Case Name: In re Estate of J. M. Strahan. Frank E. Strahan et al.; Mary W. Strahan, appellant, v. Wayne County, appellee
Court: Nebraska Supreme Court
Jurisdiction: Nebraska
Decision Date: 1913-06-16
Citations: 93 Neb. 828
Docket Number: No. 17,912
Parties: In re Estate of J. M. Strahan. Frank E. Strahan et al.; Mary W. Strahan, appellant, v. Wayne County, appellee.
Judges: Rose, J., dissenting.
Reporter: Nebraska Reports
Volume: 93
Pages: 828–840

Head Matter:
In re Estate of J. M. Strahan. Frank E. Strahan et al.; Mary W. Strahan, appellant, v. Wayne County, appellee.
Filed June 16, 1913.
No. 17,912.
1. Taxation: Inheritance Tax: Limitations. Where a petition is filed in a proceeding in the county court to recover the inheritance tax due from the heirs of a deceased person, and notice thereof is given to the persons interested within five years from the death of the decedent, a plea of the statute of limitations as a defense is of no avail.
2. -: -: Interest oe Surviving Spouse. Chapter 23, Comp. St. 1911, abolishing the estates of dower and curtesy, gives to the surviving spouse of a deceased person an enlarged estate of the same kind and nature as that of dower or curtesy, and such estate, like dower, is not subject to an inheritance tax. In re Estate of Sanford, 91' Neb. 752.
Appeal from the district court for Wayne county: Anson A. Welch, Judge.
Reversed and dismissed as to Mary IF. Strahan.
Kingsbury & Hendrickson, for appellant.
A. R. Davis and F. S. Berry, contra.
Field, Ricketts & Ricketts, TAncoln Frost, FF. L. Pope, S. L. Oeisthardt and Tibbets, Anderson & Baylor, amici curios.

Opinion:
Barnes, J.
Appeal from a judgment of the district court for Wayne county, fixing the amount of an inheritance tax due from the estate of one J. M. Strahan, deceased. It appears that Strahan, a resident of the state of Iowa, died intestate on the 14th day of August, 1907, and left surviving him Mary W. Strahan, his widoAV, tAvo adult sons, and three married daughters, hereafter designated as the heirs. At the time of Strahan's death he Avas the OAvner of certain real estate in Wayne county, Nebraska, A'alued at $133,-570, and an interest in the First National Bank of Wayne represented by 210 shares of its capital stock, valued at $29,190. On the 19th day of July, 1912, the county attorney filed a petition in the county court of Wayne county, as provided by laAV, claiming the inheritance tax in question, and alleging that no part of said tax had been paid. On the filing of the petition the county court appointed an appraiser to value the said estate, and on the same day the appraiser gave notice, as provided by laAV, to the Avidow and the heirs that he would proceed to take testimony concerning the value of the estate, at his office in the First National Bank building in the city of Wayne, Nebraska, on August 3, 1912, at 10 o'clock A. M. The evidence was taken at the time and place stated in the notice. The appraiser duly filed his report in the connty court on August 7, 1912, fixing the value of the estate at the sums above mentioned. On that day the widoAV and the heirs made a general appearance in the action, and requested the court to withhold its decree on the report filed by the appraiser until September 16, 1912, in order that they might file objections to the report. The request was granted. The Avidow and the heirs filed their objections, and a hearing Avas had on the 16th day of September, 1912, at which time the tax in question Avas assessed. The widoAV and the heirs prosecuted an appeal to the district court for Wayne county. The cause came on for hearing on the 20th day of November, 1912, and re- suited In a finding that the total value of the estate was $163,111.36. The court further found that the interest of the widow therein was $40,752.84; that she was entitled to exemptions in the sum of $10,000, leaying a balance of $30,752.84 subject to the inheritance tax; that the interest of each of the heirs in the remainder of the estate was $24,451.70, less an exemption of $10,000 each, leaving the interest of each of them subject to the inheritance tax in the amount of $14,451.70; that no part of the said inheritance tax had been paid, to all of which findings the widow and the heirs excepted. It was thereupon ordered, adjudged and decreed that an inheritance tax be assessed against the interest of the widow in the sum of $307.52, with interest at 7 per cent, from August 14, 1907,-and $144.51, with interest at 7 per cent, from August 14, 1907, was assessed against the interest of each one of the heirs of the deceased. No appeal was taken by the heirs, but on the 22d day of November, 1912, the widow filed a motion for a new trial, which was overruled, and she thereupon prosecuted this appeal.
Three questions are presented by the record: First. Was the bank stock assessable? Second. Is the tax barred by the statute of limitations? Third. Is the widow's interest assessable?
1. Appellant contends that the tax was barred by the statute of limitations because more than five years had elapsed after the tax accrued, and therefore it was conclusively presumed to have been paid. The record discloses that the proceeding to collect the inheritance tax was commenced within the five-year period above mentioned ; that notice was given the widow and the heirs, as provided by law, within that period; that they each voluntarily made a general appearance in the action within said period, to wit, on August 7, 1912. It therefore follows that this contention is without merit.
2. Appellant further contends that her distributive share of the bank stock was not subject to an inheritance tax, for the reason that, being personal property, its situs was fixed by law at the place of the residence of her deceased husband, which was at the time of his death in the state of Iowa. This reason may not be decisive of the question, and therefore need not be considered. There is another reason, however, why appellant's interest in the bank stock was not subject to the inheritance tax, as we shall presently see.
