113 N.Y. 174, In re Enston's Will

Citation:113 N.Y. 174
Party Name:In the Matter of Compelling Payment of Tax upon Property Given by the Will of HANNAH ENSTON, Deceased.
Case Date:April 16, 1889
Court:New York Court of Appeals

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113 N.Y. 174

In the Matter of Compelling Payment of Tax upon Property Given by the Will of HANNAH ENSTON, Deceased.

New York Court of Appeal

April 16, 1889

Argued January 28, 1889.


Josiah T. Marean for appellants. The legislature intended to exempt from the collateral inheritance tax estates of non-residents, whether real or personal, passing by will or intestate laws. (1 R. S. 389, § 5; Laws of 1851, chap. 176, § 2; 1 R. S. 419, § 3; Williams v. Bd. of Suprs., 78 N.Y. 561, 565, 566.) The collateral inheritance tax law imposes a tax upon the right to succeed by virtue of our laws. (Scholey v. Rew, 23 Wall. 331; Eyre v. Jacobs, 14 Gratt. 422; Pullen v. Wake, 66 N.C. 361; Moultrie v. Hunt, 23 N.Y. 394; Parsons v. Lyman, 20 id. 103; Code, § 2694; 55 Geo. 3, chap. 184, pp. 564, 565; 16 and 17 Vic. chap. 51, p. 440; 13 U.S. Stat. at Large, 285, 287; Orcutts' Appeal, 97 Penn. St. 185, 186; Thompson v. Advocate General, 12 C. & F. 1; Wallace v. Atty.-Genl., 1 L. R. Ch. 1; U.S. v. Hunnewell, 13 F. 617; Atty.-Genl. v. Napier, 6 Exch. 217.) It is for the legislature to determine what classes of objects shall be submitted to the unequal burden, but in the construction of their acts the presumption is always in favor of the narrower rather than the wider limit of that inequality. (Cooley on Taxation [2d ed.] 267, 275; Warrington v. Furbor, 8 East, 245;

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Denn v. Diamond, 4 B. & C. 244; Tompkins v. Ashby, 6 id. 543; Doe v. Snaith, 8 Bing. 152; Wroughton v. Turtle, 11 Mees. & W. 567; Marquis v. Commissioners, 6 Exch. 479; Gurr v. Scudds, 11 id. 192; Green v. Holloway, 101 Mass. 248; Smith v. Waters, 25 Ind. 399; Cahoon v. Coe, 57 N.H. 557; U.S. v. Wiggleworth, 2 Story, 373; Powers v. Barney, 5 Blatch. 203; U.S. v. Watts, 1 Bond. 583; People v. Davenport, 91 N.Y. 591; In re Miller, 110 id. 222.)Personal property, consisting of evidence of debt and of shares in foreign corporations, as in this case, ought not to be held to be property within this state within the meaning of this act. (Orcutts' Appeal, 97 Penn. St. 185, 186; People v. Smith, 88 N.Y. 580; Peterson v. Chemical Bk., 32 id. 21.)

John F. Clake for respondent. It has been the uniform policy of legislation to make all exemptions from taxation clear and explicit. They are to be clearly expressed, and never presumed or implied. (Burr. on Taxn. 132; Cooley on Taxn. 146; Hilliard on Taxn. 72, 74; Law of Assess. [ D. W. Welty] 305; Mayor, etc., v. C. R. & B. C., 50 Ga. 620; 2 R. S. 981, 982, Laws of 1882, chap. 46; Laws of 1883, chaps. 397, 406; Laws of 1852, chap. 282; Laws of 1884, chap. 537; Laws of 1847, chap. 133; Laws of 1851, chap. 122; Laws of 1867, chap. 516; Laws of 1865, chap. 546; Laws of 1856, chap. 183; Laws of 1866, chap. 273; Laws of 1879; chap. 210-250.) The words 'who may die seized or possessed of the same while being a resident of the state' in the collateral inheritance act, instead of implying an action, are expressive and declaratory of an additional case in which the tax is to be imposed. (Hoyt v. Comrs. of Taxes, 23 N.Y. 224.) The tax sought to be recovered in this matter is upon property within this state passing by will and, therefore, is within the terms of the act, chapter 483, Laws of 1885. (Thompson v. Adv.-Genl., 12 C. & F. 1; Wallace v. Attorney, L. R., 1 Ch. Div. 1; U.S. v. Hunnewell, 13 F. 617.)


