People v. Upson

• Decision Date: 21 February 1930
• Docket Number: No. 18099.,18099.
• Citation: 338 Ill. 145,170 N.E. 276
• Parties: PEOPLE v. UPSON.
• Court: Illinois Supreme Court

338 Ill. 145

170 N.E. 276

PEOPLE

v.UPSON.

No. 18099.

Supreme Court of Illinois.

Feb. 21, 1930.

Commissioner's Opinion.

Proceedings by the People against George Lyle Upson. From an order assessing an inheritance tax against defendant, defendant appeals.

Reversed, and cause remanded.Appeal from Fulton County Court; J. D. Breckenridge, Judge.

Woolsey & Lucas, of Galesburg, and Glenn Ratcliff, of Lewistown, guardian ad litem, for appellant.

Oscar E. Carlstrom, Atty. Gen., and Royce A. Kidder, of Springfield, for the People.

PARTLOW, C.

This is an appeal from an order of the county court of Fulton county assessing an inheritance tax of $1,267.20 against appellant, George Lyle Upson, under the last will and testament of Lucy M. Wright, deceased.

The testatrix died at Table Grove, in Fulton county, on January 22, 1917. Her last will and testament was admitted to probate, and an executrix was appointed. The testatrix left surviving her, as her only heirs at law, Albert Upson, a brother, and three sisters, Martha L. Taylor, Hannah T. Wright, and Sarah M. Hummel. Gabrelia Hughes and Sarah Barnhart were foster children of the testatrix who had never been adopted. George Upson, a nephew of the testatrix, died November 19, 1919, leaving four minor children surviving him, including appellant.

The provisions of the will were as follows: By article 1 the testatrix gave to her executors, as trustees, her homestead in the village of Table Grove, including three lots and 17 1/2 feet off of the north end of three other lots, also all her property in the city of Galesburg, to hold, control, and sell, the income therefrom to be used for the support and maintenance of her sister Martha L. Taylor while she lived, and for the payment of the expenses of her last illness and funeral expenses. She directed the trustees to sell the real estate and invest the proceeds in first mortgage loans so as to produce the greatest income. After the death of the sister the trustees were to use the income, and such part of the principal as they might deem necessary, to educatethe children who were then born or who might thereafter be born to her nephew, George Upson, until the youngest child received a high school education, and then the fund was to be divided, share and share alike, per stirpes, among the children of George Upson. By a codicil this last article was modified by giving to Sarah Barnhart the lots adjacent to the homestead, but not including the lots on which the house was located. By article 2 she directed her executors to sell to the highest bidder at public sale all her farm lands, one-half of the proceeds to be invested in other farm lands in Knox county, the title to be taken in the name of George Upson for life with remainder to his children, share and share alike, per stirpes. In case Upson died without children or descendants thereof, the land was to go to the sisters of Upson. In case either sister died leaving issue, the issue was to take the share of the deceased parent. The land was given to Upson for life upon condition that he did not lend any financial aid to the wife of Arthur Upson, and, if he did lend such aid, the land was to go to his children. By article 3 she directed that out of the remaining one-half of the proceeds of sale of the farm lands all her debts, funeral expenses, costs of administration, costs arising from the sale of real estate, and the pecuniary legacies, should be paid, and the remainder should go to the trustees, to hold under the same terms as were provided in article 1 of the will. By article 4 she gave to Sarah Barnhart $600 in full payment for all services rendered to the testatrix during her lifetime. She gave to Gabrelia Hughes $600, conditioned that no extra bill for services be charged against the estate. By article 5 she gave to Sarah M. Hummel $1,000. By article 6 she gave to Martha L. Taylor all household furniture, a piano, canned fruit in the cellar, dishes, and all household goods in the home in Table Grove. By article 7 she gave several specific articles of personal property, including three bequests of $25 each and a bequest of $50 to the Presbyterian church. The will containedno residuary clause and made no disposition of the personal estate except as above stated.

Hannah T. Wright filed a bill in the circuit court of Fulton county to contest the will, and a prolonged and expensive litigation followed. The jury found against the will, and a decree was entered setting it aside. Upon appeal to this court the decree was reversed, and the cause remanded. Wright v. Upson, 303 Ill. 120, 135 N. E. 209. After the case was reinstated in the circuit court a settlement was agreed upon. The court entered a decree approving the settlement, which provided that all expenses of litigation were to be first paid out of the estate and the balance divided, 40 per cent. to the four minor children of George Upson and 60 per cent. to the three sisters and Gabrelia Hughes and Sarah Barnhart. The decree provided that the will should remain the will of the testatrix.

After the decree was entered the executrix converted the estate into cash, paid all expenses of litigation and administration, and made a report to the circuit court showing a balance of $56,771.85, which report was approved. On February 23, 1923, the county judge appointed an inheritance tax appraiser. At the hearing the question was raised as to whether the tax should be assessed under the terms of the settlement or under the terms of the will. The appraiser held that the tax should be determined under the provisions of the will. He refused to allow deductions of $18,822.76, being the expenses incurred in the will contest. He held that the cash value of the life interest of George Upson was $3,000; that the cash value of the life interest of Martha L. Taylor was $3,373.83; that the value of the interests of Sarah Barnhart, Gabrelia Hughes, and Sarah M. Hummel were $1,330, $600, and $1,000, respectively. He valued the farm lands in Fulton county at $56,400, all other real estate at $11,380, and the personal property at $27,889.99. He allowed credits and deductions of $21,015.38 for debts and costs of administration, leaving a net estate of $74,654.61. He deducted from the net estate the interests of George Upson, Martha L. Taylor, Sarah Barnhart, Gabrelia Hughes, and Sarah M. Hummel, amounting to $9,303.83, leaving $65,350.78 as the value of the estate taken by the four minor children of George Upson under the will. He found that the interests of the four children of George Upson were subject to taxation, and, upon the assumption that but one of the four children would survive the life tenants, George Upson and Martha L. Taylor, he computed the tax at the highest rate and in the greatest amount that any contingency would warrant. He allowed only one exemption under section 25, of $2,000, leaving $63,350.78 as the taxable value of the property received by appellant, George Lyle Upson, which at 2 per cent. made a tax of $1,267.02. Appellant appealed to the county court, where the evidence taken before the appraiser was considered by agreement and some additional evidence was heard. The court entered an order fixing the tax as found by the appraiser. From the order entered this appeal was prosecuted.

Appellee contends that on this appeal there is no question presented for review, because no exceptions were taken to the order of the court and preserved in the bill of exceptions. Previous to the amendment of section 81 of the Practice Act (Laws 1907, p. 459) in 1911 (Laws 1911, p. 459) there would have been much force in this contention. The effect of the amendment was considered in Miller v. Anderson, 269 Ill. 608, 109 N. E. 1048, and Pittsburgh, Cincinnati, Chicago & St. Louis Railway Co. v. Chicago City Railway Co., 300 Ill. 162, 133 N. E. 181, and it was held that the common law requirement of exceptions to rulings sought to be reviewed is obviated by the amendment of 1911.

Appellant insists that the tax was not assessed as provided by statute or as provided in the will.

The assessment of an inheritance tax in this state is a statutory proceeding and is governed entirely by the provisions of the statute. Section I of the Inheritance Tax Act of 1909 (Laws 1909, p. 312), which was in force when the testatrix died, provides for an exemption of $20,000 to every brother and sister of the decedent and an exemption of $2,000 for every niece and nephew or lineal descendant of either. The rate of taxation on the latter was $2 on every $100 of the market value of the property received. Section 2 provides that, when any property, or interest therein or income therefrom, shall pass...