Court Opinion

ID: 4610194
Source: CourtListenerOpinion
Date Created: 2020-11-20 19:46:21.015187+00
Date Added: 2024-06-11T07:54:01.362554
License: Public Domain

NANALINE H. DUKE, GEORGE G. ALLEN AND WILLIAM R. PERKINS, EXECUTORS OF THE LAST WILL AND TESTAMENT OF JAMES B. DUKE, DECEASED, PETITIONERS, v. COMMISSIONER OF INTERNAL REVENUE, RESPONDENT.Duke v. CommissionerDocket No. 42500.United States Board of Tax Appeals23 B.T.A. 1104; 1931 BTA LEXIS 1770; July 13, 1931, Promulgated 1931 BTA LEXIS 1770">*1770 Held, that the two trusts here in question were not intended to take effect in possession or enjoyment at or after the decedent's death, within the purview of section 302(c) of the Revenue Act of 1924, and that the respondent erred in including in the decedent's gross estate the value of the property embraced in said trusts.  H. H. Shelton, Esq., and Forrest Hyde, Esq., for the petitioners.  Frank Horner, Esq., for the respondent.  TRAMMELL 23 B.T.A. 1104">*1105  This proceeding is for the redetermination of a deficiency in estate tax in the amount of $9,040,849.47.  The decedent died on October, 1925, and the sole issue submitted for decision here is whether or not two certain trusts created by the decedent in 1917 were intended by him to take effect in possession or enjoyment at or after his death, within the meaning of section 302(c) of the Revenue Act of 1924.  FINDINGS OF FACT.  The petitioners are the executors of the estate of James B. Duke, deceased, having been duly appointed by the Surrogate's Court of the County of Somerset, State of New Jersey, on the 23rd day of October, 1925, and have their office at 535 Fifth Avenue, New York City, N. 1931 BTA LEXIS 1770">*1771  Y.  The decedent, James B. Duke, was born on December 23, 1856, and died on October 10, 1925.  Prior to his death and under date of May 2, 1917, said decedent executed a trust instrument reading in part material here as follows: THIS INDENTURE, Made in triplicate as of the 2d day of May, 1917, by and between J. B. DUKE, of Somerville, N.Y., party of the first part, and the said J. B. DUKE AS TRUSTEE and, subject to the terms hereof, THE FARMERS' LOAN AND TRUST COMPANY, a New York Corporation with officers at 22 William Street, New York, City, as SUCCESSOR TRUSTEE as hereinafter stated, parties of the second part, Witnesseth: That for and in consideration of one dollar ($1.00) cash in hand paid and the love and affection which the said Duke has for his daughter, Doris Duke, the said Duke has bargained, sold, assigned, transferred and delivered and by these presents does bargain, sell, assign, transfer and deliver in trust unto himself as trustee and, subject to the terms hereof, unto said The Farmers' Loan and Trust Company, as successor trustee, the following securities, to-wit: [description of property omitted as not material] to be held, used and disposed of for the purpose1931 BTA LEXIS 1770">*1772  and in the manner herein expressly provided and not otherwise, namely: A.  The said Duke shall be and continue the sole trustee hereunder so long as he shall live and remain competent to act as such trustee and as such trustee is hereby empowered and required as follows, to-wit: (1) Said trustee shall receive and collect the incomes, revenues and profits arising and accruing from the aforesaid securities as well as from all other properties received or acquired under the terms of this indenture and shall pay, apply, expend and utilize the same in accordance with the terms of subdivision D. of this indenture and for the personal support, maintenance and education of the said Doris Duke and of any child or children and descendant or descendants of the same that she may have during the period covered by this trust, at such time or times, in such manner, to such extent and in such amounts as said trustee may in his sole discretion deem to be to the best interest of the trust created by this indenture; (2) Said trustee shall invest the residue, if any, of said incomes, revenues and profits not so paid, applied, expended and utilized as well as the proceeds of any sale, assignment, 1931 BTA LEXIS 1770">*1773  transfer, exchange, delivery or other disposition made 23 B.T.A. 1104">*1106  by him by virtue of the next succeeding paragraph of this indenture, in such property or properties, at such price or prices, upon such terms and at such time or times as said trustee may in his sole discretion deem to be to the best interest of the trust created by this indenture; (3) Said trustee may sell, assign, transfer, exchange, deliver and otherwise dispose of the aforesaid securities and any other properties received or acquired under the terms of this indenture, in whole or in part, at such time or times, to such extent, for such price or prices and consideration and upon such terms as said trustee may in his sole discretion deem to be to the best interest of the trust created by this indenture; B.  