Hannah Enston died at Spartensburgh, South Carolina, on the 26th day of October 1886.At the time of

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her death she was a resident of Philadelphia in the state of Pennsylvania, and she had never been a resident of or domiciled in this state. She left a last will and testament which was admitted to probate in the Surrogate's Court of Kings county. She had an estate amounting to about one million dollars, which by her will she disposed of to her collateral relatives and to strangers in blood. One of her executors resided in the county of Kings and the other at Philadelphia; and all the legatees but one were non-residents of this state. Nearly all her property was invested by her agents, residing in the city of Brooklyn, and was managed by them. After making certain deductions there was left, as held by the surrogate, for the purposes of taxation under the act, chapter 483 of the Laws of 1885, $843, 541.11, consisting of the following property: Real estate situate in the county of Kings, $125, 575; bonds secured by mortgages upon real estate in the state of New York, $471, 650, and promissory notes and bonds of municipal corporations, and stocks and bonds of other and foreign corporations, $246, 316.11. Upon this property the surrogate made an order directing the executors to pay a tax of $42, 107.05. From the order of the surrogate the executors appealed to the General Term where the order was affirmed, and they then appealed to this court.

It is not questioned that this tax would have been proper under the act referred to, if Mrs. Enston had, at the time of her death, been a resident of this state. But her executors claim that as she was not a resident of this state, there is no law imposing or requiring payment of this tax.

For the purpose of determining whether this tax was properly exacted, we must construe section 1 of the act of 1885, as that section is the only one which describes the property to be taxed under the act, and it is as follows: 'Section 1. After the passage of this act, all property which shall pass by will or by the intestate laws of the state, from any person who may die seized or possessed of the same while being a resident of the state, or which property shall be within this state, or any part of such property, or any interest

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therein, or income therefrom, transferred by deed, grant, sale or gift made or intended to take effect in possession or enjoyment after the death of the grantor or bargainor to any person or persons, or to any body politic or corporate, in trust or otherwise, or by reason whereof any person, or body politic or corporate shall become beneficially entitled, in possession or expectancy, to any property or the income thereof other than to or for the use of father, mother, husband, wife, children, brother and sister and lineal descendants, born in lawful wedlock, and the wife or widow of a son, and the husband of a daughter, and the societies, corporations and institutions now exempted by law from taxation, shall be, and is subject to a tax of five dollars on every hundred dollars of the clear market-value of such property, and at and after the same rate for any less amount, to be paid to the treasurer of the proper county, and in the city and county of New York to the comptroller thereof, for the use of the state, and all administrators, executors and trustees shall be liable for any and all such taxes until the same shall have been paid as hereinafter directed; provided that an estate which may be valued at a less sum than five hundred dollars shall not be subject to said duty or tax.'

The section is singularly involved and obscure in its phraseology, and the precise legislative intent is very far from being clear. But we must meet the difficulties which the section presents as well as we can, and by a fair construction of the language used give effect to what we believe to have been the purpose of the legislature. The tax imposed by this act is not a common burden upon all the property or upon the People within the state. It is not a general but a special tax, reaching only to special cases and affecting only a special class of persons. The executors in this case do not, therefore, in any proper sense, claim exemption from a general tax or a common burden. Their claim is that there is no law which imposes such a tax upon the property in their hands as executors. If they were seeking to escape from general taxation,

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or to be exempted from a common burden imposed upon the People of the state generally, then the authorities cited by the learned counsel for the People, to the effect that an exemption thus claimed must be clearly made out, would be applicable. But the executors come into court claiming that the special taxation provided for in the law of 1885 is not applicable to them, or the property which they represent. In such a case they have the right, both in reason and in justice, to claim that they shall be clearly brought within the terms of the law before they shall be subjected to its burdens. It is a well-established rule that a citizen cannot be subjected to special burdens without the clear warrant of the law. The following authorities furnish the true rule applicable to such a case: Cooley on Taxation (2d ed. 275); United States v. Wiggleworth (2 Story, 373); Powers v. Barney (5 Blatch. 203); United States v. Watts (1 Bond, 583); Doe v. Snaith (8 Bing. 152); Green v. Holloway (101 Mass. 248).

The section imposes a tax very plainly upon two classes of property: (1.) Upon all property which 'shall pass by will, or by the intestate laws of this state, from any person who may die seized or possessed of the same while being a resident of the state.'(2.) Upon property which shall be within this state transferred, inter vivos, to take effect at the death of the grantor or bargainor. It is claimed on behalf of the People that the words, 'or which property shall be within this state, ' were added to the prior language, which included only property left by residents of the state, so as to include all property, whether owned at death by a resident or non-resident. If that had been the result sought by the draftsman of the act, it would have been easy in simple language to have covered all the property within the state which might pass by will or intestacy from any person whatever. If the construction claimed by...

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