In re Estate of Rosing v. State of Mo.

• Decision Date: 30 July 1935
• Docket Number: No. 34117.,34117.
• Citation: 85 S.W.2d 495
• Parties: IN RE ESTATE OF WILLIAM V. ROSING, MISSISSIPPI VALLEY TRUST COMPANY, Executor, v. STATE OF MISSOURI, Appellant.
• Court: Missouri Supreme Court

85 S.W.2d 495

IN RE ESTATE OF WILLIAM V. ROSING, MISSISSIPPI VALLEY TRUST COMPANY, Executor, v. STATE OF MISSOURI, Appellant.

No. 34117.

Supreme Court of Missouri.

Court en Banc, July 30, 1935.

Appeal from Circuit Court of City of St. Louis. — Hon. James F. Green, Judge.

AFFIRMED.

Roy McKittrick, Attorney General, John W. Hoffman, Jr., and Edward H. Miller, Assistant Attorneys General, for appellant.

(1) The right to take property by devise or descent is the creature of the law and not a natural right. Magoun v. Ill. Trust & Savings Bank, 170 U.S. 283, 42 L. Ed. 1037; Knowlton v. Moore, 178 U.S. 41, 44 L. Ed. 969; State ex rel. McClintock v. Guinotte, 275 Mo. 298. (2) The Missouri inheritance tax is a tax upon the transmission of the exercise of the legal power of transmission of property by will or descent; therefore, the Federal estate tax is not a proper deduction in computing the Missouri inheritance tax. Bryant v. Green, 44 S.W. (2d) 8; Brown v. State, 323 Mo. 138, 19 S.W. (2d) 16; Lonsdale v. United States, 31 Fed. (2d) 483; In re Frick's Estate, 121 Atl. 35; Frick v. Pennsylvania, 268 U.S. 487, 69 L. Ed. 1058; Hazard v. Bliss, 113 Atl. 469; In re Week's Estate, 172 N.W. 732; In re Fish's Estate, 189 N.W. 177; Art. 21, Chap. I, R.S. 1929, as amended by Laws 1931, p. 130. (3) Even though the Missouri inheritance tax be considered as a tax upon the legal privilege of taking property by devise or descent, the Federal estate tax should not be deducted in computing the Missouri inheritance tax. In Matter of Sherman, 222 N.Y. 540, 179 App. Div. 497; Hazard v. Bliss, 113 Atl. 469; In re Sherwood's Estate, 211 Pac. 734; Succession of Gheens, 88 So. 253; In re Harkness Estate, 234 N.Y. Supp. 297; U.S. Code Annotated, Title 26, Sec. 1091. (4) The legal power of transmission of property by will or descent and the legal privilege of taking property by devise or descent may be made the basis of classification in a single taxing statute. In re Fish's Estate, 189 N.W. 177; Stebbins v. Riley, 69 L. Ed. 884, 268 U.S. 137; In re Watkinson's Estate. 217 Pac. 1073.

