
    Westchester County
    Hon. OWEN T. COFFIN, Surrogate.
    March, 1890.
    Matter of Underhill.
    
      In the matter of the estate of Edward B. Underhill, deceased.
    
    A legacy of five hundred dollars payable one year from the date of letters testamentary is not subject to the collateral inheritance tax, as its cash value is less than five hundred dollars.
    
      A legacy to an institution for the blind which does not under any circumstances receive pay from its patients is exempt from the collateral inheritance tax.
    A legacy to a creditor upon condition lhat he accept the same as payment in full of all unsettled accounts and claims held by him against testator, such accounts and claims being somewhat in excess of the amount of the legacy, is not subject to the collateral inheritance tax.
    Appraisement of the estate of Edward B. Underhill, deceased, for the purpose of fixing the value of certain legacies claimed to be subject to the collateral inheritance tax.
    The appraiser appointed herein to fix the fair market value of certain legacies claimed to be subject to taxation under chap. 713 of the Laws of 1887, has among other things reported the value of the following legacies thus:
    Abraham S. Underhill, and two others, as executors, in addition to their legal commissions and expenses, each . . . $500.00
    The New York Institution for the Blind $500.00
    The American Society for the Prevention of Cruelty to Animals . . . $500.00
    The N. Y. Soc. for the Prevention of Cruelty to Children ..... $500.00
    Henry C. Kear ..... $4,000.00
    The question arises as to whether these several legacies are subject to the tax.
    R. H. Underhill, for the executors.
    
    Platt & Bowers, for New York Institution for the Blind.
    
   The Surrogate.

There were three executors named in the will, all of whom qualified. To each of those who should qualify and act the testator bequeathed five hundred dollars, over and above his legal commissions and expenses, one half of which sum was made payable one year after he should have qualified as such, and the other half on the final accounting, which could not, by reason of the provisions of the will, occur in less than seven years. Section three of the act provides for a case where a bequest is made in lieu of commissions; but these bequests are given in addition to them and are not, therefore, within the purview of that section. As the sum is only five hundred dollars to each and is not made payable immediately, but-such payment is postponed, as stated, the present cash value is less than five hundred dollars, and thus all are exempt from the tax.

The bequests of five hundred dollars each to the several charitable institutions, are also exempt because payable at the end of a year from the date of the letters testamentary, and the cash value therefore is less than five hundred dollars, as recently held by me in the Matter of Peck, 2 Connoly Surr. Rep. 203. The legacy to the institution for the blind is claimed to be also exempt on the ground that it does not receive pay from patients under any circumstances. This is alleged on its behalf and is not controverted. Hence it is exempt as an almshouse, under subd. 4, sec. 1, title 1, chap. 13, part 1, Revised Statutes.

The testator bequeathed to Henry C. Rear, his foreman, who had for many years managed several large farms of his, the sum of four thousand dollars, payable as soon as might be after testator’s decease, upon condition that he should accept the same in full of all unsettled accounts and claims against him, other than the amount of any note or notes he might hold. It was made to appear that the amount of Kear’s claim for services was, exclusive of any such notes, somewhat in excess of the sum bequeathed, but that he was willing to accept the legacy in full. Had no bequest been made in this form, but Kear’s claim had been left in the class of “ all my just debts,” which a testator usually directs his executors to pay, it would certainly have been exempt from taxation. If he had simply bequeathed $4,000 without the mention of any claim, then it would have been taxable. Where a testator chooses to provide, in the form of a bequest, for the payment of a just debt, with a view possibly of obviating any question in the minds of his executors as to its amount or validity, he could do so with great propriety; but by doing it he could not clothe it with the character of a gift. Under the circumstances it will readily be seen that, by this provision of the will, no property is “ transferred by deed, grant, sale or gift,” as contemplated by the 1st section of this act, to Kear. He simply designates the mode of payment of a debt. It is accordingly held to be exempt from taxation under the act.  