Court Opinion

ID: 3697611
Source: CourtListenerOpinion
Date Created: 2016-07-06 06:37:35.780064+00
Date Added: 2024-06-11T15:38:06.803624
License: Public Domain

I have little quarrel with the law announced in the opinion of the majority of the court, but I do dissent from the application of that law to the facts presented in the record.
The majority opinion is predicated, not upon the facts as they existed at the time of the death of the decedent, but upon contingencies, possibilities, and alternatives, which could have existed but did not.
In the first place (and this must be constantly borne in mind in considering such facts as existed at the death of the decedent), legislative action constituting the imposition of a tax is to be strictly construed and closely limited to the area specifically covered by such legislation.
In Akron Transportation Co. v. Glander, Tax Commr., 155 Ohio St. 471,  99 N.E.2d 493, at page 476 of the opinion, it is stated:
"The decision of this question by the court is limited to an interpretation of the statutes involved. The court may not so construe the statutes, which are in effect taxing statutes, as to bring within the classifications established taxpayers not covered by the language thereof. The rule is well established that statutes imposing a tax will be construed strictly against the state and liberally toward the taxpayer and in no such instance will the language employed be extended by implication beyond its clear import."
What was the situation at the death of decedent when the "succession" is supposed to have occurred upon which the tax is levied?
Until decedent reached the age of 65, he had no right in the trust fund other than to name some person who should receive a fixed interest in such fund, created by the company and vested in the trustee. The whole situation resulted in a contractual status between the company and the trustee, with contingent *Page 131 
provisions for the benefit of the decedent, which never occurred.
It is not to be denied that decedent could have taken action which would have resulted in the application of the succession tax, or, on the other hand by discharge from his employment for cause, lost all connection with such fund.
He could not name a creditor as the person to receive a part of the fund, nor could he name any person without the consent of the trustee. He had contributed not one cent to the fund. He was not a party to the contract. He was definitely an outsider.
Other contingencies could have occurred which would have brought the taxing statute into operation. The person designated might have predeceased the decedent. The decedent might have failed to designate. In each of those cases payment would be made to his estate.
However, when all these contingencies, which never occurred, are eliminated, we find the decedent died without the slightest interest of any kind in the trust fund, for when he died the only thing he did possess, the right to name a person to receive his interest in what the company had given the trustee, manifestly died with him.
No property, even within the loose definitions of the statute, passed to anyone at his death.
When the decedent named the person who should be paid a sum out of the trust fund, and the trustee agreed to such designation, that person became the equitable owner of that amount, which increased as time went on under terms of the contract. From then on, the contractual relationship was between the company, the trustee, and the named recipient of an interest in the fund, except the right to receive the interest therein upon the employee's reaching age 65. *Page 132 
The death of the decedent was merely the time when the trustee should give the named person that which belonged to such person.
If the power of revocation, which was the sole vestige of any right left in the decedent, can be considered property, then truly the statutes involved are most liberally construed.
If succession is to be predicated upon the right of the named person to receive the fund dependent upon the death of decedent, this ignores the language of the statute — succession is to property from a resident. Nothing passed from the decedent to the named person at decedent's death. This fact appears so obvious that it seems little more should be said. An interest in a fund, created by the company, title to which fund was transferred to a trustee, became the property of the named person upon designation by decedent, and upon the death of decedent passed from the trustee to such named person.
The factual situation existing in the Pennsylvania case, regardless of what was said by the court deciding it, is easily distinguished from that here considered. In the Pennsylvania case, the decedent, up to the time of death, had a constant right to receive at his option a part of the fund. And more important, the trust fund in the Pennsylvania case was composed not only of contributions by the company, but of deductions from the wages of the decedent. In any event, the court is not bound by such decision.
The Legislature has seen fit to exclude insurance proceeds payable to designated beneficiaries from the operation of the succession tax. Although the instant fund may not be classed as insurance, still the policy of the state is apparent in freeing such successions from the application of the tax. There would be more *Page 133 
reason for including insurance proceeds in the succession tax than there is for construing the statutes here involved as applicable to the instant profit sharing and trust fund, for insurance is in many cases created and continuously augmented by the person who names a beneficiary thereof.
My conclusion, therefore, is that not only do the statutes relied upon fail to justify the tax, but that, observing the policy of the Legislature in the matter of insurance, it was not intended that the instant situation should be included within the purview of the statutes here considered. Hence, I think judgment should be rendered in favor of appellant.