Bockman v. Kelm

• Decision Date: 04 January 1954
• Docket Number: Civ. No. 4240.
• Citation: 117 F. Supp. 478
• Parties: BOCKMAN v. KELM, Collector of Internal Revenue.
• Court: U.S. District Court — District of Minnesota

117 F. Supp. 478

BOCKMAN v. KELM, Collector of Internal Revenue.

Civ. No. 4240.

United States District Court D. Minnesota, Fourth Division.

January 4, 1954.

Paul McMahon, Sp. Asst. to Atty. Gen., Washington, D. C., and George E. MacKinnon, U. S. Atty., St. Paul, Minn., for defendant in support of said motion.

R. H. Fryberger, Minneapolis, Minn., for plaintiff in opposition thereto.

DONOVAN, District Judge.

Plaintiff by this action sought recovery of federal estate taxes in the sum of $9,061.13, paid under protest to the Collector of Internal Revenue. Plaintiff requested a jury trial. The verdict was in favor of plaintiff for the full amount. There is no dispute but that plaintiff had the right to bring individual action for the amount paid defendant.¹

The only issues of fact for the jury to decide were whether two transfers of property from one Carrie Reed Bennett to the plaintiff were outright and absolute gifts, with no strings attached, or whether the transfers were made in contemplation of death.²

The facts are undisputed that the transfers in question concern $20,000 in United States Treasury Bonds, earmarked as plaintiff's in 1944 or 1945, placed by the owner, Carrie Reed Bennett, in her safety deposit box in the First Produce State Bank, Minneapolis, Minnesota, together with a deed to her homestead executed January 31, 1944, delivered to plaintiff to effect transfer of title on April 29, 1947, and which were subsequently misplaced. There was no evidence of collusion. Defendant placed a value of $10,000 on the real estate. That donor was in good health at the time of transfer is not disputed. The donor died April 22, 1948.

There is no dispute in this case, as the Court views the evidence, that the plaintiff herein was the executrix of the estate of her mother, Carrie Reed Bennett, who, under the terms of her will, made the plaintiff her beneficiary, and that the plaintiff received eighty per cent of the estate under that will. There apparently is no dispute that in the administration of that estate the plaintiff as executrix paid to the government estate taxes in the amount of $10,173.46, and that such money was derived from the estate. It is plaintiff's contention that these transfers were outright gifts, whereas the government contends they were actually transfers made in contemplation of, or taking effect at death. In filing the return on behalf of the estate, plaintiff did not include these transfers as part of the gross estate, and thereafter defendant determined that these transfers should have been included. The government thereupon made a deficiency assessment in the sum of $8,135.48. This assessment was paid by plaintiff, and, together with interest, amounted to the sum of $9,061.13. The plaintiff, in effect, made that payment under protest, claiming that it was not properly assessable to her or to the estate.

The donor is required to divest herself of control over the actual enjoyment of what she put beyond her power to retake. Hence, to constitute a completed gift inter vivos, proof of intent on the part of the donor to make the gift, and actual delivery from the donor to the donee, must be shown. In other...