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Kadison v. Horton

Decided: December 21, 1950.

LOUIS KADISON, JULIUS I. KISLAK, AND ISAAC GROSS, EXECUTORS UNDER THE LAST WILL AND TESTAMENT OF ISRAEL KORETZKY, DECEASED, PLAINTIFFS,
v.
LILLIAN HORTON, MYER B. HORTON, JEANETTE POLLAK, JACOB KORETZKY, AND BRIGHT STAR WAREHOUSE CO., DEFENDANTS. JACK M. KORETZKY, SOMETIMES KNOWN AS JACOB KORETZKY, PLAINTIFF, V. JULIUS I. KISLAK, ISAAC GROSS AND LOUIS KADISON, DEFENDANTS



Grimshaw, J.s.c.

Grimshaw

[11 NJSuper Page 104] There are two complaints involved in this litigation. In one, the executors of the estate of Israel Koretzky, deceased, seek the cancellation of four certificates of stock of the Bright Star Warehouse Company issued after his death in the names of Koretzky's children. In the other, Jacob Koretzky, son of the decedent, seeks the removal of the executors, and a restraint against their qualification as trustees under the will. In this latter suit the court is also asked to void a consent to the payment of $25,000 by the Bright Star Battery Company to Abraham I. Barash, husband

of one of the beneficiaries under Israel Koretzky's will, which consent was signed by all of the beneficiaries.

The cases were tried together. The hearings extended over several months and were conducted in an atmosphere of extreme bitterness on both sides. It was difficult to arrive at the truth. The principal witnesses on both sides were repeatedly guilty of misstatements and contradictory statements. However, from the mass of evidence I am satisfied that the following facts have been established.

After a very humble beginning, the decedent, Israel Koretzky, succeeded in building up a very successful business for the manufacture of batteries, flashlights and other kindred articles. To carry on the business, Koretzky formed a corporation known as the Bright Star Battery Company. Of a total stock issue of 39,000 shares of this corporation, the decedent, at the time of his death, owned 30,600 shares. The buildings in which the business was housed were owned by a corporation known as the Bright Star Warehouse Company, of which corporation Koretzky owned the entire stock issue of ten shares.

Koretzky died in Florida, of a heart attack, on January 7, 1946. He left surviving his daughters, Anne Barash, wife of Abraham I. Barash, Lillian Horton, wife of Myer B. Horton, Jeanette Pollak, wife of Theodore Pollak, and one son, Jacob Koretzky.

Abraham I. Barash had been associated in business with the decedent for a number of years. During Koretzky's lifetime Barash served as secretary-treasurer of the Battery Company. Some time after Koretzky's death Barash became president of the company, a position which he still holds. Horton joined the Battery Company in 1940. He was elected vice-president, a position which he continued to hold until his discharge in May, 1947. Pollak worked for a number of years as head of one of the departments of the company. He, too, was discharged in May of 1947, as was Jacob Koretzky. Both Barash and Horton, together with Israel Koretzky, served as officers of the Bright Star Warehouse Company.

Israel Koretzky's will, executed in 1941, was probated on February 6, 1946. In it he named as executors and trustees, Julius I. Kislak, a prominent real estate operator, Louis Kadison, the company accountant, and Isaac Gross, the company lawyer, who had been Koretzky's solicitor for a number of years. Among other things, the will provided as follows:

"2. All the rest residue and remainder of my estate, real, personal and mixed, and wherever the same may be situated, I do hereby devise, give and bequeath unto my friends Isaac Gross, Julius I. Kislak and Louis Kadison, to have and to hold the same, however, in trust upon the following trusts, terms and conditions:

"(a) All cash on hand or in banks, as well as moneys owing to me by Bright Star Battery Company, Bright Star Warehouse Company and also moneys owing to me by any other person, firm or corporation, whether evidenced by promissory note or other writing, as well as any stocks, bonds or securities issued by any other than Bright Star Battery Company or Bright Star Warehouse Company, as well as the proceeds of any policy or policies of life insurance on my life, which may at the time of my decease be payable to my estate, and all income, interest, dividends and accumulations on any of the items in this subdivision mentioned, shall be held in trust for my beloved son, Jacob Koretzky, but nevertheless, subject to the provisions hereinafter set forth.

"(b) Of my stockholdings in Bright Star Battery Company, a New Jersey corporation, my said trustees shall hold twenty thousand (20,000) shares, together with all dividends and income therefrom, for the benefit of my said son Jacob Koretzky, but also subject to the provisions hereinafter set forth.

"(c) Of my stockholdings in Bright Star Warehouse Company, a New Jersey corporation, my said trustees shall hold six (6) shares, together with all dividends and income therefrom, for the benefit of my said son Jacob Koretzky, but also subject to the provisions hereinafter set forth.

"(d) My said trustees are hereby vested with absolute discretion in their sole and exclusive judgment to apply and pay over such part of the accumulations, income, interest or dividends or capital for the benefit of my said son Jacob Koretzky, as to them may seem necessary or proper, for his maintenance, support or education, or for the support, maintenance or education of his wife and child or children, should he have any, until my said son shall become of the age of forty (40) years; whereupon my said trustees may turn over to him, my said son, all of the trust fund hereby provided for him, with all accumulations thereon. Should my son die before attaining the age of forty (40) years, leaving him surviving a child or children, then I direct my trustees to hold all of the then remaining portion of my estate, so provided for the benefit of my son, for the like benefit

of such child or children of my said son, who shall survive him, in equal shares, to be delivered with all accumulations thereon, when the youngest of my said son's children shall have attained the age of twenty-one years; but until the time for such ultimate distribution shall arrive, to provide such reasonable support, maintenance and education of my son's child or children, out of the same as in the discretion of my trustees shall seem proper.

"(e) That of the remaining of my stockholdings in the Bright Star Battery Company and Bright Star Warehouse Company, both New Jersey corporations, whether standing in my name or in the name of another, but in which I own the equitable interest, I do give and bequeath unto my daughters, Anne Barash, Lillian Horton and Jeanette Pollak, in equal shares. My said trustees shall hold the shares bequeathed to my said daughters under this subdivision, with all accumulations and dividends thereon, and from time to time apply the income or dividends therefrom toward the support and maintenance or my said daughters, each out of her respective share, and shall turn over to each of my daughters the share to which she is entitled, together with any accumulations accrued thereon, upon her attaining the age of forty (40) years. Should any of my daughters die before having attained the age of forty (40) years, leaving her surviving a child or children, then I direct my trustees to hold all of the then remaining portion of my estate, as provided for the benefit of my said daughters respectively, for the like benefit of such child or children of said respective daughters, who shall survive her, in equal shares, to be delivered with all accumulations thereon, when the youngest child of such daughter shall have attained the age of twenty-one (21) years, but until the time for such ultimate distribution shall arrive, to provide such reasonable support, maintenance and education of the child or children of such daughter, out of the same, as in the discretion of my trustees shall seem proper."

There is no doubt that before he died Koretzky had determined to make changes in his will. These changes he discussed with his attorney, Gross, and also with his son Jacob. Among other things, he had decided to remove Kislak and Kadison as ...


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