In Re the Denial by the Secretary of Revenue of Claim for Refund of North Carolina Inheritance Taxes by the Estate of Kapoor , 303 N.C. 102 ( 1981 )

Justice Meyer

dissenting.

I must respectfully dissent. It is clear that decedent’s obligation under the separation agreement was to “maintain in full force and effect in accordance with the provisions thereof, a life insurance trust in the amount of at least $150,000.00 for the benefit of the party of the second part and/or their children” and in connection with said trust “to make timely payment of all premiums due on the policies placed in said trust . . . .” Decedent fully complied with his obligation under the separation agreement. As of the date of his death, he was not indebted for any portion of any premium payment and the trust was in full force and effect.

The majority concludes that the language of the separation agreement creating decedent’s obligation to maintain the trust in question clearly expresses a contract to create an obligation that survives his death. I am unwilling to go that far. The majority concedes that, if any “debt” was created by the separation agreement, it was the “ ‘debt’ of funding the trust . . . If that is correct, and if, at the time of decedent’s death, there remained no further obligation to fund the trust, wherein can there be found a “debt” of decedent?

Simply put, I cannot equate decedent’s “debt” at the time the separation agreement was made (to-wit, to maintain the trust in full force and effect) with an agreement to pay the “proceeds” of $150,000.00. I do not agree that decedent’s “obligation to purchase insurance and to pay the premiums was merely the method chosen by the parties to fund the trust and to guarantee the corpus.”

While I believe it illogical that the proceeds are not deductible under our state law, I do not believe the law as presently written allows it. That is a matter for the legislature and not for this Court.

I vote to affirm the decision of the Court of Appeals.