#### Tafel, Executor, *v.*Lewis, Auditor, et al.

*Taxation of bonds*— In *possession of resident executor*— Under *will executed and probated in foreign country*— Taxation—Wills.

Bonds coming in this state into the possession of a resident executor who derives his authority under the will by appointment of the probate court of the county of his residence, are taxable in this state, notwithstanding that the will was executed and probated in a foreign country and the testator was at the time of his decease a non-resident of this state, and all beneficiaries are likewise non-residents.

(No. 9155

Decided October 30, 1906.)

*183Error to the Superior Court of Cincinnati.

The plaintiff in error, as executor of one Reuter, deceased, commenced action in the superior court of Cincinnati against Lewis, auditor of Hamilton county, and Roth, treasurer, seeking to perpetually enjoin those officers from enforcing taxation of certain bonds held by him as such executor. It was averred that the .plaintiff was appointed and qualified as executor of the last will and testament of said Reuter by the probate court of Hamilton county, the said will being executed and probated in Cassel, Germany, and duly admitted to record by the said probate court of Hamilton county; that Reuter at the time of the probate was and for many years had been a resident of Cassel, Germany; that all the beneficiaries under, the will are non-residents; that at the time of his death Reuter was the owner of certain bonds deposited in a deposit company in the city of Cincinnati which came into the possession of the plaintiff in the course of the administration of the affairs of his trust. The ward assessor, against the protest of plaintiff, returned the bonds to the value of $6,210 for taxation, and the defendants threaten and are about to place the said assessment upon the county tax duplicate and collect the tax upon the same.

A demurrer to the petition was sustained by the superior court at special term and judgment for defendants rendered, which judgment ' was affirmed by that court at general term. To reverse those judgments the executor brings this error proceeding in this court.

*184*Mr. Gustav Tafel,*for plaintiff in error.

Our contention is that the law of Ohio does not authorize the defendants to levy a tax upon the bonds in question for the following reasons:

1. It is the settled law of Ohio not to tax the personal property of non-residents.

2. Property exempt from taxation during the lifetime of the owner,.for the reason of his being a non-resident of the state, does not change its character in passing from him to heirs or legatees who are also non-residents.

3. An executor is in every sense the representative of his testator.

This court is called upon to construe the meaning and effect of the statutes bearing upon the question whether the personal property of a nonresident decedent is taxable at the residence of his executor when the heirs and legatees also are nonresidents.

In Section 2731, Revised Statutes, at the very outset, the broad principle is laid down that none but residents of the state shall be called upon to contribute to the expense of ministering to the wants of its citizens. • Besides, it has always been the policy of Ohio to encourage outside capital to come into the state for investment.

The bonds in question did not “belong” to the executor. Webster defines the word “belong” to mean “to be the property of.”

In Section 2734, Revised Statutes, it is emphasized that every person shall list the personal property of which he is the *owner,*and moneys invested, loaned or otherwise controlled by him as agent or attorney, shall be listed.

*185The plaintiff did not invest or loan the bonds in question. The investment was made by the testator, who resided in Germany. The plaintiff, as the executor of his decedent, does not “control” the bonds. Webster defines the word “control” to mean “to have the governing influence over a thing.”

The governing influence, in this instance, is reposed in the court, whose appointee the plaintiff is, in connection with the provisions of the will.

No mention is made here or anywhere else of the status of the estates of non-resident decedents. These are neither expressly included in nor excluded from the rule laid down. In a general way only are executors and administrators directed to list the property of deceased persons. *Brown*v. *Noble,*42 Ohio St., 405; *Sommers*v. *Boyd, Treas.,*48 Ohio St., 648; *Todd*v. *Hughes,*3 O. L. J., 206; *Hawk et al., Exrs.,*v. *Bonn, Auditor,*6 C. C. R., 452; *Sims, Treas.,*v. *Best et al.,*1 C. C. R. (N. S.), 41.

There is no lack of decisions in other states affirming the question that the residence of the testator is the one that determines the liability of his estate to taxation, and not the domicile of his executor or administrator, although the additional fact of the beneficiaries also being non-residents does not affirmatively appear in any reported case.

Care has been taken to examine the tax laws of the respective states,- and they have been found to practically cover the same ground as the laws of our own state.

