First Trust & Savings Bank v. County of Los Angeles

LANGDON, J.

This is an appeal by the defendant from a judgment allowing recovery of taxes paid by the

[241]

plaintiff as executor of the last will of Caroline Dillingham. Her estate consisted of a substantial interest as beneficiary under a trust in which a Wisconsin company was trustee. The terms of the trust were that the trustee should hold the

corpus

of the trust, and invest and re-invest the same, paying over the income to the beneficiary, and upon her death the entire

corpus

of the trust was to be paid to her executor.

The will of decedent was admitted to probate and the respondent was appointed executor thereof on March 7, 1922. The trustee subsequently sold the capital stock constituting the trust fund and remitted the proceeds to the executor. The first Monday in March of the year 1922 fell on the sixth, the day before the executor was appointed. Some time thereafter the assessment was levied.

The question presented by the appeal is whether the interest which the estate had in said trust on March 6, 1922, was taxable. The estate, as the successor in interest of Caroline Dillingham, also had an equitable interest in the trust property until the

corpus

was paid over to the executor. In the case of

Estate of Dillingham,

196 Cal. 525 [238 Pac. 367], involving this same trust, it was held that this equitable interest constituted taxable property in this state for the purpose of inheritance taxation. It has been held that the rules of construction with reference to the use of the word “property” in our inheritance tax law (Stats. 1921, p. 1500) are applicable to the same term in the laws governing the levy and collection of an ordinary property tax.

(Chambers

v.

Mumford,