Court Opinion

ID: 4624720
Source: CourtListenerOpinion
Date Created: 2020-11-21 02:55:44.20035+00
Date Added: 2024-06-11T08:30:24.550770
License: Public Domain

Estate of Alma Peck, Incompetent, A-1342, Security-First National Bank of Los Angeles, William Peck and Byron G. Hill, Guardians of Said Estate, Petitioners, v. Commissioner of Internal Revenue, Respondent.  Estate of Leland Peck, Incompetent, A-1343, Security-First National Bank of Los Angeles, William Peck and Byron G.  Hill, Guardians of Said Estate, Petitioners, v. Commissioner of Internal Revenue, RespondentPeck v. CommissionerDocket Nos. 17013, 17014United States Tax Court15 T.C. 788; 1950 U.S. Tax Ct. LEXIS 28; December 6, 1950, Promulgated *28 Decisions will be entered under Rule 50.  During his lifetime, George H. Peck provided abundantly for petitioners by gifts outright and in trust, and by the purchase of certain annuity contracts for their benefit, 14 of which were with The Travelers Insurance Co.  Annuity payments under the Travelers contracts were made to George H. Peck as conservator while he lived.  By endorsements of the Travelers annuity contracts he provided that all annuity payments should be made to named "trustees" after his death.  A few months after George H. Peck died, petitioners were appointed guardians of the estate of each incompetent, and in 1940 and 1941 they reported the taxable portions of the annuity payments as income of and taxable to the guardianship estates.  For 1942 and 1943, the "trustees" named by Peck to receive the annuity payments from Travelers reported the taxable portion thereof as income of the trust estate. Respondent determined that the taxable portion of the annuity payments was income of the guardianship estates.  Held, no express trust was created by George H. Peck by his endorsements of the annuity contracts and respondent correctly determined that the taxable portion*29  of the annuity payments was income of the guardianship estates.  Byron G. Hill, Esq., for the petitioners.H. A. Melville, Esq., for the respondent.  Rice, Judge.  RICE*789  These cases, consolidated for hearing and decision, involve deficiencies in income and victory taxes for 1943 as follows:Estate of Alma Peck, Incompetent$ 6,658.27Estate of Leland Peck, Incompetent$ 7,238.66In determining the deficiencies the respondent made several adjustments to the net income reported by each incompetent for the calendar years 1942 and 1943.  The year 1942 is involved because of the Current Tax Payment Act of 1943.  The petitioners challenge some, but not all of respondent's*30  adjustments.At the hearing the parties filed a written stipulation of facts, paragraph 20 of which states that only one issue is to be decided, "inasmuch as the parties have agreed upon a basis for disposing of the other issues raised in the petitions in computations under Rule 50."The sole issue in dispute is whether income from certain annuity contracts with The Travelers Insurance Co. is taxable to trust estates, as contended by the petitioners, or to guardianship estates as determined by the respondent.Some facts were developed by testimony but most of the facts were stipulated.FINDINGS OF FACT.The stipulated facts are so found and are incorporated herein.The petitioners are the duly appointed, qualified and acting guardians of the Estate of Alma Peck, Incompetent, and the Estate of Leland Peck, Incompetent, respectively.  Alma Peck and Leland Peck are brother and sister who, at present, reside at 3320 West 81st Street, Inglewood, California.  Income tax returns for the incompetents for 1943 were filed by the guardians with the collector of internal revenue for the sixth district of California.*790  Alma Peck, the daughter of George H. Peck, deceased, was born on February*31  26, 1888.  Leland Peck, the son of George H. Peck, deceased, was born on November 10, 1894.During his lifetime George H. Peck accumulated a very substantial amount of property; his estate tax return reported a gross estate in excess of $ 6,000,000.  He realized that his two children, Alma Peck and Leland Peck, were, from early childhood, permanently mentally incompetent to handle their own affairs, to provide for their own support, comfort, and maintenance, or to manage any property or estate which he, George H. Peck, might transfer to them during his lifetime or bequeath to them upon his death.  For that reason, George H. Peck made abundant provision for their care, maintenance, comfort, and welfare, not only during his lifetime, but following his death.  To that end, he gave them outright, during his lifetime, subject, of course, to his actual, if not legal, control, very substantial sums of money and also some real estate.  He made them chief beneficiaries of a very substantial trust estate created during his lifetime, and he also made them beneficiaries to the extent of $ 2,000 per month, plus additional income that may be produced from a testamentary trust consisting of one-half*32  of his estate.In addition to the above, George H. Peck purchased for the benefit of Alma Peck and Leland Peck, 14 annuity contracts from The Travelers Insurance Co., of Hartford, Connecticut, hereinafter referred to as Travelers.  