Court Opinion

ID: 9754045
Source: CourtListenerOpinion
Date Created: 2023-08-28 19:40:50.211565+00
Date Added: 2024-06-11T07:27:47.583449
License: Public Domain

Concurring Opinion by
Mr. Justice Roberts:
While I concur in the result reaached by the majority, I do so because I believe that the payment made in this case is specifically made nondeductible by the Inheritance and Estate Tax Act of 1961, P. L. 373, 72 P.S. §§2485-101 to 2485-1201. It is my opinion that the claim presented by Milton Lazar’s designees was a liability of Lena Lazar’s estate within the meaning of §631, 72 P.S. §2485-631, and that the payment made in satisfaction of that claim was therefore deductible *177unless otherwise excludable. The mere fact that a claim or debt is contested does not render it any less a liability, which I define as any obligation which may be enforeable through legal compulsion. The settlement, which I assume to have been made in good faith, did nothing more than fix a value for and discharge a previously unliquidated liability.
However, it is my view that §632 of the act, 72 P.S. §2485-632, disallows any deduction for the payment made in satisfaction of this liability. Section 632 provides that: “Except as otherwise provided in sections 638 and 639, the deductions hereinafter set forth for indebtedness of the decedent, when founded upon a promise or agreement, shall be limited to the extent that it was contracted bona fide and for an adequate and full consideration in money or money’s Avorth.” I think it clear that this liability was “foundded upon a promise or agreement” Avithin the meaning of §632. The designees’ claim Avas grounded in and dependent upon the 1947 agreement between Milton and Lena, and I cannot believe that the intervening negotiations and litigation in any way affected the genesis of the asserted liability.
Having reached this conclusion, it is my view that •the deduction should not be alloAved because the indebtedness was not supported by “an adequate and full consideration in money or money’s worth.” I do not question the bona fides of the transaction or the presence of sufficient consideration to make the contract enforceable. But it is clear to me that §632 requires more than just legally sufficient consideration. Ninety-nine percent of Milton Lazar’s property Avas held by the entireties with his Avife; therefore the only consideration which he could have passed to Lena as compensation for her promise to leave his designees seventy-five percent of her estate was the right to possibly inherit some $2,000. Since this is hardly *178“adequate and full consideration in money or money’s worth,” I believe that the fl50,000 payment was nondeductible.