The sun. [volume] (New York [N.Y.]) 1833-1916, 1897-07-03
GOULD INHERITANCE TAX.
IssEssMEST OF THE ESTATE AT
S75,6I5,fS3.OS UPHELD.

Ceurt's view or George ,. Gouid's services-Tho
State and the city Objected to the Exemption
or llis IS. 900. OCOI the Executors TO tho
Valuation OF the securttiesi Both OVerruied
The Appellate Division OF tho Supreme
Court, In an opinion written by Justice VIII
hams, with Justice Ingraham writing a dis
sonting opinion, has affirmed tho report OF APP
praiscr David Mcclure valuing the estate OF the
late Jay Gould for the purposes OF the inherit
tnnco tax at S73.6l5,453.os. The executors OF
Gould and the state and City Comptrollcrs all
appealed from the decision OF Mr.. Mcclure.
The main positions tnkon by tho Comptrol-
lors were that the appraiser had improperly OK
emptcd 80, 900, 600 TO DO paid George J. Gould
for services, at the ratio Of half q million dollars
q year. to his father. the Comptrouers claim
ing that this charge was not u debt of the es'
tate, and they further urged that MIR. Mcclure
should not have exempted from the tax $780,
600 which was set apart as the expenses OF the
administration OF the trust at the rateof Slo,ooo
. year for each OF the four executors during the
probable continuance OF their lives as shown
by the lifo.tablcs. The'exocutors opposed the
report because they contended that the APP
praiscr had improperly valued the securities
at the Stock Exchange quotations at the time
Of the death of Gould instead of taking expert
evidence as to what the securities would sell
for II turned into the market in the blocks In
which they were held by Gould.
The point OF the Comptrollers, that the APP
praiscr should not have admitted evidence OF
George j.. Gould about conversations with his
father as to his employment. is ovcrruled.
George J. Gould was born. the opinion proceeds,
conversations occurred at Saratoga. The father
then said he wanted the son to devote himself to
the fathers business, and not speculate The
"He followed his fathers directions during
his minority. became familiar with the business,
and did whatever tho father directed. He came
of age in 1855. and from that time on the work,
business and interests was thrown more or less
upon the son. as the fathers health dechned
from year TO- year; Inc son h Ss pr, Pbra yrbas. + me me
ness, and conducted 1t without the advice OF
the father. He alone had access TO the safe dc.
posit vaults which contained the millions OF
dollars OF property owned by the father. He
acted under u power OF attorney from tho father
Could himself. Stood for him. and counsel We're
referred by the father to the son for instruc.
disposition OF hundreds OF millions OF dollars OF
cash OF the father. having as much as S3o.oOo.-
900 at times subject to his sole check. and the
O00.O0o to Si,OOO,0oo annually: The estate
manaSement. and the trust and confidence i'm.
posed by the father in the son had been amply
Justified BY the results obtained.
The estate was peculiar in its nature, and the
large extent to which it was invested in differ:
emit ways and different properties required
secure favorable results. The capacity and
business ability which safely and successfully
which tho father implicitly reposed in such
management, were deserving Of a large re-
The son received S2s+.657 IN securities from
the father arter coming OF age and received
salaries ls as otheer OF diiieF Sn 30, f9FP2 stSs9 Nc 10
lived with his father and got at times allow
Snses ,f for ,, sfpsnSSs sd t AT , .ae S S&sa'G sbe . son r
check for 1917. 600 to pay for a house and stable.
1t is found that the half million salary was
paid was not liked until 1892. when the father
put the agreement in writing.
stocks were the correct figures TO take for ap-
pratsal and not the supposed values Of the Sc
curities in blocks.
S"Under the construction contended for the
opinion says. The securities. involved in this
proceeding might have been shown 10 be Of lit
lie or no value BY considering that forcing them
uEon the market in large blocks at. one time
would break the market and make them prac-
tically unsuitable at all.
In dissenting. Justice Ingraham says that the
$4,000, ooo TO George J. Gould, while given by
Jess a voluntary gift rather than the payment of
an Obligation. and so should be taxed, He says:
that given to his other children as a recogni-
tion OF the devotion that the son had shown to
milton and payment Of an existing legal obi
CATION"
ties were improperly valued. He says the evi-
dencc shows that many OF the securities had
Hike the quotations The Justice Gays that the
report should go. back to the appraiser with
o direction that where the sales upon the STOCK
Exchange are proved to be bOna-t!de sales OF
securities which indicated at the time the fair
mArket.value OF such securities they are 20 con-
troll him in fixing their value. But in the case
Of those securities where IL is proved that there
were no actual transactions, or that the re-
ported transactions We're OF such a character
that they furnished no fair Indication OF the
market price, other evidence OF The value
should be considered, and the securities or in
debtedness appraised at the fair market value
the value which. considering all the ciTcum-
stances, Tho property would have sold for at the
time Of the death OF the testator."