: June 27, 1946.
PRATT'S ESTATE ET AL.
COMMISSIONER OF INTERNAL REVENUE.
Before SWAN, CLARK, and FRANK, Circuit Judges.
In 1903 Harold I. Pratt created a trust for a term measured by the lives of two individuals and the survivor of them. The trust income was to be paid to the settlor during his life and upon the termination of the trust the corpus was to be paid to him, if living, and, if not, to others. He died in 1939 before the end of the trust term.The corpus of the trust was included in the settlor's estate as a transfer "intended to take effect in possession or enjoyment at or after his death" within the meaning of section 811(c) of the Internal Revenue Code, 26 U.S.C.A. Int. Rev. Code, § 811(c). The petitioners contend that the application of the section to a trust created before the enactment of a statute imposing an estate tax is unconstitutional. Concededly a decision in their favor requires us to overrule Commissioner v. Flanders, 2 Cir., 111 F.2d 117. The rule we there laid down for valuing the settlor's interest in the trust property was shown to have been too favorable to the taxpayer in Commissioner v. Estate of Field, 324 U.S. 113, 65 S. Ct. 511, 89 L. Ed. 786, 159 A.L.R. 230. But we find nothing in the Supreme Court cases nor in the petitioners' able argument to convince us that the Flanders decision was wrong with respect to the constitutional point. On the authority of the Flanders case, the decision is affirmed. See also Matter of Pratt's Estate, 262 App. Div. 240, 28 N.Y.S. 2d 997, affirmed 289 N.Y. 621, 43 N.E. 2d 839.
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