r -. I.. 186



### OFFICE OF THE ATTORNEY 

### QENERALOF TRICAR AUSTIN



### rboro faotr,kindly

r the polloior

balagpayJlamod b*B,tlrlarles

md a alng l plr rlr ofthe

o rtato are taxable undrs thr ,Sbdr

“W* Y i!u abigo quoetion Is anmom 

### .od yor, 18 lb the oonbntioa o? the Dopart- ~qontthat the atetute 10 retro-aotlrcr **and** .a~~1108 ts tha ~oliolor q? fnruranae taken one boioro tho pa8rago or tho **Aa%?***

### ,Ronorable **George** 

### R. **Bhoppar4,** pa@ **8**

&Mel* PllT of U8 Ilsvfredaivil 89etuto* w rpaoad04in 

### l#bO roadl,in part,a8 iollowa;

**“ All**  **proper&y** 

### rlthla tho &rl.sdiotion oi this Btato PO81 ox ~orro~tal,* e L lnoludiq 

### ,t b prow& or

1Ko lB8uPa ao*

toIkilo l xtM$ oi W~wount noolirbh bytk mom&or or ad&a1JtrrSooa



### aa **irmranoo uadm**  **polieiw taken**  out by *ho dqoodonC rpoa hi8 mm life and to chrli$'OiChO 

### l

UO8B OVW %+rty dOU8Md DOlbU'8 7% 000) of t&u houat reanlvablo b{ all other k&..~.i?iO8 ,a# inrwanoo WltiOr PO1 Ob8 takea out by * ioww*~ Y hirowll1lm,*** '~ Whirk $hrfi pa88 db80 

### UtcIlJ OP h 

### %PU8t by Wilt. 

### oi by th0 laW8.Of 4089Ont 

### or dirtrllbutlon Of bhi8 OP My ether #t8tO, or br dood, aant, 8aJq, ox glit a + + rh411, upon 

### pa88iagto OP for 

### tho tM* 

# Of l nyí* ar8onl

oopporatloa, 

### OTl

88OOiW tion, k Subjedt $0 8 $a% ltorth. bmnofit of **tha** **Pltrtr*r** Gonoral ROIOaw ?udkj in aooordanor with the folloufiy olaarlfiortion. l e + .* 

### Ia.awwor 64 your tlrrt qtiortloa 

### it 18 rpwront that 

### the k@irlature ban tazod i$8ur8noo whloh **does** 

### not bwoma a pati of tho 

### l 8tato of the daoedent bu$ whlob
t) 888oI **tm aawd**  **bOnOiiO%8riO#.** Buoh taf, how8vor, $8 on ho wouat of oh, in8uPanoe 3a moo88 oi $40 OOtLOO of the amowN **rroeivod** by all Eanafioiarlor on {ho polioiar kbn out by tkwdoordont upon hl8 own liio.

ah boliote tie Imn&r$a i8 oloar aad **wamblgww** 

### aad **~9** 

### are **of th@**  **opinion tlIat**  **proorodrr 91**  **brurmoo** poliolrr prsring to **named**knofislarlor u on tho death of l domdont 

### ara proppclr rabjootr oi l&or% ?an00 kutlon ad tho tax ha8 beea 80 lmporod by tha above quoted 

### l **rbiole.** 

### ThaLhrgrwno Wart 

### of Uiroqmria 

### in tho oa8a o$ **XX Rf**  **AS&D*** **WILL 184**  **%W9, 981,**  **rtrted a8**  fO11OW8l

* e e + I The nature mad quality o? rueh **bOMfief~1 fntOSO8t**  **ti tb8.**  **pO1iO108 &IS-**  8ho fimuodí r lK@ OOB8titllk l goed ground for ledlrletlro a&ion to nrbjsot the proooods zoallaod thoro&m to 

### iahorltanoo tbaxrtion upan tho ba8i8 that **they** '8hrll br, **dpemod**a paP$ of 

### hi8 88%&O

### Ronorablo **tiorg~** Be. Sheppard, **pa@8** b



### ?OX th0 QtLVQOIO1 

### Of th0 

### tPX and Sbii bb taxable **$0 tb8**  **PerrOll OP**  **pOr.Oll8** Ontitled thereto,’ It 18 notl

ssontial that qmh prooeodr eh4ll broom, 4 gprt of th0 dooomrod hu8b4ndv8 08t4tO **upon** 