From amongst the many we cite the following: *City of Staunton*v. *Stout’s Exrs.,*10 S. E., *1865; *McGregor’s Executor*v. *Vaupel,*24 Ia., 436; *San Francisco*v. *Lux et al., Exrs.,*64 Cal., 481; *Millsaps*v. *City of Jackson,*30 So., 756; *McDougal et al.*v. *City of Brazil,*83 Ind., 211; *Stephens, Admr.,*v. *Booneville,*34 Mo., 323.

The law in Ohio does not tax the personal property of non-residents. It taxes all the personal property of a resident of the state wherever situate. It is logical, therefore, to conclude that there never was any intention on the part of the Legislature to tax personal property belonging to nonresidents which is *in transitu*as it were — in the process of transition from a non-resident decedent to his non-resident heirs, and which property is only temporarily and for a restricted purpose, in the custody of a resident representative.

Legislatures are presumed to enact laws applicable to circumstances that obtain in every-day life.-’ Ordinarily a decedent’s place of residence is the same as that of his executor or administrator, and also as that of his heirs or legatees; and it is this presumption that underlies the enactment of these laws. The impossibility is recognized of providing by statute for all possible exceptions to common usage: of providing for conditions arising from unforeseen circumstances. Section 2735, Revised Statutes.

An executor is not required to list non-taxable bonds, be they government bonds or any other kind of bonds exempt from taxation held by the decedent owner.

Property rights, both real and personal, pass from the decedent to his heirs *instantly at his death,*though they may be in several different *187states at the time. The property itself remains unmoved. The rights continue in the widely separated heirs in their respective jurisdiction. *Street Railroad Co.*v. *Morrow,*87 Tenn., 438.

So far as property is concerned, and for the purpose of collecting and paying debts, and doing justice by others, the acts and doings of a deceased person while in life still continue to affect the living. In a certain legal sense, therefore, and for certain purposes, *he still lives,*and will continue to live until those purposes are fully accom'plished. As he is incapable of acting for himself, the executor represents him. *Cornwall, Exr.,*v. *Todd,*38 Conn., 446.

In the case at bar it is sought to tax the property, not only of the non-resident decedent, but also of the non-resident beneficiaries, merely because the person through whom the title passes happens to be domiciled here. There is no law for such contention and certainly no equity.

The manner of dealing with the estates of nonresident decedents, therefore, seems to have been left open by the Legislature advisedly, to be acted on by the courts according to the circumstances of each particular case.

This view of the law is strengthened if we consider the provisions contained in the law levying .an inheritance tax, which expressly makes it applicable to the interests of non-residents in estates situated within the state. Section 2731-1, Revised Statutes.

There are no decisions by our courts directly in point. No case presenting facts like the one at bar has ever been adjudicated in this state.

*188Whenever the question arose in this state, whether property belonging to an estate should be subject to taxation at the residence of the administrator or executor, it appears that the decedent, as well as the beneficiaries were residents of the state, and the contention arose only between, the officers of different counties where such administrators or executors happened to reside. *State ex rel.*v. *Mathews, Auditor,*10 Ohio St., 431.

*Messrs. Ireton, Collins, Schoenle & Poor,*for defendants in error.

The question of law presented is:

*Are bonds which have their actual situs in this state and in possession of an executor appointed by the Probate Court of Hamilton County, exempt from taxation, because the beneficiaries are nonresidents and the deceased died a resident of a foreign countryf*

The actual *situs*of these bonds has always been the city of Cincinnati, which is also the residence of the executor, and the same county where the executor was appointed. Cooley on Taxation (3d Ed.), 664; Constitution of Ohio, Section 2, Article XII.

In pursuance of this mandate, the Legislature has taxed these bonds in the possession of the executor at his place of residence. Sections 2730, 2734, 2735 and 2836, Revised Statutes.

The statutes of Ohio therefore demand of the executor to list “all the personal property” “of every estate of a deceased person” “in his possession or under his control” at his own place of *189residence. It then follows that the bonds of the non-resident deceased, actually held by the plaintiff as executor in Hamilton county, are returnable there for taxation.

That the beneficiaries are non-residents can have no bearing ' whatsoever on this question. That fact may often be the case, but the property is in possession and control of the executor by operation of law, and no right or title to this property accrues to the beneficiaries until the executor has completed his duties and the time for distribution has come.