Seven of these contracts provided for annuities during the life of Alma Peck and the remaining seven provided for annuities during the life of Leland Peck.  All of the annuity contracts with Travelers were purchased during the period October 18, 1918, to September 3, 1923, inclusive. Their general provisions were substantially the same, including the prohibition against the right to assign or commute any payments under the annuity contracts.From time to time each of the Travelers' annuity contracts had endorsements placed thereon at the request of George H. Peck.  These endorsements are identified in the 14 annuity contracts as A-1, A-2, B, C, and D.  No one of the annuity contracts contained all the endorsements.Pertinent provisions of the annuity contracts and the endorsements provided, prior to September 7, 1925, that Travelers would make all payments by way of return of premiums or by way of annuity payments to George H. Peck as conservator of the*33  annuitants, if living, or to his successors, or to the conservator or duly appointed guardian of the surviving incompetent, or to named substitute annuitants.In negotiating for the annuity contracts, or for changes in existing contracts, Travelers was advised by its Los Angeles office on August 2, 1920, George H. Peck having already purchased four annuities, *791  that the annuities "were sold to Mr. Peck because of the fact that they would provide a permanent Monthly Income during the lifetime of the Annuitants," and that he did not want either the conservator or guardian after his death to have the right to cancel the annuities and raise a lump sum in cash "because that would terminate the provision he had made for the care of these incompetent children, by means of these Monthly Income Annuities, and leave their care dependent upon the investment of the funds by the guardian or conservator with a possibility or even danger of the loss of the funds."In June 1923, after George H. Peck had purchased 12 annuity contracts from Travelers, the latter was advised by their Los Angeles office in part as follows:* * * He is insistent on having these annuities issued as applied for. *34  Of course on account of the other annuities, it will be necessary upon Mr. Peck's death for a Guardian or a Conservator to be appointed, but Mr. Peck desires to have these particular annuities payable direct, in order to fill the gap between the time of his death and the actual appointment of a Guardian, which he feels might require a considerable lapse of time.  Also, he feels that if his name is left out, there is more certainty of these annuities being free from inheritance and estate taxes.  * * *Under date of February 20, 1924, the Los Angeles office of Travelers notified Travelers as follows:Mr. George H. Peck is the purchaser of a number of annuities in favor of his children, Alma and Leland, in which Mr. Peck is named as the conservator to receive the proceeds.  This was a voluntary action on Mr. Peck's part because he considered the children incompetent to handle the money although they have never been adjudged so by any legal authority.Mr. Peck has been in ill health for the last few weeks and he now advises it is an arduous task even to look after these annuity payments which are coming in under several of the contracts and he would like to arrange to have someone else*35  act in his stead as far as these contracts are concerned.Of course he is aware of the fact that he could start an action before the proper court to have the children adjudged incompetent and a conservator or guardian appointed, but he would like to arrange the matter without going through this process if possible.Will you kindly give the case your consideration and give us the benefit of your advices as to the best course for him to pursue.Travelers responded to this request of their Los Angeles office by suggesting that George H. Peck "have the annuity payments made payable to someone as trustee for his children, or what would probably be more advisable, have them payable to some trust company of his own selection and have the trust company act in his stead."George H. Peck countered this suggestion by asking whether Travelers "would be willing to amend the above policies, by endorsement or otherwise, making the annuity payments payable direct to the annuitant instead of to a conservator."Under date of April 22, 1924, Travelers notified George H. Peck *792  that "in view of the circumstances this Company objects to making payments directly to the annuitants. It occurs to*36  us that the most reasonable way out of the situation would be that you have a conservator legally appointed and then request that payments be made directly to such conservator. In this respect we think that a Trust Company would be a good selection to act as such conservator or guardian."By letter dated August 20, 1925, George H. Peck advised Travelers in part as follows with respect to the 14 annuity contracts:* * * *The said annuitants are mentally incompetent to personally receive and disburse the income for their care and maintenance and in order to make proper provision therefrom after my death I hereby nominate their nearest living relatives; my daughter Mrs. Rena Culler and stepson Mr. Wm. Peck jointedly [sic] and the survivor trustees and trustee respectively, effective immediately upon my death, and for so long as both and the survivor shall live.Please draft trust agreement embodying the purpose of the above with such amendments and additions as shall best serve the desired provisions.