(113 A.) erty passing to the legatee, and the value of the property is fixed as of the date of the death of the testator. Before the estate can be settled, and the property transferred and given into the possession of the residuary legatee, the federal estate tax must first be paid, for it is required by the express terms of the federal act "that the tax must be paid before distribution by the executor." The state appropriates a portion of the decedent's estate at the moment of his decease under section 1, as a tax upon his right to transfer; and the United States appropriates a portion of the decedent's estate at the moment of his decease under the federal estate tax and imposes personal liability upon the executor for the payment thereof, and the value of the estate to be used as the measure of the tax imposed upon the residuary legatee, as a tax upon her right to receive under section 5, is diminished by the amount of these two estate taxes paid by the executor; therefore the money required to pay the federal estate tax and the state estate tax cannot be considered a part of the residuary estate which the residuary legatee is entitled to receive. Not to deduct the federal estate tax in order to ascertain the value of the estate which the residuary legatee receives would require the residuary legatee to pay a tax upon property which she never received and would not have the right to receive. Such a construction of the law would be unjust and inequitable, and there is nothing in the inheritance tax act of 1916 requiring such a construction. In administering the inheritance tax act of 1916, it has been the uniform practice of the board of tax commissioners, for nearly five years, to deduct the amount of the estate tax imposed upon the estate of the decedent, under section 1, as a tax upon the "right to transfer," in ascertaining the full and fair cash value of the property transferred, to be used as a measure in imposing the tax under section 5 upon a person as a tax upon his "right to receive." This tax act was enacted as the result of the investigation, report, and recommendation of the board of tax commissioners. They knew what it meant and how it was intended to operate, and their administration and construction of the law may be considered in interpreting and applying it. In their seventh annual report they state that the tax imposed by section 1 of the "inheritance tax act of 1916" is nearly identical with the federal estate tax. In the instant case the board has deducted the estate tax imposed by section 1 before imposing the legacy tax under section 5, and under the same construction of a similar law the estate tax imposed by the federal estate tax law should be deducted; for the federal estate tax imposed on the net estate of the decedent is practically the same as that imposed on the net estate of the decedent under section 1. Article 6 of the Constitution of the United States provides, among other things, thatThe "Constitution and laws of the United States which shall be made in pursuance thereof * shall be the supreme law of the land; and the judges in every state shall be bound thereby, anything in the Constitution or laws of any state to the contrary notwithstanding." As we have seen, the federal estate law imposes an estate tax upon the net estate of every decedent and requires his executor to pay the same; and it states that the receipt given to the executor for the payment of said tax shall be sufficient evidence of such payment, and shall entitle him to be credited and allowed the amounts thereof by any court having jurisdiction to audit and settle his accounts. The reasonable construction of this law requires the board of tax commissioners to credit and allow the executor with the payment of the federal estate tax shown by the tax receipt. By operation of federal law the net estate left by the decedent has been depleted by the amount of the tax, and the deceased was deprived of the right to transfer so much of his net estate as would be required to pay the federal estate tax. The decedent had the right to dispose of only so much of his net estate as would be left after the deduction and payment of the federal estate tax, and the residuary legatee had the right to receive from the decedent only so much of his estate as would be left after the deduction and payment of the federal estate tax. For the board of tax com missioners to include in the value of the property transferred to the residuary legatee the amount of money paid by the executor as the federal estate tax would be to charge her with receiving property which she never received and never had the right to receive. A tax based upon such a valuation would be an illegal tax because the residuary legatee never had property, to the