Black v. State

• Decision Date: 18 February 1902
• Citation: 89 N.W. 522,113 Wis. 205
• Parties: BLACK ET AL. v. STATE ET AL.
• Court: Wisconsin Supreme Court

113 Wis. 205

89 N.W. 522

BLACK ET AL.

v.STATE ET AL.

Supreme Court of Wisconsin.

Feb. 18, 1902.

Appeal from circuit court, Milwaukee county; Eugene S. Elliott, Judge.

Proceedings by the state of Wisconsin and the county treasurer of Milwaukee county against Elizabeth Black and another, as executrix and executor of the last will and testament of John Black, deceased, for the collection of an inheritance tax. From a decree in favor of plaintiffs, the defendants appeal. Reversed.

This is an appeal from a judgment of the circuit court of Milwaukee county requiring the executors of the estate of John Black, deceased, to pay an inheritance tax upon the personal property transferred by the will of said deceased. The judgment appealed from affirmed a previous decree of the county court of Milwaukee county, both judgmentsbeing upon the following stipulated facts: “That John Black, said deceased, was a citizen, inhabitant, and taxpayer of the city and county of Milwaukee and state of Wisconsin for more than ten years prior to and up to the time of his death, which occurred on October 25, 1899, and that the personal property of said John Black during his lifetime, and especially during the years 1898 and 1899, was taxable in the city and county of Milwaukee, state of Wisconsin, and was assessed by the proper authorities of the city and county of Milwaukee, state of Wisconsin, for taxation, as hereinafter set forth; that said John Black did not make any statement in relation to his personal property, nor did he practice any concealment or fraud in relation thereto; that in 1898 he was assessed for personal property $56,950, and in 1899 he was assessed for personal property $58,720, as appears by the tax roll of the proper authorities of said city and county of Milwaukee in said years, respectively, and that said John Black did pay the said personal tax so assessed and levied upon his said personal property for the year 1898 in the month of January, 1899, and that the executors of said John Black did pay all the taxes so assessed on said personal property of said deceased for the year 1899 on the 4th day of January, 1900, and that said personal taxes so paid by said executors were paid from the estate and funds of said John Black, deceased; that, all and singular, the personal property described in the inventory on file in this matter, and owned by the said John Black at the time of his death, was owned and possessed by said John Black on and prior to the 1st day of May, 1898, and thereafter continuously down to the time of his death, and during all of such time such personal property was of the value of $354,697.92; that at the time of his death said deceased owed no debts whatever; that at the time of his death, and for some years previously, said deceased owned valuable real estate situated in said Milwaukee county, in addition to said personal property, and that there is now, and has been for more than five years last past, real estate in said county which is taxable of the value of more than $10,000,000; that the said personal property owned by said John Black at the time of his decease as aforesaid was disposed of and bequeathed by him by his last will and testament as follows: One thousand dollars to the Home of the Aged; two thousand dollars to the St. Rose Orphan Asylum; one thousand dollars to the Rt. Rev. Archbishop Katzer in trust for the use and benefit of St. John's Catholic parish (which said sums, amounting to four thousand dollars [$4,000] in all, were bequeathed to corporations organized for religious, charitable, and educational purposes, solely for their use and benefit, and solely for the purposes of their organization); two thousand dollars to Mrs. Louise B. Stamm, sister-in-law of the said deceased; two thousand dollars to Barney S. Schoeffel, brother-in-law to said deceased (which said last two named persons were not related to said deceased in any degree or relationship described, mentioned, or specified in section 2 of chapter 355 of the Laws of Wisconsin for the year 1899); two thousand dollars to Katherine Mayer, a sister of the deceased; two thousand dollars to Peter Black, a brother of said deceased; and all the rest and residue of said personal property, to Elizabeth M. Black and Louise C. Clark, children and daughters of said deceased.”