* * * *Pursuant to this request Travelers drafted the following agreement (endorsement C attached to each of the 14 annuity contracts) which the parties executed on or about September*37  7, 1925:IT IS MUTUALLY AGREED between The Travelers Insurance Company, Hartford, Connecticut, and George H. Peck, the Conservator of the annuitants in the Annuity Contracts Numbered * * * [listing the 14 contracts] * * *, that all of the payments, to-wit, the annuity payments or the payments of the return of premiums, whichever the case may be, prescribed in the said annuities, which shall become payable to George H. Peck as the Conservator of the annuitants nominated in the above numbered Annuity Contracts, namely, Leland Peck and Alma Peck, shall be payable upon receipt of proof of the death of the said George H. Peck by the Company to Rena Culler and William Peck, respectively daughter and step-son of George H. Peck, jointly or to the survivor as Trustees or Trustee for the annuitants.* * * *On or about July 22, 1930, Travelers and George H. Peck executed endorsement D to each of the annuity contracts.  Endorsement D contained substantially the same provisions as endorsement C, the principal exception being that after the death of George H. Peck any payments by Travelers under the annuity contracts were to be made to different trustees, namely, "William Peck, Chas. T. Wilder*38  and Byron G. Hill, respectively step-son, nephew and employee of George H. Peck, jointly or to the survivor as Trustees or Trustee for the annuitants." Endorsement D also provided that payments by Travelers to "any two of the Trustees or the survivor of them" discharged the company from liability and the agreement of September 7, 1925, (endorsement C) was specifically canceled and "said former agreement is hereby declared null and void."During the period 1923 to 1937, inclusive, George H. Peck purchased *793  18 other annuity contracts from six different insurance companies for the benefit of Alma Peck and/or Leland Peck.  The total cost of these 18 annuity contracts was $ 470,722.91.  In each of these 18 annuity contracts the annuity payments were to be paid by the respective insurance companies during the lifetime of Alma Peck or Leland Peck, (subject to the prior termination of the annuity benefits) in one of the several manners stipulated by the parties, which we briefly summarize as follows: to one of the incompetents, to both, to both share and share alike or the survivor, to both or the survivor.The total cost of all of the annuity contracts, i. e., the 14 with Travelers*39  and the 18 with the six other companies, was paid by George H. Peck from his own funds or by Alma Peck and Leland Peck from funds which had been given to them by their father George H. Peck.In a private trust agreement dated April 30, 1936, in which the Security-First National Bank of Los Angeles is trustee, George H. Peck appointed William Peck as guardian of the person of Alma Peck and as guardian of the person of Leland Peck.  After the death of George H. Peck the Superior Court of California confirmed this appointment as hereinafter more fully explained.During 1936 George H. Peck suffered a stroke of paralysis which left him unable to attend to his business affairs.  He appointed Wm. Peck, Charles T. Wilder, and Byron G. Hill as attorneys in fact to sign deeds and conveyances in fulfillment of contracts entered into prior thereto, and to endorse and deposit the annuity payments from Travelers.George H. Peck died January 9, 1940.During his lifetime George H. Peck did not, for various reasons, have legal guardians appointed for Alma Peck and Leland Peck.  In his last will and testament, which was admitted to probate on January 30, 1940, George H. Peck appointed Security-First*40 National Bank of Los Angeles, a National Banking Association, William Peck, and Byron G. Hill, or the survivor, as guardians of the estate of Alma Peck and the estate of Leland Peck.  On or about March 15, 1940, the parties appointed guardians by George H. Peck filed petitions in the Superior Court of California in and for the County of Los Angeles entitled, "Petition for Confirmation of Appointment of Guardian of the Person and of Guardian of the Estate" of Alma Peck and of Leland Peck.  On April 23, 1940, the Superior Court appointed William Peck guardian of the person of each incompetent, which confirmed George H. Peck's appointment in the private trust agreement dated April 30, 1936, and appointed the petitioners herein guardians of the estate of each incompetent, which confirmed George H. Peck's appointment in his last will and testament.During the life of George H. Peck, Travelers made any payments due under the 14 annuity contracts to George H. Peck as "conservator." *794  Before his stroke Peck endorsed the annuity checks and deposited them in various bank accounts standing in the name of Alma Peck or Leland Peck as joint incompetents. After George H. Peck's stroke the*41  Travelers' annuity checks on hand were returned to the Company with the power of attorney.  