INHERITANCE TAXATION

(Joint accounts belonging solely to survivor are not taxable.)

The Surrogate's Court for Columbia County, New York, holds that where bank accounts standing in the joint names of a decedent and another, payable to either, are created or added to after May 29, 1915, and it satisfactorily appears that all the moneys so deposited were the sole property of the survivor, the accounts are not subject to the transfer inheritance tax of the State of New York.

The case involves a new point in the matter of taxing joint bank accounts in that the money involved was solely that of the survivor. The Surrogate says: "I refrain from here discussing the statutory and judicial history of the taxing of joint accounts created since May 20, 1915; the higher courts have already done so, and will doubtless do so again, when the question here involved comes directly before them. Were it not for the so-called dicta in Matter of Dolbeer, 226 N. Y. 624, 123 N. E. 382, perhaps the law would be considered well settled and all joint accounts irrespective of the manner of their creation, would be taxable. However, in the opinion of the court in the last mentioned case this significant statement is made:

""The record does not disclose who furnished the money which was deposited to the joint credit. Nothing indicates that the succession in this case was not donative in character (Matter of Orvis, 223 N. Y. 1, 7), and we may well reserve consideration of the application of the statute to a case where the survivor had previously acquired his interest for value.' "There is little to guide the mind as to what the highest court will actually do when a case similar to the one here comes before

it. A surrogate in one county fails to find anything in this statement which would conflict with the plain, unequivocal language of section 220, subd. 7, of the Tax Law, Consol. Laws, c. 60 (Matter of Bigelow [1919] 108 Misc. Rep. 601, 177 N. Y. Supp 847), while in another county the surrogate believed that the Court of Appeals in the Dolbeer opinion 'at least intimated that the source of the deposit and the character of the succession might be considered.' Matter of Weissbach (1920) III Misc. Rep. 501, 183 N. Y. Supp. 771. So that from courts of equal jurisdiction to this one I am confronted by conflicting though interesting and instructive opinions. Matter of Van Vranken, 110 Misc. Rep. 84, 179 N. Y. Supp. 752. Matter of Buchanan, 184, App. Div. 237, 171 N. Y. Supp. 708, I believe, involves an entirely different question, namely, that of agency.

"In this dilemma I prefer to follow the result in the Weissbach Case and substantially the reasoning of the learned surrogate who decided that case. After all, the courts are and should be the final arbiters of statutory language and intent and of the lawfulness and effect of statutes themselves. It is my opinion that the Court of Appeals intended in the Dolbeer Case to express a possible exception to the general rule of taxation of joint accounts created subsequent to May 20, 1915, and when that expression is coupled with the citation of Matter of Orvis. 223 N. Y. 1, 119 N. E. 88, 3 A. L. R. 1636, decided but a year previous, it is very significant. I have, therefore, given much consideration to Matter of Orvis, supra, and conclude from studying it that the Court of Appeals has already decided that 'the nature of the tax and the language of the statute considered in its entirety have convinced us that the Legislature did not, however, intend that all transfers by deed. grant,

* *

*

The

WASHINGTON LOAN

and TRUST COMPANY

WASHINGTON, D. C.

DISTRIBUTION OF TRUST FUND

(A trust fund cannot be distributed unless all persons interested therein are made parties.)

In the recent decision of Berin vs. United States Trust Company of New York, 193 N. Y. Supp. 753, the above principle is applied where it does not appear to the satisfaction of the court that one of the parties interested in the trust fund was dead. The court makes the interesting statement "that letters of administration are not prima facie evidence of the death of an intestate; that such letters may be issued where a person is presumed to be dead without actually proving death."

REMOVAL OF TRUSTEE

(Failure of Declaration of Trust to provide for removal of trustee does not preclude proceedings in equity for that purpose.)

A recent decision from Texas in Burnett vs. Smith, 240, 1007, brings attention to the increased use of the trust form of organization in business. (See "Trust Estates as Business Companies," 2nd Ed.)

In this case the Declaration of Trust establishing the North Texas Consolidated Oil & Gas Company did not contain any provisions for the removal of trustees. The court

BILLS AND NOTES

(Where words in a note are badly written or spelled they nevertheless prevail over figures.)

