216 F.2d 630 (D.C. Cir. 1954), 11961, District of Columbia v. Wilson

Docket Nº:11961.
Citation:216 F.2d 630
Party Name:DISTRICT OF COLUMBIA, Petitioner, v. Edith Bolling WILSON, Respondent.
Case Date:November 04, 1954
Court:United States Courts of Appeals, Court of Appeals for the District of Columbia Circuit

Page 630

216 F.2d 630 (D.C. Cir. 1954)



Edith Bolling WILSON, Respondent.

No. 11961.

United States Court of Appeals, District of Columbia Circuit.

November 4, 1954

Argued April 20, 1954.

Mr. Henry E. Wixon, Asst. Corp. Counsel for District of Columbia, Washington, D.C., with whom Messrs. Vernon E. West, Corp. Counsel, and Chester H. Gray, Principal Asst. Corp. Counsel, Washington, D.C., were on the brief, for petitioner.

Mr. Dale D. Drain, Washington, D.C., with whom Mr. B. Woodruff Weaver, Washington, D.C., was on the brief, for respondent. respondent.

Before BAZELON, WASHINGTON and DANAHER, Circuit Judges.

WASHINGTON, Circuit Judge.

This is a petition by the District of Columbia for review of a decision of the District of Columbia Tax Court. D.C.Code, §§ 47-2403, 47-2404 (1951). The respondent Edith Bolling Wilson was there held entitled to a refund of inheritance tax of $7,431.36 paid with respect to $93,000 of United States bonds, assessed under the District of Columbia statute. D.C.Code, § 47-1601 (1951).

The decedent, John Randolph Bolling, was the brother of Mrs. Wilson. For many years prior to his death in 1951 he had resided with her. Their relationship was close. She testified that he handled all her accounts and financial affairs.

Page 631

At all times her brother was authorized to draw checks on her bank account as 'attorney.' 1 On April 28, 1944, Mrs. Wilson authorized her brother in writing to use $3,000 in her bank account for the purchase of United States Savings Bonds, Series G, 'the bonds to be issued in your name, payable to me on death.' She added:

'Should I die before you do, then this $3,000 is to be considered an advance on any amount I may leave you under a trust specified in my will.

'The interest on the above will provide you with a small additional income during lifetime, and is to be considered as a gift from me, only the principal being deductible from the Trust referred to above.'

On various subsequent dates she gave written authority to her brother to purchase additional Series G bonds, to be issued in the same way and subject to the same conditions. Altogether, using Mrs. Wilson's funds, the decedent purchased bonds totaling $93,000 in maturity value under her authorization. 2 They were registered in his name, payable on death to her. After decedent's death they were all found in an envelope in his safe deposit box, segregated from yet other bonds, the taxability of which is not here in question.

The question here is whether 'any interest' in the bonds was 'transferred from' a decedent who died 'seized or possessed thereof, * * * by law, or by right of survivorship,' within the meaning of the inheritance tax statute. D.C.Code, § 47-1601 (1951). The District, in other words, asks us to find that at the time of his death decedent owned an interest in the bonds and that this interest was transferred to Mrs. Wilson by law or by right of survivorship.

Certainly the legal title to the bonds in question stood in the name of the decedent at the time of his death, and Mrs. Wilson acquired it on his death. If we may look only at legal title, excluding the actual, equitable, or true ownership, it follows that there was a taxable transfer. But the principle is firmly established that taxation is concerned with real ownership rather than with refinements of title. As it was phrased in Estate of Sanford v. Commissioner, 1939, 308 U.S. 39, 43, 60 S.Ct. 51, 55, 84 L.Ed. 20, 'the essence of a transfer is the passage of control over the economic benefits of property rather than any technical changes in its...

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