Travelers thereupon reissued the checks in the names of William Peck, Charles T. Wilder and Byron G. Hill, as attorneys in fact for George H. Peck.  The attorneys in fact endorsed the annuity checks and deposited them in the same bank accounts that George H. Peck had used.  During his lifetime George H. Peck treated the Travelers' annuity payments as a guardian would treat the income of his ward in that he reported them as income of the annuitants for Federal income tax purposes.Following the death of George H. Peck, Travelers paid the annuities to William Peck, Byron G. Hill and Charles T. Wilder "as trustees" for the annuitants "under an agreement executed by George H. Peck on 7-22-30", i. e., endorsement D.  After the death of Charles T. Wilder on December 18, 1940, Travelers issued the annuity checks to the two remaining "trustees" who deposited the checks in bank accounts in which they were designated as trustees, or the survivor as trustee for Leland Peck or Alma Peck, as the case may be.  None of the annuity checks from Travelers was turned over to the respective guardianship estates*42  during 1942 and 1943.Immediately after the death of George H. Peck and until the guardians were appointed on April 23, 1940, all Travelers checks were deposited in a bank account with the Security-First National Bank standing in the name of Leland Peck or Alma Peck.  The annuity checks deposited during this period were made out by Travelers exactly the same as were the annuity checks after the appointment of guardians and until the death of Charles T. Wilder.  The bank account to which the checks were credited bore no designation such as "trustee" or "trustees", but it was actually, if not legally, controlled by William Peck, Byron G. Hill and Charles T. Wilder.  This procedure was similar to that followed by George H. Peck during his lifetime. Upon the appointment of the guardians this bank account was turned over to them.Annuity payments on the 18 annuity contracts aforementioned were made by the six insurance companies by checks to Leland Peck or Alma Peck as the case might be.  Prior to his stroke George H. Peck accumulated the checks until a substantial number had been received.  He then had the checks endorsed by the respective incompetents and deposited them in various bank*43  accounts standing in the name of Alma Peck or Leland Peck as joint incompetents. In depositing the annuity checks George H. Peck made no distinction between the Travelers payments and payments by the other six insurance companies.  After George H. Peck became incapacitated, Byron G. Hill *795  accumulated the checks, secured the endorsements of the incompetents thereon, and deposited them in one of the bank accounts as George H. Peck had done prior thereto.  The attorneys in fact for George H. Peck had no authority over the annuity payments from these 18 annuity contracts; the annuity checks were physically endorsed by the respective incompetents. After George H. Peck's death and until the appointment of the guardians the annuity payments on the 18 contracts continued to be handled as they were after George H. Peck's stroke and before his death.  After the guardians were appointed annuity payments from the six insurance companies were returned with copies of the letters of guardianship, the checks were reissued to the guardians for the incompetents, and the checks were endorsed and deposited in guardianship accounts.  From and after April 23, 1940, on which date the adjudication*44  of the incompetency of Alma Peck and Leland Peck became effective, The Security-First National Bank of Los Angeles, William Peck, and Byron G. Hill, as guardians of the estate of each incompetent, have collected and accounted for all of the annuity payments from the 18 annuity contracts.For the years 1940 and 1941 William Peck and Byron G. Hill filed Fiduciary Income and Defense Tax Returns (Form 1041) for Alma Peck and Leland Peck on which they reported the taxable portion of the annuity income from Travelers, but on which fiduciary returns no tax was reported or paid with the explanation that "all of the income reported hereon was reported to and the tax thereon paid by Security-First National Bank of Los Angeles as co-guardian of the estate of" each incompetent.Individual Income Tax Returns (Form 1040) were filed for the years 1940 and 1941 by the Security-First National Bank of Los Angeles as co-guardian of the estate of Alma Peck, incompetent, and Leland Peck, incompetent, respectively, on which the taxable portion of all the annuity income from Travelers, as well as the other six insurance companies, along with other income, was reported and the tax paid thereon.For the years*45  1942 and 1943 William Peck and Byron G. Hill filed Fiduciary Income Tax Returns (Form 1041) for Alma Peck and Leland Peck on which they reported the taxable portion of the annuity income from Travelers and paid the tax thereon.The Security-First National Bank of Los Angeles, as co-guardian of the estates of Alma Peck, incompetent, and Leland