Court Opinion

ID: 9443551
Source: CourtListenerOpinion
Date Created: 2023-08-03 19:24:43.04182+00
Date Added: 2024-06-11T17:29:32.239985
License: Public Domain

MAGRUDER, Chief Judge
(concurring).
This -is certainly a close case. I do not dissent from the opinion and judgment of the court, though I am still somewhat troubled by the considerations expressed in my concurring opinion in Gammons v. Hassett, 1 Cir., 1941, 121 F.2d 229, 234, certiorari denied, 1941, 314 U.S. 673, 62 S.Ct. 136, 86 L.Ed. 539.
In Ithaca Trust Co. v. United States, 1929, 279 U.S. 151, 49 S.Ct. 291, 73 L.Ed. 647, the Court looked not at the trust instrument alone, but also at the extrinsic facts, and reached the conclusion that as of the moment of the testator’s death there was no substantial likelihood that the corpus would be invaded for the benefit of the life tenant under the limited power of invasion conferred in the will; that the amounts which would ultimately be received by the charities in remainder were affected with “no uncertainty appreciably greater than the general uncertainty that attends human affairs.” 279 U.S. at page 154, 49 S.Ct. at page 291, 73 L.Ed. 647. On that factual conclusion, the charitable deduction was allowed. If there is a “clear Congressional policy not to benefit the national revenue at the expense of charitable institutions,” it seems that the decided cases have drawn an unfortunate line in denying a charitable deduction where-ever the power to invade corpus is conferred in terms embracing “factors which cannot he accounted for accurately by reliable statistical data and techniques” 320 U.S. at page 261, 64 S.Ct. at page 111, 88 L.Ed. 35, even though on the existing facts and circumstances one might conclude to a moral certainty that the power would never he exercised and that the unimpaired remainder would go to the charity upon the death of the life tenant. In Gammons v. Hassett, supra, 121 F.2d at page 234, I pointed out:
“Theoretically the contingency is broader and the chance of its occurrence less capable of estimation than in the Ithaca Trust case, because it depends upon the life tenant’s desires as well as her needs. But practically speaking, upon the facts in the present *595record as compared with the facts in the Ithaca Trust case, the charitable remaindermen are at least as well assured — perhaps somewhat better assured — of receiving the corpus intact upon the death of the life tenant.”
Upon the facts appearing in Gammons v. Hassett it was indeed fantastic to suppose that the corpus would ever be invaded. Yet the charitable deduction- was denied. Likewise, the charitable deduction was denied in Merchants National Bank v. Commissioner, 1943, 320 U.S. 256, 64 S.Ct. 108, 88 L.Ed. 35, the Court disregarding as irrelevant the conclusion of the Board of Tax Appeals that there was reason to believe that the life tenant would never want more than the income from the trust and that “the possibility of corpus being invaded is sufficiently remote to justify the deductions claimed.” 45 B.T.A. 270, 274. Instead of having to split hairs between “comfort and welfare” on the one hand and “comfort, support, maintenance, and/or happiness” on the other, it might seem more logical to adopt either of two alternatives: (1) To deny the charitable deduction unless the testator has given an indefeasible remainder to charity upon the death of the life tenant, or (2) to allow the deduction in full wherever it - is properly found as a fact upon consideration of all the circumstances that the chance of invasion of the corpus is negligible, however broadly or narrowly the power to invade corpus may be expressed in the will.