In the Matter of the Estate of Dudley B. Dawson, Deceased, Late of Boonton, Morris County, New Jersey

Summary

The Supreme Court of New Jersey reversed the Appellate Division and reinstated the Chancery Division’s order allocating eight disputed stock distributions to principal. The Court adopted a rebuttable presumption that distributions of 25% or more of outstanding shares are stock splits, rejecting the traditional capitalization test. It also held that collateral estoppel does not preclude applying this new definition.