amount of said federal estate tax, transferred to her, and never had the right to have it transferred to her. Such procedure would ignore the validity and effect of the federal estate law imposing such tax, requiring its payment by the executor and providing that the receipt given to the executor for the payment of the same would entitle him to be credited therefor; and it would deprive the residuary legatee, to the amount of such illegal tax, without due process of law and of the equal protection of the laws. The principle contended for by the peti tioners, namely, that the amount of the fed eral estate tax imposed upon the net estate of the deceased should be deducted or excluded in ascertaining and computing the full and fair cash value of the property transferred and passing to the residuary legatee for the purpose of assessing a tax against her under said section 5, as a tax upon her "right to receive" such property, is neither 484 novel nor unreasonable. It appears to be just and equitable. The question is not so much a question of law, or the construction of our inheritance tax act of 1916, as it is a question of the application of the law to admitted facts. This principle is supported by decisions of the highest courts in the states of Massachusetts, Connecticut, New Jersey, Pennsylvania, Illinois, Indiana, Minnesota, and Colorado. As the board of tax commissioners refused to make such a deduction, and included the amount of the federal estate tax ($343,228.48) in computing and ascertaining the full and fair cash value of the property transferred and passing to the residuary legatee, and assessed the tax imposed by said section 5 thereon, I am of the opinion that so much of said tax as was assessed upon the amount of said federal estate tax is unfair and illegal, and should be abated. VINCENT, J., concurs in this dissent. STATE v. GOLDENBERG (two cases). (Nos. 5486, 5487.) (Supreme Court of Rhode Island. May 16, 1921.) Exceptions from Superior Court, Providence and Bristol Counties; J. Jerome Hahn, Judge. Harry Goldenberg was convicted under separate indictments of conspiracy to commit robbery and of assault with intent to rob, his motions for new trial being denied, and he extence in each case. cepts. Causes remitted, with direction for sen Antonio A. Capotosto, Asst. Atty. Gen., for the State. Charles R. Easton, of Providence, for defendant. PER CURIAM. The above-entitled causes One charges the respondent are indictments. with conspiracy to commit robbery, and the other with an assault with intent to rob. By the respondent's consent the indictments were tried together before a justice of the superior court sitting with a jury, and resulted in a verdict of guilty on each indictment. A motion for new trial in each case was denied by said justice. The causes are before us upon the respondent's exception to the decision upon each motion for new trial and upon exception to a portion of the charge of said justice to the jury. We have examined the transcript of testimony, and it appears that there was no error in the decision of said justice denying said motion for a new trial. The respondent's exception to the charge of the justice to the jury is entirely without merit. The causes are remitted to the superior court with direction for sentence upon the verdict in each case. (92 N. J. Eq. 567) (113 A.) In re RILEY'S Estate. (No. 49/590.) (Court of Chancery of New Jersey. April 1, 1921.) 1. Equity 44—Chancery court and not orphans' court may order distribution to next of kin of distributees without administration. Where next of kin have died in foreign states, intestate and without debts, and no administrators have ever been appointed for either of them, the orphans' court cannot make a decree directing the payment of the shares to which these next of kin were entitled directly to the persons who are their respective next of kin, but the chancery court may, in a proper case, on adequate proofs, make such a decree under its general equity powers. BUCHANAN, V. C. The administrator of this estate shows in his hands a small fund for distribution to the next of kin; that cer tain of these next of kin have died in for eign states, intestate and without debts, and that no administrators have ever been appointed for either of them. He asks a decree of distribution from this court directing the payment of the shares to which these next of kin were entitled directly to the persons who are their respective next of kin, without the intervention of administration on the estates of the ancestors. [1] Such a decree could not, of course, be made in the orphans' court, but may in a 2. Executors and administrators 314(1) proper case (and, of course, on adequate Distribution a proceeding in rem, not in per-proofs), be made by this court, having general equity powers. sonam. The distribution of a decedent's estate is a proceeding in rem, not in personam; the estate being administered by the court for the purpose and object of distributing all of the decedent's estate to and among those entitled thereto under the law of decedent's domicile, and the decree of distribution being the formal adjudication and record of what the court has ascertained and determined as to the persons entitled to participate and the proportions. 