Parkhurst v. Treasurer & Receiver General

• Decision Date: 13 September 1917
• Citation: 228 Mass. 196
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court
• Parties: LEWIS PARKHURST & others, executors, v. TREASURER & RECEIVER GENERAL & another.

228 Mass. 196

LEWIS PARKHURST & others, executors, v. TREASURER & RECEIVER GENERAL & another.

Supreme Judicial Court of Massachusetts, Middlesex.

September 13, 1917

March 29 1917.

Present: RUGG, C J., BRALEY, DE COURCY, CROSBY, & PIERCE, JJ.

Charity. Tax, On legacies and successions.

World Peace Foundation.

A corporation organized under the laws of this Commonwealth "for the purpose of educating the people of all nations to a full knowledge of the waste and destructiveness of war and of preparation for war, its evil effects on present social conditions and on the well-being of future generations, and to promote international justice and the brotherhood of man and generally by every practical means to promote peace and good will among all mankind," whose incorporators gave time and services without other reward than the hope of benefit to mankind, and no pecuniary profit being even remotely available to any members of the corporation, and whose work consisted chiefly in the publication of literature and the employment of speakers to promote the purposes of the corporation, tending in the direction of educating the world in the true principles of international order as a cure for the waste of preparation for war and the horrors of waging war, is a charitable society or institution within the meaning of St.

1912, c. 678, Section 1, and St. 1909, c. 490, Part I, Section 5, and accordingly the passing of property to it by will is not subject to a legacy and succession tax.

Whether the passing of a gift by will to a corporation is subject to a legacy and succession tax, or whether it is exempt from such a tax as the passing of a gift to a charitable society or institution, depends on the purposes and work of the corporation at the time of the death of the testator, when his will took effect after it was proved, and subsequent acts of the corporation only can be material so far as they tend to show what the character of the corporation was at that time.

PETITION, filed in the Probate Court for the County of Middlesex on March 3, 1917, under St. 1909, c. 490, Part IV, Section 20, by the executors of the will of Edwin Ginn, late of Winchester, to recover $52,958.04, that being the amount, determined by the Tax Commissioner, of a legacy and succession tax paid by the petitioners to the Treasurer and Receiver General and alleged to have been imposed unlawfully on the passing by the will of the testator of a devise and legacy to the World Peace Foundation, a corporation organized under the laws of this Commonwealth and alleged to be a charitable institution exempt from taxation.

The Probate Court made a decree that the tax was assessed without authority of law and was exacted wrongfully, and ordered that the entire tax so assessed should be abated. The Treasurer and Receiver General appealed, and filed the following objections to the decree: "1. The provision in the will of Edwin Ginn for the benefit of the World Peace Foundation is not a devise or bequest to or for the use of a charitable, educational or religious society or institution, the proprety of which is by the laws of this Commonwealth exempt from taxation, or for or upon trust for any charitable purpose to be carried out within this Commonwealth, within the meaning of the legacy and succession tax law. 2. The tax described in the petition was duly assessed in accordance with the provisions of the legacy and succession tax law, and the decree ordering its abatement was accordingly contrary to law."

The appeal came on to be heard before Loring, J., who at the request of the parties reserved the case, upon the pleadings and the transcript of the testimony taken in the Probate Court, for determination by the full court.

W. H. Hitchcock, Assistant Attorney General, for the respondents. F. W. Knowlton, for the petitioners.

RUGG, C. J. This is a petition to recover a tax levied by the tax commissioner upon a legacy given by Edwin Ginn for the benefit of the World Peace Foundation. By St. 1912, c. 678, Section 1 amending St. 1909, c. 490, Part IV, Section 1, property is not subject to this tax which passes by will "to or for the use of charitable, educational, or religious societies or institutions, the property of which is by the laws of this Commonwealth exempt from taxation." The statement of such exemptions, so far as here material, is in St. 1909, c. 490, Part I, Section 5, as follows: "The following property . . . shall be exempted from taxation: -- . . . Third, The personal property of literary, benevolent, charitable and scientific institutions and of temperance societies incorporated within this Commonwealth, the real estate owned and occupied by them or their officers for the purposes for which they are incorporated, and real estate purchased by them with the purpose of removal thereto, until such removal, but not for more than two years after such purchase. Such real or personal property shall not be exempt if any of the income or profits of the business of such corporation is divided among the stockholders or members, or is used or appropriated for other than literary, educational, benevolent, charitable, scientific or religious purposes."

Mr. Ginn by his will provided for a large annual payment to the World Peace Foundation, a corporation organized under the laws of this Commonwealth. Its corporate purpose is declared in these words: "The corporation is constituted for the purpose of educating the people of all nations to a full knowledge of the...