Should the said Doris Duke die in the lifetime of the said J. B. Duke, this trust shall immediately cease and determine and thereupon all properties of every nature then held in trust under and by virtue of this indenture shall go, revert and belong to the said J. B. Duke absolutely and said trustee or his successor as such trustee shall forthwith pay, convey, assign, transfer and deliver the same to the said1931 BTA LEXIS 1770">*1774  J. B. Duke; C.  Should the said J. B. Duke, in the lifetime of the said Doris Duke, for any cause cease to be such trustee, then and not until then, the said The Farmers' Loan and Trust Company shall become interested as trustee in the trust hereby created as successor to the said J. B. Duke, and shall become entitled to receive and shall receive and have delivered and paid over to it as such successor trustee, the whole of said trust estate, with the authority and power and subject to the limitations and conditions following: (1) Said successor trustee shall, so long as the said Doris Duke shall live, collect and receive the incomes, revenues and profits arising or accruing from all the properties at any time received or acquired by it as such successor trustee under the terms of this indenture and shall pay, apply, expend and utilize the same in accordance with the terms of subdivision D. of this indenture and for the personal support, maintenance and education of the said Doris Duke and of any child or children and descendant or descendants of the same that she may have during the period covered by this trust, at such time or times, in such manner, to such extent and in such1931 BTA LEXIS 1770">*1775  amounts as Mrs. Nanaline Holt Duke, the mother of the said Doris Duke, if living, may in writing from time to time request, and if the said Mrs. Duke be not living, then in such manner and to such extent and at such times as will support, maintain and educate the said Doris Duke and any child or children and descendant or descendants of the same that she may have during the period covered by this trust as befits their station in life, making payments for such purpose after the death of the said Mrs. Duke to and upon the written request of the said Doris Duke after she shall have become twenty-one (21) years old, whose receipts then given shall be a complete acquittance to said successor trustee therefor, which payments after the death of the said Mrs. Duke and the said Doris Duke shall have become twenty-one (21) years old shall aggregate annually at least one-third and after the death of the said Mrs. Duke and the said Doris Duke shall have become twenty-five (25) years old shall aggregate annually at least two-thirds of such annual incomes, revenues and profits; (2) Should the said Doris Duke die after the death of the said J. B. Duke and leave no child or children or descendant1931 BTA LEXIS 1770">*1776  or descendants of the same then living, then and in that event this trust shall immediately cease and determine and said successor trustee shall forthwith pay, distribute, convey, transfer, assign and deliver the properties of every kind held under this indenture absolutely in accordance with the provisions in that respect of any valid will or codicil the said Doris Duke may leave and if she leave no such will or codicil 23 B.T.A. 1104">*1107  then such successor trustee shall forthwith pay, distribute, convey, transfer, assign and deliver the said properties in all respects in accordance with the terms of the present statutes of the State of New Jersey governing the descent of real property to and among those who at that time by the terms of said statutes would have inherited the said properties had the said J. B. Duke then died intestate and owning the same; (3) Should the said Doris Duke die after the death of the said J. B. Duke and leave a child or children or descendant or descendants of the same then living, this trust shall continue after the date of the death of the said Doris Duke and until the termination thereof by and in accordance with the terms of the next succeeding paragraph1931 BTA LEXIS 1770">*1777  of this indenture.  During such continuation of this Trust said successor trustee shall collect and receive the incomes, revenues and profits arising and accruing from all the properties at any time received or acquired by it as such successor trustee under the terms of this indenture and shall pay, apply, expend and utilize the same in accordance with the terms of subdivision D. of this indenture and for the personal support, maintenance and education of such child or children and descendant or descendants of the same at such time or times, in such manner, to such extent and in such amounts as the said Mrs. Duke, if living, may in writing from time to time request and if the said Mrs. Duke be not living, then in such manner and to such extent and at such time as will support, maintain and educate such child or children and descendant or descendants of the same as befits their station in life; (4) In the event this trust shall be continued as aforesaid after the death of said Doris Duke, then upon the last day of the twenty-one year period next and immediately succeeding the date of the death of the said Doris Duke or upon the death within said period of all the children and