3. Executors and administrators 3(4)Distribution without administration where there are no debts. Where one of the next of kin dies before distribution, his share ordinarily will be decreed to be paid to his executor or adminstrator, but where he dies intestate, leaving no debts, or his administrator having paid all of his debts, the administrator's title to such distributive share would obviously be but a mere naked legal title, which he would be required immediately to transfer to the equitable owner, the next of kin of such deceased next of kin, and where next of kin has died intestate, leaving no debts, and no administrator has ever been appointed, the appointment of an administrator for the mere purpose of taking the distributive share is unnecessary, and equity will dispense with such administration and decree distribution directly to secondary next of kin. 4. Executors and administrators 3(5)-Payment directing disposition to secondary next of kin only on satisfactory proof of payment of debts. Where court of chancery is called upon to render a decree directing distribution to next of kin of those next of kin who have died be fore distribution and without administration, it must be made to appear by full and satisfactory proof that there were no debts owing by the next of kin of the decedent, or that, if any debts existed, they have been paid, and that no transfer or succession taxes are leviable, or, if such be leviable, what they are, so that the decree may provide for their payment. [2] The distribution of a decedent's estate is a proceeding in rem, not in personam. Exton v. Zule, 14 N. J. Eq. 501. The decedent's estate is administered by the court, for the purpose and object of distributing all of the decedent's estate, in the proper amounts and proportions, to and among those entitled thereto (whether creditors or next of kin), under the law of decedent's domicile. When creditors have been paid the court ascertains and determines the persons who are entitled to receive the balance, as next of kin, and in what proportions. The decree of distribution is the formal adjudication and record of that ascertainment and determination. [3] Where one of the next of kin dies before distribution, his share ordinarily will be decreed to be paid to his executor or administrator. But where he dies intestate, leaving no debts, or his administrator having paid all of his debts, the administrator's ti tle to such distributive share would obvi ously be but a mere naked legal title, which he would be required immediately to transfer to the equitable owner, the next of kin of such deceased next of kin. Where the next of kin has died intestate, leaving no debts, and no administrator has ever been appointed, the appointment of an administrator for the mere purpose of taking the distributive share and immediately paying it over to the "secondary" next of kin is unnecessary and a matter of useless time, trouble, and expense-a "useless ceremony" (Fretwell v. McLemore, 52 Ala. 124, at page 133), and a court of equity will dispense with such administration and decree distribution directly to the "secondary" next of kin. See, also, Re Mullon, 145 N. Y. 98, at page 104, 39 N. E. 821; Watson v. Byrd, 53 Miss. 480; Marshall v. Crow's Adm'r, 29 Ala. 278; Young v. Kennedy, 95 N. C. 265; also 18 In the matter of the Estate of Maggie | Cyc. 624, and cases there cited. Riley. On application of Edwin Robert Such decree will therefore be advised in Walker, administrator, for decree of distri- the present case. bution. Decree advised. Edwin Robert [4] Of course, in any case of this kind it Walker, administrator, of Trenton, pro se. I must be made to appear, by full and satis factory proof, that there were no debts, or that, if any debts existed, they have been paid, and that no transfer or succession taxes are leviable (or, if such be leviable, what they are, so that the decree may provide for their payment). (92 N. J. Eq. 493) construction of the bungalow, but it is certain, in any event, that not more than $25 to $50 worth of material had been furnished by the Rohdenburg Company for the use of the building when Camburn, the builder, started to work on it some time between the 1st and 5th of July, 1918. Meantime Kearnin and Von Saal, who were