A note in the left hand corner mentioned the sum of "$9,060.00." The written portion of the note read "nine hounderd and sixty.“ The "h" was so written that it might possibly be mistaken for a "t."

The Supreme Court of Minnesota in Bonn vs. Mertz, 188 N. W. 262, held that the amount of the note is $960.00. The Court refers to the Negotiable Instrument Act, which contains the following provision: "Where the sum payable is expressed in words and also in figures and there is a discrepancy between the two, the sum denoted by the words is the sum payable; but if the words are ambiguous or uncertain, reference may be had to the figures to fix the amount."

Directors of the Lawyers Title & Trust Company of New York recently declared an extra dividend of 2 per cent. in addition to the regular quarterly dividend of 11⁄2 per cent.

The Logan Title and Trust Company and the Logan National Bank of Philadelphia are to be merged under the title of Logan Title & Trust Company with capital of $500,000. James J. Diamond will be president.

WACHOVIA BANK & TRUST COMPANY

A recent statement of the Wachovia Bank & Trust Company of Winston-Salem, N. C., shows aggregate resources of $22,427,000. To meet total deposits liabilities of $19,416,000 the company has assets as follows: Cash, $3.884,000; loans payable on demand, $1,776,000; loans payable in less than three months, $14,941,000; checks on other banks, $85,300; bonds, $453,467; real estate and banking houses, $1,285,000, leaving a surplus above liabilities of $3,010,243.

Richard G. Stockton has been appointed secretary and assistant trust officer. Не was formerly the law partner of A. H. Eller, now head of the trust department. Mr. Stockton is a native of Winston-Salem and graduated from the University of North Carolina, later studying law there and also at Columbia University. He was licensed to practice law in 1913 and formed a partnership with Mr. A. H. Eller. This partnership continued until 1918, when Mr. Eller withdrew from the firm in order to devote his entire time and attention to his duties as vice-president and trust officer of the Wachovia Bank and Trust Company. In 1917 he was elected solicitor of the Municipal

MILLION CAPITAL FOR "BIRMINGHAM TRUST"

Further evidence of the active growth of the Birmingham Trust & Savings Company of Birmingham, Ala., is contained in the recent announcement of an increase in capital from $500,000 to $1,000,000. This announcement follows closely upon the recent formal opening of the monumental new home of the company, which was described in the June issue of TRUST COMPANIES Magazine. With the increase in capital the "Birmingham Trust" enhances its prestige as one of the pioneer and strongest trust companies in the South which has always typified, in its policies, the most approved principles of fiduciary and banking administration.

A recent financial statement, exclusive of a large volume of trust holdings, shows combined resources of $13,578,000, deposits of $12,283,000 and besides capital an earned surplus of $700.000 and undivided profits of $89,366.

VALUABLE BUSINESS SURVEY BY U. S.

MORTGAGE & TRUST COMPANY

In addition to its large number of out-oftown correspondents, the United States Mortgage & Trust Co. of New Cork has a staff of mortgage department representatives in leading cities of the South and West who are in position to give accurate account of human conditions in their respective localities. As has been customary for several years past the U. S. Mortgage & Trust Company recently published the results of first hand information from their representatives and correspondents dealing with existing conditions in the South and West, including retail trade, crop outlook, industry, business and housing construction, rents, labor and building costs, mortgage market and rates. Following is a summary of the returns:

"Briefly, there would seem to be reason for optimism tempered by caution in general business and crop conditions. Industries are clearly tending toward a more healthy situation. The shortage of business space reported until recent months seems to have been provided for, and further busi

ness construction at this time will have a tendency to decrease rents. In housing, while the shortage created during past years perhaps warrants additional construction, the pronounced activity in this field, it would seem from this report, is in advance of business conditions. Should this movement slow down, adjustment in labor might result: meanwhile, building costs should be scrutinized with great care and in many instances discounted.

"The excessive competition in mortgage investments which is resulting from the present abundance, of money, will bring a period requiring the exercise of patience and good judgment. As a whole, particularly after considering the period through which we have passed, there is much of what might be termed 'quiet encouragement' in the situation."

The two four-story dwellings adjoining Calvary Baptist Church on West Fifty-seventh street have been leased for 21 years by the Mechanics & Metals National Bank of New York for a permanent home for its Central Park Branch.