§ 220 Money Deposited in Bank. Farmers' Loan & Trust Company of New York as trustee under the will of Edward Husson. At his death the balance of his deposit was the sum of $73,715, of which it was shown that $2,000 belonged to the trust estate and the balance was his individual money. The Appellate Division held that individually the decedent occupied no contract relation toward the company, that the legal relation of debtor and creditor existed between the trust company and the decedent as trustee, and as such the debt was not property within this State within the meaning of the Taxable Transfer Act. The Court of Appeals reversed the Appellate Division, stating that, under the view of the Appellate Division, it would enable a large sum of money invested and left in this State, and enjoying the protection of its laws, to escape taxation, because the decedent had voluntarily commingled his own funds with those of an estate he represented; that while the relation of debtor and creditor technically existed, practically the decedent had his money in the bank, and could come and get it when he wanted it. It was an investment in this State subject to attachment by creditors, and if not voluntarily paid he could compel payment through our courts, and in order to enforce those rights it was necessary for him to come into this State, and that, conceding the deposit was a debt and that it was intangible, still it was property in this State for all practical purposes, and in every reasonable sense within the meaning of the Transfer Tax Act. In re Romaine, 127 N. Y. 80-89. The court held further that, while the distribution of the fund belongs to the State where the decedent was domiciled, yet such distribution cannot be made until his administra When Residuary Estate Not Presently Taxable. § 220 tor has come into this State to get the fund, and might possibly be obliged to resort to the courts for aid in reducing it to possession; therefore the fund has a situs here, because it is subject to our laws. "A reasonable test in all cases as it seems to me is: Where the right, whatever it may be, has a money value and can be owned and transferred, but cannot be enforced or converted into money against the will of the person owning the right without coming into this State, it is property within this State for the purpose of succession tax." A majority of the court concurred in the result reached by Vann, J., who wrote the opinion, but the majority of the court were of the opinion that a deposit of money in a bank, although technically a debt, is still money for all practical purposes, and as such is taxable. 247. The Mere Right to a Legacy or a Residuary Estate Is Not Presently Taxable. In the Matter of Phipps, 77 Hun, 325, 28 N. Y. S. 330; affd., 143 N. Y. 641, one Elizabeth Fogg, a resident of this State, made a will, in which she left her residuary estate, consisting of real and personal property, to Hiram Fogg, of Bangor, Me., and John H. Phipps, of Boston, Mass. Phipps died in Boston before the estate of Elizabeth Fogg had been administered, leaving a will, in which his interest in the estate passed to his wife. The question presented was whether the interest so transferred in the State of Massachusetts was taxable in the State of New York. The court held it was not, for the reason that such interest at the time a tax was attempted to be imposed had not been ascertained by an accounting of the executors, and until that had been done the legatee $ 220 When Legacy Not Presently Taxable. might not be able to maintain an action for its recovery. A somewhat similar question arose in the Matter of Zefita, 167 N. Y. 280. In that case Mrs. Hayward, a resident of Paris, bequeathed certain personal property in this State to her daughter, the Countess Zefita. The day the will of Mrs. Hayward was probated, the Countess, also a resident of Paris, died, and the Appellate Division held that the only question to decide was whether this property, which is in the hands of the executor of Mrs. Hayward, and is not yet administered upon, is now to be subject to a transfer tax against the legatee of the Countess Zefita, who was also a nonresident of this State. The Appellate Division (44 App. Div. 340-345, 60 N. Y. S. 927) held that the question must be decided as of the time when the appraisal was made, and, such appraisal having been made before the Hayward estate had been administered, that the personal property represented by the securities which the executor of Mrs. Hayward held, but which, upon the final administration of that estate, would have been paid over as the legacy bequeathed to the Countess Zefita, is not now taxable. The Court of Appeals affirmed this decision, saying: "We are of the opinion that the learned Appellate Division made a proper disposition of the case at bar in view of the situation existing at the time the tax was imposed. When the executor of Mrs. Hayward, the mother, shall have accounted and ascertained the amount of the residuary estate in his hands it will be his duty to see that the transfer tax is adjusted and satisfied before paying over the residue to the legal representatives of the Countess." Where Legatee Dies before Receiving Legacy. § 220 248. Legacy Payable to a Nonresident Who Died before Receiving It, When Taxable. In the Matter of Robert T. Clinch, 180 N. Y. 300, it was held that, where the will of a nonresident of this State has been admitted to probate in this State and securities representing the interest such nonresident had in the estate of his father, who was also a nonresident, have, since the legatee's death, come into the hands of his executors, and are, at the time of a transfer tax appraisal, in the possession of such executors in this State, the securities are subject to the transfer tax. Charles J. Clinch (father of Robert) died July 22, 1898, a resident of Paris, and his will was duly admitted to probate by the surrogate of New York county September 6, 1898, and a transfer tax was paid upon all his taxable property within this State. Under that will the son Robert was entitled to one-fourth of his father's residuary estate, subject to the dower of his mother in the real estate and a power of sale given the executors. Robert T. Clinch, also a resident of Paris, died April 12, 1899, and his will was admitted to probate by the surrogate of New York county February 23, 1900. All the property, real or personal, within the State of New York, which was owned by Robert T. Clinch at the time of his death, was the property in which he was interested under the will of his father. At the time of his death the executors of the father's estate had not accounted or made any distribution of the personal property among the residuary legatees mentioned in the father's will. After the death of Robert, and about June 14, 1899. § 220 Where Legatee Dies before Receiving Legacy. the executors of the father's estate distributed and set apart for the estate of Robert, and as the equivalent of his interest in the residuary estate of his father, certain securities and property, consisting of stocks of New York corporations, bonds, and other property within this State, which was taxed in the usual transfer tax proceedings upon the estate, by order entered April 20, 1903, and amounting to $21,729.36. The Appellate Division affirmed the order of the surrogate assessing the tax, and the only question presented upon the appeal was whether the property received by the executor of Robert T., after the death of said Robert T. Clinch, from his father's estate, was, at the time of its transfer to the executor of Robert T. Clinch, personal property within the State of New York, and subject to transfer tax proceedings under the will of Robert T. Clinch. On January 24, 1905, the Court of Appeals affirmed the decision of the Appellate Division, stating that the appellant contends that, at the time of Robert's death his interest in his father's estate was a mere chose in action, the situs of which was not this State, but at Robert's domicile in France, and hence was not property within the State and subject to our inheritance tax laws, and that the action of the executor subsequent to Robert's death, in receiving in satisfaction of that chose in action specific securities held in this State, could not subject the property to our inheritance tax if it was not liable to tax at the time of Robert's death. Judge Haight, in writing the opinion, says: We may concede for the discussion all the appellant claims except the single proposition that a claim due a nonresident from a resident of this State is not property within this State |