Peck, incompetent, in filing the Individual Income Tax Returns (Form 1040) for 1942 and 1943, did not include the taxable portion of the annuity income from Travelers with the other income which was thereon reported.In his notices of deficiency respondent determined that the taxable portion of the annuity income from Travelers represents income taxable to the estate of Alma Peck, incompetent, and the estate of Leland *796  Peck, incompetent, respectively, rather than income taxable to "trusts" for each of these incompetents as reported in the fiduciary returns, as filed.Endorsements C and D aforementioned are the only written documents that were ever executed with reference to the creation of the alleged "trusts" involved herein and the appointment of the alleged "trustees" who were to receive, and who have received, the proceeds of the*46  annuity contracts with Travelers.George H. Peck did not intend to nor did he create a valid trust within the meaning of section 161 of the Internal Revenue Code by endorsement D, attached to and made a part of the 14 Travelers' annuity contracts.OPINION.There is no dispute about the amount of taxable income derived from the Travelers' annuity contracts.  The dispute is whether the guardianship or the "trust" estates are taxable thereon.  Respondent determined that this income is taxable to the guardians of the incompetents upon the theory that George H. Peck did not intend to nor did he create a valid trust. The guardians contend that the agreement of July 22, 1930, between George H. Peck and Travelers created a valid trust, that distribution of corpus or income of the trust was discretionary with the trustees, that no distribution of any kind was made during the taxable year 1943, and that under the circumstances herein the law requires the trust income to be taxed to the trust estate. Section 161, Internal Revenue Code.Section 161 (a) of the Code provides that the taxes imposed by this chapter upon individuals "shall apply to the income of * * * any kind of property held in*47  trust, * * *." A like provision for taxing the income of any kind of property held in trust appears in section 219 of the Revenue Acts of 1918 and 1921.  Interpretations by the courts as to the meaning of the provisions of section 219 have established the rule that is followed today.  In Stoddard v. Eaton, 22 Fed. (2d) 184, the court held that Congress did not use the word "trust" in section 219 of the early acts as comprehending every type of trust recognized in equity.  A trust ex maleficio, a resulting trust, or a constructive trust were cited by the court as examples of trusts which did not fit into the framework of the revenue statute.  And the court specifically stated: "A trust, as therein understood, is not only an express trust, but a genuine trust transaction.  A revenue statute does not address itself to fictions." See also, Claud McCauley, 17 B. T. A. 886, affd., 44 Fed. (2d) 919; Prudence Miller Trust, 7 T.C. 1245">7 T. C. 1245.It is stipulated and we have found that the incompetents were beneficiaries of two express trusts created by George H. Peck, one*48  a very *797  substantial inter vivos trust, 1 and the other a testamentary trust.  The existence of these express trusts for the benefit of the incompetents must be weighed and considered in deciding whether George H. Peck intended to create a third trust for their benefit, or intended to provide for their comfort, support and maintenance in another manner.In determining whether George H. Peck created a third trust we must ascertain his purpose and intent in executing endorsement D, which is the only written instrument evidencing the trust, if any.  Since that instrument is not a formal trust indenture, we must look to the surrounding conditions and the circumstances which motivated him.  Our findings set forth in some detail *49  his method of handling the Travelers' annuity payments, the annuity payments from the other six insurance companies, and excerpts from correspondence relating to the Travelers' annuity contracts.  We have also detailed the treatment of these payments before and after Peck's stroke, after his death, and after the appointment of guardians for the incompetents.The most revealing evidence of George H. Peck's intentions with respect to the annuity payments is found in the statements made to Travelers in connection with the purchase of contracts or changes in contracts already written.  His purpose, as therein stated, was to provide the annuitants with a permanent monthly income during their lifetime. He sought by every possible restriction and limitation to provide them with a permanent monthly income. He insisted on provisions in each contract that would prohibit him, any court appointee, or the annuitants themselves from assigning or commuting the annuity payments for a lump sum.  His first concern was the security of his incompetent children.  He recognized that he could obtain a court appointed conservator or guardian for the annuitants, but he preferred to handle their affairs himself*50  without judicial authorization.  