Dixon v. Russell

• Decision Date: 08 July 1910
• Citation: 76 A. 982,79 N.J.L. 490
• Parties: DIXON et al. v. RUSSELL et al.
• Court: New Jersey Supreme Court

76 A. 982

79 N.J.L. 490

DIXON et al.

v. RUSSELL et al.

Court of Errors and Appeals of New Jersey.

July 8, 1910.

(Syllabus by the Court.)

Error to Supreme Court.

Certiorari by William P. Dixon and others, Executors of Martha Collard, deceased, against George E. Russell and another to review an order levying an inheritance tax. From a judgment affirming the order and levy (73 Atl. 51), plaintiffs bring error. Reversed.

Morrison C. Colyer, Ralph E. Lurn, Frank H. Sommer, Edward M. Colie, and Robert H. McCarter, for plaintiffs in error.

Theodore Backes and Edmund Wilson, Atty. Gen., for defendants in error.

GUMMERE, C. J. The plaintiffs in error are the executors of Mrs. Martha Collard, deceased, who, at the time of her death, was a resident of the state of Rhode Island. By her will she bequeathed certain shares of stock of the Standard Oil Company, a New Jersey corporation, to persons and corporations designated in that instrument. The surrogate of the county of Essex, acting in supposed compliance with the provisions of an act entitled "An act to amend an act entitled An act to tax intestates' estates, gifts, legacies, devises, and collateral inheritance in certain cases,' approved May 15, 1894" (P. L. 1906, p. 432), assessed a transfer tax upon the property so bequeathed. The validity of that tax is the question involved in the present litigation.

In the case of Neilson v. Russell, 76 N. J. Law, 655, 71 Atl. 286, 19 L. R. A. (N. S.) 887, 131 Am. St. Rep. 673, we were called upon to determine the scope of the original act which is amended by the statute of 1906, so far as it dealt with legacies. We reached the conclusion mat its purpose was to impose legacy duties, and not transfer or succession taxes; that it was not intended to, and did not reach legacies, the validity and amount of which were required to be determined by the laws of a foreign jurisdiction; and that, therefore, a tax imposed by the surrogate upon a legacy of stock of a New Jersey corporation, bequeathed by the testator, who was a resident of England at the time of his death, was invalid. We further expressed the opinion (perhaps unnecessarily) that even if we had considered the imposition provided by the statute to be a succession tux, and not a legacy duty, we would have reached the same conclusion, i. e., that it was not intended by the statute that a tax should be imposed upon the singular succession of the legatee of a foreign testator, even though the subject of the legacy was shares of stock of a New Jersey corporation.

From what was said during; the arguments of counsel in the present case, it would seem that our opinion in the Neilson Case is understood by some of the bar to indicate a doubt upon our part as to the power of the Legislature to tax the succession to property located in this state of a nonresident decedent. Such a supposition is not justified by anything to be found in the opinion. On the contrary, our decision is based upon the expressed assumption that the succession to shares of stock in a New Jersey corporation may be taxed by the state Legislature. We do not doubt the power of the state to impose a succession tax, where the succession is by reason of death, without regard to the domicile of the decedent from whom the property passes, provided that the property which is the subject of the successron is within the jurisdiction of ...