3. Finally, appellant contends that none of her distributive share of her husband's estate, either real or personal, was subject to an inheritance tax under the laws of this state. Chapter 49, laws 1907, called the "King Inheritance Law," abolishes the estates of dower and curtesy, and in lieu thereof provides (sec. 1) : "When any person shall die, leaving a husband or wife surviving, all the real estate of which the deceased was seized of an estate of inheritance at any time during the marriage, or in which the deceased was possessed of an interest either legal or equitable at the time of his or her death, which has not been lawfully conveyed, by the husband and wife while residents of this state, or by the deceased, while the husband or wife was a non-resident of this state, which has not been sold under execution or judicial sale, and which has not been lawfully devised, shall descend subject to his or her debts and the rights of homestead, in the manner following: First. One-fourth part to the husband or wife." By section 3 of the act it is further provided that the personal estate of the deceased shall be distributed in the same proportions to the same persons as prescribed for the descent of real estate. Comp. St. 1911, ch. 23, secs. 1, 176. It thus appears that the appellant, as the widow of her deceased husband, by operation of law became the owner of one-fourth of the real estate and bank stock in question, upon her husband's death. Under the present law the interest of the wife in the personal property of her husband is similar to that of a silent partner. The husband is, in effect, the managing agent and has control of the property. He can sell and dispose of it, or he may exchange it for other property. But at his death her interest therein comes to her in her own right. It does not pass to her by will, or by the intestate laws of the state. The husband cannot deprive her of that right. Gaster v. Estate of Gaster, 92 Neb. 6.
Many of the courts of last, resort in this country have declared that the property of the widow, which comes to her by law, or by wha.t has been designated as the "wife right," is immune from the payment of an inheritance tax. In In re Estate of Sanford, 91 Neb. 752, this court held: "The dower interest of the widow in the estate of her deceased husband, whether taken under his will or by operation of law, is not subject to an inheritance tax."
It is argued by counsel for the appellee that, the legislature having abolished the estates of dower and curtesy, that rule has no application to the present controversy. It appears, however, upon a.n examination of the authorities, that the legislature of the state of Iowa in 1873 passed an act abolishing estates of dower and curtesy, and giving to the surviving spouse a fee simple interest in one-third of the estate of the deceased. The provisions of our present inheritance law are, in effect, the same as those of the loAva statute, with the exception that in this state the surviving spouse, under certain conditions, takes a. fee simple interest in one-fourth of the estate of the deceased, both real and personal. Construing the Iowa statute, the supreme court of that state, in Purcell v. Lang, 97 Ia. 610, said: "A Avife is entitled to dower in land alienated by her husband, in the deed of which she did not join, according to the laAV in force at the time of such alienation, notwithstanding his death takes place after the passage of IoAva Code 1873, section 2440, declaring the estates of doAver and curtesy abolished, and giving the surviving spouse a fee-simple interest in one-third of the estate of the deceased, as such act merely abolishes the use of the words 'dower' and 'curtesy' as descriptive of the enlarged estate."
It has been held by the great Aveight of authority that dower is not immune because it is dower, but because it, like the right to the homestead, and to the distributiA'e share of the widow of the estate of her deceased husband, belonged to her inchoately during liis life, and vested fully in her at his death. The widow's share of the estate of her deceased husband, by the present inheritance law, is given to her in lieu of dower, and it follows that the interest of the appellant in her deceased husband's estate, both real and personal, comes within the test of immunity.
Under the present statute the wife takes her interest in the estate of her deceased husband by operation of law. She cannot be deprived of that interest by his will. It is something which belongs to her absolutely and independently of any right of inheritance or succession. Strictly speaking, the widoAv's share should be considered as immune, rather than exempt, from an inheritance tax. It is free, rather than freed, from such tax. It is not excepted from the taxable class because it never was in such class. Like all debts, taxes, costs, expenses and other similar items, it is deducted before any inheritance tax is assessed. The share of the realty and personalty, Avhich under our law go to the widoAV independent of any will or act of the husband, is not, so to speak, a part of his estate, and is no more liable to a succession tax at his death than is her individual property derived from her OAvn ancestors and held in her oavii name, though the husband may have had the management and control of the estate during his lifetime.
The effect of our decedent law is practically the same as the law of community of property, and the courts of those states which have adopted that law have held, with but a single exception, that the wife is not liable, upon the death of her husband, to pay an inheritance tax on her one-half of the community property, for the reason that the property does not pass to her by will or by the intestate laws of the state. Kohny v. Dunbar, 21 Idaho, 258, 121 Pac. 544; Succession of Marsal, 118 La. 212. As we view the question, this rule should be applied to the facts under consideration. It is sustained by the greater weight of authority, and the more recent decisions of the courts of last resort in this country, and to our minds correctly disposes of the main question in this case.
It follows that the district court erred in assessing the amount of $307.52 against the appellant as an inheritance tax upon her distributive share of her deceased husband's estate. The judgment of the district court is therefore reversed in so far as it affects the rights of the appellant, and as to her the action is dismissed.
Reversed.
Rose, J., dissenting.
Fawcett, J., not sitting.