Connell's Estate

• Decision Date: 16 March 1925
• Docket Number: 190
• Citation: 128 A. 503,282 Pa. 555
• Parties: Connell's Estate
• Court: Pennsylvania Supreme Court

128 A. 503

282 Pa. 555

Connell's Estate

No. 190

Supreme Court of Pennsylvania

March 16, 1925

Argued January 26, 1925

Appeal, No. 190, Jan. T., 1925, by Commonwealth, from decree of O.C. Lackawanna Co., 1921, No. 1210, setting aside assessment for inheritance tax, in estate of Ezra H. Connell deceased. Affirmed.

Appeal from assessment for inheritance tax. Before SANDO, P.J.

The opinion of the Supreme Court states the facts.

Assessment set aside. Commonwealth appealed.

Error assigned was, inter alia, decree, quoting it.

The decree is affirmed at the costs of appellant.

John Robert Jones, Deputy Attorney General, with him Wallace G Moser, and George W. Woodruff, Attorney General, for appellant. -- The orphans' court had no jurisdiction: Cutler's Est., 225 Pa. 167; Handley's Est., 181 Pa. 339; Webb's Est., 15 Pa. Dist. R. 54.

A gift inter vivos must be complete in praesenti. It has no reference to the future: Roberts's App., 85 Pa. 84; Cooper's Est., 263 Pa. 37.

The Uniform Stock Transfer Act of May 5, 1911, P.L. 126, applies: Cooke v. Marshall, 191 Pa. 315.

The gift was intended to take effect at the death of the donor: Reish v. Com., 106 Pa. 521; Dolan's Est., 279 Pa. 582.

John P. Kelly, with him George Morrow, for appellee. -- The orphans' court has jurisdiction: Crossetti's Est., 211 Pa. 490; Hermann's Est., 226 Pa. 543; Williams's Est., 236 Pa. 259.

It is not inconsistent with delivery that the stock after the alleged gift was kept in a box to which the donor and donee had access: Leitch v. Bank, 234 Pa. 557; Mothes's Est., 29 Pa.Super. 462; Packer v. Clemson, 269 Pa. 1.

The language and expressions of the donor may be given to establish his intention to give as well as the delivery: Com. v. Crompton, 137 Pa. 138; Wise's Est., 182 Pa. 168; Mothes's Est., 29 Pa.Super. 462; Northern Trust Co. v. Huber, 274 Pa. 329; Hafer v. McKelvey, 23 Pa.Super. 202; Smith's Est., 144 Pa. 428.

Transfer stamps were not necessary: South Hills Trust Co. v. Baker, 83 Pa.Super. 243.

The Uniform Transfer Act does not invalidate a gift of stock because the donor failed to endorse the certificate.

If this stock was given by Ezra H. Connell to his wife prior to his death it is not subject to direct inheritance tax: Kratz's Est., 72 Pa.Super. 232; Martin's Est., 67 Pitts. 54.

Before MOSCHZISKER, C.J., FRAZER, WALLING, SIMPSON, KEPHART, SADLER and SCHAFFER, JJ.

OPINION

MR. JUSTICE SADLER:

Ezra H. Connell died on November 10, 1921, leaving to survive him a widow and adopted child. The executors named in his will prepared an inventory, including therein such property as apparently belonged to him. In the safe deposit box, used jointly by husband and wife, two packages of securities were found, marked separately in the name of each, and all in his envelope were set forth in the appraisement filed. Later, it was discovered that a certificate of stock of the Scranton Button Company for 589 shares had been issued to the decedent, though held in actual possession by the wife, and the register of wills included it in the calculation made for the purpose of fixing the amount of collateral inheritance tax, determining its present worth to be $117,800, a valuation not the matter of dispute in this proceeding. A review of this decision was asked, as permitted by section 13, of the Act of June 20, 1919, P.L. 521, which provides that one "not satisfied with any appraisement of the property of a resident decedent may appeal, within thirty days, to the orphans' court, on paying or giving security to pay all costs, together with whatever tax shall be fixed by the court. Upon such appeal, the court may determine all questions of valuation and of the liability of the appraised estate for such tax." The inclusion of the item referred to was held, after hearing, to be unjustified, and stricken from the appraisement on the ground that the property did not belong to the decedent at the time of his death, but to the wife, and it is from the conclusion reached that this appeal is taken.

Though not the subject of contention in the court below, -- indeed there was an express stipulation that the matters in contest should be passed upon by it, -- the claim is now made that no jurisdiction to determine the question existed. Our cases hold that the ownership of an alleged asset of an estate, not included in either inventory or account, and claimed by another, cannot be settled by the orphans' court, the jurisdiction of the court being limited to the instances where it has been expressly, or by necessary implication, conferred: Cutler's Est., 225 Pa. 167. When property is formally claimed as belonging to the decedent, and to be a part of the estate, in either of the ways suggested, it may, however, pass on the question of title (Crosetti's Est., 211 Pa. 490; Williams' Est., 236 Pa. 259), with the right, in case of a substantial dispute, to certify the case to the common pleas for trial before a jury on the issue raised: Walkinshaw's Est., 275 Pa. 121. The appeal here is based on the alleged improper inclusion of a supposed asset of Connell in the collateral appraisement, and, in such case, the right to a review by the orphans' court is expressly given by the Act of 1919, above referred to. The objection, now raised on this ground for the first time, is without merit.

It remains therefore for us to determine whether the findings of fact of the court below were justified by the evidence, and the legal conclusions reached sustainable. The testimony showed the decedent had a large annual income under his father's will, though the principal of the fund, from which it was derived, had not been transferred to him, -- a matter, under the will, within the discretion of the executors, who had not, however, seen fit to do so, though urged. Without such action, the widow, upon his death, was limited to an annuity, which would provide a much smaller income than that to which she was accustomed, and it was therefore natural he should desire to make substantial provision for her and their adopted daughter. The stock of the Scranton Button Company, now in dispute, was issued to him, and the court below has found the certificate was delivered to her as a gift, and that she had it in her possession at the time of his death. The power of attorney, authorizing transfer on the books of the company, was not signed, nor were tax stamps attached.

The wife, as found by sufficient testimony, took a present control of the property, and placed it, with her other individual securities, in a safe deposit box rented by the husband, but used by both. His right of access thereto does not alter the situation, if there was a completed gift Kaufmann's Est., 281 Pa. 519. The dividend checks were drawn in his name, as would necessarily follow, since the stock was so registered, and were endorsed by him and deposited by her in a bank account, upon which both had the right to draw, by virtue of a power of attorney duly filed with the institution where they did business. Both of these facts are important in considering whether an absolute transfer had been intended and made, but, in themselves, are not sufficient to show the contrary to be true. The reason for the failure to secure a new stock certificate was satisfactorily explained by a disinterested witness. Indeed, the intention to give was practically admitted by the Commonwealth, the argument being made, however, that the...