Cite as 964 F.2d 965 (9th Cir. 1992)
“best interests.” Interpreting the Nicholson trust as qualifying for the QTIP deduction would have required the Tax Court to “rewrite the trust instrument.” Id. at 675. No such task is required here to read the Trust Agreement as creating an interest which qualifies for the QTIP deduction.
Similarly, in Wisely v. United States, 893 F.2d 660 (4th Cir.1990), the Fourth Circuit upheld the denial of a QTIP deduction noting that “[t]he Estate has not pointed to any language in the will from which it can be concluded that the testator’s paramount intention was to qualify the marital trust for a marital deduction….” Id. at 665. Moreover, the Wisely court noted that reformation of the will would have been required to permit the estate to claim a QTIP deduction. See id. at 665–666.
Estate of Doherty, 95 T.C. at 446 and Wells v. United States, 746 F.Supp. 1024 (D.Hawaii 1990), upon which the Commissioner relies, provide no assistance in interpreting the Accumulation Proviso in this ease. While each of those cases involved an income accumulation clause, neither involved a dispute over the interpretation of the clause.
IV. Conclusion
The Commissioner argues that it would make bad law to read a trust agreement as creating an interest which qualifies for a QTIP deduction solely because the settlor expressly declared in the trust that he intended that effect. We agree. However, this case does not implicate the Commissioner’s concern. Certainly, the Trust Agreement could have been more clearly drafted. Nevertheless, the choice for this court is between two plausible readings of the agreement, only one of which effectuates the settlors’ clearly manifested intent. If the Accumulation Proviso could plausibly be read only as granting the trustee unlimited discretion, the QTIP deduction would be lost. That is not the case here, however.
REVERSED
LEWIS GALOOB TOYS, INC., Plaintiff–Appellee,
v.
NINTENDO OF AMERICA, INC., Defendant–Appellant.
NINTENDO OF AMERICA, INC., Plaintiff–Appellant,
v.
LEWIS GALOOB TOYS, INC., Defendant–Appellee.
No. 91–16205.
United States Court of Appeals, Ninth Circuit.
Argued and Submitted March 12, 1992.
Decided May 21, 1992.
As Amended Aug. 5, 1992.
