Court Opinion

ID: 9707036
Source: CourtListenerOpinion
Date Created: 2023-08-26 01:59:18.892064+00
Date Added: 2024-06-11T18:22:27.271766
License: Public Domain

Concurring Opinion by
Mr. Justice Cohen :
Our problem here is to determine the impact of Article III “Transfers Not Subject to Tax” and decide *332whether that article gives us any clue or guide as to whether there shall be included in the “whole estate,” “gross estate,” “taxable estate,” “gross probate estate,” or whatever it might be called, the value of the property transferred to a charity. A superficial reading of Article III indicates that with the exception of governmental and charitable transfers, none of the “transfers not subject to tax” is includible in the gross estate.
Better draftsmanship would have eliminated the confusion that results in not emphasizing the distinction between transfers not subject to tax which are not includible in the gross estate and transfers not subject to the tax which are includible in the gross estate.
There is no doubt that the history of §302 (the charities exemption) has contributed to the confusion. Historically, transfers to charities in Pennsylvania were not exempt from the payment of transfer inheritance tax, and assets transferred to charities were included in the gross estate. The exemption to charities from payment of transfer inheritance taxes was extended to the charities by the Act of May 28, 1956, P. L. (1955) 1757, which amended the Act of 1919.
The practice under the Act of 1919, the Act of 1956 and the Act of 1961, has been uniform. After the allowable debts and expenses and other deductions have been deducted from all of decedent’s assets in the gross estate, both the noncharitable and the charitable transfers are made from the resulting net distributive estate. Prior to the Act of 1957, the inheritance tax was *333collected from both the charitable and noncharitable transfers. After the Act of 1957, no tax was collected on the charitable transfer but only on the noncharitable transfers. The Act of 1961 effected no change in this procedure, and the practice continued of including in the gross estate property of the decedent which was to be distributed to charitable transferees and to noneharitable transferees.
A close reading of the Act of 1961 causes the instant confusion, since the Act makes no clear distinction between exemptions afforded to gross estate assets and to assets that are not included in the gross estate. Hence, appellants contend with some force that the value of the property to be transferred to a charity should not be included in the gross estate. However, I see no clear legislative intent that a change of this nature was contemplated when the legislature enacted the Act of 1961. I do see in the legislative history of this section a clear expression of intent by the legislature, evidenced by its almost verbatim adoption of the Act of 1957, to continue the inclusion of charitable as well as noncharitable transfers in the value of the gross estate, from which value the deductions provided for in Article VI would be taken.
An appraisement for inheritance tax serves two purposes: (a) it is a list of all items of realty and personalty of which the decedent died seized; (b) it fixes the cash value of each of said items.
Appraisements were originally provided for by §10 of the Transfer Inheritance Tax Act of June 20, 1919, P. L. 521, 72 P.S. §2321. That section required the appointment of appraisers by the register of wills. However, it was superseded by the Act of May 4, 1927, P. L. 727, as last amended by the Act of May 21, 1943, P. L. 370, 72 P.S. §2324, so that the Auditor General and, since 1943, the Secretary of Revenue now appoint the inheritance tax appraisers. To the same effect see *334§407 of The Fiscal Code, Act of April 9, 1929, P. L. 343, as amended by §1 of the Act of May 21, 1943, P. L. 380, 72 P.S. §407.
After the appraisement has been filed it then becomes the duty of the register of wills as agent for the Commonwealth in the collection of inheritance tax to determine the clear value of the estate passing from the decedent in accordance with the provisions of the Transfer Inheritance Tax Statutes. This procedure has been followed throughout the Commonwealth, particularly since the enactment of the Act of May 27, 1943, P. L. 757, 72 P.S. §2302. The allowance of debts and deductions by the register of wills is a function separate and apart from the appraisement by the inheritance tax appraisers: Weir Estate, 399 Pa. 612, 161 A. 2d 388 (1960). The state-wide practice since 1957 has been to deduct from the clear value of the estate passing from the decedent, the charitable bequests in order to determine the clear value of the estate passing from the decedent and subject to the transfer inheritance tax. Since there have been no deviations from this long-accepted practice, I see no reason to change it. In fact, I regard this constant practice as added reason for affirming the lower court.
Were it not for my desire to determine this issue on its merits, I would vote to quash this appeal. Appellant maintains that the assets applicable to the charitable gifts should not have been appraised and they now object to such appraisement. But §1001 of the 1961 Act provides that one not satisfied with an appraisement may within 60 days after receipt of notice appeal therefrom to the orphans’ court. This appraisement was filed on July 29, 1963, and the docket entries do not disclose that an appeal to the Orphans’ Court of Allegheny County had been taken from the inventory and appraisement within the permitted period,
*335Finally, appellant’s brief, the Commonwealth’s brief, the lower court’s opinion and the majority opinion all contain reference to “gross estate.” The brief of amicus curiae filed under Buie 65 indicates, however, that the Commonwealth and the lower court invented this phrase and injected it into the calculations. Amicus quotes from our decision in Pratt Estate, 422 Pa. 446, 451, 221 A. 2d 117 (1966), that “'Cross estate’ is a term which is always used in connection with the estate of a decedent for purposes of Federal Estate taxation, but never used in connection with an estate under the law of Pennsylvania ...” I disagree. Camp’s Estate, 298 Pa. 405, 148 Atl. 496 (1930), an opinion by Mr. Justice Schaffer, made numerous references to the “gross estate,” of the decedent involved in that litigation. Hence, the admonishment in Pratt Estate that “No decision of this Court and no statute of Pennsylvania defines or even uses the term 'gross estate,’ ” is patently in error and should not in the future be relied upon. “Cross estate” is often used by practitioners in referring to an estate being settled under the laws of the Commonwealth, and a definition is gradually developing which accurately defines and limits the term as applied to the administration of Pennsylvania estates.