descendants1931 BTA LEXIS 1770">*1778  of children of the said Doris Duke, whichever shall first occur, this trust shall immediately cease and determine and thereupon said successor trustee shall forthwith pay, distribute, convey, assign, transfer and deliver the properties of every kind held under this indenture absolutely to and among the child or children of the said Doris Duke who may be then living, and the descendant or descendants who may be then living of any child or children of the said Doris Duke who may have died leaving same, per capita to and among the class nearest to the said Doris Duke and per stirpes to and among any other class or classes, and if there be no such child or children or descendant or descendants then living, said successor trustee shall forthwith pay, distribute, convey, transfer, assign and deliver the said properties in all respects in accordance with the terms of the present statutes of the State of New Jersey governing the descent of real property to and among those who at that time by the terms of said statutes would have inherited the said properties had the said J. B. Duke then died intestate and owning the same; (5) Said successor trustee shall, so long as this trust continues, 1931 BTA LEXIS 1770">*1779  invest promptly the residue, if any, of said incomes, revenues and profits not paid, applied, expended or utilized in accordance with the terms of paragraphs (1) and (3) of subdivision C. of this indenture as well as the proceeds of any sale, exchange, assignment, transfer or delivery made under the next succeeding paragraph of this indenture, but in those securities only in which trust funds are allowed to be invested by the laws and statutes of the State of New Jersey or New York and preferably in National and State bonds; (6) Said successor trustee may, so long as this trust continues, sell, exchange, assign, transfer and deliver the whole or any part of the properties received or acquired by it under the terms of this indenture whenever in its opinion, 23 B.T.A. 1104">*1108  so doing is to the best interest of the trust created by this indenture, provided that if the said Mrs. Nanaline Holt Duke be living, her consent in writing thereto shall be first had and obtained, and if the said Mrs. Duke be not living and the said Doris Duke shall be living and twenty-one (21) years of age, then the consent in writing thereto of the said Doris Duke must be first had and obtained; * * * (H) This1931 BTA LEXIS 1770">*1780  instrument is made under and in pursuant of the laws and statutes of the State of New Jersey and is to be construed, interpreted and given effect in accordance with said laws and statutes.  Prior to his death and under date of September 4, 1917, the decedent executed a trust instrument reading in material part as follows: THIS INDENTURE, Made in quadruplicate this 4th day of September, 1917, by and between J. B. Duke, residing in Somerset County, N.J., party of the first part, and the said J. B. DUKE as Trustee and, subject to the terms hereof, NANALINE H. DUKE, residing in Somerset County, N.J., as First Successor Trustee and THE FARMERS' LOAN AND TRUST COMPANY, a New York Corporation with offices at 22 William Street, New York City, as Second Successor Trustee, as hereinafter stated, parties of the second part, Witnesseth: That for and in consideration of one dollar ($1.00) cash in hand paid and the love and affection which the said Duke has for his daughter, Doris Duke, the said Duke has bargained, sold, assigned, transferred and delivered and by these presents does bargain, sell, assign, transfer and deliver in trust unto himself as trustee and, subject to the terms hereof, 1931 BTA LEXIS 1770">*1781  unto said Nanaline H. Duke, as first successor trustee and unto said The Farmers' Loan and Trust Company, as second successor trustee, the following securities, to-wit: [description of property omitted as not material] to be held, used and disposed of for the purpose and in the manner herein expressly provided and not otherwise, namely: A.  The said J. B. Duke shall be and continue the sole trustee hereunder so long as he shall live and remain competent to act as such trustee and as such trustee is hereby empowered and required as follows, to-wit: (1) Said trustee shall receive and collect the incomes, revenues and profits arising and accruing from the aforesaid securities as well as from all other properties received or acquired under the terms of this indenture and shall invest the same as well as the proceeds of any sale, assignment, transfer, exchange, delivery or other disposition made by him by virtue of the next succeeding paragraph of this indenture, in such property or properties, at such price or prioces, upon such terms and at such time or times as said trustee may in his sole discretion deem to be the best interest of the trust created by this indenture; (2) Said1931 BTA LEXIS 1770">*1782  trustee may sell, assign, transfer, exchange, deliver and otherwise dispose of the aforesaid securities and any other properties received or acquired under the terms of this indenture, in whole or in