Court Opinion

ID: 5229217
Source: CourtListenerOpinion
Date Created: 2022-01-06 16:52:15.893125+00
Date Added: 2024-06-11T08:27:38.466666
License: Public Domain

Dowling, J.:
This is an appeal from an order of the Surrogate’s Court, dated August 5, 1912, modifying the decretal portion of an order of the same court, made February 6, 1912, by adjudging that the tax to be levied upon the three respective remainders, after the chief and surviving life estates of Wolcott Gr. Lane, Sarah S. Lane and Elizabeth Gr. L. Moss, was presently payable, and not to have payment thereof suspended, as had theretofore been reported by the appraiser herein.
This appeal involves the construction to be placed upon the will of the decedent, by which she undertook, among other things, to dispose of a fund received by her from her father, Charles C. Grriswold, wherein she and her sister, Sarah J. Gr. Spencer, *696were the life tenants. The 2d article of her will recited the advice which she had received from counsel that the ultimate disposition in her father’s will was void and of no effect, and that as to said remainder he died intestate, she being entitled to a share therein. She then undertook to dispose of said fund with the exception of $5,000 (which she left to her daughter, Sarah S. Lane, absolutely), by devising and bequeathing the same to her trustees in trust to pay over the net income therefrom, in equal shares, to each of her children, Elizabeth Gr. L. Moss, Wolcott Gr. Lane and Sarah S. Lane. She then provided that upon the death of any child before her, leaving issue which should survive the testatrix, or upon the death of any child after her, leaving issue, the net income to which the deceased child would have been entitled, if living, should be divided per stirpes, and not per capita, among said issue. Upon the death of the last survivor of her three said children she gave, devised and bequeathed one-third part ,of the principal of such trust estate to and among the then surviving issue of each of her deceased children, in equal shares, per stirpes and not per capita, provided that they should not receive the principal of their shares until they had reached the age of twenty-one years. After making various other provisions intended to cover the possible cases of the death of a child survived by a husband or wife only, and of the death of a child without issue and unmarried, she thus provides at the end of the said 2d article: “ I hereby authorize and empower each of my said children to dispose by his or her last will and testament, executed after my death, to and among such person or persons, and in such way or manner as he or she may think proper, the whole or any part of one equal third part of the principal of said property so held in trust as aforesaid and remaining upon the termination of all of said life estates.”
We are of the opinion that in view of the clear and unambiguous language of this 4th paragraph just cited there can be no question of the right of the children of the testatrix to execute the power of appointment thus conferred. Had there been no power of appointment thus given the remainders would have absolutely vested in the children of the testatrix. The inclusion of the clause giving the remainder to the issue *697of the children in the face of this power of appointment may be explained by the desire of the testatrix to avoid intestacy as to any of her estate in case the power of appointment should not be exercised. In any event the only intent upon the part of the testatrix which can fairly be spelled out from this will is that she gave the power of appointment to her children, and in default of its exercise only was the remainder to go to their issue.
The law applicable to the taxation of this estate is to be found in section 220 of the Tax Law (Consol. Laws, chap. 60; Laws of 1909, chap. 62), for the amendment made by chapter 706 of the Laws of 1910, under the stipulated facts herein, did not take effect until after the death of the testatrix, which happened on the same day upon which the statute was passed and took effect. Under the law as it stood at the time of Mrs. Lane’s decease no transfer tax could be imposed until the power of appointment had been exercised, for it was the exercise of that power and not the creation of the power itself which effects the transfer which the statute makes taxable. (See Matter of Howe, 86 App. Div. 286; Matter of Burgess, 204 N. Y. 265.)
The order appealed from will, therefore, be reversed, with ten dollars costs and disbursements, and the objection of the State Comptroller to the suspension of the taxation upon said remainders overruled, which leads as well to the reinstatement.of the original order of February 5, 1912.
Ingraham, P. J., Laughlin, Scott and Hotchkiss, JJ., concurred.
Order reversed, with ten dollars costs and disbursements, objection of Comptroller overruled, and original order reinstated. Order to be settled on notice.