Upon these facts, the court decided that the estate was liable to pay the following taxes:

+-----------------------------------------------------------------------------+
                ¦A tax of 5 per cent. on the transfer of $2,000 to said Louise B. Stamm¦$ 100 ¦
                ¦                                                                      ¦00    ¦
                +----------------------------------------------------------------------+------¦
                ¦A tax of 5 per cent. on the transfer of $2,000 to said Barney S.      ¦100 00¦
                ¦Schoeffel                                                             ¦      ¦
                +----------------------------------------------------------------------+------¦
                ¦A tax of 1 per cent. on the transfer of $2,000 to said Katherine Mayer¦20 00 ¦
                +----------------------------------------------------------------------+------¦
                ¦A tax of 1 per cent. on the transfer of $2,000 to said Peter Black    ¦20 00 ¦
                +----------------------------------------------------------------------+------¦
                ¦A tax of 1 per cent. on the transfer of $285,747.92, the undivided    ¦2,857 ¦
                ¦interest in said Elizabeth M. Black and Louise C. Clark, residuary    ¦48    ¦
                ¦legatees of said deceased                                             ¦      ¦
                +----------------------------------------------------------------------+------¦
                ¦Total                                                                 ¦$3,097¦
                ¦                                                                      ¦48    ¦
                +-----------------------------------------------------------------------------+
                

As conclusions of law, the court determined that chapter 355 of the Laws of 1899, under which the inheritance tax aforesaid was imposed, was a valid law; that the words “estate” and “property,” as used in that law, referred not to the property of the individual transferee, but to the entire property or estate of the decedent; that the payment of the tax assessed on a part of said personal property for the years 1898 and 1899 does not exempt the entire estate from the payment of an inheritance tax, but that the amount on which taxes were paid for said year 1898 should be deducted from the clear market value of the personal property of the deceased at the time of his death, and the balance thereof subjected to the payment of an inheritance tax. Judgment was entered in accordance with these findings.

Winkler, Flanders, Smith, Bottom & Vilas, for appellants.

E. R. Hicks, Atty. Gen. (W. H. Bennett, Dist. Atty. of Milwaukee Co., and F. E. McGovern, Asst. Dist. Atty., of counsel), for appellees.

WINSLOW, J. (after stating the facts).

In the present case chapter 355 of the Laws of 1899, entitled “An act for tax on gifts, inheritances, bequests and legacies in certain cases,” is attacked as unconstitutional. The act in question provides for the imposition of a tax upon any transfer of personal property of the value of $10,000 or over, or of any interest therein or income therefrom, in trust or otherwise, to any person or corporations, except corporations organized for religious, charitable, or educational purposes, which use the transferred property solely for such purposes, in the following cases: (1) When the transfer is by will or by the intestate laws of this state from any person dying possessed of the property while a resident of this state; (2) when the transfer is by will or intestate law of property within this state, the deceased being a nonresident at death; (3) when the transfer is made by a resident or by a nonresident, the nonresident property being within the state, by bargain, sale, or gift made in contemplation of the death of the vendor or donor, or intended to take effect at or after such death. The act further provides that the tax shall be imposed when any beneficiary is entitled to such property by any such transfer, whether made before or after the passage of the act, and that the tax shall be at the rate of 5 per centum per annum upon the clear market value of the property transferred, except that when the property passes to the decedent's father, mother, husband, wife, child, brother, sister, and certain other specified near relatives, it shall not be taxed unless of the value of $10,000 or more, and then only at the rate of 1 per centum upon the clear market value thereof. The law also provides that such tax shall be a lien upon the property transferred until the tax is paid, and contains full and specific administrative provisions regulating the manner in which it is to be collected, the appraisal of the property, and the powers and duties of district attorneys, the county courts, and the secretary of state in the matter of making collection of such taxes. All taxes so collected, less expenses of collection, are to be paid into the state treasury, to be used for the expenses of the state government, and for such other purposes as the legislature shall direct, but the county treasurer is to retain for the use of his county 15 per cent. of any tax collected in his county. Section 19 of the act, among other definitions, defines the words “estate” and “property,” as used in the act, to mean the property or interest therein of the testator, intestate, grantor, bargainor or vendor, and not the property or interest passing to individual legatees, devisees, heirs, next of kin, donees, or vendees. A number of sections of the act were amended by chapter 245 of the Laws of 1901, but none of the amendments affect in any material respect the provisions of the law which are attacked in this case, and hence it is not deemed necessary to state the effect of the amendments.

The tax which this law authorized is what is generally known...