part, at such time or times, to such extent, for such price or prices and consideration and upon such terms as said trustee may in his sole discretion deem to be to the best interest of the trust created by this indenture; (3) The said trustee may pay, give, grant, assign, transfer and deliver to or for the said Doris Duke and/or to or for any child or children or descendant or descendants of the same that she may have during the period covered by this trust the whole or any part or parts of the principal and/or income of the properties at any time held in trust under this indenture at such time or times, 23 B.T.A. 1104">*1109  in such manner, for such purpose and in such amount, kind and value as said trustee may in his sole discretion deem to be to the best interest of the trust created by this indenture and whenever the whole of said principal and income shall be so disposed of, this trust shall cease and determine; B.  Should the said Doris Duke die in the lifetime of the said J. B. Duke, 1931 BTA LEXIS 1770">*1783  this trust shall immediately cease and determine and thereupon all properties of every nature then held in trust under and by virtue of this indenture shall go, revert and belong to the said J. B. Duke absolutely and said trustee or his successor as such trustee shall forthwith pay, convey, assign, transfer and deliver the same to the said J. B. Duke; C.  Should the said J. B. Duke, in the lifetime of said Doris Duke, for any cause cease to be such trustee then and not until then the said Nanaline H. Duke shall become interested as trustee in the trust hereby created as successor to the said J. B. Duke, if she be living and capable of acting as such, and shall become entitled to receive and shall receive and have delivered and paid over to her as such successor trustee all properties of every nature then held in trust under and by virtue of this indenture, and as such successor trustee she shall have and may exercise like duties, powers and discretion in all respects as by this indenture are conferred or imposed upon said J. B. Duke as trustee.  D.  Should the said Nanaline H. Duke be dead or incapable of acting as successor trustee when the said J. B. Duke shall cease, as aforesaid, 1931 BTA LEXIS 1770">*1784  to be trustee or should the said Nanaline H. Duke cease, for any cause, during the period covered by this trust, to be successor trustee, as aforesaid, after becoming such, then and in either of said events, and not until then the said The Farmers' Loan and Trust Company shall become interested as trustee in the trust hereby created as successor trustee and shall become entitled to receive and shall receive and have delivered and paid over to it as such successor trustee all the properties of every nature then held in trust under and by virtue of this indenture with the authority and power and subject to the limitations and conditions, following: (1) Said successor trustee shall, so long as this trust thereafter continues, collect and receive the income, revenues and profits arising or accruing from all the properties received or acquired and held by it as such successor trustee under the terms of this indenture and shall promptly invest the same, as well as the proceeds of any sale, assignment, transfer, exchange and delivery made by it under the terms of the next succeeding paragraph of this indenture, but in those securities only in which trust funds are allowed to be invested1931 BTA LEXIS 1770">*1785  by the laws and statutes of the States of New Jersey or New York and preferably in National, State, County and Municipal bonds; (2) Said successor trustee may, so long as this trust thereafter continues, sell, exchange, assign, transfer and deliver the whole or any part of the properties received or acquired and held by it under the terms of this indenture whenever, in its opinion, so doing is to the best interest of the trust created by this indenture, provided that after the said Doris Duke shall have become twenty-one (21) years of age, her consent in writing thereto must be first had and obtained; (3) Upon the said Doris Duke becoming twenty-one (21) years of age, said successor trustee shall pay, transfer, assign and deliver to her one-third (1/3) in value of all the properties then held in trust under this indenture and upon the said Doris Duke becoming twenty-five (25) years of age said successor trustee shall pay, transfer, assign and deliver to her one-half (1/2) in value of all the properties then held in trust under this indenture, and upon the said Doris Duke becoming thirty (30) years of age said successor trustee shall pay, 23 B.T.A. 1104">*1110  transfer, assign and deliver1931 BTA LEXIS 1770">*1786  to her all the properties then held in trust under this indenture.  