in the event of a transfer effected by the exercise, by a resident of Rhode Island, of a power of appointment created by a resident of New York, is not taxable in New York, the property being bonds and mortgages physically situated in New Jersey, and the bulk of the trust estate being secured by mortgages on real estate within the state of New York.24 When a man by will exercised a power of appointment as to property situated in New York in favor of his wife, who disposed of the property by will which was probated in another state, the property, although removed from New York before distribution under her will, was held subject to the inheritance tax.25 But where a nonresident testator, whose property was entirely without the state, left specified property in trust for his daughter for life, with power to appoint the remainder after the trust, and the trustee was a resident, and thereafter the daughter, then a resident of the state, executed the power by will, it was decided that this exercise was not a taxable transfer.26 It has also been decided that an estate of a nonresident testator, acquired as appointee named by a legatee for life, with power to name the remainderman, may be assessed prior to the administration of the estate of the legatee, who dies shortly before the appointee." Where a resident of the state gave a power of appointment by her will, and the appointee, also a resident 27 New York to pass to the appointees in accordance with the provisions of the will probated in New Jersey. Therefore the jurisdiction of the state of New York to tax the transfer of property passing under the will of decedent is limited to the property situated in this state at the time of her death." 24 Estate of Fearing, 138 App. Div. 881, 123 N. Y. Supp. 396. 25 Estate of Lord, 111 App. Div. 152, 97 N. Y. Supp. 553, affirmed, 186 N. Y. 549, 79 N. E. 1110. 26 Estate of Thomas, 39 Misc. Rep. 136, 78 Ky. Supp. 981. 27 Estate of Chabot, 44 App. Div. 340, 60 N. Y. Supp. 927, affirmed, 167 N. Y. 280, 60 N. E. 598. of the state, exercises the appointment by will, the beneficiary becomes liable under the transfer tax of New York, although the property, real and personal, is situated without the state.28 § 84. Probate Court Having Jurisdiction.-Since it is the exercise, not the creation, of a power of appointment which effects the transfer against which the tax is enforced, the surrogate of the county in which the donee of the power resided at the time of his death, and in which his will is probated, and not the surrogate of the county in which the creator of the power resided, has juirsdiction to determine whether the transfer is taxable.29 Where the donee of a power, who is a nonresident of the state, exercises the power in connection with real property in 28 Estate of Hull, 111 App. Div. 322, 97 N. Y. Supp. 701, affirmed, 186 N. Y. 586, 79 N. E. 1107. "We are of opinion," said the court in reversing the surrogate's decision in this case, "that the learned surrogate has fallen into error in reversing the original decree in this matter, due to the confusion of the question by an entirely irrelevant detail in relation to the situs of the property which passed to the said Ida M. Hull. The question is not where the property was located, or whether it was real estate or personal property, but whether the beneficiary came into its possession through the exercise of a privilege conferred by the state of New York. . . . . It being the privilege upon the right to succession to property by means of a will that is taxed, and the subject of the litigation being within the jurisdiction of the state, it seems clear that the beneficiary under the power of appointment contained in the will of Caroline C. Hull, a resident of this state, upon the exercise of that power by Wager J. Hull, likewise a resident of this state, is bound to pay the tax imposed upon that privilege, regardless of the question of where the property to which the power related was located. Ida M. Hull gets all of her rights in and to the property by reason of the exercise of the power (a privilege granted by the state of New York), and she may not be relieved from that obligation because of the fact that the property itself was without the jurisdiction of the state at the time the power was exercised. That is an entirely irrelevant matter." 