Wilmington Trust Company v. Highfield

• Decision Date: 06 February 1931
• Citation: 34 Del. 394,153 A. 864
• Court: Supreme Court of Delaware
• Parties: WILMINGTON TRUST COMPANY, a corporation of the State of Delaware, defendant below, plaintiff in error, v. JOHN GILPIN HIGHFIELD, Register of Wills, in and for New Castle County and State of Delaware, for the use of the State of Delaware, plaintiff below, defendant in error. HARRY G. HASKELL, executor of the last Will and Testament of Elizabeth D. Haskell, defendant below, plaintiff in error, v. J. GILPIN HIGHFIELD, Register of Wills, in and for New Castle County, in the State of Delaware, for the use of the State of Delaware, plaintiff below, defendant in error. HARRY G. HASKELL, executor of the last Will and Testament of Elizabeth D. Haskell, defendant below, plaintiff in error, v. HOWARD M. WARD, State Treasurer of the State of Delaware, for the use of the State of Delaware, plaintiff below, defendant in error

153 A. 864

34 Del. 394

WILMINGTON TRUST COMPANY, a corporation of the State of Delaware, defendant below, plaintiff in error, v. JOHN GILPIN HIGHFIELD, Register of Wills, in and for New Castle County and State of Delaware, for the use of the State of Delaware, plaintiff below, defendant in error. HARRY G. HASKELL, executor of the last Will and Testament of Elizabeth D. Haskell, defendant below, plaintiff in error, v. J. GILPIN HIGHFIELD, Register of Wills, in and for New Castle County, in the State of Delaware, for the use of the State of Delaware, plaintiff below, defendant in error. HARRY G. HASKELL, executor of the last Will and Testament of Elizabeth D. Haskell, defendant below, plaintiff in error, v. HOWARD M. WARD, State Treasurer of the State of Delaware, for the use of the State of Delaware, plaintiff below, defendant in error

Supreme Court of Delaware

February 6, 1931

Supreme Court of the State of Delaware, Nos. 2, 3, and 4 January Term, 1931.

STATEMENT OF THE CASE.

These cases present the same questions of law and were accordingly heard together. They call for a determination of whether or not the court below erred in entering judgments in the first two cases against the defendants below for inheritance taxes alleged to be due from the estates of the decedents, whose executors were sued on their administration bonds, and, in the last case, whether the court below erred in entering judgment against the defendant below for an estate tax alleged to be due from the estate of the decedent whose executor was similarly sued.

The cases were heard in the court below on cases stated, and the court below, being of the opinion that the taxes were due directed judgments to be entered in accordance with the stipulations of the cases stated. The amounts of the judgments in the first two cases represent the inheritance taxes claimed to be due as calculated under the schedules found in the act approved May 6, 1929 (36 Del. Laws, c. 7) and the amount of the judgment in the third case represents the estate tax claimed to be due as calculated under the act approved April 29, 1927 (35 Del. Laws, c. 8).

The questions involved are pure questions of law arising upon the face of the statutes. No statement of facts is, therefore, necessary.

The opinion of the court sufficiently sets out the statutes and needs no supplementary statement for an understanding of the questions at issue.

Judgments affirmed.

Robert H. Richards and Caleb S. Layton (of Richards, Layton and Finger) for Wilmington Trust Company, plaintiff in error.

James H. Hughes, Jr. (of Ward and Gray) for Harry G. Haskell, plaintiff in error.

William H. Foulk, Deputy Attorney-General, for defendants in error.

WOLCOTT Chancellor, RICE and RODNEY, J. J., sitting.

OPINION

WOLCOTT, Chancellor

These cases present two questions: The first one is, whether or not, since May 6, 1929, the date of the enactment of the act found in 36 Delaware Laws, chapter 7, by which an important section of the inheritance tax provisions of the Delaware code was attempted to be amended, the inheritance tax law has been in effect, though not in form, repealed. The second question is, whether, if the inheritance tax provisions are ineffective, the act of April 29, 1927 (35 Delaware Laws, c. 8) by which an estate tax is imposed, is any longer in force. If the first question is answered in the affirmative, the second question thus calls for an answer. If, on the other hand, the first question is answered in the negative, the second one cannot arise.

Inasmuch therefore, as the necessity of considering the second question is dependent upon the answer to the first, the logic of the situation suggests that we direct our attention first to a consideration of whether the inheritance tax provisions are no longer in force.

