
    In the Matter of the Appraisal of the Estate of James F. Corbett, Deceased, under the Law Relating to Taxable Transfers of Property. William J. Morgan, Comptroller of the State of New York, and Edwin B. Temple, Treasurer of the County of Washington, Appellants; Cornelius Corbett and Ellen Corbett, Beneficiaries, Respondents.
    
      Tax wider the Transfer Act — the §10,000 limit relates to the aggregate of the transfers to taxable persons, not to that passing to each.
    
    Section 321 of the Tax Law (Laws of. 1896, chap. 908) -provides that transfers of property to the persons mentioned in that section “shall not be taxable under this act, unless it is personal property of the value of ten thousand dollars or more, in which case it shall be taxable under this áct at the rate of one per centum upon the clear market value of such property.”
    Section 243 of the act provides, in substance, that the words “estate” and “property,” as used in this article, shall be taken tornean the property or interest therein of the testator, passing or transferred to those not herein specifically exempted, from the provisions of this article.
    
      
      Held, that property transferred is taxable, irrespective of its amount if the aggregate of the transfers to taxable persons exceeded §10,000;
    That all the persons mentioned in section 221 are taxable persons.
    Appeal by William J. Morgan, Comptroller of the State of New York, and another, from a decree of the Surrogate’s Court of the county of Washington, entered in said Surrogate’s Court on the 13th day of April, 1900, revoking the transfer tax theretofore fixed upon the shares passing to Cornelius Corbett and Ellen Corbett, and adjudging that such shares are exempt from taxation under the Transfer Tax Law.
    Section 221 of the Tax Law (Laws of 1896, chap. 908), referred - to in the opinion, is as follows: “ When the property or any beneficial interest therein passes by any such transfer to or for the use of any father, mother, husband, wife, child, brother, sister, wife or widow of a son' or the husband of a daughter, or any child or children adopted as such in conformity with the laws of this state of the decedent, grantor, donor or vendor, or to any person to whom any such decedent, grantor, donor or vendor for not less than ten’ years prior to such transfer stood in the mutually acknowledged relation of a parent, or to any lineal descendant of such decedent, grantor, donor or vendor born in lawful wedlock, such transfer of property shall not be taxable under this act unless it is personal property of the value of ten thousand dollars or more, in which case it shall be taxable under this act at the rate of one per centum upon the clear market value of such property. But any property heretofore or hereafter devised or bequeathed to any person who is a bishop, or to any religions, corporation, shall be exempted from and not subject to the provisions of this act.”
    James F. Corbett died intestate, leaving as his next of kin a brother, a sister and two nieces. Upon appraisal the total amount of his estate for final distribution was $11,880.69, all of which was personal property. The brother and sister each took a third of that amount, and the two nieces divided the remaining third between them.
    Upon the report of the appraiser a tax of one per cent was imposed upon each of the shares of the brother and sister and of five per cent on each of the shares of the two nieces. On appeal by the brother and sister to the surrogate the tax of one per cent upon their shares was revoked, upon the ground that their shares together, not amounting to $10,000, they were exempt from taxation under the Inheritance Tax Law.
    From the order of the surrogate revoking such tax the Comptroller of the State and the treasurer of the county appeal to this court.
    
      J. A. Kellogg, for the appellant.
    
      Edgar Hull and Lewis E. Carr, for the respondents.
   Parker, P. J.:

The reasons upon which the decision is' based in Matter of Hoffman (143 N. Y. 327) are, in my opinion, conclusive against the conclusion which the surrogate reached in this case.

In the case cited the question was presented whether a bequest to a mother valued at less than $10,000 was taxable. The effect of the amendment of 1892 (Chap. 399) upon the Inheritance Tax Law, as it stood prior to that date, is there discussed at length and fully explained. It is there said that the object of the amendment was to make the imposition of the tax depend upon the amount of property disposed of by the transferrer, and not upon the amount received by the particular transferee: Prior to that amendment the court had held that under the provisions of an act, which was substantially the same as section 221 of the act nów in force, no tax could be levied against an amount passing to either of the persons mentioned in that section, unless it was personal property and exceeded in value $10,000. But-by the provisions of section 22, as amended and added in 189,2, and which is substantially the same as section 242 of the present law,, the valuation must be placed upon the whole estate disposed of, and not - upon the particular share. After a careful discussion of the purpose and effect of such amendment, Judge Finch, writing for the court, says: “.And so we are prepared to say that the interest, of the mother is taxable at one per cent, although itself of a value-of less than ten thousand dollars, because the aggregate transfers by the will to taxable persons exceeded that amount.” Here the reason of the decision is concisely stated. When the aggregate transfers by the will to taxable persons exceed $10,000, the share to a-mother is taxable, although less than $10,000, and if to a mother the same rule applies to either of the persons mentioned in such section 221.

In the case at bar, if the aggregate transfers to taxable persons exceed $10,000, then each particular recipient thereof, no matter how small his proportion was, must be taxed at the fate which the statute imposed as against such recipient. Thus a brother and a sister are each in the category of those who are to be taxed at the rate of one per cent. A niece is in the category of those who are to be taxed at the rate of five per cent.

The phraseology of the amending section (242 in the present statute) is substantially as follows: The words estate and property, as used in this article, shall be taken to mean the property or interest therein of the testator, intestate, etc., passing or transferred to those not herein 'specifically exempted from the provisions of this article, etc. That is, not all of the testator’s property -which he bequeathes is to be included in the- valuation-to ascertain whether it exceeds $10,000, but only such as he transfers to those not specifically exempted, etc. This phrase Judge Finch expressed by the phrase taxable persons.” The surrogate lias held that all of the persons mentioned in section 221 of the act are specifically-exempted. In other words, that they are not “ taxable persons; ” and so the amount distributed to the brother and sister is not to be included in the valuation of the deceased’s estate, and hence the aggregate amount transferred does not, under the statute, exceed $10,000. But it is plain that a brother and a sister, and all those persons mentioned in section 221, are not exempted from * * * the provisions of this act.” They are taxable persons under the act. The same section does specifically exempt from “ the provisions of this act ” a bishop and a religious corporation. Any bequest to them could not be included in the valuation of the estate, but bequests to any or either of the persons mentioned in section 221 are not to persons specifically exempted from the provisions of the act, and hence are to be included in such valuation. The bequests to them make a part of the aggregate transfers - * * to taxable persons,” and including such bequests in this case the case is brought squarely within the principle declared in the Hoffman case.

I conclude, therefore, that the order appealed from should' be reversed, and the order made upon the report of the appraiser, dated December 22, 1899, should be affirmed.

All concurred, except Kellogg, J.,‘ not voting.

Order of the surrogate; reversed, with ten dollars costs and disbursements, and the order made upon the report of the appraiser, dated December 22, 1899, affirmed.  