215 Mass. 129 | Mass. | 1913
This is a petition brought under St. 1909, c. 490, Part IV, § 21, by the executors of the will of a testator who died a resident of New York, for instructions whether certain property of the testator was "within the jurisdiction of the Commonwealth” within the meaning of those words in St. 1907, c. 563, § 1, and thus subject to an inheritance tax. This petition relates only to certain shares in five different real estate trusts. All the property both real and personal of all the trusts was in this Commonwealth, and all the trustees lived here. The places of business and books of the trusts were also in Massachusetts, where alone the certificates could be transferred upon surrender and new ones issued in their stead. It is not necessary for the purposes of this judgment to state in detail the terms of the several trust instruments. In general the subscribers join for the purpose of purchasing and developing certain real estate and agree to contribute money therefor. The legal title to all the property of each of the trusts is in the trustees, who have control over the property with power to invest and hold personal property and to distribute net earnings among the shareholders, but no power to bind the shareholders personally. The trustees are subject to a limited direction on the part ■ of the shareholders. Two of the trusts contain the further provision that the shares represented by the certificates are to be and remain as to title personal property only, and be held, bequeathed, assigned and distributed as personal estate.
The language of the taxing statute indicates “an intention on the part of the Legislature to tax all property that it has the power to tax. The statute is as broad as the jurisdiction of the Commonwealth.” Knowlton, C. J., in Kinney v. Treasurer & Receiver General, 207 Mass. 368, 369.
The nature of the interest held by shareholders under trust agreements similar to those here involved has been before the courts frequently. In Kinney v. Treasurer & Receiver General, the legal title to real and personal estate was in the trustees, the interests of the individual contributors to the trust being repre
It is not necessary to analyze with greater nicety the precise character of the property interest of a shareholder under each of the trusts. It is true of all of them that their rights are equitable interests in tangible property within this Commonwealth. While the legal title is in the trustees, their ownership is fiduciary, and the. certificate holders are the ultimate proprietors of the property, which is held and managed for their benefit, and which must be divided among them at the termination of the trust. Their rights constitute not choses in action but a substantial property right. In this respect the case is indistinguishable in principle from shareholders in a domestic corporation. Greves v. Shaw, 173 Mass. 205. The fact that the certificates themselves were not within the Commonwealth is an immaterial circumstance. Kennedy v. Hodges, ante, 112.
Decree of Probate Court affirmed.