Jones v. Schneider

Decision Date21 December 1964
Citation3 Ohio App.2d 325,32 O.O.2d 431,210 N.E.2d 399
Parties, 32 O.O.2d 431 JONES, Exr., et al., Appellants, v. SCHNEIDER, Tax Commr., et al., Appellees. In re ESTATE OF JONES.
CourtOhio Court of Appeals

Loomis & Jones, Ravenna, for appellants.

Jon A. Ziegler, Columbus, for appellees.

FRANCE, Judge.

This appeal is from an order of Probate Court, Portage County, sustaining exceptions of the Tax Commissioner to the determination of succession tax and ordering that the tax be recomputed at the highest possible rate, under the temporary-order provisions of statute.

In question is the provision made for two grandchildren of the testatrix giving them a total one-fourth interest in the estate, to be held in trust for them by the First National Bank and Trust Company of Ravenna.

Item III E of the will provides:

"If either of my said grandchildren, for whose primary benefit property is held in trust hereunder, should die before attaining the age of 35 years, all of the assets then constituting the trust estate for such deceased grandchild shall be distributed in equal shares to such deceased grandchild's then living lineal descendants per stirpes, or if none, then the undistributed portion of such grandchild's trust estate shall be added to the trust estate of the other living grandchild, or if such other living grandchild's trust has terminated then it shall pass directly to such other living grandchild."

Item III F provides (in pertinent part):

"No income or principal payable to or held for any beneficiary hereunder shall be alienated, disposed of or in any manner encumbered while in the possession of the Trustee otherwise than by the authorized act of the Trustee; and (if) by reason of any act of any such beneficiary, or by operation of law, or by the happening of any event, or for any other reason except by an act of the Trustee authorized hereunder, any of such income or principal shall, or except from this provision would cease, to be enjoyed by such beneficiary, or if by reason of an attempt of any such beneficiary to alienate, charge or encumber the same, or by reason of the bankruptcy or insolvency of such beneficiary, or because of an attachment, garnishment or other proceeding, or any order, finding or judgment of court either in law or in equity, the same except for this provision, would vest in or be enjoyed by some other person, firm or corporation, otherwise than as provided herein, then the trust herein expressed concerning such income and/or principal shall cease and determine as to such beneficiary, and all such income and/or principal thereafter during the life of such beneficiary, subject, however, to the rights of all other beneficiaries as herein provided, shall be held by the trustee according to its absolute discretion; but the Trustee meanwhile may pay to or expend for such beneficiary for the maintenance, support, comfort and education of such beneficiary, or of any husband, wife, child, children of such beneficiary, out of such income and/or principal theretofore so held for such beneficiary, such sums and such sums only as the Trustee, in its absolute discretion, shall deem proper, using or retaining for the benefit of beneficiaries hereunder whose interests are not so affected, any portion not so expended."

In its original order, the Probate Court failed to take into account the provisions of Section 5731.28, Revised Code, which read:

"When, upon any succession, the rights, interests, or estates of the successors are dependent upon contingencies or conditions by which they may be wholly or in part created, defeated, extended, or abridged, a tax shall be imposed upon such successions at the highest rate which, on the happening of such contingencies or conditions, would be possible ***."

The application of this statute to Article III is immediately apparent when one notes the size of the share of each grandchild after applying exemptions. Under the very apparent contingency of one or the other of the grandchildren dying...

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1 cases
  • Domo v. McCarthy
    • United States
    • Ohio Supreme Court
    • June 2, 1993
    ...(1975), Section 5, at 39; and Bogert, Trusts & Trustees (2 Ed.Rev.1979) 543-545, Section 230. See, also, Jones v. Schneider (1964), 3 Ohio App.2d 325, 32 O.O.2d 431, 210 N.E.2d 399. It appears that this type of trust has found some support in the United States. IIA Scott, Law of Trusts (4 E......

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