71 A.D. 581 | N.Y. App. Div. | 1902
However desirous we may be to give a liberal. construction in order to uphold a levy under the Transfer Tax Act (Laws of 1896, chap. 908, art. 10, as amd.), we think there is an insuperable -objection to sustaining, the tax fixed in this proceeding. Ordinarily on the death of a member of a firm the legal title-to the assets of the firm vests in the surviving members, and what is left to the representatives of the deceased partner is the right to an accounting. (Williams v. Whedon, 109 N. Y. 333.) Assuming, however, but not deciding, that the decedent had a property interest in the assets of the firm in this- State which is subject to taxation, we find it impossible to get away from the conclusion that' as against such property the right exists to deduct the debts due to creditors in this State.
It is true that the firm did not owe the persons from whom it purchased the goods; but it did owe for discounts and loans effected, the proceeds of which were applied towards the purchase price of the property. That no distinction, however, can be drawn between debts due to those from whom the purchase was made as against banks from whom the money was obtained to pay for such purchase, was held in People ex rel. Bijur v. Barker (21 App. Div. 480). Therein, this court, affirming a decision of Mr. Justice Beekman, adopted his language that, “ it is too narrow a construction to hold that the statute refers only to the immediate debt to the vendor for the purchase money. It includes as well a debt incurred upon the borrowing of money from another with which to pay the vendor.”
Our conclusion, therefore, is, that as the debts in this State exhausted the value of the property here, no tax could be imposed, and that, accordingly, the order should be reversed, with costs, and the motion to confirm the report of the appraiser should be denied.
Van Brunt, P. J., Patterson, McLaughlin and Laughlin, JJ., concurred.
Order reversed, with costs, and motion denied.