
    In the Matter of the Estate of Amelia G. Ullmann, Deceased.
    
    
      (Court of Appeals,
    
    
      Filed March 7, 1893.)
    
    Collateral inheritance tax — Power of surrogate to construe will. The surrogate has power, in collateral inheritance proceedings, under § 15 of the act, to determine the invalidity of a provision of the will, and that the property subject to tax has not passed to the legatees or devisees, but to the heirs at law or next of kin; especially where everyone interested in the property has so treated it and acted accordingly.
    Appeal from order of the supreme court, general term, first department, reversing decree of surrogate in collateral inheritance tax proceedings.
    
      Horace Russell, for app’lt; De Lagnel Berier, for resp’ts.
    
      
       Reversing 50 St. Rep., 748.
    
   O’Brien, J.

The order of the general term, from which this appeal was taken, reversed a decree of the surrogate of the county of New York, assessing and imposing a tax upon certain heirs at law of Amelia Gr. Ullmann, who died in the year 1890, leaving a will, which was admitted to probate. This tax was imEosed by the surrogate under the authority of chapter 483 of the iaws of 1885, amended by chapter 713 of the Laws of 1887, commonly known as the collateral inheritance tax law. The deceased, by her will, gave the income of all her property to her husband, Daniel Ullmann, for and during his life and made certain other bequests which were conceded to be valid The bulk of her estate she attempted to dispose of in the residuary clause to her executors, of whom her husband was one, upon certain trusts which were invalid as contravening the statute against perpetuities, as the estate was sought to be vested in the Society for the Prevention of Cruelty to Animals after the expiration of four lives in being at the death of the testatrix. Objection was made to the probate of the will by the heirs at law on account of the invalidity of these provisions. The society, which by the terms of the will would ultimately be entitled to the property if the residuary clause was valid, as well as the executors, admitted that the objections were good and that the disposition in trust was void This concession would leave the specific legacies and a life estate to the husband contained in the will to stand, but the remainder of the property, not having been validly disposed of by the deceased, would pass under the statute as in cases of intestacy, the personal property to the husband, there being no children, and the real estate to the heirs at law. All parties interested in the estate recognized this situation and acted accordingly. The society thereupon purchased the real estate from the heirs at law and they conveyed the same to it by quit claim deeds for a consideration representing substantially its full value. In the negotiations which culminated in this settlement it was foreseen that the heirs might be liable to pay the tax in question, and, therefore, a sufficient sum for that purpose was retained by the counsel for the society for that purpose if it was determined that they were liable for its payment.

The will, however, containing some provisions that were valid, was admitted to probate by consent of all parties. The executors by application to the surrogate initiated this proceeding for the assessment and adjustment of the tax. The heirs at law and all parties interested were for this purpose cited and appeared before the surrogate, who had before him not only the will, which upon its face showed the invalidity of the provision referred to with respect to the residuary estate, but, also, all the facts above stated. The result was that the heirs were assessed for that portion of the estate which passed to them under the statute, and the surrogate treated the residuary clause, as the heirs and all parties interested in the estate had treated it, as void. Three of the heirs, only, questioned the action of the surrogate and appealed to the general term, where the order of the surrogate was reversed, as already stated. The reversal proceeded upon the ground that the surrogate had no power in such a proceeding to determine the invalidity of any provision of a will. While we think that this case does not necessarily turn upon that question, yet if it did there would be no difficulty in sustaining the decree of the surrogate. The fifteenth section of the statute, under which the tax was assessed, provides that, “ The surrogate’s court in the county in which the decedent was a resident at the time of his death shall have jurisdiction to hear and determine all questions in relation to the tax arising under the provisions of this act” Aside from the ordinary jurisdiction of the surrogate this is a special grant of power in broad and comprehensive language, and there can be no good reason for hampering the power thus conferred by any construction that would take from him the authority to decide every question that may arise in the proceeding before him which may be necessary in order to fully discharge the duties imposed upon him by the act Every officer charged with the duty of executing the taxing, power, "whether it be a surrogate or a town assessor, must necessarily decide, in a judicial capacity, important questions of law in order to perform the duties of his office. Ordinarily such decisions do not, like judgments in actions, conclude the parties as to the same question in subsequent proceedings instituted for some other purpose, although in all such proceedings for the assessment of the tax it ought to and doubtless would, until reversed or set aside. In re Wolfe, 137 N. Y., 205; 50 St. Rep., 406.

The surrogate must decide whether any property of a deceased person has passed to another under a will or under the laws of intestacy before he can perform the duty imposed upon him. It may sometimes happen that the property of the deceased passes in both ways. The fact that there is a will, and that it has been admitted to probate, does not necessarily determine the ownership or the transmission of the property. When the surrogate looks into the will some of its dispositions may be so clearly void as to» warrant him in holding that nothing has passed by virtue of them, but that the property embraced therein has passed to heirs or next of kin under the statutes of descent ór distribution. In the numerous cases that have been passed upon by this court recently, arising under this statute, we have held that the surrogate was clothed with power, and that it was his duty to decide questions arising under wills or under the statutes quite as intricate and important as that arising out of the residuary clause of the will in this case. In re McPherson, 104 N. Y., 306; 5 St. Rep., 680; In re Enston, 113 N. Y., 174; 22 St. Rep., 569; In re Sherwell, 125 N. Y., 379; 35 St. Rep., 403; In re Romaine, 127 N. Y., 80; 38 St. Rep., 76; In re Stewart, 131 N. Y., 274; 43 St. Rep., 171; In re Wolfe, 137 N. Y., 205; 50 St. Rep., 406; In re Prime, 136 N. Y., 347; 49 St. Rep., 658; In re Swift, 137 N. Y., 77; 50 St. Rep., 81.

In the settlement of the accounts of executors and the distribution of the personal estate under a will, the surrogate is empowered to determine the validity of testamentary provisions under statutes that are not more explicit or comprehensive than the one now under consideration. Code, §§ 2472, 2481, 2743; In re Verplanck, 91 N. Y., 439; Purdy v. Hayt, 92 id., 446; Riggs v. Cragg, 89 id., 479; Garlock v. Vandevort, 128 id., 378; 40 St. Rep., 418; In re Wagner, 119 N. Y., 32; 28 St. Rep., 266; In re Cager, 111 N. Y., 343; 19 St. Rep., 497.

The jurisdiction conferred by the statute upon the surrogate to hear and decide all questions in relation to the tax imposed by its provisions upon persons to whom property has passed from a decedent is, we think, broad enough to warrant the surrogate in holding, in a case like this, that,the property which is the subject of the tax has not passed to the legatees or devisees under the will, but to the heirs at law or next of kin. But in this proceeding it appeared before the surrogate not only that this provision of the will of Mrs. Ullman, was invalid, but that everyone interested in the property so treated it and acted accordingly.

It appeared that the beneficiaries under the residuary clause conceded its invalidity, and abandoned all claim to the property to the heirs. That the latter sold it and received the consideration therefor, and thus that they, as matter of fact, took it under the statute, and that it did not pass under the will, and further, that out of the price received for the property they had made provisions for the payment of the tax in case it was held that they were liable for its payment In view of all this, it would be an indefensible rule that would compel the surrogate to close his eyes to the facts and to the law arising from the disposition of the will and to still decide that the tax should be assessed upon the legatees or devisees named therein, though he knew that they did not and could not receive any part of it It was shown that the heirs were not only entitled to the property, but that they actually received it, and hence that it passed to them as in case of intestacy.

It follows that the order of the general term must be reversed and the decree of the surrogate affirmed, with costs in all courts to the appellant against the respondents.

All concur.  