Flournoy v. Wiener

• Decision Date: 28 February 1944
• Docket Number: No. 252,252
• Citation: 321 U.S. 253,88 L.Ed. 708,64 S.Ct. 548
• Parties: FLOURNOY, Sheriff and Ex Officio Tax Collector, v. WIENER et al
• Court: U.S. Supreme Court

321 U.S. 253

64 S.Ct. 548

88 L.Ed. 708

FLOURNOY, Sheriff and Ex Officio Tax Collector,

v WIENER et al.

No. 252.

Argued Feb. 4 and 7, 1944.

Decided Feb. 28, 1944.

As Amended on Denial of Rehearing Mar. 27, 1944.

Appeal from the Supreme Court of the State of Louisiana.

Mr. Leonard L. Lockard, of Shreveport, La., for appellant.

Mr. Sidney L. Herold, of Shreveport, La., for appellees.

Mr. Samuel O. Clark, Jr., Asst. Atty. Gen., for the United States, as amicus curiae.

Mr. Max Radin, of Berkeley, Cal., for the State of California, et al., as amici curiae.

Mr. Chief Justice STONE delivered the opinion of the Court.

This case comes here on appeal under § 237(a) of the Judicial Code, 28 U.S.C. § 344(a), 28 U.S.C.A. § 344(a), from a judgment of the Supreme Court of Louisiana, appellant assigning as error that that court had held invalid, as in violation of the Fifth Amendment, § 402(b)(2) of the Revenue Act of 1942, 56 Stat. 942, 26 U.S.C.A. Int.Rev.Code, § 811(e)(2). On considering the jurisdictional statement filed by appellant pursuant to Rule 12 of the Rules of this Court, 28 U.S.C.A. following section 354, we postponed decision of the jurisdictional questions to the argument on the merits.

Section 237(a) of the Judicial Code authorizes an appeal to this Court from a judgment of the highest court of the state 'where is drawn in question' the validity of a statute of the United States and the decision is against its validity. The error assigned is therefore one cognizable on appeal. The question for our decision is whether, the state court having rested its decision and judgment upon two independent grounds, each adequate to support the decision but only of which appellant has assigned as error on appeal to this Court, we have jurisdiction to decide either.

Appellees, children and sole legatees of Wiener, who had died a resident of Louisiana, leaving his widow surviving, brought the present proceeding in the District Court for the First Judicial District of Louisiana to establish the amount of the state inheritance tax on the interest acquired by them under the will of decedent. Under state law they cannot be placed in possession of the property inherited by them until they have paid the tax. Act No. 127 of the Extra Session of 1921, as amended by Act No. 44 of 1922; see § 3 of Act No. 119 of 1932. So far as material here, the amount of their liability for the tax depends upon the meaning and application of Act No. 119 of the Louisiana Acts of 1932, Louisiana Code of Practice, Arts. 996.89—996.97, and of § 402(b)(2) of the Revenue Act of 1942. Act No. 119 directs the levy, in addition to existing inheritance taxes, of 'an estate transfer tax upon all estates which are subject to taxation under the Federal Revenue Act of 1926'. The Act provides that whenever the aggregate amount of all inheritance, succession, legacy and estate taxes actually paid to the several states of the United States in respect to any property owned by the decedent shall be less than 80% of the estate tax payable to the United States under the provisions of the Revenue Act of 1926, the difference between that amount and 80% shall be paid to Louisiana.¹ Section 402(b)(2) of the Revenue Act of 1942 amends § 811(e) of the Internal Revenue Code, which was derived from § 302(e) of the Revenue Act of 1926, 26 U.S.C.A. Int.Rev.Acts, page 230, so as to include in the gross estate of decedent for purposes of the federal estate tax, property 'to the extent of the interest therein held as community property by the decedent and surviving spouse under the law of any State, Territory, or possession of the United States, or any foreign country, except such part thereof as may be shown to have been received as compensation for personal services actually rendered by the surviving spouse or derived originally from such compensation or from separate property of the surviving spouse.'

Relying on these statutory provisions appellant, who is charged by state law with the duty of collecting the state inheritance tax, set up by his answer that the State of Louisiana is entitled to recover an inheritance tax equal to 80% of the basic federal estate tax, which by § 402(b)(2) of the Revenue Act of 1942, is to be computed upon the entire community, and prayed judgment against appellees for an inheritance tax so computed.

