Court Opinion

ID: 7219974
Source: CourtListenerOpinion
Date Created: 2022-07-25 03:47:23.408927+00
Date Added: 2024-06-11T16:17:11.688061
License: Public Domain

DICKINSON, District Judge
(dissenting).
The events attending the trial and ruling in this cause evidence that it is what is called a “close case.” The turning point in it is really a fact finding. There is nothing in this which of itself would justify a dissent. The majority opinion gives the view which the eourt has taken. It has been thought that the opposing view should be presented.
The majority opinion starts with the proposition that tangible property is taxable where it is unless there is in the fact situation something which takes it out of this rule. Then follows the fact "finding that the ease before us presents no such exempting feature. Confronting this is the other view of the fiction of the law that personal property is wherever its owner is and is in the place of his domicile. It is in consequence only there taxable unless there is that in the fact situation which gives it a situs of its own independent of the domicile of its owner. This fiction is followed in the case of intangibles, but in the ease of tangibles may be overthrown by conflicting facts. The question is one of cold-blooded law. Whatever element of sentiment there might be in the case is submerged in the fact that the question is really between two states and whether the tax is payable to Pennsylvania or New York, with the circumstance present that the Pennsylvania tax exaction is the greater. If the situation were reversed and this property was in New York but belonging to the estate of a decedent whose estate was being administered in Pennsylvania, we may assume the taxpayer would not be objecting to a taxation in New York.
The evidentiary facts are not in controversy. They are found in the answer, supplemented by the undenied averments of the bill, and have been so stipulated. The pertinent facts °are few.
A collection of portraits belonged to a citizen of New York and were physically there. They had great historical, and, we have no doubt, artistic, value. The owner had at the time no use for them for display purposes or otherwise, and would have put them in storage. The Art Museum of Philadelphia, learning of this, requested a loan of the collection in order that they might be hung in their galleries for public exhibition. The owner had gathered the collection for his own gratification as an art lover or as a collector. The portraits were not held for sale. He acceded to the request made of him. In this he had no selfish motive, but incidentally he did profit by saving storage, insurance and other charges, and by what-, ever element of value there was in the publicity given to his collection in case he should ever wish to sell it. The collection thus went to Philadelphia. After being on exhibition at the Art Museum for some time, the owner asked for its return. The managers of the Art Museum thought highly of the collection and indulged the hope that they might find a friend and patron who would buy it to present to the museum. They in consequence appealed to the owner, with the request that he permit the portraits to remain with the museum and put a price upon them for sale to any one who would present them to the museum. In so doing the owner was not actuated wholly by a commercial motive, but he took a pride in his collection, which was gratified by the thought of its being kept intact and put on public exhibition. No time limit was mentioned, but the owner was at liberty to have the portraits returned to him whenever he chose. The hopes of the museum managers were not realized, and the owner died with the portraits still on exhibition.
Out of this has arisen the conflicting claims of Pennsylvania and New York to the right to impose an inheritance tax. The distinction of when tangible property is taxable in the jurisdiction in which it is, and when it is assumed to be in the domicile of its owner, is illustrated by the not uncommon practice of an owner of such property having residences in different places. A man may have a town and country residence and summer and winter ones, with tangible per*820sonal property in each. If they are in different states, the question, in case of his death, arises of what property is taxable in each. Along with this there may be a question of the domicile of the owner. The latter question may throw some light on the former, but the two are distinct and different.
The case of Frick v. Pa., 268 U. S. 473, 45 S. Ct. 603, 69 L. Ed. 1058, 42 A. L. R. 316, and others give us the rule for our guidance, but it is not always easy to apply it. It is especially difficult to find a phrase by which the rule may be expressed. The majority opinion employs a happy phrase which comes as near to its expression as any which has been coined, but which yet does not fully express it. The phrase applied to the duration of time the property has been where it is and the expectation of its continuance is “indefinitely prolonged.” The fact situation must have this element, but yet this is not wholly controlling. There are two expressions in the vernacular which convey the idea. .We speak of a place in which a person or thing “belongs” or that a person or thing has its “proper place.” Wherever a tangible thing “belongs” or has its “proper place,” there it is taxable. The truth seems to be that that rule is based upon an idea which is not difficult to grasp but which cannot be verbally defined.
There are many such ideas. The practical consequence is that the question of where property is taxable turns upon an ultimate fact finding to be made in each ease presented. In this ease the fact finding made is that these portraits at the time of the owner’s death were in Pennsylvania and here under circumstances which would not justify the finding that they were not to stay here .because they were here with no end of their stay in sight. In other words, their stay was to be “indefinitely prolonged.”
We could join in this finding except for one circumstance. The portraits were sent here only for exhibition purposes. Such a stay is transient. We do not see that the character thus given to their stay here was changed by the hope that some one might buy them for presentation to the museum. The hope remained a hope and was never realized. More than this the la\y has its policies as well as its principles. There are works of art which it is a liberal education to view. Pilgrimages are made as to a shrine by unnumbered thousands to where they are. Many more thousands are unable to do this. Works of art are, because of this, taken to where the viewers are, that they may see them. This may be to expositions, such as the Centennial or the Century of Progress. They likewise are put on view in permanent art exhibitions, such as the Academy of Fine Arts or the Art Museum in Philadelphia, the Metropolitan in New York, the Corcoran Art Gallery in Washington, and countless other art displays. If the loan of them for such display is meant to be for a limited time, no one would say that they were thus subjected to taxation at the place where on display, merely because of the accidental circumstance that the owner had died while they were still there. The question of liability to tax arises when the display is “indefinitely prolonged.” This exhibition of famous works of art serves a useful public purpose, so that the law should not discourage the practice of making such loans. We may be sure that the policy of the law is not to discourage the practice. This means that, in making the f aet finding of whether works of art thus on exhibition had so far a permanent habitat as to be taxable, the courts should not be over eager to make that finding. We cannot escape the feeling that it is an ungracious aet on the part of any state to tax the owner of art treasures who has sent them into the state to be exhibited for the gratification and edueatioh of the people of the state. Merely because their stay there has been prolonged is no justification for taxing them, especially when, as here, the stay has been prolonged because the owner was urged to permit them to remain on exhibition.
As it-has been determined that this bill may be maintained, we think that on its merits its prayers should he granted and the injunction prayed for issue.