Young Men Christian Ass of Columbus, Ohio v. Davis, 249
| Decision Date | 18 February 1924 |
| Docket Number | No. 249,249 |
| Citation | 68 L.Ed. 558,44 S.Ct. 291,264 U.S. 47 |
| Parties | YOUNG MEN'S CHRISTIAN ASS'N OF COLUMBUS, OHIO, et al. v. DAVIS et al |
| Court | U.S. Supreme Court |
Messrs. J. I. Boulger, of Columbus, Ohio, Frank Davis, Jr., of Washington, D. C., Henry A. Williams, of Columbus, Ohio, and Guy W. Mallon, of Cincinnati, Ohio, for petitioners.
Mr. Arthur J. Vorys, of Columbus, Ohio, for respondents.
Mary J. Sessions, a citizen and resident of Columbus, Ohio, died on April 1, 1919, leaving a will executed September 17, 1914, and disposing of a considerable estate. The executor paid a tax of $31,000 to the United States as the so-called 'estate tax' under the Revenue Act of 1918, enacted February 24, 1919 (chapter 18, 40 Stat. 1057, 1096 [Comp. St. Ann. Supp. 1919, § 6336 3/4a, et seq.]).
The question in the case is what effect this payment shall have in the distribution of the estate among the legatees and beneficiaries under the will. After providing that her just debts and funeral expenses be paid, and making a number of specific legacies and devises, the testatrix gave the rest, residue, and remainder of all her property, of every description, including lapsed legacies, to the Young Men's Christian Association of Columbus, the Young Women's Christian Association of Columbus, Ohio, Berea College, and the American Missionary Association, to be divided equally among them.
Section 401 of the Estate Tax Law, ubi supra (Comp. St. Ann. Supp. 1919, § 6336 3/4 b), imposes 'a tax equal to the sum of the following percentages of the value of the net estate,' determined as provided in section 403, 'upon the transfer of the net estate of every decedent dying after the passage of this act.' Then follow the percentages graduated according to value.
Section 403 (Comp. St. Ann. Supp. 1919, § 6336 3/4 d) provides that for the purpose of the tax the value of the net estate shall be determined in the case of a resident of the United States by deducting (1) funeral and administration expenses, claims against the estate, losses from casualties not insured against and amounts which by law of the domicile are required for support of dependents of testator, but not including income taxes or estate, succession, legacy or inheritance taxes, but (2) including property received by decedent by will or descent within five years on which an estate tax was paid, and (3) deducting:
'The amount of all bequests, legacies, devises, or gifts, to or for use of the United States, any state, territory, any political subdivision thereof, or the District of Columbia, for exclusively public purposes, or to or for the use of any corporation organized * * * exclusively for religious, charitable, scientific, literary, or educational purposes, * * *' and (4) 'an exemption of $50,000.'
It is admitted that the corporations mentioned in the residuary clause of the will come within the description of subdivision (3).
The executor deducted from the gross estate the debts, losses, and charges and the specific devises and bequests to find the value of the residuary estate, which, together with the debts, losses, and charges, and $50,000, he then deducted from the gross estate, to get the value of the net estate by a proper percentage of which the tax was measured and fixed. After paying the tax, he brought an action in the common pleas court of Franklin county, Ohio, asking the direction of the court as to whether the tax should be deducted from the amounts which were about to be distributed to the specific legatees and devisees, or from the residuary estate given to the charitable and educational institutions named. All those taking under the will were made defendants. The common pleas court and the Court of Appeals of Franklin county and the state Supreme Court all held that the tax must be paid out of the residuary estate, and a judgment was entered accordingly. We have brought the case here by certiorari because of the federal question, seasonably made in all the courts by the residuary legatees, that in the payment of the...
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