Nothing in this indenture contained shall be construed as requiring the said J. B. Duke as trustee or the said Nanaline H. Duke as successor trustee to make any such payment, transfer, assignment or delivery to the said Doris Duke notwithstanding she may attain one or more of the above mentioned ages while said J. B. Duke is trustee or said Nanaline H. Duke is successor trustee as aforesaid; but in case said Doris Duke shall have attained any one or more of the above mentioned ages when the said The Farmers' Loan and Trust Company shall become successor trustee as aforesaid, then it shall thereupon pay, transfer, assign and deliver to her that proportion in value of the properties then held in trust under this indenture which it would have paid, transferred, assigned and delivered to her under the previous provisions of this paragraph had she attained such age or ages while it was such successor trustee.  In making said payments, transfers, assignments and deliveries, said successor trustee shall act promptly and its judgment and decision as to values and as to all other questions arising in the making of the same1931 BTA LEXIS 1770">*1787  shall be final and conclusive on all parties concerned.  When said successor trustee shall have so paid, transferred, assigned and delivered to the said Doris Duke all the properties of every kind held in trust under this indenture, this trust shall thereupon cease and determine.  E.  Should the said Doris Duke die after the death of the said J. B. Duke and before this trust has ceased and determined as hereinbefore provided, this trust shall thereupon immediately cease and determine and all the properties of every kind then held under this indenture shall be forthwith paid, distributed, conveyed, transferred, assigned and delivered absolutely in accordance with the provisions in that respect of any valid will or codicil the said Doris Duke may leave and if she leave no such will or codicil then per capita to and among the child or children of the said Doris Duke who may then be living and the descendant or descendants who may then be living of any child or children of the said Doris Duke who may have died leaving same, and if she leave no such will or codicil and there be no such child or children or descendant or descendants of the same, then in all respects in accordance with1931 BTA LEXIS 1770">*1788  the terms of the present statutes of the State of New Jersey governing the descent of real property to and among those who at that time by the terms of said Statutes would have inherited the said properties had the said J. B. Duke then died intestate and owning same; * * * K.  This instrument is made under and in pursuance of the laws and statutes of the State of New Jersey and is to be construed, interpreted and given effect in accordance with said laws and statutes.  The decedent executed each of said trust instruments and delivered it and the property embraced therein on the day of its date, upon the terms and for the purposes stated in said trust instruments, respectively.  Neither of said instruments constituted a transfer or created a trust in contemplation of the death of the grantor therein.  Doris Duke, named as beneficiary in said trust instruments, was born on November 22, 1912, survived her father, the said James B. Duke, and is still living.  At the time of the death of said James B. Duke, the value of the property then embraced in the trust instrument of May 2, 1917, was $14,488,785.33 and the value of the property then embraced in the 23 B.T.A. 1104">*1111  trust instrument1931 BTA LEXIS 1770">*1789  of September 4, 1917, was $16,145,255.32.  The estate of the decedent was valued in the 60-day letter for Federal estate taxes at $101,606,839.76, exclusive of the value of the properties embraced in said trusts at his death.  Upon the death of said James B. Duke, he was succeeded as trustee in said trusts, respectively, by the successor trustees therein designated for that purpose, which successor trustees thereupon took possession of the properties embraced in said trusts respectively, and have since administered said trusts in accordance with their respective terms, without any other change by reason of the death of said Duke.  OPINION.  TRAMMELL: The facts were stipulated by the parties substantially as set out in our findings of fact, above.  In addition, the parties also stipulated: That the sum of $500,000 is the total deficiency in Federal Estate Tax due by the petitioners by reason of the questions presented in this case, except only the single question * * * whether or not, and if so, to what extent, there may be a deficiency in Federal Estate Tax due by the petitioners, in addition to said sum of $500,000 by reason of the claim of the respondent that the value of1931 BTA LEXIS 1770">*1790  the trusts created by said James B. Duke as grantor, by trust instruments dated respectively May 2, 1917, and September 4, 1917, were by him "intended to take effect in possession or enjoyment at or after his death" in the sense of those words as used in Sec. 302(c) of the Revenue Act of 1924; * * * That if the question submitted * * * be finally decided to any extent against the petitioners, then, and in that event only, the deficiency in Federal Estate Tax shall be increased over and above the said sum of $500,000 to the extent of the additional Federal Estate Tax resulting from said decision, such additional tax to be computed as required by the statutes * * * and with due credit for State Inheritance Taxes paid by the petitioners to the extent not theretofore credited.  