seems to be in conflict with a prior decision in the same state.63

64

§ 153. Masses for Repose of Souls.-It has once been affirmed in New York that a bequest to the Roman Catholic church for masses to be read for the repose of the soul of the testatrix is exempt from the transfer tax. But on another occasion it was decided that a bequest to executors in trust to expend for masses for the repose of the soul of the testatrix and her husband was subject to the tax imposed by the collateral inheritance act.65 On a subsequent occasion it was held that a direction to executors to expend, in their discretion, a certain sum for masses for the repose of the soul of the testatrix was a gift to the executors for a religious use upon a valid and effectual trust, and that the transfer should be taxed at the rate of five per cent. A mass is not necessarily a part of the funeral service, and hence a bequest to a priest to say masses is not exempt from the transfer tax as a funeral expense."

66

67

Bequests for masses have been pronounced for charitable purposes in California, and therefore held exempt from the inheritance tax.67

§ 154. Societies for Prevention of Cruelty.—Bequests for the benefit of a society for the prevention of cruelty to animals are for a public charity.68 An in

63 Estate of Vinot, 7 N. Y. Supp. 517. For Pennsylvania decisions on this question, see Hurst v. Cookman, 1 Lanc. Law Rev. 60; Estate of Walters, 1 Pa. Co. Ct. Rep. 447; Estate of Long, 22 Pa. Super. Ct. 370.

64 Estate of Didion, 54 Misc. Rep. 201, 105 N. Y. Supp. 924.

65 Estate of Black, 1 Con. 477, 5 N. Y. Supp. 452.

66 Estate of Eppig, 63 Misc. Rep. 613, 118 N. Y. Supp. 683.

67 Estate of McAvoy, 112 App. Div. 377, 98 N. Y. Supp. 437.

67a Estate of Herzo, 2 Cof. Pro. Dec. 165.

68 Minns v. Billings, 183 Mass. 126, 97 Am. St. Rep. 420, 5 L. R. A., N. S., 686, 66 N. E. 593.

stitution whose purpose is so laudable and humane, and therefore so worthy of encouragement, is quite as much entitled to exemption from the inheritance tax as many other charities that enjoy such exemption. But in New York, though the decision was rendered nearly a quarter of a century ago, it was decided that a bequest to a society for the prevention of cruelty to animals was subject to the legacy tax. And recently it has been held in that state that a testamentary gift to a society for the prevention of cruelty to children is not exempt from the transfer tax.7

69 Estate of Keith, 1 Con. 370, 5 N. Y. Supp. 201.

70

70 Estate of Moses, 138 App. Div. 525, 123 N. Y. Supp. 443.

14

CHAPTER X.

CIRCUMSTANCES AFFECTING LIABILITY FOR TAX.

§ 158. Compromise of Will Contest or Litigation-Pennsylvania Decisions.

§ 159. Compromise of Will Contest-Illinois Decisions.

§ 160. Compromise of Will Contest-New York Decisions.

§ 161. Compromise of Will Contest-Iowa Decisions.

§ 162. Compromise of Will Contest-Massachusetts Decisions.

§ 163. Compromise of Will Contest-Other Decisions.

§ 164. Renunciation or Waiver of Legacy.

§ 165. Compensation to Executor or Trustee.

§ 158. Compromise of Will Contest or LitigationPennsylvania Decisions.-A compromise of litigation or of a will contest cannot be resorted to as a mere device for evading the payment of an inheritance tax; for courts look beyond the form of any arrangement, whereby the commonwealth is deprived of a tax, to its substance to ascertain its real purpose. Hence an agreement to set aside a will and to make distribution in accordance with its provisions or otherwise will not relieve legacies otherwise taxable from the burden which the law imposes upon them. But the view prevails in Pennsylvania that money paid in good faith in compromise of threatened litigation or of a will contest is not subject to the legacy tax.1

It has been decided in that state that the collateral inheritance tax is not payable on the money which legatees, who are collaterals, authorized the executor

