Marble v. Treasurer and Receiver General.

• Decision Date: 05 June 1923
• Citation: Marble v. Treasurer and Receiver General., 245 Mass. 504 (Mass. 1923)
• Parties: EMILY G. MARBLE v. TREASURER and RECEIVER GENERAL.
• Court: Supreme Judicial Court of Massachusetts

245 Mass. 504

EMILY G. MARBLE v. TREASURER and RECEIVER GENERAL.

Supreme Judicial Court of Massachusetts, Worcester.

June 5, 1923

September 26, 27 1922.

Present: RUGG, C.

J., BRALEY, DE COURCY, CROSBY, PIERCE, & CARROLL, JJ.

Tax, On succession. Husband and Wife. Joint Tenancy. Tenancy by Entirety. Savings Bank. Words, "Or."

It seems, that a husband and his wife may own a deposit in a savings bank as an estate by entirety.

It seems, that a joint tenancy may be created in a deposit in a savings bank.

While deposits in savings banks, stated as in the names of a husband "and" his wife, or of a husband "or" his wife, and to be "Payable to either or the survivor," or to be "Subject to withdrawal [or withdrawals] of whole or part by either or the survivor of either," create neither estates by the entirety nor, in the accurate sense of the term, estates held in joint tenancy, beneficial interests therein arise in the wife, on the death of the husband before the accounts are withdrawn "by survivorship" in a "form of joint ownership" which are taxable under

G.L.c. 65, Section 1.

The same rule applies to a deposit remaining in a savings bank at the death of the husband, which stood in the name of the husband "or" the wife without any statement that it was subject to withdrawal by or payment to either, the word "or" in the circumstances being given a disjunctive and not a conjunctive meaning.

The widow of a testator received property under the provisions of his will which justified the assessment of a succession tax under G.L.c. 65,

Section 1, upon the graduated scale of one per cent, two per cent and four per cent upon such interest. The tax was paid by the executor of the husband's will. It appearing that the widow also received a beneficial interest of a value less than $5,000 "by survivorship" in a

"form of joint ownership" in certain savings bank deposits which never came into the possession of the executor of the husband's will, a further succession tax was assessed upon her at the rate of four per cent without any exemption. On an appeal by the Treasurer and Receiver

General from a decree of the Probate Court allowing an abatement of the tax it was held, that

(1) The property under the will of the husband and the beneficial interest in the deposits passed to the widow at the same time and by reason of the same event, namely, the death of the husband and they should be taken together as a whole and treated as such in determining the tax and the exemption;

(2) The method of assessment was correct.

PETITION, filed in the Probate Court on February 4, 1922, under G.L.c. 65, Section 27, for the abatement of a succession tax of $242.62 assessed on the estate of J. Russell Marble under the provisions of G.L.c. 65, Section 1.

In the Probate Court, the petition was heard by F. H. Chamberlain, J., upon the pleadings and an agreed statement of facts.

The petitioner was the widow of the deceased. She received an interest under his will amounting to $113,748.03, on which a tax was assessed, according to the graduated scale of rates provided for in G.L.c. 65, Section 1, at one per cent, two per cent and four per cent, as described in the opinion, and was paid by the executors. Subsequently, on information furnished by the executors, the commissioner of corporations and taxation assessed an additional tax of $242.62 against the petitioner as surviving owner of certain savings bank deposits standing in the joint names of herself and her husband, which never came into the possession of the husband's executors. These joint deposits amounted to $9,705.14 and the tax was assessed on one half of the amount, or $4,852.57. The tax was at the rate of four per cent, the amount of the deposits being added to the previous assessment for the purpose of determining the tax. The petitioner paid the tax and filed this petition. Other material facts are described in the opinion.

In the Probate Court, a decree was entered allowing the petition and abating the tax. The Treasurer and Receiver General appealed.

The case was argued at the bar in September, 1922, before Rugg, C.J., Braley, Crosby, Pierce, & Carroll, JJ., and afterwards was submitted on briefs to all the Justices except Jenney, J.

C. R. Cabot, Assistant Attorney General, for the respondent.

T. H. Gage, (M.

S. June with him,) for the petitioner.

CARROLL, J. J. Russell Marble died October 8, 1920. At this time there were deposits in six Massachusetts savings banks, aggregating $9,705.14. None of these deposits came into the possession of the executors under the will of J. Russell Marble. It was agreed that Marble contributed to the joint accounts. The tax in question was assessed on one half of the balances, $4,852.57, of the six above mentioned deposits. The petitioner, who is the widow of the decedent, in November, 1921, paid a tax amounting to $242.62 and interest, and brought this petition for an abatement under G.L.c. 65, Section 27. In the Probate Court a decree was entered ordering an abatement of the tax, and the defendant appealed.

G.L.c. 65, Section 1, after reciting that all property within the jurisdiction of the Commonwealth, and any interest therein which shall pass by will or by laws regulating intestate succession, or by deed, grant or gift intended to take effect in possession or enjoyment after the death of the grantor or donor, provides: "and any beneficial interest therein which shall arise or accrue by survivorship in any form of joint ownership," shall be subject to a tax. The phrase quoted became a part of the law by St. 1916, c. 268, Section 1. Prior to the passage of this amendment it was held, where real estate was owned by husband and wife as tenants by the entirety, that no new estate passed on the death of either to the survivor which was taxable under the laws regulating intestate succession. Palmer v. Treasurer & Receiver General, 222 Mass. 263 . It was also decided that the interest, which on the death of one of two joint tenants in real or personal property belongs to the other by right of survivorship, does not pass by the laws regulating intestate succession within the meaning of the inheritance tax statute, and its transfer is not subject to the excise imposed by the statute. Attorney General v. Clark, 222 Mass. 291 . See Chippendale v. North Adams Savings Bank, 222 Mass. 499 , 502. Following these decisions the amendment, "any beneficial interest therein which shall arise or accrue by survivorship in any form of joint ownership," St. 1916, c. 268, Section 1, was passed, and we assume in the consideration of this case that this phrase refers to the first part of this section -- "All property within the jurisdiction of the Commonwealth, corporeal or incorporeal."

Five of the deposits were as follows: Fitchburg Savings Bank," J. Russell Marble or Emily G. Marble. . . . Subject to withdrawal of whole or part by either or the survivor of either." Athol Savings Bank," J. Russell Marble or Emily G. Marble. Payable to either or the survivor." Whitinsville Savings Bank, "J. Russell Marble or Emily G. Marble. . . . Subject to withdrawal of whole or part by either or the survivor of either." Springfield Five Cent Savings Bank, "J. Russell Marble and Emily G. Marble. . . . Subject to withdrawals of whole or part by either or survivor of either." Springfield Institution for Savings," J. Russell Marble and Emily G. Marble. . . . Subject to withdrawal of whole or part by either or survivor of either."

An estate by the entirety may exist in personal property. Boland v McKowen, 189 Mass. 563 . Phelps v. Simons, 159 Mass. 415 . A joint tenancy may be created in personal as well as in real estate. Attorney General v. Clark, supra. And the personal property may consist of a deposit in a savings bank. Chippendale v. North Adams Savings Bank, supra. In our opinion, none of the five deposits in question constituted an estate by the entirety, or a joint tenancy in the accurate sense of the term. In an estate by the entirety one of the owners cannot sever the tenancy during the joint lives without the consent of all. Palmer v. Treasurer & Receiver General, supra. And although a joint tenancy may be terminated by the transfer or conveyance of his interest by one of the tenants, each tenant can dispose of only his own interest in the property. Attorney General v. Clark, supra. By the express terms of these five deposits, either the husband or the wife had the right, during the lifetime of...