Montour American. (Danville, Pa.) 1866-1920, 1910-10-20
COLLATERAL
INHERITANCE TAX


Ellen Coleman Bennett, administra.
trix c. t. a. Of John X. Bennett. de-
ceased, to show cause who collateral
/ Inheritance tax should not be paid.
The case was argued last summer and
attracted good deal of attention \
| synopsis of the opinion follows:
The testator, John Il. Bennett, died
| in the city of Mentor, State of Ohio,
June 2lst, 1908. At the time of his
( death he left "A will written by him
self. in the city of Paris, France. Hi
will was admitted to probate in the
Registers Office of Montour County,
June 2Sth, 1905. The will gives his
entire estate TO his wife, Ellen Cole
man Bennett, with the exception o
S25, 900, which is given TO his sister,
Sarah Craig Bennett.
Soon after the probate of his will,
his brothers and sisters threatened to
institute proceedings to contest the
probate of the Will upon the ground
that John r. Bennett at the time of
his death was "a resident Of the State
of New York and not resident of tn
State of Pennsylvania, and that under
the law of the State of New York, his
will was void as to them, and that they
were entitled to his estate in prefer
ence to the respondent, the widow. On
Jany. 18th, 1906, this threatened litiga-
tion was compromised and ended by
the widow, Ellen Coleman Bennett,
the respondent, paying to the testator's
brothers and sisters the sum of Sl30,
600. and they executed and delivered
to her "a release.
Under the above state of facts two
questions arise: % Is the Common
wealth entitled to collateral inherit
ance tax upon the $3.50, 600 paid by the
widow to the collateral heirs in COM
promise of their threatened litigation: /:
(2) Is the Commonwealth entitled to
such tax on the legacy of ,S25, 600 be-
queathed by the viii to Sarah Craig
Bennett, but never paid to or receiv-
ed by her?
In our opinion the first of these
questions should be answered in the
negative.
In order to settle the threatened
litigation and avoid further dispute
and establish the will, the respondent
compromised with the brothers aud sis
tiers, the proposed contestants, and paid
to them Sl3O, 900 in compromise and
settlement Clearly she had the right
to do so. There is not even a breath
of suspicion that there was collusion.
Peppers Estate 159 Pa. sos; Ken's
Estate I59 Pa. 5l2; and Hawley's
Estate PA Pa. 525, are authority for
the proposition that collateral inner
itance tax cannot be imposed upon
money paid in good faith in compro-
mise of threatened litigation.
The second question raised in this
case involves the payment of collater-
al inheritance tax on the legacy OF
$50, 600. bequeathed to Sarah Craig
Bennett, sister of the testator, and
in our opinion should be answered i'll
favor of the Commonwealth. 1t is true
that the legacy has not been paid to
or received by the legatee. The legatee
however, in consideration of her share
of the $780, 600. released and discharg-
ed Ellen Coleman Bennett from the
payment of the legacy. This she too
clearly had right to do. 1t was a
matter of her own concern. But in so
doing she could not defeat the right
of the Commonwealth to the collateral
Inheritance tax on said sum.
In Franks Estate 8 G. G. X. 662,
Judge Hanna decided, that a devisee
or legatee may waive all claim and
refuse the bounty of testator or her
right to share as distributee, but if
she be a collateral heir or stranger to
the blood of the testator, the tax re-
mains due and payable and accrues
Immediately upon the death of the
testator or intestate, and that its pay
ment cannot be evaded by conveyance
to one whose right of succession is not
subject to the tax.
AS Judge Hanna says the Common
wealth would easily and constantly be
deprived of her revenue provided for
by the Act of 1887, if payment of the
tax could thus be avoided
And now, October 18th, 1910, the
citation heretofore issued upon the
administrators C. t. a. of John Il.
Bennett, deceased, to show cause why
an inventory and an account should
not be filed and collateral Inherit
ance tax should not be paid on the
sum of $780, 900. with interest, is dis
charged; and the citation to show
cause why a collateral inheritance tax
should not be paid ON the $25, 900
legacy bequeathed to Sarah Craig Ben
nett is made absolute, and Ellen Cole
man Bennett, the administrators, is
ordered and directed to pay to the
Commonwealth of Pennsylvania,
through its proper officer. a collateral
inheritance tax of per cent. on $25,
900, together with interest thereon at
A.w,a IL