### his pt;g ln ardor 

### to rubi cot tbra to lnheritanoo tar-

. lt is 8olf-oV **dont that**  **by** 

### aaans **of** thorn pOliOlO 

### tho hurbrnd tPan8tomd 8 14PgO p4Pt O? hi8 **08tate 00**  hi8 widow, nhioh **beoamo**l??00tlv0 **at** his death. Thi8 **>Ut8** tho **tran84Otion** within **tw** ?lOld 0r inhqrltanso taxation.*
,' & JrOUP8000!ld **qUO8tiOu r** **’ ou**  **in U&O**  4pplioab~llIty

o? tho aboro atstuto to po 

### 16198 p: **48** t0 **thO**

of in8tU’- anoo takm out prior to th0 peseapo of the **sbatuto** by th0 LoAgirlatup4in 1939, In **awwering** this qUestIon HI will as8unw 

### that the polioy 

### of innUP4nW you 

### lnqulro.obouO eontainod thm ordinary 

### olouso~@antIng to the inrtcrod tho d%; to 

### ohango bonotioiaPis8 ot any tiaa prior 

### to hlr
tlon, , Upon 8UOh 4n assumption wo will an4w4P your quo+

The qOxa8 Inh~ritanoo Tax l.8 8 tax bared tapontho right to **roooivo propotiy,**  **or,** In othor ~0~48, **ugon tho**  **Pl@h$ or**  **rucoo88ion.** The ~OdSS1OIl8 Of Appeal8 Of lb&l8 ln tho 0.80 of **STATE vm**  **HOGQ, ‘** **PS** S.W. **(2d)** 

### 696, **8tatod a8**  **f 0110~8**  **I**

"An 4X4minltiOn Of tho 4uthOpitfO8 OOnVinOO8 **U8** that tb **.b!lO.t** MiWi~fJal **Pul8 18,**  the8 inhO?- itan tar08 8uOh a8 **a?0 lorlsd**  **by PWT** **8tatUto8** go$d to b0 pr~vll4g0 taX48, ,and

### not property

fn other WOlFtt8,

the tar'i8 upon the right **Of 8Ug0fi88iOn**  **and DO8**  **UpOn** tho prOpOPty~ *+8 l * 

### Wo0.11 four attention to the Zaot that tho polioier o? inruranoo taken out In the 0440 of ltn Ro AllI8' will, 8uppa, WOPO tskon out prior to tho anendaont bonrtmod in the4 0480 tsring.in8UrMaO paid to 4 Mmfid bOWtlolary. 'Ihthat 0.00 tho oourt 

### held that tho tax applied
**to** 8!i4h

pollelor t&on **out prior**  **to** tho l **naot;nsnt of**  tho **rtetuto** booauarethr tax wa8 based upon tho penrIn6 to th0 kno?loiarpwhieh took plaoo at tho timr of dosbh of th@ insured 8ub8equOn* to the onaotmon8 of the **8t4tUtO in**  **qUO8-** 

### t10lh

**trh0 SUITS-**  **COUPE 0r**  **mm8800 in**  th0 0680 0r**RowPablo Oeorgo**  

### Fkshoppnrd, pago 

### 4

**STATE** v* WIN, 36 

### 3.W. (Ed) 88, paseed OA s similar qusstloa **and 8tatod**  **aI** r0iirmt

**mi8 4ppOOi**  **i8 ??a**  **S** dOOPt hOidiII& 8hO Qroo..d8, aboto #40,000, of OOPtrin 

### InBUPaaOe pOlIOiO8 on the Iif0 **0s** Miohaol J. OaSn dsooamod 186uOd **p?i0? to**  tho pasrago Of oh&Or AOk8 Of TOMO.800, 

### 198) to tho lnheritanoo tar ErtrS 

### So88ion, bh **sroby** morodr 

### dlod Mbruary 14, lOSO, loarln# by **hi8** will hi8 l biP@ l **8thO inOiUdin(l**  **~DIUFUIOO, t0**  hi8 **WsfO,** A8 hi8 dO6bh b0 h6a $90,000 **Of in8UPOnOO**  **in** 

### r0P00, all 

### 0s whloh **wa8 parable**  **to** hi8 wit0 un00n81010nall 

### tr0 r0r 

### $6 $80,000 and that tho in- %0X08$ **on** liio, the 

### botwson hi8 Ohhlldnll,

aaoh polloy **oontrlnod** l **olauso ’**  giving **Orin** tho rl#tt 

### 00 ohan@ tho bonotiolary whioh 

### right ho did 

### not 

### aarolre, th0 doprtmn$ 0s 

### r*nm **8nd taxabioa**  **held 81%** 

### Thor **prooood8** of **Mr.. Gain** **’ 8**  liio lnruranoo sbovo #40 000 liable 00 **the** ***ax** imposed **by** 

### said ohaptor h and **thi8 rulfna**  hating beon mutalnrd **by the**  **h:. board,**  **%hO qw8tion**  **m8 8ubmittod**  **to** tha ahanoellor 48 