In doing so it is sufficient for the present purposes to commence our recitation of the pertinent statutory inheritance tax enactments with the act of March 24, 1917, found in 29 Delaware Laws, chapter 7. That act wrote into chapter 6 of the Code of 1915 the following provisions:

"146. Sec. 109. Property Subject to; Rates; Exemptions. All property within the jurisdiction of this State, real and personal, and every estate and interest therein, whether belonging to residents or non-residents of this State (except shares of the capital stock of corporations created under the laws of this State when owned by persons without this State) which passes by will, or by the intestate laws of this State or by deed, grant, gift, or settlement (except in cases of a bona fide purchase for full consideration in money or money's worth) made in contemplation of, or intended to take effect in, possession or enjoyment, after the death of the grantor, donor, or settlor, to any person, or persons, bodies politic, or corporate, in trust or otherwise, shall be subject to taxation, as follows:

"Class A. * * * (Stating degrees of relationship and rates of tax).

"Class B. * * * (Stating the same).

"Class C. * * * (Stating the same).

"(The statute then proceeded to specify certain exemptions and to define contemplation of death' as used in the section.)"

The next legislation on the subject was the act approved April 25, 1927, 35 Delaware Laws, c. 7. That act struck out all of the section just quoted down to the words "Class A" and inserted in lieu thereof the following:

"146. Sec. 109. Property Subject to; Rates; Exemptions: Where real property is referred to in Sections 109 to 115, inclusive, of this Chapter, it shall be deemed and held to mean real property actually situated within this State but not real property actually situated without this State unless otherwise specified; and where personal property is referred to in said Sections 109 to 115, inclusive, it shall be deemed and held to mean all kinds of personal property whether tangible or intangible except tangible personal property having an actual situs without this State unless otherwise specified.

"The estates of persons who at the time of their death were non-residents of the State of Delaware, and the gifts and legacies in the last will and testament of every such non-resident, and the distributive shares of the intestate estate of every such non-resident shall be exempt from taxation in this State except the real property actually situated in this State of such non-resident and except also the tangible personal property of such non-resident having an actual situs in this State which real property and tangible personal property having an actual situs in this State shall be subject to the provisions of Sections 109 to 115, inclusive, of this Chapter.

"All property, real and personal, and every estate and interest therein, legal or equitable, belonging to any person who at the time of his death was a resident of the State of Delaware, and which passes by will or by the intestate laws of this State, or by deed, grant, gift, or settlement (except in cases of a bona fide purchase for full consideration in money or money's worth) made in contemplation of death or intended to take effect in possession or enjoyment after the death of the grantor, donor, or settlor to any person or persons, body politic, or corporate (whether resident or non-resident of this State) in trust or otherwise, shall be subject to the tax specified in this Section; all tangible personal property having an actual situs in this State, and all real property actually situated in this State and every estate and interest therein, legal or equitable, belonging to any person who at the time of his death was not a resident of this State and which passes by will or intestacy, or by deed, grant, gift or settlement (except in cases of a bona fide purchase for full consideration in money or money's worth) made in contemplation of death or intended to take effect in possession or enjoyment after the death of the grantor, donor, or settlor to any person or persons, body politic, or corporate (whether resident or non-resident of this State) in trust or otherwise, or shall be subject to the tax specified in this Section."

The next and final piece of legislation on the subject is found in the act entitled "An Act to amend Chapter 98 of the Revised Code of Delaware (1915) relating to Inheritance Tax as the same has been amended," approved May 6, 1929, 36 Delaware Laws, c. 7. That act in section 1 provided as follows:

"Section 1. That Chapter 6 of the Revised Code of Delaware (1915) be and the same is hereby amended by striking out all of 146, Section 109 after the first paragraph thereof, and inserting in lieu thereof the following:

"(Then follows a series of classifications starting with Class A and ending with Class D; and repeating the exemption provisions and the definition of contemplation of death' as found in the section in its 1917 and 1927 forms. The change in the classifications consisted only in this--that husbands and wives were more generously dealt with.)"

Two points of criticism are directed against this act. One has to do with the title. It will be observed that the title of the act is an act to amend chapter 98 of the Code relating to inheritance taxes. Chapter 98 of the Code to which the title of the act refers deals generally with "Administration of Estates. Register of Wills." There is a reference, however, in chapter 98 to the subject of inheritance taxes. It is found in section 79 thereof where the duty is laid on the Register of Wills to ascertain, collect and account, for collateral inheritance taxes as provided in chapter 6. The body of the act amends chapter 6, 146, Sec. 109 of the Code. The section amended in the body is therefore part of a chapter different from that referred to in the title.

In view of this situation, it is contended...