182 Pa. 157 | Pa. | 1897
Opinion by
John F. Miller, of Huntingdon, on August 24, 1893, died unmarried, without issue. He left an estate of about 170,000, nearly all of it personalty. He left a will, in which he made specific bequests to a number of collateral relatives, amounting in the aggregate to 142,000; the residue of the estate he be
Within one year after testator’s death the executor paid to the register of Huntingdon county, $670, collateral inheritance tax, computing it on the amount in his hands, less $4,000, which he reserved for expenses and possible contingencies. On May 23, 1896, the register of Huntingdon county petitioned the court for a citation to the executor to appear and show cause why decree should not be made against him to pay the collateral inheritance tax on the whole appraised estate, the amount of said tax being computed at $2,434.45, with interest thereon at twelve per cent from August 25, 1894. To this the executor made answer, setting out fully the facts of prolonged litigation, the amounts he had received, and the dates; also that a large sum as taxes had been collected in Iowa, and he is advised that the part of
On full hearing, the court below decided that portion of the estate in Iowa was subject to the Pennsylvania tax, and all the estate except a small portion of real estate outside of this state. The learned judge of the court below thus states a computation of the tax and his reasons therefor:
“ This tax was payable on August 24, 1894. The executor paid $670 of it on the 23d of August, and he is entitled to credit for that amount. The balance of the tax remains unpaid, and the act of assembly fixes the rate of interest on it at 12 per cent per annum, except where, from litigation or other unavoidable cause of delay, a portion of the estate cannot be settled, only 6 per cent per annum is chargeable on such unsettled portion until default. On account of litigation in the state of Iowa the sum of $27,997.57 did not come into the hands of the executor until March 16,1895. He would not be in default in the payment of the tax on that part of the estate until after that time, and would be liable for interest on it only at the rate of 6 per cent from the end of the year until he received it.
“Applying the foregoing method of computation, we find that there is due and unpaid collateral inheritance tax the sum of $1,788.92 ascertained as follows:
5 per cent on $178.50, value of furniture, &c. $ 8.92
5 per cent on $42,000, legacies paid, . . 2,100.00
5 per cent on $2,000 note of John H. Miller, 100.00
5 per cent on $5,000, paid to residuary legatee, 250.00
$2,458.92
Deduct amount paid Aug. 23, 1894, . . 670.00
$1,788.92
Interest from Aug. 24,1894, to March 16,1895, at 6 per cent, .... $ 35.65
Interest on same from March 16,1895, to this date, Nov. 16,1896, at 12 per cent, ..... 207.46
Interest on balance, $730, from Aug. 24,1894, to this date, Nov. 16, 1896, at 12 per cent, .' . 195.15 438.26
$2,227.18
Obviously, from this act, it was not the intention of a great commonwealth, where a faithful representative of an estate has striven both in her interests and those of the estate to perform Ms official duty, to harass him with vexatious litigation and the imposition of punitive charges, because of delay that was unavoidable.
It will be noticed, that, under the will, the whole of the collateral inheritance tax is to be paid out of the residuary estate devised and bequeathed to Mrs. Taylor; there is to be no abatement of specific legacies to the amount of the tax. The executor, however, voluntarily, at his own risk, paid the tax witMn one year on the amount received by him in Huntingdon county, less $4,000 reserved for expenses and contingencies. The law just quoted, then, had no further demands on him wMle the Iowa litigation was pending; for it is not disputed that the commencement and prosecution of that litigation was an unavoidable, though probably a very irksome duty. He prosecuted it, not only in the interest of the estate, but in the interest of the commonwealth, for had he not done so, and permitted one half the estate to go into the hands of a foreign administrator, the commonwealth would probably have lost at least one half the tax now claimed. That part of the estate was not settled, by reason of unavoidable litigation. On March 16, 1895, the executor received from that source $33,888.62, and on April 20, following, $5,000. But, when was the estate settled, so as to determine approximately the amount subject to the tax ? Litigation as to $10,000 is still pending; that claim, however, is not against the estate, but is made in its favor. There can be no more unfavorable result to the estate than a failure to recover the amount, and consequent payment of costs ; the residuary estate will be to that extent depleted, but that does not
The executor avers in his answer that it is doubtful if $7,000 will cover the expenses of final settlement. In view of the protracted and expensive litigation carried on in a distant state, we think this not an unreasonable sum to reserve for such contingency. We therefore affirm the decree of the court below, with this modification: That from the whole amount received by the executor, both in Pennsylvania and Iowa, there be deducted the sum of $7,000, to be retained by him for contingent expenses which may be incurred in the final settlement of the estate, and that interest at 6 per cent be computed on 5 per cent of balance from one year after the death of testator until the date of this decree. Thus:
Furniture,......$ 178.50
Legacies paid,..... 42,000.00
Note of John H. Miller, .... 2,000.00
Residuary legatee,..... 5,000.00
' $49,178.50
Deduct....... 7,000.00
$42,178.50
*163 Five per cent ...... $2,108.92
Deduct tax paid, ...... 670.00
$1,488.92
Interest on same at 6 per cent from August 24,
1894 to July 15,1897, .... $ 249.65
$1,688.57
This amount, the executor is directed to pay over to the register of wills of the county of Huntingdon, and as thus modified, the decree is affirmed.