The Revenue Act of 1924, which is the statute applicable in this case, provides in pertinent part as follows: SEC. 302.  The value of the gross estate of the decedent shall be determined by including the value at the time of his death of all property, real or personal, tangible or intangible, wherever situated - * * * (c) To the extent of any interest therein of which the decedent has at any time made1931 BTA LEXIS 1770">*1791  a transfer, or with respect to which he has at any time created a trust, in contemplation of or intended to take effect in possession or enjoyment at or after his death, except in case of a bona fide sale for a fair consideration in money or money's worth.  * * * The decedent in this case executed two trust instruments on May 2, 1917 and September 4, 1917, respectively, by which he conveyed to himself as trustee, for the benefit of his daughter Doris Duke and 23 B.T.A. 1104">*1112  her descendants, the personal property described therein.  The decedent also appointed in the respective instruments successor trustees.  Each trust instrument, together with the properties embraced therein, was delivered on the day of its date upon the terms and for the purposes stated, and each trust was formally accepted both by the trustee and the successor trustees.  The grantor did not reserve the power to alter or revoke either instrument, with or without the consent of the beneficiary.  The trust properties were to revert to the grantor only in the event the beneficiary died during his lifetime.  Otherwise, the transfers were absolute and complete.  The beneficiary survived the grantor, and upon his death1931 BTA LEXIS 1770">*1792  the designated successor trustees took possession of the trust properties and have since administered the trusts in accordance with their terms, without any other change by reason of the death of the grantor.  As stipulated by the parties, we have found that neither of the trust instruments constituted a transfer or created a trust in contemplation of the grantor's death.  The respondent included the value of the trust properties in the decedent's gross estate on the sole ground that the trusts were "intended to take effect in possession or enjoyment at or after his death." Whether the respondent's action on this point is correct constitutes the question presented for decision here, and its solution must depend upon the nature and extent of the transfers effected by the trust instruments.  The tax in controversy is an excise tax laid upon the transfer of property by death, and is measured by the value of the property so transferred.  Therefore, if the decedent in this case by the said trust instruments divested himself fully, completely and irrevocably of all interest in the trust property which might inure to his benefit, no interest therein remained to be transferred as an incident1931 BTA LEXIS 1770">*1793  of his death, and there is no basis for the tax.  Cf. . In , where the applicable statute was section 402(c) of the Revenue Act of 1921, which, so far as material here, is substantially the same as section 302(c) of the 1924 Act, supra, the court said: In its plan and scope the tax is one imposed on transfers at death or made in contemplation of death and is measured by the value at death of the interest which is transferred.  * * * One may freely give his property to another by absolute gift without subjecting himself or his estate to a tax, * * * It is of significance, although not conclusive, that the only section imposing the tax, section 401, does so on the net estate of decedents and that the miscellaneous items of property required by section 402 to be brought into the gross estate for the purpose of computing the tax, * * * are either property transferred in contemplation of death or property passing out of the 23 B.T.A. 1104">*1113  control, possession or enjoyment of the decedent at his death.  The two sections read together indicate no purpose to1931 BTA LEXIS 1770">*1794  tax completed gifts made by the donor in his lifetime not in contemplation of death, where he has retained no such control, possession or enjoyment.  In the light of the general purpose of the statute * * * we think it at least doubtful whether the trusts or interests in a trust intended to be reached by the phrase in section 402(c) "to take effect in possession or enjoyment at or after his death," include any others than those passing from the possession, enjoyment or control of the donor at his death and so taxable as transfers at death under section 401.  That doubt must be resolved in favor of the taxpayer.  The facts of this case bring it squarely within the principles above stated by the Supreme Court.  The decedent made an absolute and unconditional gift of the property embraced in the two trusts.  It is true the instruments provided that the property should revert to the decedent if the beneficiary predeceased him, but this was a mere possibility which did not in fact occur.  