In the Matter of the Transfer Tax upon the Estate of CHARLES C. TIFFANY, Deceased. LAURA WHEELER and CHARLES P. HOWLAND, as Executors of CHARLES C. TIFFANY, Deceased, Appellants; THE COMPTROLLER OF THE STATE OF NEW YORK, Respondent.
APPEAL by Laura Wheeler and another, as executors, etc., from an order of the Surrogate's Court of the county of New York, entered in said Surrogate's Court on the 24th day of January, 1911, affirming a prior order fixing a transfer tax.
Charles P. Howland, for the appellants.
Henry A. Miller, for the respondent.
On the 20th of August, 1907, the decedent, a resident of the State of Connecticut, died owning certain promissory notes which then, and for some time prior thereto had been in a safe deposit box in the city of New York. With two exceptions the notes were made by non-residents, and payment of all of them was secured by property outside of the State of New York. The question presented is whether they are subject to taxation under the Transfer Tax Act of this State. This act, as contained in the Tax Law (Gen. Laws, chap. 24 [Laws of 1896, chap. 908], § 220, as amd. by Laws of 1905, chap. 368; re-enacted by Laws of 1908, chap. 310, and Consol. Laws, chap. 60 [Laws of 1909, chap. 62], § 220 [a1] ), so far as material, provides that: 'A tax shall be and is hereby imposed upon the transfer of any property, real or personal, of the
value of five hundred dollars or over, or of any interest therein * * * in the following cases: * * *
'2. When the transfer is by will or intestate law, of property within the State, and the decedent was a non-resident of the State at the time of his death.'
It is admitted that the transfer was by will and that the decedent, at the time of his death, was a non-resident, but it is urged that the notes, the subject-matter of the transfer, are at most mere evidences of debts and are not taxable property within the State. It cannot well be doubted that the Legislature of this State in enacting the Transfer Tax Act considered promissory notes property and intended to impose a tax upon their transfer. Personal property is defined in section 4 of the Statutory Construction Law (Gen. Laws, chap. 1; Laws of 1892, chap. 677), which was re-enacted by section 39 of the General Construction Law (Consol. Laws, chap. 22; Laws of 1909, chap. 27), as follows: 'The term personal property includes chattels, money, things in action, and all written instruments themselves, as distinguished from the rights or interests to which they relate, by which any right, interest, lien or incumbrance in, to or upon property, or any debt or financial obligation is created, acknowledged, evidenced, transferred, discharged or defeated, wholly or in part, and everything, except real property, which may be the subject of ownership.'
The definition of personal property as thus given is applicable to cases under the Transfer Tax Act. ( Matter of Jones, 172 N.Y. 575.) But notwithstanding the fact that the Legislature intended by the Transfer Tax Act to make promissory notes owned by a non-resident, if located within this State at the time of the owner's death, subject to a transfer tax, nevertheless it is claimed that it failed to accomplish that purpose for want of power.
In Matter of Whiting (150 N.Y. 27) it was decided that bonds of foreign as well as domestic corporations, and certificates of stock of domestic corporations owned by a non-resident decedent and deposited by him in a safe deposit box in this State, were, at the time of his death, taxable under the Transfer Tax Act. Judge VANN, who delivered the opinion of the court, said: 'The law clearly distinguishes 'written instruments themselves' from 'the rights or interests to which they relate' * * * and makes
either taxable. * * * There is obvious propriety in subjecting the instrument of transfer to a transfer tax when it is left in this State for safe keeping. It is subject to the jurisdiction of our laws, and hence is within the intent of the Transfer Tax Act. When the design of the Legislature is to tax the transfer of everything that it has power to tax, there is no inconsistency in taxing in one form if another is not available. Indeed, perfect consistency is not always practicable in a scheme of taxation that is intended to let nothing escape that can be owned or transferred. Thus the Legislature intended, as I think, to repeal the maxim mobilia personam sequuntur, so far as it was an obstacle, and to leave it unchanged, so far as it was an aid, to the imposition of a transfer tax upon all property in any respect subject to the laws of this State.'
So far as this court is concerned, the identical question here presented has already been passed upon. (Matter of Wall,105 A.D. 643.) There, promissory notes made by a non-resident to a non-resident were, at the time of the latter's death, found in his safe deposit box in this State. A majority of the court held that such notes were property having a situs in ...