140 N.Y.S. 13 | N.Y. App. Div. | 1913
The decedent left a last will and testament which purports to have been executed on the 29th day of May, 1901, and two codicils thereto, in which it is recited that they were executed on the same day that the will bears date. She died on the 4th day of November, 1904. Prior to her death, but whether prior to the execution of the will does not appear, her son, George W. Merritt, who survived his mother but has since died, had married and his wife had obtained a decree of absolute divorce from him in this State.
By her will the testatrix directed her executors to divide her residuary estate into eight equal parts and directed that they should invest two of said parts and apply the net income arising therefrom to the use of her son, George W. Merritt, during life, with the remainder over to his issue or to her other children or their issue, with a proviso that out of such income the executors should pay to Augusta Temple Merritt, who was or had been the wife of said George W. Merritt, an annuity
By the 1st codicil she revoked the provision charging the annuity of $3,000 against the income given to her son and substituted therefor a provision directing her executors to set apart from her estate a sum sufficient to buy and she authorized them “to buy $60,000 5% Railroad Bonds and collect the income and interest thereof and apply the same to the use of Augusta Temple Merritt for her life only, or so long as she shall remain unmarried.” No change was made by the 2d codicil aifecting these provisions. It was shown by the affidavit of one of the sons of the testatrix that prior to the execution of the will the testatrix had entered into an agreement in writing with said Augusta Temple Merritt wherein and whereby the testatrix agreed to pay the said Augusta Temple Merritt the sum of $2,800 per annum for life or until, remarriage; that after the death of the testatrix said Augusta Temple Merritt sued the estate, claiming both the annuity under said agreement and under the will; that this litigation was settled on the 23d day of May, 1901, and that by the settlement agreement “said Augusta Temple Merritt was to receive the amount of Twenty-eight hundred ($2800) dollars per year as in said contract provided, but in regard to her claim to the entire income of the fund of Sixty thousand ($60,000) dollars so established ” by the will “she accepted the sum of One thousand ($1,000) dollars per annum and waived and renounced all claim to any greater amount,” and that the settlement on these terms was made in good faith and as the result of the contention by said Augusta Temple Merritt that she was entitled to both annuities, which was contested by the executors. The present value of the life use of the trust fund of $60,000 given to said Augusta Temple Merritt by the will was determined to be the sum of $38,350, and a tax upon that amount was assessed at the rate of five per cent.
The appellants contend that a tax of only one per cent should
The executors further contended that it was error to impose the tax upon the theory that Augusta Temple Merritt took under the will the income from the entire fund of $60,000, when it appears without controversy that before receiving any income under the will she formally renounced her claim to the extent of two-thirds thereof. Of course, if those interested in the residuary estate took the two-thirds interest renounced by
It follows that the order should be modified by reducing the tax on the fund of $38,350 to one per cent on two-thirds thereof and five per cent on the remaining one-third, and as thus modified affirmed, without costs.
Ingraham, P. J., McLaughlin, Clarke and Scott, JJ., concurred.
Order modified as directed in opinion, and as modified affirmed, without costs. Order to be settled on notice.