C. Powell Fordyce for respondent; Fordyce, White, Mayne & Williams of counsel.

(1) The appellant's theory violates the decisions of this court. Bryant v. Green, 44 S.W. (2d) 8; 15 C.J., pp. 940, 952; Brown v. State, 323 Mo. 144, 19 S.W. (2d) 16; Mo. Estate Tax Act of 1927, Laws 1927, p. 100, now Sec. 573, R.S. 1929; In re Rogers' Estate, 250 S.W. 579; State ex rel. McClintock v. Guinotte, 275 Mo. 313; Bank of Commerce & Trust Co. v. McLemore, 35 S.W. (2d) 33; Hollis v. Jackson, 242 Mass. 163, 136 N.E. 163; In re Inman's Estate, 101 Ore. 182, 199 Pac. 620; Tax Commission ex rel. Price v. Lamprecht, 107 Ohio St. 535, 140 N.E. 337. (2) The theory advanced by the appellant misconstrues the inheritance tax laws of Missouri. In re Rogers' Estate, 250 S.W. 578; State ex rel. Natl. Life Ins. Co. v. Hyde, 241 S.W. 399, 292 Mo. 352; State ex rel. Compton v. Buder, 271 S.W. 771, 308 Mo. 260; State ex rel. Am. Central Ins. Co. v. Gehner, 280 S.W. 417, 315 Mo. 1130; State ex rel. Ford Motor Co. v. Gehner, 27 S.W. (2d) 3, 325 Mo. 29; Farmers Loan & Trust Co. v. Minn., 280 U.S. 212, 74 L. Ed. 375; Sec. 570, R.S. 1929, as amended by Laws 1931, p. 130; Secs. 572, 604, R.S. 1929; Webster's New International Dictionary; Shelton v. Campbell, 109 Tenn. 696, 72 S.W. 112; In re Taylor's Estate, 219 N.W. 154, 175 Minn. 310; Bugbee v. Roebling, 111 Atl. 30, 94 N.J.L. 438; Secs. 573, 581, 582, R.S. 1929. (3) The theory advanced by the appellant ignores the intent of the Missouri Legislature. Laws 1931, p. 130; Laws 1921, First Ex. Sess., p. 26; Brewster v. Gage, 280 U.S. 327, 74 L. Ed. 457; Logan v. Davis, 233 U.S. 627, 58 L. Ed. 1128; McCaughn v. Hershey Chocolate Co., 283 U.S. 492, 75 L. Ed. 1187; United States v. Cerecedo Hermanos y Compania, 209 U.S. 339, 52 L. Ed. 822; Ross v. Railroad Co., 111 Mo. 26; State ex rel. Hays v. Railroad Co., 135 Mo. 648; State ex rel. Union Electric L. & P. Co. v. Baker, 316 Mo. 864, 239 S.W. 399; Forry v. Ridge, 56 Mo. App. 623; 59 C.J., pp. 1025-1029; Wisconsin v. Illinois, 278 U.S. 413, 73 L. Ed. 433; 2 Sutherland on Statutory Construction, sec. 474; National Lead Co. v. United States, 252 U.S. 146, 64 L. Ed. 499; State v. Messino, 325 Mo. 755, 30 S.W. (2d) 750; Mass. Mut. Life Ins. Co. v. United States, 288 U.S. 273, 77 L. Ed. 742; Old Mission Portland Cement Co. v. Helvering, 293 U.S. 294, 79 L. Ed. 173; Strottman v. Railroad Co., 211 Mo. 255; Kansas City Pub. Serv. Co. v. Ranson, 328 Mo. 536, 41 S.W. (2d) 169; State v. Schenk, 238 Mo. 455, 142 S.W. 263; Timmonds v. Kenish, 244 Mo. 328; Poe v. Seaborn, 282 U.S. 114, 75 L. Ed. 245. (4) The theory advanced by the appellant is contrary to the great weight of authority. People v. Passfield, 284 Ill. 450, 120 N.E. 288; People v. Northern Trust Co., 289 Ill. 475, 124 N.E. 662; People v. McCormick, 158 N.E. 861; State v. First Calumet Trust & Savings Bank, 71 Ind. App. 467, 125 N.E. 202; Tax Commission ex rel. Price v. Lamprecht, 107 Ohio St. 535, 140 N.E. 333; Old Colony Trust Co. v. Burrell, 238 Mass. 544, 131 N.E. 324; First Natl. Bank v. Commissioner, 154 N.E. 844; Cabot v. Commissioner, 166 N.E. 852; Corbin v. Townshend, 92 Conn. 501, 103 Atl. 649; In re Roebling's Estate, 89 N.J. Eq. 163, 104 Atl. 295; In re Tyler, 89 N.J. Eq. 170, 104 Atl. 298; In re Kountze's Estate, 93 N.J. Eq. 143, 115 Atl. 93; In re Russell, 146 Atl. 361; Macmiller v. Bugbee, 96 N.J.L. 324, 115 Atl. 341; Bugbee v. Roebling, 94 N.J.L. 438, 111 Atl. 29; Automobile Gasoline Co. v. St. Louis, 326 Mo. 443, 32 S.W. (2d) 281; State ex rel. Pearson v. Railroad Co., 215 Mo. 479, 114 S.W. 956; In re Knight's Estate, 261 Pa. 537, 104 Atl. 765; Williams v. State, 125 Atl. 661; Bingham's Admr. v. Commonwealth, 196 Ky. 318, 244 S.W. 781; Corliss v. Bowers, 281 U.S. 378, 74 L. Ed. 917; Bank of Commerce & Trust Co. v. McLemore, 35 S.W. (2d) 33; Hollis v. Treasurer, 242 Mass. 163, 136 N.E. 162; People v. Bemis, 68 Colo. 48, 189 Pac. 32; In re Miller's Estate, 184 Cal. 674, 195 Pac. 415; In re Inman's Estate, 101 Ore. 182, 199 Pac. 620; In re Perkin's Estate, 115 Ore. 178, 236 Pac. 1064; Jones v. Bowman, 118 Kan. 343, 243 Pac. 955; In re Young's Estate, 239 Pac. 287; State ex rel. Smith v. Probate Court, 139 Minn. 210, 166 N.W. 125; Simmons v. South Carolina Tax Comm., 132 S.E. 37; Beidler v. S.C. Tax Comm., 160 S.E. 272. (5) The appellant's theory accords undue weight to decisions which are either fallacious or are based upon statutes essentially different from our own. Hazard v. Bliss, 113 Atl. 469; In re Weeks' Estate, 172 N.W. 732; In re Fish's Estate, 189 N.W. 177; Matter of Sherman, 179 App. Div. 479, affirmed 222 N.Y. 540; In re Harkness' Estate, 234 N.Y. Supp. 297; In re Sherwood's Estate, 211 Pac. 734; In re Succession of Gheens, 88 So. 253; Stebbins v. Riley, 268 U.S. 137, 69 L. Ed. 884; In re Frick's Estate, 121 Atl. 35; Lonsdale v. United States, 31 Fed. (2d) 482; Bingham's Admr. v. Commonwealth, 196 Ky. 318, 244 S.W. 786; In re Miller's Estate, 195 Pac. 416; Bugbee v. Roebling, 94 N.J.L. 438, 111 Atl. 31; Tax Commission ex rel. Price v. Lamprecht, 107 Ohio St. 535, 140 N.E. 335; State ex rel. Smith v. Probate Court, 139 Minn. 210, 166 N.W. 125; In re Knight's Estate, 261 Pa. 537, 104 Atl. 765; People v. Passfield, 284 Ill. 450, 120 N.E. 286; State v. First Calumet Trust & Savings Bank, 71 Ind. App. 467, 125 N.E. 200; In re Roebling's Estate, 89 N.J. Eq. 163, 104 Atl. 295; Sec. 578, R.S. 1929; Brown v. State, 323 Mo. 138, 19 S.W. (2d) 12; Bryant v. Green, 44 S.W. 7.