### an l grood oaeo* 

### *Woera **oowtrafmcrd** 

### to OO~PTwith tho loerned ohanoollor. Tho 'fOMO88.0 fnhOrit.lrOO tax beIn& lovlod~ upon th8 

### to l oquIpo 

### and 

### not upon 

### tho right to 48 undo? tb fsdoral law (Hmmon vr 88d 8.1. 104f&)and tb 148 Tona, UB, in‘thi8~Oa8. belng 'all BaynbSo to **8h0** wlio or the WKO l d ohil- 

### &on of 

### tho IMUPOa, 

### but with the .mrO8. **POlOcI** 

### vatlon 0s 

### tho **right.** 

### to ohange th0 

### bmotioIr an& **thr wit0**  **OT** 

### ohirdrrn bsrln(l ne rorto4 in orT **b8t iA**  8uOh **fOPA% Of**  **POliOr UndOP**  **OUP** dOOl8iOW, thlr 

### right ta naqulro did not booomo l iio otiro until attor oh6ptor 80 A088 Prr 80s~~ 1919, 

### h6a 80nO lat0 Orr00t, ft iOuOW8 that 110 ~OtZO.OtiVO 

### l pplloation 18 

### glton **to** tho 8tatutO.*
**A** rePy Peoont QaSo **on** ohi8 **question** i8 th0 OS80

### of MaIssRxL

vr llxwml,

34aa,$ (Ed)

1sarr *hoootu?+

of **hpppr0lr: OS**  **xintu.LJ,** ?he oao\lrc~ fin thil **oaael** fully dirou6r.d all tho 

## l

uBhoritio+ and 

## l

)ate& aa iollowaa

r 9 e l l In the pnren$ odm, howover, ‘I, have no.dab% that’a p3’op.roonrtnxobion 6t our **Btatuto,** X4mtuaky **btatuter, recrtion**  

### 4S8C)la-l~6,~tr that tho Lm&irlatPn Intonllr& 10 to apply to ‘all poliOie@ Uh+hOf 'bOkOa OUs bOfO]M 01 OnOr f$R 

### l Sieotlv*

dot.* ml@ h r p of

*hamltio

u plain and tmmbiguoor Wb will no% imply an laPen$ on *hi pert ai the kgirlaturo *o rxoopf **froa** ftr **oporatlon** 0110%08 Mo*tofom Ukn **OUt b&t%** 

**Will QrO989** 

**1 (Is**  **69t8nnin4 d34thrr**  **61 lid**  **i*** **is unoonati~utionel**  **wbn 00**  **apglled~ It**  **ir trw**  **thed ’** **atatpkr, ‘** **an not**  **to b** * **iton a**  **r9ItOI** aotlro erreat, ema where 9ho teg rl.stuN f bar

sorwirto maa* 

### alloh a atitut*, anle8r ruoh 

### aa atantlon oltiarl **a~pearm** fmn:ph~9;4a~tu8%;- 

### l olt (Bunlap v# zitOoll, ZOO **880) but**  

### a ~$roeotire **eff691) “**  **ii I**  **obthnad o&**  whan 

### a rta&ute Is applied to r%! 

### a aequlr94 f **rfar to**  it8 **ennobient. I8**  

### npp l d to t&O 010 oies in question no 

### *sate4ryltr 

### are irpsM 4red or will M later pointed outr

* 9 ,+ c l

ìIn o onai4orlng the ooMtlwtiona~ity of tllo ICentuolq **Stetutb** In 

### its applioation **to** the poll0208 inrolre4 we nest,detozalne whether or no8 any **ve8tod** PI **88** wora obtained by t&e ~benoilafarler **Of tha**  **po ioler**  by ,Win# daol#natad **aI ‘** **boueiioi**

**pb ario**  **with the**  **right** 

### zbaened **In** tb **irhure(L $0**  **ohnmg thb**  b6aetiagnr**1 Wa**  find that the almoat oalreraal **ru30** 

### ia **8ha whbn**  **a rl(ihB**  **to** ahan@ tb) bonei 1010 7 hes been rtmrrveb to 

### tha inrured Js tha polloy ha kne$ioiOxy nansd has a se* 1)x**p99tuio~ and**  

### a0 **re8to& rQht**  **Or** interosti **dud&g the**  llfsbilpr

of tha ln~re4, thfa **rule king**  **maI+** Jeo) W the que3iiioalrlon, of oou?U that Bhr .’ 

