Court Opinion

ID: 9420016
Source: CourtListenerOpinion
Date Created: 2023-08-02 22:52:34.210043+00
Date Added: 2024-06-11T17:22:21.768872
License: Public Domain

Mr. Justice Rutledge,
with whom The Chief Justice concurs,
dissenting.
I am in agreement with the views expressed by Mr. Justice Jackson, except that I intimate no opinion concerning whether Rhode Island could lay a tax upon one of its residents for the privilege of acting as one of two or more trustees, when the state’s only connection with the trust arises from the fact of his residence. This is not such a case.
Whether or not due process under the Fourteenth Amendment forbids state taxation of acts, transactions, *502events or property is essentially a practical matter and one of degree, depending upon the existence of sufficient factual connections, having economic and legal effects, between the taxing state and the subject of the tax. I do not think the mere fact that one of a number of trustees resides in a state, without more, is a sufficiently substantial connection to justify a levy by that state upon the trust corpus, by an ad valorem, tax either fractional or on the entirety of the res.
It may become necessary for claimants, beneficiaries or others to sue the trustee in Rhode Island or perhaps for him to join with other trustees in suing third persons there about trust matters. To that extent benefit and protection may be conferred upon the trust. But those needs may arise in connection with any sort of business or activity, trust or other, located and conducted outside the state as largely as this trust’s affairs. I had not supposed that merely keeping open the state’s courts to such claims would furnish a sufficient basis for bringing within its taxing grasp all property affected by the claims’ assertion. That the trust res here consists of intangibles does not seem to me a sufficiently substantial factor, in the circumstances presented, to justify so wide a reach of the state’s taxing arm.
Mobilia sequuntur personam has its appropriate uses for sustaining the states’ taxing powers affecting residents and their extrastate interests. But when it is applied to the split ownership of a trust, not only as between trustee and beneficiary but also as among several trustees, to bring the trust res within the several states’ powers of taxation, merely by virtue of the residence in each of one trustee and nothing more, the fiction I think is carried too far. Something more than affording a domiciliary basis for service of process, coupled with the split and qualified representative ownership of such a trustee, *503should be required to sustain the state’s power to tax the trust res, whether for all or only a fraction of its value.
Finally, whatever might be true of a single trustee or of several residing in a single state, I should doubt the thesis that the interest of one of two or more trustees in a trust is more substantial than that of a beneficiary or receives greater protection or benefit from the state of his residence. And if the beneficiary’s residence alone is insufficient to sustain a state’s power to tax the corpus of the trust, cf. Brooke v. Norfolk, 277 U. S. 27,1 it would seem that the mere residence of one of a number of trustees hardly would supply a firmer foundation.

 But cf. Holmes, J., dissenting in Safe Deposit & Trust Co. v. Virginia, 280 U. S. 83, 96.