Richmond planet. [volume] (Richmond, Va.) 1883-1938, 1898-10-08
DECIDED AGAINST GOULD
The Millionaire Mast Pay Tax on
, ::.... a So, 100000 Bequest.
HOW THE PAYMENT WAS EvADED
This PrInceIy sum Was Left by JAY
Gould to HIS Son For Services Rem
dered'' For Twelve Years Succeed
: Ing the Latrer's sixteenth Birthday.

dered' For Twelve Years Succeed
/: ing the Latrer's sixteenth Birthday.
Albany. N. Y. Oct 5.-George ].
Gould, by a decision of the court of
appeals. will be compelled to pay 10 the
state $132, 7S4 as tax on $4,000. 600 be-
uuest left him by his father, the late
DAY Gould. The decision also declares
that the estate OF Jay Gould was not
appraised 10000 600 in excess of its
actual value. as was contended by the
executors of the dead railroad king.
The case has been at issue for the
last four years. and in its disposition
a precedent is established which in the
future will have great weight In the
determination of cases arising under
the administration OF the taxable trans
FER act
When Jay Gould died and his viii
was offered for probate the surrogate
OF New York county appointed David
Mcclure. OF New York, as appraiser
for the purpose of collecting a tax I'M
der the collateral Inheritance statute
of the state. He fixed the taxable
value of the estate at 1865, 437, and
decided that $4,000. 900 left to George ].
Gould did not come within the opera
lion of the act, it being alleged that
the sum in question was left by the
father to the son in payment for a
debt for services rendered during a
period Of - years.
Two appeals were taken from that
decision. The executors appealed from
the appraised valuation of the taxable
property, claiming that there was an
generalization of $40, 900, 00O and the
comptroller of the state appealed from
the exemption of the $1,000, 900 from
Taxation, contending that a debt, if
Dne really existed, paid in that manner
did not exempt the amount paid from
the operations of the taxable transfer
act. The surrogate sustained the APP
praiser in both of his conclusions. The
case was appealed to the appellate di-
vision OF the supreme court, and that
fribunal rendered a decision affirming
that OF the surrogate. The case was
carried on appeal to the court of APP
peals and argued before that court
at Saratoga in June last by John f.
Dillon for the Goulds and David 3.
hill on behalf of the comptroller.
in relation to the alleged overvalua-
tion of the estate it was contended that
the appraisers had employed an err
1oneous method in determining the
market value of shares of stock owned
10y the estate. He had appraised them
;at their markft value at the time of
the appraisal. which the Gould ex-
Ccutors declared would have depreciat-
ed to a great extent if an attempt had
been made to sell them in the open
market at that time. The state ap-
pealed from the exemption of the $5,-
100000 from taxation on several
grounds. The first was that the al
legged obligation of the father to the son
WAS preposterous. 1t represented an an
nual salary Of nearly $780, 000, dating
from the time George Gould was 16
years of age, which was larger by many
figures than that received by the high
est salaried man in the United States
1t was also contended that it was a
Eubterfuge to defeat the operations OF
the taxable transfer act, and that If
permitted to stand as legal would be a
precedent that many others might fol-
low in order to escape paying the tax
Imposed. The legal proposition ad-
wanced by the state was that the pay
anent Of a debt by bequest succeeding
death does not exempt the property
ygiven as compensation from taxation
nnder the taxable transfer act.
The stats vine Or both PROPOSITIONS