Peabody v. Stevens

• Decision Date: 24 May 1913
• Citation: 215 Mass. 129,102 N.E. 435
• Parties: PEABODY et al. v. STEVENS, Treasurer and Receiver General, et al.
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

215 Mass. 129

102 N.E. 435

PEABODY et al. v. STEVENS, Treasurer and Receiver General, et al.

Supreme Judicial Court of Massachusetts, Suffolk.

May 24, 1913

COUNSEL

Fred T. Field, of Boston, for respondent Stevens.

Willard B. Luther, of Boston, for other respondents.

OPINION

RUGG C.J.

This is a petition brought under St. 1909, c. 490, pt. 4, § 21, by the executors of the will of a testator who died a resident of New York, for instructions whether certain property of the testator was 'within the jurisdiction of the commonwealth' within the meaning of those words in St 1907, c. 563, § 1, and thus subject to an inheritance tax. This petition relates only to certain so-called shares of stock in five different real estate trusts. All the property both real and personal of all the trusts was in this commonwealth, and all the trustees lived here. The places of business and books of the trusts were also in Massachusetts where alone the certificates could be transferred upon surrender and new ones issued in their stead. It is not necessary for the purposes of this judgment to state in detail the terms of the several trust instruments. In general the subscribers join for the purpose of purchasing certain real estate and agree to contribute money therefor. The legal title to all the property of each of the trusts is in the trustees who have control over the property with power to invest and hold personal property and to distribute net earnings among the shareholders, but no power to bind the shareholders personally. The trustees are subject to a limited direction on the part of the shareholders. Two of the trusts contain the further provision that the shares represented by the certificates are to be and remain as to title personal property only, and be held, bequeathed assigned and distributed as personal estate.

The language of the taxing statute indicates 'an intention on the part of the Legislature to tax all property that it has the power to tax. The statute is broad as the jurisdiction of the commonwealth.' Knowlton, C.J., in Kinney v Treasurer and Receiver General, 207 Mass. 368, 369, 93 N.E. 586, 587 (35 L. R. A. [N. S.] 784, Ann. Cas. 1912A, 902). The nature of the interest held by shareholders under trust agreements similar to those here involved has been before the courts frequently. In Kinney v. Treasurer and Receiver General, the legal title to real and personal estate was in the trustees, the interests of the individual contributors to the trust being represented by deposit books which were assumed to be transferable. The court said 'this property was a valuable interest in real estate * * * the legal title to which was held by trustees. The testator held an equitable interest in it. * * * All this property is subject to the tax upon succession prescribed by our law.' In Williams v. Boston, 208 Mass. 497, at page 500, 94 N.E. 808, at page 809, it was said: 'There is no doubt that [the certificate holders in the trust] are joint owners of the property, for whose joint benefit the business is being carried on.' In Atty. Gen. v. N. Y., N.H. &...