The question presented in this case has, we claim, been adjudicated in this state. *Grant*v. *Jones,*39 Ohio St., 507; S. & C., page 1439.

The case of *Sommers*v. *Boyd, Treas.,*48 Ohio St., 648, in reviewing these sections of the statutes comes to the same conclusion.

To the same effect are: *Brown*v. *Noble,*42 Ohio St., 405; *Hawk et al., Exrs.,*v. *Bonn, Auditor,*6 C. C. R., 452; *In re Estate of John Robb,*5 N. P., 52.

The Circuit Court of Appeals of this circuit had occasion to review these same statutes, when holding taxable in Ohio, bonds of a foreign corporation deposited at Columbus with the Superintendent of Insurance. *Western Assurance Co.*v. *Holliday et al.,*61 C. C. A., 271; *Hubbard, Treas.,*v. *Brush,*61 Ohio St., 252.

And it was so held in the recent case of *Heintz et al., Receivers,*v. *Cameron et al.,*70 Ohio St., 491, and reported by the circuit court in 25 C. C. R., 149, that the bonds of foreign corporations deposited as a security with the state treasurer are taxable in Ohio.

*190If bonds of a non-resident, held by the state officers as a mere deposit without title, are taxable in Ohio, then assuredly are bonds taxable in the possession of an executor appointed by a probate court of this state, in whom there is both possession and title.

Plaintiff claims that as these bonds were not taxable when Conrad Reuter lived, they should not be taxed when he died. It appears that no taxes were paid on these bonds when Reuter lived, but these bonds were taxable then, for the allegations of the petition show that these bonds were in the hands of his agent, to-wit: “deposited in a deposit company in the city of Cincinnati, Hamilton county, Ohio.”

Under the provisions of Sections 2730, 2734, 2735 and 2736, Revised Statutes, and the foregoing authorities, these bonds were taxable in the hands of his agent, the deposit company of Cincinnati, when Reuter lived. *Baldwin*v. *Shine,*84 Ky., 502.

The laws of Kentucky do not, as in Ohio, specifically provide for the taxation of personal property in the hands of an executor or administrator. Therefore, if the statutes of this state, requiring the taxation of all personal property xin the possession of guardians, trustees, executors or administrators, were not on the statute books, nevertheless this property would be taxable in their hands, the samé as in the hands of an absolute owner.

Some of the states that have statutes on this subject, like our own, have held personal property in possession of an executor or administrator taxable to them at their residence.

*191In New Jersey, the law provides (Nix. Dig., 951) that “every person shall be assessed in the township or ward where he resides for all personal estate in his possession, or under his control, as trustee, guardian, executor or administrator.” *State, Ely, Prosecutor,*v. *Collector of Holmdel Township,*39 N. J. L., 79. See Sections 803 and 805, McClain’s Annotated Statutes of Iowa (1882).

The Supreme Court of Iowa in *Cameron*v. *City of Burlington,*56 Ia., 320, decided that promissory notes held by an executor are taxable to him at his residence, and not at the residence of the deceased.

And it was held in *Dorris, Exr.,*v. *Miller,*105 Ia., 564, that where the testator died a resident of Pennsylvania, the personal property in possession of the executor appointed by the I.owa court was taxable at the residence of the executor. Statutes of Oregon, Section 19, 895; *Johnson et al., Exrs.,*v. *Oregon City, 2*Ore., 327; *Kent*v. *Exeter,*68 N. H., 469; *Wood*v. *Torrey,*97 Mass., 321.

Plaintiff claims that' these bonds are non-taxable, because at Reuter’s death the title vested in the beneficiaries and not in him as executor of Conrad Reuter’s will. Where plaintiff finds such a principle, we are unable to discover. It was the common law and now the law everywhere, except perhaps where modified by statute, that the personal property of a decedent vests immediately in the executor or administrator and the real estate in the heirs. *Sommers*v. *Boyd,*48 Ohio St., 648.

*192To the same effect are: *Orlopp*v. *Schueller. Admr.,*72 Ohio St., 41; *Tobias*v. *Richardson et al.,*26 O. C. C., 81.

The will of the non-resident decedent was admitted to probate and the executor appointed by virtue of our laws. Since the year 1896 this property has been administered and protected by our laws, and will be distributed accordingly. Whoever wishes the protection of his property held within the jurisdiction of this state, should pay the state in taxes. Sections 5944, 5938, 5940,. 5941 and 6044, Revised Statutes.