TIPTON, J.

This is an appeal from a judgment of the Circuit Court of the City of St. Louis, Missouri, wherein that court sustained an exception of the executor of the estate of William H.V. Rosing. The ground for the exception was that the inheritance tax appraiser of that estate had not allowed as a deduction from the decedent's gross estate, the sum of nine thousand eight hundred dollars ($9,800), which the executor had paid to the collector of internal revenue in St. Louis as the Federal estate tax.

Upon the record before us both sides agree that the only question for our determination is: In the computation of the Missouri inheritance tax as imposed by the laws of Missouri, should the amount paid to the collector of internal revenue as and for the estate tax prescribed by the laws of the United States, be deducted from the gross estate of the decedent?

[1] "An inheritance tax, using the term in its broadest sense, is an excise which may be imposed on either, or both, of two entirely different subjects. It may be a tax upon the transmission of property by a deceased person, in which case it will be charged upon the whole estate, regardless of the manner in which it is to be distributed. Such a tax is called a probate duty or estate tax. An inheritance tax in its common form is however an excise on the privilege of taking property by will or by inheritance or by succession in any other form upon the death of the owner, and in such case is imposed upon each legacy or distributive share of the estate as it is received. Such a tax is called a legacy or succession tax." [26 R.C.L., sec. 166, p. 195.]

Briefly stated, one is a tax on the right to transfer property by will or descent, and the other is a tax on the legal right to take property by devise or descent. It is not a tax on the property.

We will not undertake to give a history of estate or inheritance tax laws, except to state that they are of ancient origin. The following cases give a history of their origin and development to the present time: Knowlton v. Moore, 178 U.S. 41, 44 L. Ed. 969, 20 Sup. Ct. 747; State ex rel. McClintock v. Guinotte, 275 Mo. 298, 204 S.W. 806; In re Inman's Estate (Ore.), 199 Pac. 615.

Our inheritance tax laws do not expressly provide whether or not the Federal tax shall be deductible.

[2] It is the contention of the State that our inheritance tax is a tax on the...