In re Fayerweather

• Decision Date: 09 October 1894
• Citation: 38 N.E. 278,143 N.Y. 114
• Parties: In re FAYERWEATHER.
• Court: New York Court of Appeals Court of Appeals

143 N.Y. 114

38 N.E. 278

In re FAYERWEATHER.

Court of Appeals of New York.

Oct. 9, 1894.

Appeal from superior court, general term, first department.

Proceedings to appraise the estate of Daniel B. Fayerweather for taxation under the inheritance tax act. From a judgment of the general term affirming an order of the surrogate court the comptroller of the city of New York appeals. Affirmed.

Emmet R. Olcott, for appellant.

Wm. H. Arnoux, for respondents.

PECKHAM, J.

The executors of the will of the above decedent made certain payments on account of the collateral inheritance tax within the period of 18 months subsequent to his decease, and in regard to the balance due they applied, some time after the 18 months had expired, and under the fifth section of the tax act, to have the penalty of 10 per cent. interest thereon remitted. The comptroller of the city of New York appeals from the order made by the surrogate of New York county upon that application. The order was affirmed by the general term of the supreme court of the first department.

The decedent died on the 15th day of November, 1890, leaving a large estate. A contest arose over the probate of the will. It was finally decided in favor of the proponents, and the will was admitted to probate by the surrogate of New York on the 24th of March, 1891. The application of the executors to the surrogate for a remission of the penalty imposed by law for the nonpayment of the whole of the tax within 18 months of the date of the death of the decedent resulted favorably to the executors, and the surrogate adjudged that, by reason of litigation and other unavoidable causes, the amount of the tax had not been determined; and he therefore granted the application and remitted the penalty, and then decreed that the interest to be charged on the balance of the tax then imposed should be at the rate of 6 per cent. from the 15th of May, 1892 (18 months subsequent to the death of the decedent), and the application of the comptroller for an order charging interest on that amount at the rate of 6 per cent. from the death of the testator (November 15, 1890), as provided by chapter 399 of the Laws of 1892, was denied. The question, therefore, is simply whether interest on the amount of the tax still due shall be charged from the date of the death of the decedent, or from a date 18 months subsequent thereto.

If the saving clause in the 24th section of the act (chapter 399, Laws 1892) cover and apply to this case, then the order is right. If it do not, then the further question would arise whether in any event the act of 1892 applied to the estate of any individual dying before its passage. Under the act of 1887 (chapter 713), which was in force at the time of the death of the decedent, the taxes imposed by the act were by the fourth section thereof made due and payable at the death of the decedent; and if they were paid within 18 months thereafter no interest was to be charged or collected thereon, but, if not so paid, interest at the rate of 10 per cent. per annum was to be charged and collected from the time the tax accrued. By the fifth section of the act it was provided that the penalty of 10 per cent. imposed by the fourth section should not be charged where in cases by reason of claims made upon the estate, necessary litigation, or other unavoidable cause of delay, the estate of a decedent could not be settled at the end of the 18 months from the death of the decedent, and in such cases only 6 per cent. per annum should be charged from the expiration of the 18 months until the cause of delay should be removed. At the time, therefore, when the tax upon this estate accrued or became due, viz. upon the death of the decedent, the law gave the executors of his will 18 months in which to pay the tax without the addition of any interest whatever; and 10 per cent. interest from the time this tax accrued was imposed as a penalty for nonpayment, unless it was excused under the provisions of section 5 above quoted, and in that case interest only at the rate of 6 per cent. from the expiration of the 18 months, until the...