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Delaware Trust Co. v. Blackstone

Court of Chancery of Delaware, New Castle County

May 17, 1951

DELAWARE TRUST CO.
v.
BLACKSTONE et al.

Delaware Trust Company, a banking corporation of the State of Delaware, executor of the will of Basil B. G. Blackstone, deceased, brought an action against Margaret Patterson Blackstone, widow of decedent, and others, for instruction as to whether testator intended to impose upon testator's residuary estate the succession taxes assessed against non-testamentary property as well as testamentary property. The Chancery Court, Wolcott, Chancellor, held that intention of testator was that all succession taxes levied against taxable estate of testator, whether testamentary or nontestamentary, should be paid from residuary estate.

Conclusion in accordance with opinion.

Under will directing succession taxes assessed against testator's " estate as a whole", any specific devise or bequest, any distributive share thereof, or any life estate or interest vested in remainder by will and codicil, to be paid from testator's residuary estate to extent such taxes became due and payable within 15 months from testator's death, intent of testator was that all succession taxes levied against taxable estate of testator, whether testamentary or nontestamentary, should be paid from residuary estate. 46 Del.Laws, c. 119, as amended by 47 Del.Laws, c. 405.

[32 Del.Ch. 131] John Van Brunt, Jr., of Killoran & Van Brunt, of Wilmington, for the complainant.

Vincent A Theisen, of Wilmington, for the respondent, Margaret Patterson Blackstone.

Albert J. Stiftel, of Wilmington, for Albert L. Massey, Guardian ad litem for the minor respondents.

WOLCOTT, Chancellor.

The testator died August 31, 1949 leaving a will and codicil which were duly admitted to probate. Item VI of the codicil provided in part as follows: ‘ Item VI. I further order and direct that all Federal and State estate, inheritance and other succession taxes, whether assessed against my estate as a whole, any specific devise or bequest, any distributive share thereof, or any life estate or interest vested in remainder by the terms of my last Will and Testament and by the terms of this Codicil thereto, shall be paid out of my residuary estate to the extent that such taxes become due and payable within a period of fifteen (15) months from and after my death.’

[32 Del.Ch. 132] For Federal estate tax purposes, the taxable estate of the testator included property passing under his will and codicil and property passing outside of his will by operation of law. The non-testamentary taxable property of the testator included real estate held as tenant by the entireties; United States Government Bonds jointly owned with the testator's daughters, and life

Page 127

insurance for the benefit of the testator's widow, his two daughters and his mother.

The entire taxable gross estate of the testator amounted to $431,818.27 and the approximate value of the testator's non-testamentary taxable property was $113,905.25 or slightly more than one-fourth of the entire gross taxable estate.

The executor seeks to be instructed as to the effect of Item VI of the codicil to the will and as to whether or not in paying Federal and state succession taxes such payment should be made from the residuary estate. The precise question raised is whether or not the testator, by Item VI of the codicil, intended to impose upon his residuary estate the taxes assessed against non-testamentary as well as testamentary property.

The widow of the testator contends that Item VI of the codicil is a direction to discharge from the residuary estate all taxes including taxes assessed by reason of the non-testamentary property. The guardian ad litem for the minor children of the testator contends that Item VI of the codicil is a direction to pay from the residuary estate only those taxes assessed against the testamentary property.

[32 Del.Ch. 133] It is suggested that the Court of Chancery is without jurisdiction to hear and determine the subject matter of the case at bar for the reason that 47 Laws of Delaware, Chapter 405, confers jurisdiction upon the Orphans' Court to make prorations of succession taxes and that, accordingly, an executor is not entitled to ...


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