Spear, J.

The record presents the question whether or not bonds coming in this state into the possession of a resident executor who derives his authority under the will by appointment of the probate court of the county of his residence, are taxable in this state, notwithstanding that the will was executed and also probated in a foreign country, and the testator was at the time of his decease a non-resident of this state, and all beneficiaries are likewise non-residents.

It is not necessary to follow the able arguments of the learned counsel by a discussion of the principles upon which the power of taxation rests under our system of government, nor attempt to notice the many limitations which have been declared to exist upon the legislative exercise of that power. It will suffice to direct inquiry respecting the proper answer to the specific question above stated, and, as it seems to us, the tenor of that answer can not admit of serious doubt.

The mandate of section 2, article XII, of our constitution is the warrant for taxation of prop*193erty in this state. That is: “Laws shall be passed taxing, by a uniform rule, all moneys, credits, investments in bonds, stocks, joint stock companies, or otherwise; and also all real and personal property, according to its true value in money.” Conformably with the requirement the general assembly, by sections 2730 to 2736, inclusive, of the Revised Statutes, has made provision that property, including bonds, “held by persons residing in this state whether for themselves or others,” shall be subject to taxation; that every person of full age and sound mind shall list the personal property of which he is owner, and moneys invested, loaned or otherwise controlled by him on account of any person or persons; that the property of every estate of a deceased person shall be listed by the executor or administrator; that property so held shall be listed in the same township, city or village in which such person is required to list his own property; that every person required to list property shall, annually, make out and deliver to the assessor a statement of all personal property, including bonds in his possession or under his control, on the day preceding the second Monday of April of that year, either as owner or holder thereof, or as-executor or administrator. Thus property to be taxed, the person who is to list it, the place where it is to be listed, and the time when to be listed, are all distinctly and definitely provided for. It results from this that it is the duty of the holder to list where he is (1) the owner, (2) where he holds for others, .and (3) where he holds as executor.

Taking these several provisions together can there be any doubt that the legislative intent is to include bonds held by an executor? We think *194not. Not only are they held, speaking in general terms, “for others,” that is, in. the interest of others, but they are under the dominion, the control, of the executor, subject only to the orders of the probate court. The general rule is, that where such property is held here in the possession and under the control of the one so having the possession, it is taxable here, although where held here subject to the control of a non-resident owner it may not be. It is conceded that in general the *situs*of a debt is at the residence of the creditor, although this rule is subject to exceptions *(Hub*bard, Treasurer, v. Brush, 61 Ohio St., 252). But in the present case the legal title is in the executor; and in this sense he is the owner. And, if this view be correct, then the estate was annexed to his person and thereby had an actual *situs*in this state. It may be that these provisions were not necessary to fix the liability to so list on the executor, because of the specific provision applying in terms to executors, but they serve to show the scope and intent of the statute, and leave its real meaning relieved of rational doubt.

It is insisted that these, bonds are liable to taxation in Germany, and that to tax them here would result in double taxation. The proposition is not tenable. The power of taxation conferred by our constitution can not be made to depend upon the operation of laws of a foreign jurisdiction.

It is further urged that these bonds should not be taxed in Ohio because the property right in them passed to the testator’s heirs instantly at his death, and that, as they reside outside the state, their property is not subject to our tax *195laws. No fact in support of the assumption that the property in the bonds passed at once to any beneficiary or beneficiaries under the will appears by the petition. It is not shown or claimed that these specific bonds were bequeathed to anybody. Hence the title vested in the executor and the question attempted to be made by this proposition is not fairly in the case.

We have not overlooked the cases of *Grant v. Jones,*39 Ohio St., 506, or *McNeill, Assignee,*v. *Hagerty, Auditor,*51 Ohio St., 255. Neither case-controls, or materially affects, the case" at bar.

As conclusion, we are of opinion that, notwithstanding the fact that the will was executed in a foreign country, and that at his decease the testator' was a resident of that country, and that the beneficiaries under the will are all non-residents of the state, the bonds were properly taxable in Hamilton county, and it was the duty of the executor to return them for taxation because the statute, in plain terms, so directs.

*Judgment affirmed.*

Shauck, C. J., Price, Crew, Summers and Davis, JJ., concur.