29 Estate of Seaver, 63 App. Div. 283, 71 N. Y. Supp. 544; People v. Williams, 69 Misc. Rep. 402, 127 N. Y. Supp. 749. the state, the surrogate court in the county where the land is situated has jurisdiction to assess the tax.3° 30 § 85. Rate of Taxation-Relationship of Parties. The relationship of the parties, which determines the rate of taxation, or whether any tax at all can be assessed, is the relationship between the donee of the power of appointment and the appointees. This necessarily follows from the propositions that the donee is regarded as devising to the appointees property of which he is the absolute owner, and that it is his exercise of the power, not the creation of the power, which effects the taxable transfer."1 § 86. Time for Assessment of Tax.-As the exercise of a power of appointment, rather than the creation of the power, effects the transfer which is taxable, remainders subject to the power of appointment are not taxable until the time comes for the exercise of the power to appoint conferred upon the life beneficiary. The tax is to be assessed at his death on the present value of all the property passing under the power.33 Remainders created in a trust fund by the exercise of a power of appointment are subject to taxation at the time of the transfer under such act, 32 80 Estate of Lowndes, 60 Misc. Rep. 506, 113 N. Y. Supp. 1114. 31 Estate of Seaver, 63 App. Div. 283, 71 N. Y. Supp. 544; Estate of Walworth. 66 App. Div. 171, 72 N. Y. Supp. 984; Estate of Rogers, 71 App. Div. 461, 75 N. Y. Supp. 835, affirmed, 172 N. Y. 617, 64 N. E. 1125. The rate of taxation will be found discussed in the very recent case of Estate of Burgess (N. Y.), 97 N. E. 591. 32 Estate of Howe, 86 App. Div. 286, 83 N. Y. Supp. 825, affirmed, 176 N. Y. 570, 68 N. E. 1118; Estate of Burgess (N. Y.), 97 N. E. 591. 33 Estate of Tucker, 27 Misc. Rep. 616, 59 N. Y. Supp. 699. But see Hoyt v. Hancock, 65 N. J. Eq. 688, 55 Atl. 1004. That the value of the property is determinable as of the date of the death of the donee of the power, rather than as of the date of the death of the creator of the power, sce Fisher v. State, 106 Md. 104, 66 Atl. 661. if they are absolute and not subject to be devested or to fail in any contingency whatever, and their present value is determined by aid of the table of annuities.34 34 Matter of Dows, 167 N. Y. 227, 88 Am. St. Rep. 509, 52 L. R. A. 433, 60 N. E. 439. CHAPTER VI. LIFE ESTATES, REMAINDERS, AND CONTINGENT INTERESTS. § 90. Life Estates and Annuities. § 91. Vested Remainders. § 92. § 93. § 94. Future and Contingent Estates-Earlier New York Rule. § 95. § 96. Future Contingent Estates-Minnesota Rule. Future Contingent Estates-Pennsylvania Rule. § 97. Future Contingent Estates-Wisconsin Rule. § 98. Future Contingent Estates-Tennessee Rule. § 99. Future Contingent Estates-Massachusetts Rule. Future Contingent Estates-United States Rule. Person or Fund Liable for Tax. § 100. § 101. § 102. Amount of Tax on Contingent Remainder. § 103. Law Governing Tax-Retrospective Statute. § 90. Life Estates and Annuities are not overlooked by the inheritance tax statutes; their passing by last will and testament are made transfers presently taxable, and in some, perhaps all, jurisdictions this is true although they may be devested or cut down to an estate for years by the act or omission of the life tenant. The value of the life estate is ordinarily ascertainable by aid of mortality tables. In New York it is calculated by the methods and stand 1 In re Hoyt, 37 Misc. Rep. 720, 76 N. Y. Supp. 504. In Estate of Plum, 37 Misc. Rep. 466, 75 N. Y. Supp. 940, a devisee was held taxable as for an estate for life, although she might, by marrying, cut down the estate to one for a term of years only. But in an earlier case it was decided that the value of a bequest by the testator to his widow for life or until she again married could not be determined for purposes of the transfer tax until the termination of her estate: Estate of Millward, 6 Misc. Rep. 425, 27 N. Y. Supp. 286; and the New York court of appeals, under the former statute of that state, affirmed that the value of a life estate subject to determination by the remarriage of the life tenant could not be ascertained until the estate terminated: Matter of Sloane, 154 N. Y. 109, 47 N. E. 978. The New York statute now provides that "where an estate for life or for years can be devested by the |