1 Estate of Hawley, 214 Pa. 525, 6 Ann. Cas. 572, 63 Atl. 1021. In Appeal of Commonwealth, 34 Pa. 204, the testator devised his entire estate to his executors in trust for legatees and devisees; the widow declined to take her legacy, but afterward, by an arrangement with the executors approved by the court, accepted a sum less than her share of the estate and relinquished her claim to the residue. It was held that she took this sum under her paramount title as a widow, not out of the fund bequeathed in trust, and therefore that it was not subject to the collateral inheritance tax.

to pay to a disinherited son of the decedent, in pursuance of a compromise by which the son's caveat was withdrawn and the will admitted to probate;2 and that such tax cannot be imposed upon money paid to extinguish the title of persons who claim adversely to the decedent, or upon property surrendered by way of compromise to persons who so claim. The theory of the first of these decisions appears to be that the portion of the estate that passed to the son was never accepted by the legatees, and that a bequest is not effectual without acceptance. In the second decision the court declared that "no liberality of construction can extend the language of the statute so as to make it include either moneys paid to extinguish the title of persons claiming adversely to the decedent, whose estate is liable to taxation, or property surrendered by way of compromise to persons so claiming, and thus never forming part of decedent's estate at all."

§ 159. Compromise of Will Contest-Illinois Decisions.-The Illinois court has declined to assent to the

2 Estate of Pepper, 159 Pa. 508, 28 Atl. 253. In this case the will gave the estate to collateral kindred and strangers, and to avoid a contest they yielded a portion of the estate to a son. The issue was whether this portion was subject to a tax. In deciding in the negative, the court said: "We have reached the conclusion that under the most favorable construction of the act, so far as respects the contention on behalf of the commonwealth, they are not so liable, and for the reason that the amount paid caveator was never received by them as legatees, and under the act it is only so much of the estate which actually passes to them by virtue of the will that is liable to the tax. It will readily be seen, if the contest instituted by the caveator had been successful, he would be entitled under the intestate law to the entire estate, and freed from the tax; but, instead of further litigation, he accepted a portion of the estate, relinquished his claim to the balance, and thus, of course, reduced the amount passing to the legatees, and, in fact, to the extent of the amount he received, the will is a nullity, so that all the legatees take is the amount of their bequests after deducting the sum paid the caveator and this they concede is subject to the tax."

& Estate of Kerr, 159 Pa. 512, 28 Atl. 354.

reasoning and conclusion of these two Pennsylvania cases, and has held that a sum paid by executors, by virtue of an agreement among the residuary legatees, to an heir in consideration of his promise not to contest the will, is no part of the expenses of administration to be deducted from the estate in ascertaining its value for purposes of the inheritance tax. To adopt the language of the court: "No changes of title, transfers, or agreements of those who succeed to the estate, among themselves or with strangers, can affect the tax. All questions concerning it must be determined as of the date of decedent's death. . . . . The statute requires all the property of the estate to be appraised at its fair market value. The value of the estate which passes is the value so ascertained less the indebtedness of the decedent and the expenses of administration. Whatever litigation may occur between those who succeed to the estate as to their respective rights, or between different claimants of interests, cannot affect such value. The fair market value so ascertained is the basis upon which the amount of the tax must be fixed. Unjust claims may be made against those succeeding to the estate, and they may be put to great expense in defending their property, but the value of the property or of their respective interests in the property is not thereby affected. . . . . It is argued that the heir received the sum paid her as the value of her interest in the estate by virtue of the fact that she was heir, and that it therefore passed by descent. In fact, however, she received nothing as heir. She received nothing from the estate. No beneficial interest passed to her under any statute. The money was paid to her by virtue of a contract with the heirs. The decedent died testate. His will disposed of all of his estate. The whole of the residuary estate vested, at the instant of his death, in the residuary legatees. The inheritance tax was then due and pay

...