the managers, di A. B. NEWBURY CO., Inc., v. TENNANT rectors, and substantially the whole of the et al. In re ROHDENBURG CO., Inc. (No. 47/424.) (Court of Chancery of New Jersey. March 18, 1921.) Rohdenburg Company, with one other person, whose name does not appear, organized a new corporation under the General Corporation Act of New Jersey, called the Beachwood service, Incorporated. Prior to the commencement of the bankruptcy proceedings of the Rohdenburg Com Bankruptcy 155-Creditor of company con-pany, Kearnin, and Von Saal, or one of them, structing building on bankrupt's land held entitled to contract price rather than bankrupt's general creditors. The R. Co., after having agreed to build a bungalow for L. on land owned by the R. Co., went into bankruptcy, prior to which its managers and directors organized the B. Service Inc., and induced L. to contract with it to build the bungalow, which it did. L. paid into the bankruptcy fund the balance due on the bunga low. Held, that one having an unsatisfied judgment and execution against the B. Service, Inc., for materials used in the construction of the bungalow was entitled to the fund rather than general creditors of the R. Co.; that company having acquiesced in the construction of the bungalow on its land. represented to Lanning that the Rohdenburg Company was unable to carry out its agreement to construct the bungalow, and induced Lanning to make a new contract for that purpose with the Beachwood Service, Incorporated. The bungalow originally planned and contracted to be erected by the Rohdenburg Company was then built for Lanning by the Beachwood Service, Incorporated. trustee in bankruptcy of the Rohdenburg After the appointment of Mr. Tennant as Company, these facts were made known to him. Thereupon Lanning filed a petition in the United States District Court for the District of New Jersey, setting up that he was the owner of the four lots at Beachwood reCreditors' bill by the A. B. Newbury Com-ferred to; that he had made the contract pany, Incorporated, against George G. Ten- mentioned with the Rohdenburg Company; nant, trustee in bankruptcy of the Rohden- that the company had since become bankburg Company, Incorporated, and another. Decree for complainant. Maja Leon Berry, of Camden, for complainant. Randolph Perkins and George G. Tennant, both of Jersey City, for defendants. LEWIS, V. C. This is a creditors' bill in aid of judgment and execution at law. Iauch v. De Socarras, 56 N. J. Eq. 524, 39 Atl. 381. The facts are practically undisputed. rupt; that he had put his money into the bungalow built by the Beachwood Service, Incorporated, on property which stood in the name of the Rohdenburg Company, and ask. ed leave to pay into the bankruptcy fund the balance due, namely, $1,000; that the trustee in bankruptcy be directed to convey to him the title to the lots on which the bungalow had been actually built; and that he, in turn, convey to the trustee the four lots at Beachwood which he had agreed to transfer to the Rohdenburg Company as part of the consideration of the original contract, the money to be paid to the trustee in bankruptcy for the benefit of whoever might be entitled thereto. This has been accomplished, and the funds are in the hands of the trustee in bankruptcy, George G. Tennant, one of the defendants in the present suit. In the summer of 1917 the Rohdenburg Company agreed to build for Jeptha H. Lanning a bungalow, on property then owned by the Rohdenburg Company at Beachwood, N. J. Lanning made a deposit on account, and work on the bungalow was to be commenced the following year. As part of the consideration of this agreement Lanning was to transfer to the Rohdenburg Company four lots that he then owned at Beachwood. Subsequently the Rohdenburg Company went into voluntary bankruptcy in the United States District Court for the District of New Jersey; and George G. Tennant was elected as the trustee in bankruptcy of that company. ed judgment against the Beachwood ServIt is not entirely clear from the evidence whether the bankruptcy proceedings were begun before or after the commencement of the The Newbury Company, the present complainant, furnished material to the Beachwood Service, Incorporated, which was used in the construction of the bungalow in question, and, failing to receive payment therefor, instituted an action at law, and recover ice, Incorporated, upon which execution was issued, but which remained wholly unsatisfied. (113 A.) The amount actually paid to the Rohden- [ Co. v. U. S., 216 U. S. 504, 30 Sup. Ct. 386, burg Company by Lanning, in addition to the 54 L. Ed. 590; Linn, Etc., Timber Co. v. U. transfer of his four Beachwood lots to the S., 196 Fed. 593, 116 C. C. A. 267; Phila. trustee in bankruptcy, is asserted to be