance taxes on the general assets of his estate. The second sentence of article 12 of his will placed the obligation to pay future interest inheritance taxes on the marital trust property, but

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only if they were "paid after the establishment of the trust." Thus the burden of future interest inheritance taxes was to fall on the marital trust only if those taxes were not paid (i.e., by compromise) before the marital trust was established. [Note 12] The testator's indifference concerning the repository of the obligation to pay future interest inheritance taxes cannot fairly be permitted to destroy his clear and primary intent to utilize the marital deduction to its fullest. The intention expressed in the second sentence of article 12 must yield to the extent necessary to permit the achievement of the dominant tax goal of the will. In the circumstances we believe that the expressed intention to impose the obligation of future interest taxes on the marital trust, once established, must be wholly disregarded.

It would be a rare case in which a conflict of terms or an ambiguity in a will should be resolved by attributing to the testator an intention which as a practical matter is likely to benefit the taxing authorities and no one else. See Old Colony Trust Co. v. Governors of the Belleville Gen. Hosp. 355 Mass. 776, 780 (1969); Strange v. Powers, 358 Mass. 126, 133 (1970); Mazzola v. Myers, 363 Mass. 625, 638-639 (1973). A testator who wishes to make a gift to his State and country can do so directly, and he should not be presumed to have intended such a gift by indirect means. Although "[t]he achievement of the purposes of the marital deduction is dependent to a great degree upon the careful drafting of wills" (Jackson v. United States, 376 U.S. 503, 511 [1964]), the intention of a testator must be given effect where possible. If that intention can be discerned from the will, using normal principles of construction, it should not be thwarted by placing legalistic over-reliance on an omission of counsel in dealing with a subject of such complexity.

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A final decree shall be entered in the Probate Court declaring that all inheritance taxes at any time imposed with respect to future interests in the trust under article 6 of the will of Stephen Phillips are to be paid from the assets of the estate passing under article 8 of his will and not from the trust under article 6 of his will.

So ordered.