He recognized too that when he died it would be necessary for a guardian to be appointed for the incompetents and he sought to assure them of an income during the interim between his death and the appointment of a guardian by insisting that Travelers provide in the last two annuity contracts for payment directly to the annuitants. Travelers' refusal to issue annuity contracts on the application of the incompetents may explain Peck's purchase of the 18 annuity contracts from the other insurance companies during the period 1923 to 1937, inclusive.It should also be noted that Peck repeatedly ignored the suggestion from Travelers that he appoint a trust company to act as trustee for his incompetent children.  When he executed endorsement C, he selected members of his own family who were presumably familiar *798  with his wishes to serve as the trustees.  Likewise, when he canceled endorsement C by executing endorsement D, it was members of his family and a trusted employee who were appointed trustees.  His long and intimate associations and confidential relations with these three trustees evidently reassured Peck that his own personal methods of *51  providing for the comfort, care, maintenance, and support of his incompetent children would be continued after his death.The correspondence relative to the Travelers annuity contracts negatives any intent on Peck's part to create an express trust by the execution of endorsement D.  The reaction of the named "trustees" to the situation that arose with the death of Peck also refutes the suggestion, belatedly made by them, that Peck intended to create a trust.  During the period between Peck's death and the appointment of guardians the "trustees" deposited the annuity checks from Travelers to the credit of the incompetents. With the appointment of the guardians by the Superior Court the funds deposited in this account were turned over to the guardians, a treatment completely in accord with Peck's intentions, as we understand the evidence, but utterly inconsistent with the petitioners' present contentions that Peck intended to and did create a trust.The "trustees" attempted to excuse such treatment of this account on the ground that they had actual if not legal control of the account.  But it is our opinion that this was exactly what George H. Peck intended to accomplish by his designation*52  of them as "trustees." He wanted to provide for his incompetent children during the period following his death and prior to the appointment of guardians by the Superior Court, and the evidence shows that he anticipated a much longer lapse of time than actually occurred.  Peck refused by his actions to create a trust for the annuity payments during his lifetime, and the acts of his "trustees" after his death in following the same procedures Peck had used during his lifetime supports our determination that no express trust was intended or created by endorsement D, and that this was the understanding of the "trustees" during the years 1940 and 1941.Even after the "trustees" began depositing the Travelers' annuity payments in a bank account which designated them as "trustees", they continued to treat the payments as George H. Peck had treated them during his lifetime. It is stipulated that Peck "treated such funds as a guardian would treat the income of his ward in that he reported them as income of the annuitants for Federal income tax purposes." Our findings show that for the calendar years 1940 and 1941 the taxable portions of the Travelers' annuity payments were reported as income*53  of their wards by the guardians of the incompetents, petitioners herein.  It was not until the taxable years 1942 and 1943 that petitioners concluded that the taxable portions of such payments should *799  be taxed to William Peck and Byron G. Hill as trustees under endorsement D to the contracts.We are convinced that petitioners' original treatment of the Travelers annuity payments was correct.  It was clearly in accordance with Peck's procedures during his lifetime. The direction to Travelers to pay the annuities to named individuals, as trustees, was based not upon any intent to create an express trust, but upon confidence and faith that the named individuals would continue the procedures adopted by Peck during his lifetime for the care, comfort, maintenance and support of his incompetent children.  In view of our determination that Peck did not intend to create an express trust by his directions to Travelers, and in view of the established rule that the revenue statutes relate to express trusts, and not constructive trusts, Prudence Miller Trust, supra, we hold for the respondent on the disputed point.  In so holding we have considered Elizabeth Earhart Kennedy, 38 B. T. A. 1307,*54  cited by petitioners, but find it inapplicable to the present facts.It being stipulated that other adjustments have been resolved by the parties, the deficiencies should be recomputed in accordance with the foregoing and with the agreed adjustments.Decisions will be entered under Rule 50.  Footnotes1. The size of this trust is undisclosed, but the extent of the provision made by Peck for his incompetent children is indicated by the estimated annual income therefrom of $ 20,000 for each incompetent as shown by the schedule filed with the petition for the appointment of guardian.↩