Court Opinion

ID: 7172372
Source: CourtListenerOpinion
Date Created: 2022-07-24 16:27:46.037867+00
Date Added: 2024-06-11T16:15:46.589182
License: Public Domain

O’NIELL, 3.
(dissenting). By Act 109 of 1906, as amended by Act 42 of 1912, and by Act 301 of 1914, and by Act 51 of 1918, the Legislature did not levy a transfer tax on donations inter vivos, or on transfers made for an inadequate consideration. By those statutes, the inheritance tax was levied only upon inheritances, either legal or testamentary. By Act 127 of 1921, which was enacted pursuant to section 7 of article 10 of the Constitution of 1921, the tax was levied upon “inheritances, legacies and donations and gifts made in contemplation of death.” It may be that, under that language, the tax is now levied upon donations inter vivos, even those Which are disguised as Sales, provided they were made “in contemplation of death.” I do not express an opinion on that question, because the statute of 1921 was enacted subsequent to the death of Frank Vatter and therefore does not control this case.
By the statute of 1906 and by the amendments of 1912 and 1914, the inheritance tax was levied strictly and only as an inheritance tax, “on all inheritances, legacies and donations mortis causa.” The amending statute of 1918 did not purport to convert the inheritance tax into a transfer tax, or extend it to donations inter vivos or to transfers made for an inadequate consideration. The amendment of 1918 merely established a presumption that all donations and all transfers *609of property for an inadequate consideration, made within 90 days before the death of the donor or transferor, should be deemed to have been made to avoid the inheritance tax, and declared that the property so donated or transferred should be deemed a part of the estate of the deceased donor or transferor, for the purpose of computing the inheritance tax on his estate. But we must bear in mind that, even after the amendment of 1918, the inheritance tax remained strictly an inheritance tax, not a'transfer tax upon a transfer of title made otherwise than by inheritance or by testamentary disposition. The only reason why property that had been transferred within the 90 days, either by donation inter vivos or by a transfer made for an inadequate consideration, could be included in the property on which the inheritance tax was computed, was that the statute declared, as a mere fiction, that the property so donated or alienated should “be deemed a part of the succession” of the deceased donor or transferor. Property that was disposed of before the 90-day period, however, was not “deemed a part of the succession” of the deceased transferor, “for purposes of computing the inheritance tax,” as the statute says. Therefore, before the enactment of the amendment of 1918, the collector of inheritance taxes was not concerned with the motive that prompted a person in making a donation inter vivos, or a transfer of his property for an inadequate consideration. No matter what the motive was, the property disposed of was not “deemed a part of the succession” of the party who had disposed of it “for purposes of computing the inheritance tax.”
The issue in this case was presented clearly by the statement made by the attorney f or the tax collector, during the trial, viz.:
“I want to state what I desire to prove. The tax collector now endeavors to show by-this witness that deceased possessed a large amount of property subject to the inheritance tax some six or eight inonths previous to his decease, but more than 90 days'previous to his decease, the deceased made a transfer, for apparent consideration, fraudulently, and for the purpose of avoiding the inheritance tax law, of all his assets to his heirs.”
By section 18 of Act 127 of 1921, the Legislature has extended the 90-day period to one year. This, in my opinion, is a legislative interpretation, signifying that, before the enactment of the statute of 1921, property disposed of by donation inter vivos, or by a transfer for an inadequate consideration, before the period of 90 days preceding the death of the donor or transferor, was not “deemed a part of the succession” of the donor or transferor, and was therefore not subject to the inheritance tax.
Eor the reasons stated, I respectfully dissent from the opinion and decree rendered in this ease.