Opinion
Argued October 5, 1891
Decided October 20, 1891
D.J. Dean for appellants.
Evarts, Choate Beaman for respondent.
There is no dispute as to the facts in this case. The allegations contained in the relator's petition as to the property in question are uncontroverted and the simple question is whether upon such facts the relator or the defendants are correct.
The claim of exemption is based upon two different sections of the Revised Statutes. They are as follows:
"§ 5. Every person shall be assessed in the town or ward where he resides when the assessment is made, for all personal estate owned by him, including all personal estate in his possession or under his control as agent, trustee, guardian, executor or administrator, and in no case shall property so held under either of those trusts be assessed against any other person, and in case any person possessed of such personal estate shall reside during any year in which taxes may be levied in two or more counties, towns or wards, his residence for the purposes and within the meaning of this section shall be deemed and held to be in the county, town or ward in which his principal business shall have been transacted; but the products of any state of the United States, consigned to agents of any town or ward of this state for sale on commission, for the benefit of the owner thereof, shall not be assessed to such agents, nor shall such agents of moneyed corporations or capitalists be liable to taxation under this section for any moneys in their possession or under their control transmitted to them for the purpose of investment or otherwise." (1 Rev. St. 389, § 5.)
"§ 3. When any bond, mortgage, note, contract, account, or other demand, belonging to any person not being a resident of this state, shall be sent to this state for collection, or shall be deposited in this state for the same purpose, such property shall be exempt from taxation; and nothing contained in this chapter shall be construed to render any agent of such owner liable to be assessed or taxed for such property; but every such agent shall be entitled to have any such property deducted from his assessment upon making affidavit before the assessors at the time appointed by them for reviewing their assessments, that such property belongs to a non-resident owner, and therein specifying his name and residence." (1 Rev. St. 419, § 3.)
The administrator was not, after his appointment, the agent of the deceased testator, and hence he was entitled to no exemption as an agent having moneys in his possession or under his control transmitted to him for investment or otherwise, as provided in the first of the above cited sections. The administrator says, indeed, that the moneys never were transmitted to him by testator for investment or otherwise; but if we assume that his statement in that respect was a conclusion of law and that he was mistaken, we find that the moneys were transmitted not later than 1881, and that in such year the testator died, and since the year 1882 the funds, or debts, or bonds and mortgages have been in the hands of the relator as administrator as owner, and not as agent of any one. His duty in regard to such funds is to distribute them as ordered by the will, subject to the lawful orders of the surrogate of the county in which the letters issued, and also subject to whatever rights the creditors resident in this state might have in regard to them. He was to distribute or pay debts. Certainly from the time when these ancillary letters were issued, which was in 1882, up to 1890, when this assessment was made, a sufficient period had elapsed to wholly change the original character of the funds, even assuming they were sent here for investment and were placed in the relator's hands for that purpose, and had been thus invested. If not, then a resident administrator, at the request of the distributees, could hold such funds permanently and pay the interest to the distributees, who might all be residents, and so in this manner such distributees could secure the exemption of the property from taxation while enjoying the protection of our laws and themselves residing here.
It does not seem that the case of Ferrer v. Comrs. of Taxes (42 Hun, 560; Affd. in Memoranda, 105 N.Y. 629) is at all like this. The funds in that case were originally sent by the testator from Cuba here for investment. The testator died and the relator, a resident of Cuba, was appointed his executor. Such executor came here and took out letters for the sole purpose of obtaining the moneys and disposing of them under the terms of the will, which directed him to invest a large portion of them in bonds of the United States. It was held that the funds were exempt because, as the court said, they had been sent here for investment and were still in the hands of the original agent, and the testator had not changed his purpose up to the time of his death. The ancillary administrator was himself a non-resident, not subject to taxation, and the character of the funds in the hands of the New York agent had not changed so as to become taxable simply because of the death of their former owner so short a time before. Here the administrator takes the funds and as such has them in his possession and has held them for eight years, and he is a resident and the residuary legatees are residents. The Ferrer case is no authority for the decision herein appealed from.
Nor is the case of Williams v. Supervisors of Wayne Co. ( 78 N.Y. 561) at all like this. The property there was assessed to the plaintiff as agent, and it consisted of bonds and mortgages, some of which had been sent him for collection by the owner, who was a non-resident of the state, and the balance had been left or deposited with him for collection by such owner. This court held the property was exempt.
We think no exemption was made out under either of the above quoted sections of the statute, and for this reason the orders of the General and Special Terms should be reversed, the assessment reinstated and the writ dismissed, with costs in all courts.
All concur.
Orders reversed.