To this answer appellees interposed pleas that the inheritance tax demanded of them, insofar as it is measured by the interest of the widow in the community, is unconstitutional for want of the uniformity prescribed by § 8 of Article I of the Constitution, and is a denial of due process, in contravention of the Fifth Amendment, in that it taxes property not belonging to decedent and not acquired by appellees under the will. The District Court sustained these pleas on the grounds assigned and gave judgment accordingly.

It will be observed that although the federal estate tax, laid on all the property included in the taxable estate of the decedent, is payable by the estate,² the effect of appellant's contention in both state courts was that Act No. 119 had, by virtue of § 402(b)(2) of the Revenue Act of 1942, imposed an inheritance tax measured by the entire community property and had authorized collection of that entire tax from the decedent's legatees. The case thus presented not only the question whether a tax could constitutionally be imposed on the entire community property on the death of the husband, but also the further question, not necessarily governed by the federal Act, cf. Riggs v. Del Drago, 317 U.S. 95, 63 S.Ct. 109, 142 A.L.R. 1131, whether the entire tax could be collected from those who inherit from the decedent, although they took no interest in the share of the community property retained by the surviving spouse.

On appeal to the state Supreme Court the Attorney General of the United States was allowed to intervene; on the argument there he urged that the validity of § 402(b)(2) of the Revenue Act of 1942 was not in question, but that the only issue before the court was the validity of Act No. 119 under the Fourteenth Amendment, if construed and applied in the manner contended for by appellant. Appellees accordingly were allowed to amend their plea of unconstitutionality so as to plead in the alternative that if Act No. 119 were construed so as to impose on them an inheritance tax measured by the entire community property it would violate the Fourteenth Amendment.

The Supreme Court of Louisiana affirmed the judgment of the District Court but for different reasons. Succession of Wiener, 203 La. 649, 14 So.2d 475, 478. It held that 'the construction sought to be placed on Act No. 119 of 1932 by the tax collector * * * would render it violative of the due process guaran- teed by the 14th amendment to the Constitution of the United States, since such interpretation would result in the imposition of a tax upon those succeeding to the estate of a decedent measured in part by the property comprising the estate of another, to which the estate of the decedent is in no way related.' For this conclusion it relied upon Hoeper v. Tax Commission, 284 U.S. 206, 52 S.Ct. 120, 76 L.Ed. 248, 78 A.L.R. 246, holding that a state graduated income tax measured by the joint income of husband and wife violated the Fourteenth Amendment. It said that the tax was there held invalid because 'any attempt by a state to measure the tax on one person's property or income by reference to the property or income of another is contrary to due process of law as guaranteed by the Fourteenth Amendment.'

The Court thus made an alternative decision that either Act No. 119 did not impose on appellees a tax on property not bequeathed to them or that if it did it violated the Fourteenth Amendment. But it also went on to hold that 'the limitation placed upon the states by the Fourteenth Amendment is likewise placed on the Federal Government by the Fifth Amendment' and that § 402(b) of the Revenue Act of 1942, which appellant, by interpretation of Act No. 119, had contended was the measure of the tax to be imposed on appellees, is likewise a violation of the Fifth Amendment if interpreted so as to tax the entire community property here.

Appellant, in his assignments of error here, made no mention of the ruling of the state Supreme Court that Act No. 119, as construed and sought to be applied by him, violates the Fourteenth Amendment. He assigned as error the Supreme Court's decision that § 402(b)(2) of the Revenue Act of 1942 violates the Fifth Amendment. He also asserted that it had erred 'in denying legal efficacy' to that provision of the Revenue Act which required the valuation of all the community property of decedent and his surviving spouse in the computation of the fed- eral estate tax. But in his 'Statement of the points on which he intends to rely', filed pursuant to paragraph 9 of Rule 13 of this Court, he stated, 'the only issue before the Court, and the point on which he intends to rely is that the Act of Congress held by the Supreme Court of Louisiana to be unconstitutional, to-wit Section 402(b)(2) of the Revenue Act of 1942, approved October 21, 1942, is constitutional and that the Supreme Court of Louisiana erred in holding said statute to be violative of the Fifth Amendment to the Federal Constitution.'

Rule 9 of this Court's Rules requires the appellant in all cases to file assignments of error 'which shall set out separately and particularly each error asserted', and paragraph 9 of Rule 13, requiring the statement of points to be relied upon, provides that 'The court will consider nothing but the points of law so stated'. See also Rule 27, par. 6. It is a familiar rule, consistently followed, that upon appeal from a state court this Court will not pass upon or consider federal questions not assigned as error or designated in the points to be relied upon even though properly presented to and passed upon by the state court. O'Neil v....