Newark evening star and Newark advertiser., 1910-03-14
TAX LAW ASSA|LED
IN ERRORS COURT
coontimued from Fh,.t Pageo

rogate who shall first assume juris-
diction," and under the amendment
quoted possessed full authority to act.
Regarding this amendment the States
brief says:
"It is true that at the time the act
was passed the testatrix had died, but
it is also true that at the instant oil
her death the right accrued to impose
the tax contemplated by the statute.
The property in question at once De-
came liable to the tax, and the act OF
| 1908. though made operative after ner
death, was effective at the time when
the surrogate of Essex county made the
assessment upon this property. Inc
statute did nothing more than to deIlne
a method of procedure by which the
| States right to the tax In question
could be enforced and collected. IL
was therefore operative and effective
for that purpose at any time in deal
ing with property within the descrip-
tion of the general act of 1894
! In reply to the claim that the act
of 1906 under which the assessment was
made. is unconstitutional for the reason
that it sought to impose property tax
by method which is not uniform, the
States attorneys say:
| This claim can only be justified upon
| the assumption that the act itseif Gre
ates property tax, The state denies
! that the act has in contemplation any
such purpose: it insists that the tax
devolved is in the nature of an I'M
post: that it rests, not upon property in
the ordinary sense of the term, out
upon the right to dispose of it. and that
/
its contribution to the State that II
can or ought to become the property of
the Iegatee This whole question was
treated eaborately by Justice Garri-
son in Nelson V. Russell, who wrote
the decision in the Supreme Court. The
rea soning and authorities In support
of his conclusion seem unanswerable. 1t
is pointed out that by the consensus
of judicial opinion the tax now being
considered was an impost. not upon
property, but a premium or privilege
upon the devoIution of property. In
other words, ii was a succession tax,
and that it rested fundamentally upon
the sovereign right of the state TO
withhold and hence limit the right OF
testamentary disposition or of intestate
succession"
Continuing, the brief says: The
matter stands thus: The testatrix. in
this instance. died in Cairo, Egypt. |
She was, in fact, resident OF the state
of Rhode Island and left Will which
was probated. however, in New York.
If the situs of the stock in question
had. in fact been in the state OF New
York, its devolution would have been
tf,l
right to transmit by .testamentary act
was the creatur of the statute, the
law-making power of New York might |
have imposed succession tax. What |
happened. however, was this: The will |
was probated in New York, the testa- |
mentary act was perfected by the
grace of the sovereignty of New York |
but the property, in fact, being stock
issued by New Jersey corporation, |
had its situs in the State of New Jer-
sey.
For the purpose of the tax here i'm
posed. shares of stock in a corporation
organized under the laws of this state
are property within the state, and
this. too, without regard to the place
of residence of the stockholder or the
place of deposit of the certificates of
stock or the location of the property
owned by the corporation. Such STOCK
is the proprietary right the stockholder
has in the anomalous species OF IN
corporal property that comes into eX-
istence under the laws of the state IN
which the corporation is organized, and
is itself property within the State In
the sense that it has its abiding situs
there for all matters appertaining to
sovereignty among which is the levy
ing of the impost upon the deVolutlon
of such property right at the death Of
its owner
eft is clear. therefore, that before the
beneficiary named in her Will could re-
duce this stock to possession ana en-
ioyment two things must have con-
CURED, namely, the sovereign power OF
another State, to wit, the state OF New
Jersey, must have, in some adequate
way, recognized the testamentary act
consummated in the state OF New
York. and, second, the state OF New
Jersey must needs have, by some vol
untary act surrendered its control ana
dominion over the stock to the person
made the beneficiary by her Will In
other words. if we assume that the sue
cession was complete in the State of
New York, it must follow that the act
of enjoyment which followed the formal
succession must, of necessity. nave
arisen from the consent given by the
sovereignty of New Jersey. If this con-
sent be necessary, then it must also
folio that the State of New Jersey,
in giving it's consent to the operation
of the testamentary act in New York
and to the actual possession of the
beneficiary, might impose terms and
conditions under which such consent
became operative
( Again. the brief states 1T Will be
conceded that our Legislature could
/ provide that in case of intestacy all
| property which has it's situs within this
state, personal as well as real, should
I be distributed as our interstate laws
and law of descent prescribe
"The Legislature could also provide
! that property within our State, per-
/ sonal as well as real, could not pass
/ by will, unless the will was executed In
| conformity with our laws.
! "Our Legislature has secured the
/ same right to the State by providing
that before the property of non-resi-
dent decedent. which has its situs In
! this State, can actually pass to the rer-
son designated by the law of a foreign
state as the successor of the decedent,
! IAl-z 1,o1 na ph a