Tax Comm. v. Bank & Tr. Co.

• Decision Date: 21 December 1927
• Docket Number: 20356
• Citation: 117 Ohio St. 443,159 N.E. 570
• Parties: Tax Commissioner Of Ohio v. The Security Savings Bank & Trust Co. Of Toledo, Trustee, Et Al.
• Court: Ohio Supreme Court

159 N.E. 570

117 Ohio St. 443

Tax Commissioner Of Ohio v. The Security Savings Bank & Trust Co. Of Toledo, Trustee, Et Al.

No. 20356

Supreme Court of Ohio

December 21, 1927

Inheritance tax - Exemptions - Successions passing to public charity - Section 5334, General Code - Inapplicable where property used for profit and accumulation devoted to charity - Succession limited to Masons, their families and clergymen, not exempt.

1. The provision of Section 5334, General Code, "The succession to any property passing * * * to or for the use of an institution for purposes only of public charity * * * shall not be subject to the preceding sections of this subdivision," does not apply to the succession of property to be used for a period of not less than fifty nor more than sixty years exclusively for profit and the multiplication of profits, even though such property add its accumulation is thereafter to be dispensed as a public charity, the purpose of the testator being not alone to dispense a public charity but also to increase and augment the estate he has left.

2. The succession of property to a trustee to be used for the purpose of dispensing charity only to aged Master Masons their wives, widows and dependent orphans, or superannuated clergymen, is not a succession of property "for purposes only of public charity." (Morning Star Lodge v. Hayslip 23 Ohio St. 144, approved and followed.)

Otis Avery Browning died testate on July 28, 1923. His last will and testament was duly probatedi n the probate court of Lucas county, Ohio. In his last will and testament he provided (division No. 4):

"Section Eight. After my executors shall have paid from the personal property included in this division number four, all my lawful and just debts and obligations, and the expenses of my estate, including all state, national and other inheritance taxes and similar charges, and shall have paid in full each and all of the specific gifts and bequests as provided in my will in which a stated cash amount is named, and which shall not for any reason have lapsed whatever then regains shall be the residue of division number four, as provided in this division of my will.

"Section Nine. This residue shall be divided by my executor into one hundred (100) equal parts or shares of equal worth and value to be paid and distributed as hereinafter provided, and I hereby give and bequeath such residue as hereinafter in this division set forth, and the number of shares which I give to each beneficiary shall determine the amount each beneficiary named shall receive out of such residue, except as may be otherwise specified and provided."

Division No. 5:

"Section One. In this division number Five is set forth my wishes and desires and requirements respecting the Otis Avery Browning Masonic Memorial Fund and Home, * * *.

"I again call special attention to what I have termed the residue of division number four, which shall be divided into one hundred (100) shares or parts of equal worth and value. Forty-six (46) of these said shares I have bequeathed to the Security Savings Bank & Trust Company, of Toledo, Ohio, in trust, for the foundation of the Otis Avery Browning Masonic Memorial Fund, but only on condition that the board of directors as hereinafter named, to accept the oversight and control of such fund, shall organize qualify and accept the same, within four months after the date of qualification of my executors. * * *

"Section Five. The purpose of the memorial home shall be purely eleemosynary; it shall not be in any way sectarian in character; it shall be for aged master Masons, their wives, widows and dependent orphans, who desire the home comforts and the happiness of the Christian home, free of sectarian bias or influence. It shall never be used for any other purpose than as herein provided. * * *

"Section Six. The home shall be, in the first instance, for master Masons, their wives or widows. Such master Masons shall be at least sixty (60) years of age, either born or naturalized citizens of the United States of America, residents of the state of Ohio, of good, moral character, and shall have been members of some regular and legal Masonic lodge of the state of Ohio, for at least six (6) years immediately preceding his admission, or the death of such master Mason, in case of the admission of the widow or orphan of such master Mason. When the home is not fully taken up or occupied by such qualified master Masons, their wives or widows, then, at the discretion of the board of directors, any superannuated clergyman may be admitted, irrespective of denomination, who has been a citizen and resident of the state of Ohio for at least six (6) years immediately previous to his admission, and who comes well recommended, subject to the approval of the board of directors.

"Section Seven. Membership dues shall be charged and paid, thus removing from the minds of those in the home the idea that they are dependent subjects of charity. The rules of the home, regulation of and the amount of the dues I leave to the discretion of the board of directors. * * *

"Section Thirteen. All real estate, bonds, stock, money and other property received and field in trust by said trustee for the benefit of the memorial fund, shall be invested and reinvested, compounded and kept accumulative and at interest for a period of not less than fifty (50) years from and after the date of my decease. My sole purpose in delaying the building of said home for fifty years is to create an endowment sufficiently large not only to build the said home, but to maintain and care for it, and to make it self-sustaining. * * *

"Section Fifteen. Each and every active member of the board of directors shall be a master Mason in good and regular standing and a resident of the state of Ohio."

The executors of the will of Otis Avery Browning filed an application in the probate court of Lucas county for that court to determine the inheritance tax due upon the succession of the estate to the various legatees and devisees under the will, including the Security Savings Bank & Trust Company of Toledo, Ohio. That court found the total actual net market value of the succession...