full Creamery Co. v. Davis, etc., Building Co. value for the Rohdenburg Company's land; | (C. C.) 77 Fed. 879. See, also, 14 Corpus Juand it does not appear that any of that com- ris, page 59-61. pany's general creditors supplied anything of value that went into the bungalow property. Complainant contends that, as a judgment creditor of Beachwood Service, Incorporated, I shall advise a decree in accordance with these views. (92 N. J. Eq. 504) it is entitled to follow the money paid by J. C. SMITH & WALLACE CO. v. GOLDNER Lanning into the hands of the trustee in et al. (No. 49/526.) bankruptcy of the Rohdenburg Company and to have it applied in satisfaction of its judg- (Court of Chancery of New Jersey. March 29, ment against the Beachwood Service, Incorporated, inasmuch as its material was used in the construction of the building which produced the value now the subject-matter of the controversy, through the contract of the Beachwood Service, Incorporated. The trustee in bankruptcy contends, however, that the fund so produced constitutes assets in his hands to be distributed among the general creditors of the Rohdenburg Company, on the technical theory that the bungalow, having been built upon the lands of the Rohdenburg Company, became the property of that company, and that the Beachwood Service, Incorporated, had no right of any kind in the land of the Rohdenburg Company, or the bungalow built there on, and argues that the Beachwood Service, Incorporated, is in the position of a mere volunteer who has erected a building on the land of another, without the owner's consent and acquiescence. I am of the opinion that the complainant in this case should prevail, and that the funds involved should be applied in satisfaction of its judgment and execution at law against the Beachwood Service, Incorporated. To hold otherwise would be to permit the general creditors of the Rohdenburg Company to appropriate the funds arising from the completion of the contract to construct the bungalow in question by the Beachwood Service, Incorporated, without having contributed in any way to its production, while the complainant who furnished the material used in the construction of the buildingand without which the fund would not have been produced-would go unpaid. 1921.) I. Fraudulent conveyances 47-Sale in bulk void as to vendor's creditors, unless Bulk Sales Act complied with. A sale in bulk is void as to creditors of the vendor, unless the provisions of the Bulk Sales Act of 1915, requiring the purchaser to demand and receive a list, in writing, of the proposed sale, are complied with. vendor's creditors, and to notify them of the 2. Fraudulent conveyances 181 (5)-That sale is void under Bulk Sales Act does not give creditors claim upon purchase price. Though a sale in bulk is void as to the vendor's creditors, unless the provisions of the act of 1915, requiring the purchaser to demand and receive a written list of the creditors and to notify them of the proposed sale, are complied with, this does not give creditors a claim upon the purchase price. 3. Fraudulent conveyances 237 (1)—Where bulk sale void, creditors may levy on goods or proceed in equity against purchaser for value. Where a sale is void as to the vendor's creditors under the Bulk Sales Act of 1915, for failure of the purchaser to demand and receive a list of the creditors and to notify them of the proposed sale, creditors may execute their judgment by a levy and sale of the goods, or, if unable to do so, may cause the writ to be returned nulla bona and proceed in equity against the purchaser for the value of the goods, as transferred without consideration with intent to defraud creditors. Bill by J. C. Smith & Wallace Company against Nathan J. Goldner and another. On motion for preliminary injunction. Motion denied, with permission to amend bill. Reed & Reynolds, of Newark, for the motion. Abraham Henig, of Newark, opposed. This would seem to me to be inequitable, particularly in view of the fact that the Rohdenburg Company, through Kearnin and Von Saal, who entirely controlled and directed its affairs, not only had full knowledge of what was being done, but actually brought it about, and must be taken to have acquiesced therein. King v. Morris, 74 N. J. Law, 810, 68 Atl. 162, 14 L. R. A. (N. S.) 439, 12 Ann. Cas. 1086; Perkins v. Trinity Realty Co., 69 N. J. Eq. 723, 61 Atl. 167, affirmed 71 N. J. Eq. 304, 71 Atl. 1135; J. J. McGaskill 377). BACKES, V. C. The defendant Nathan Goldner sold his stock of merchandise, in bulk, to the defendant Isaacson. The purchaser failed to demand and receive a list, in writing, of the vendor's creditors, and to notify them of the proposed sale, as required by the Bulk Sales Act of 1915 (P. L. The complainant recovered a judg |