Such possibility of reversion did not prevent the gift from being complete.  In the case of 1931 BTA LEXIS 1770">*1795 , the Circuit Court of Appeals for the Seventh Circuit held that the fact that the settlor could revoke the trust if the beneficiary predeceased her was a factor to be considered in determining whether the trust was revocable or whether the gift was to take effect in enjoyment or possession at or after death, but the Supreme Court reversed that decision () on authority of May v. Heiner.In the case at bar the trust was not revocable.  We passed on a similar question in the case of , and the Supreme Court in the case of , decided the question adversely to the Commissioner. In this case the trust was actually created and took effect and the property passed to it before decedent's death.  Nothing passed at or after his death.  The fact that there was a bar possibility that the property which had a already passed to the trust for the beneficiary might revert to the grantor during his lifetime, not by any act on his part, does not have the effect1931 BTA LEXIS 1770">*1796  of reserving to the grantor any rights or benefits which passed at or after his death.  He might have, by a bare possibility, reacquired the property during his life, but he did not.  In the case of any gift by a man to his child or wife there is always a possibility that the donee may die, leaving the grantor sole heir and thus a possibility of the donor reacquiring the property, but clearly this mere possibility is not sufficient to create or reserve in the donor property rights which pass to the donee only at or after the donor's death where the donee has had both the possession and enjoyment thereof during the donor's lifetime.  This might equally be true whether the trust instrument contained any such provision or not.  This contingency or possibility did not give the donor any 23 B.T.A. 1104">*1114  rights of control over the property.  He could not have recalled the property to himself.  When he died he was not seized or possessed of the property.  Decedent did not retain control over the economic benefits or enjoyment of the property.  He retained no control which might inure to his own benefit.  He did not reserve the power to change, modify or revoke the trusts. 1931 BTA LEXIS 1770">*1797  He could not designate a new and different beneficiary.  The fact that he appointed himself trustee with power to administer the trust properties for the benefit of his daughter does not change the result.  See In , the court made this point clear in the following language: Nor did the reserved powers of management of the trust save to decedent any control over the economic benefits or the enjoyment of the property.  He would equally have reserved all these powers and others had he made himself the trustee, but the transfer would not for that reason have been incomplete. The shifting of the economic interest in the trust property which was the subject of the tax was thus complete as soon as the trust was made.  His power to recall the property and of control over it for his own benefit then ceased and as the trusts were not made in contemplation of death, the reserved powers do not serve to distinguish them from any other gift inter vivos not subject to the tax.  [Italics supplied.] We see no basis for the contention of the respondent that the transfer1931 BTA LEXIS 1770">*1798  of the property was contingent.  The property was clearly transferred from the decedent, by the trust instruments.  As above set out, the fact that he was trustee is of no importance.  Any uncertainty or contingency as to who might eventually receive the trust corpus as the result of the named beneficiary dying or the fact that under a certain contingency the legal heirs of decedent might receive the property does not indicate that the decedent had not parted with the property and all economic benefits thereof in his lifetime.  We can not overlook the plain fact that the decedent did not own the property or any economic benefits therein when he died or the fact that no economic interests or benefits therein passed at his death.  The entire disposition of the property in so far as the decedent was concerned was completed during his lifetime.  The death of the decedent was not the generating source of any right in any beneficiary.  Nothing moved from him on his death in so far as the property here involved is concerned.  It is unimportant that under certain circumstances other or different beneficiaries might eventually, pursuant to the trust instrument, receive the corpus.  The decedent, 1931 BTA LEXIS 1770">*1799  however, did not reserve any right to change beneficiaries or to direct any disposition of the property until his death.  We think the respondent erred in including in the decedent's gross estate the value of the properties embraced in the two trust 23 B.T.A. 1104">*1115  instruments in question.  His action on this point is, therefore, reversed.  See ; ; ; ;. In accordance with the stipulation of the parties, Judgment will be entered that there is a deficiency in the amount of $500,000.