Pierce v. Stevens

• Decision Date: 25 February 1910
• Citation: 91 N.E. 319,205 Mass. 219
• Parties: PIERCE et al. v. STEVENS, Treasurer, etc.
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

205 Mass. 219

91 N.E. 319

PIERCE et al. v. STEVENS, Treasurer, etc.

Supreme Judicial Court of Massachusetts, Suffolk.

February 25, 1910

COUNSEL

Dana Malone, Atty. Gen., and Fred T. Field, Asst Atty. Gen., for Treasurer and Receiver General.

Hutchins & Wheeler, for Michael Anagnos Schools.

OPINION

KNOWLTON C.J.

This is a petition for instructions, brought in the probate court by trustees appointed under the will of Michael Anagnostopoulos. The question is whether the property passing under the residuary clause of this will is subject to an inheritance tax under Rev. Laws, c. 15, § 1, as amended by St. 1905, c 470, and St. 1906, c. 436. This residuary clause is as follows:

'All the rest, residue and remainder of the estate, both real and personal, and wheresoever situated, of which I shall die seised or possessed, or to which I shall be at the time of my decease in any way entitled, I give, devise and bequeath to my trustees hereinafter named, and their heirs and assigns forever; but in trust nevertheless, to manage, invest and reinvest the same, changing investments from time to time as shall seem to them proper, and one-sixth part of the net income thereof to pay in semiannual payments to the board of managers of the Kallineian Free Schools for Girls at said Papingon, for the period of ten years after my decease, and the remaining five-sixths of the net income thereof, during said period of ten years, to apply, in such manner as they shall see fit, to the maintenance of a Latin school, to be of the highest grade possible under the circumstances, and as far as possible similar to the best German gymnasia, to be entirely a free school for the education of youths, without distinction of race, creed, color or social condition, to be located either at Konitza or in Janina, or in some other town of the province of Epiros, west of Janina.

'At the expiration of ten years after my decease, I direct that one-sixth of the capital of said trust fund shall go to the board of managers of the Kallineian Free Schools for Girls at said Papingon, and that the remaining five-sixths of said capital shall be applied, in such manner as my trustees shall deem best, to the permanent establishment and maintenance of such Latin school as is hereinbefore described, and in making such application of the income and principal of said trust fund for the maintenance of such Latin school, I give to my said trustees, and to whoever shall be trustees under this my will, full power and authority to adopt such method as shall seem to them best suited for the purpose, by payment of said income and capital to any person or persons or corporation, to be held by him, them or it, and applied for the purpose herein indicated or otherwise; and authorize the trustees under this my will, to form a corporation to maintain such school, if it shall seem wise to them so to do. And I direct that the receipt of such person or persons or corporation, for all sums of money so paid to it or them by my trustees, and for all property delivered to it or them by my trustees, shall be a complete discharge to my trustees, and that thereafter my trustees shall be under no further liability to account for the same, or to see to the application thereof.'

The trustees have caused a corporation to be formed under Rev Laws, c. 125, for the purpose of carrying this clause of the will into effect. It was decided by the probate court that the one-sixth part of the residue of the estate which is given in trust for the board of managers of the Kallineian Free Schools for Girls at Papingon is subject to the tax, and that the remaining five-sixths of the estate is not subject to the tax. From the decree relative to the one-sixth part no appeal was taken. But from the decree relative to the five-sixths part the Treasurer and Receiver General of the commonwealth appealed to the Supreme Judicial Court. The case was reported by a single justice to the full court. The question is whether this gift is within either of the exemptions created by the statute. These are three in number. The first is of gifts 'to or for the use of charitable, educational, or religious associations or institutions the property of which is by law exempt from taxation'; the second is of property given 'to a trustee or trustees for public charitable purposes within the commonwealth'; and the third is of property given 'to or for the use of a city or town for public purposes.' Rev. Laws, c. 15, § 1. The public charitable purposes for which each of these gifts was made are not within the commonwealth, but in a distant foreign country, and it is not contended that the gifts are within either of the last two exceptions. It is contended by the corporation that it is a charitable and educational institution whose property is by law exempt from taxation, and that therefore no tax can be collected upon the property that passed to it from the trustees under the will. If the corporation had been in existence when the will took effect, and if the will had passed the property from the testator's estate directly to it, there would be strong ground for its contention. The right of the commonwealth to its tax, as well as the rights of others claiming under the testator's will, vested at the time of his death. Hooper v. Bradford, 178 Mass. 95, 59 N.E. 678. When the will took effect, the...