### benofioiary may **aoquira** 

### a **voWI ri&**  **0f 0~**  

### by+ 0r~0pb0i03 **90ntrqot. 87**  **da** 14 R.&L. l3fMB Laadrarr vm IandmWr 

### Xy. 778, 818 9.1, a741 ULrgtri6n tr Xiller, 96 n$*ru?M 

### naenrd the right to ohan@ the b@ne?iolary, mold (870 IL8 ttt, 49 8.011 lm, 78 In Ed, 405 58 A*L.B* Jesjt 

### 'Rut until aha mo!xontof 

### dea&b tht 

### (Loowlanl

ratmine a lagal intereat 

### la tba polioie8 

### wbiab gme.bim 

### the power of 

### bi8pe81- *loa of them l

nd 

### that? rooeedm 

### a0 o@nplotal~ or IS b wora hlemelf the & noflol6r~ of them,' Tha 

### oourt in that 

### @am, in Irpeakfng 

### oi the 

### poworof sentrsl over auoh pollolea retain& b raid 

### the8 auoh power *ia by no moan@ I 

### an Snsured, ha leart 

### aubrt8ntlal

of 

### tha lo al Ond lb0 te?mloatloa a

### t fnoident ot ammrahlp, hi8 

### death80 a0 Bo tree tha bmmilolarl6r of the polioy from the 

### poem& blllbyof its oxeroler would aeomto b no le8r
a 

### tranrfsr

within the riaah of the 

### Caxinng pawor 

### *ban a tramfer offeoteclin oth8r way8 through 

### drath,* sinoe the bensSlaiery kr the poll0148 

### in quratlon him aoquira no teatied 

### right but 

### only a 

### aero 9xp9otansr br being dealgnatad a# beoetiolary wa fell 

### to mea wherein the otatute in qurrtlon whn appllcsd to the 

### pOliOi in oontrorerrrj, inpair the Obll&8tlOn of a OOntra9t or reOult8 in 

### a violation of the duo 

### p?ooraa olauso of tha 14th amonduumt 

### to tha Federal Oonstltutfon o? any **prorlalon** bi ou? atate oonatltutlon.*
Xxtb&li.th@ **Tennaisoe** and Xentuoky oa8eB **the** oourt held that the ***$.nherltanoe** tax war 8 tax upon tho ?l&ht of auooeaalon and that a tar imposed upon 

### the prooeedr 

### or inrurrnor 

### polfoie# br 

### a **8batuta** 

### whioh wa8 **pQ88ed** 

### prior ta the doahh of the lnsu?ad 

## l ubjeoted the 

### prooeeda of insanoe 

### polloiea takaa 

### out to the 8ax impoee6 then srior to thq pssarge of the tax mot II* We a011 pour attention, however, to th trot that in 

### bo$h of those 

### oa8eathe lnrured had 

### a ridht uuber the terma of the 

### lnruranoe oontaot to ohenga bb **no&d** beneflolar 

### 2hla beihg lo 

### the oourta x at any timr **pPfO?** to hi8 death, ha 

### d that the right0 in the pro-.- -.

. . -.,, 

## 192 j

&onoreblo 

### (Horgo X1 

### Shappord,

Page 7

**oeeda** ai& 

### no4 **aoortm TV**  **the b8n8flOiadO8**  uutil the hatb of the luawed a& therefore 

### tha **proper$v** pesaad **al oi**  **8Ueb tins,**  wbloh **woo** auba~quent to thi tirm of tb pesaage ai the tar sot,

We are of the opLaion that **under** the authnrf4106 the **probeebr** oi lnsu?anae polloloa payable to named baneilalarlsr are’aubjrot to 

### the Tex.aa Inherlbanoo 

### Tax doeplU **tbo** ho4 $ba$ 4ba pollolea of lmu?eaoe wera taken 

### ou4prior40 the ammdaont of lVS@ taxing ln8uraaoe proowla, wbon thr 

### pol~oieain queablon~?eaerted to $h& lnawed the **r3@** 

### to’ ohange the nanad bextMlela~ in tho polloy at any ttma prior to hi0 beathi 

### Tour0 very truly

Bt?cab 

# A!mOltxaT al?mAL Of TxA8 By‘ t+i$wi

A08104an4
,