Untitled Texas Attorney General Opinion ( 1959 )

. . .
May 20, 1959
Honorable Robert S. Calvert Opinion No. ww-626
Comptroller of Public Accounts
Capitol Station Re: Classlflcatlon for
Austin, Texas Inheritance tax
purposes of alleged
Dear Mr. Calvert: adopted child.
You have requested that we advise you as to
whether Marian Jean Dooley Lee (hereafter referred to as
Marlan) should be classified for inheritance tax purposes
under the provision of Article 7118--Class A, Vernon's
Civil Statutes, for a "legally adopted child. . .of the
decedent" or whether she should be classified under
Article 7122--Class E, V.C.S., which provides the appro-
priate class for all.persons not specifically covered by
special classification provisions.
On July 5, 1917, the New York Foundling Home
placed Marlan who was then two and one-half years old in
the home of Leslie B. Dooley and his wife Katherine Marie
Dooley (hereafter referred to as DecedentI. Marlan re-
msined with the Dooleys until the time of her marriage.
Prior to 1936, the Dooleys made no attempt to
adopt tiarianbut held her out to be an adopted daughter and
so considered her. 'On December 2, 1936, Mr. Dooley and the
~Decedent executed a deed of adoption which was duly acknowl-
edged and recorded and which stated that they by said ln-
strument adopted Marlan *a child of parents unknown to us,
now twenty years of age (and who has continually resided
with us since July 5, 1917) as our legal heir, hereby can-
ferrlng on said Marlan Jean Dooley all the rights and privi-
leges, both in law and equity, appertaining to this act of
adoption for all purposes retroactive and to be effectual
from the 5th day of July, 1917." The Dooleys were advised
by their attorney that upon filing of the deed of adoption
In the Deed Records of Dallas County, Texas, Marlan had been
legally adopted by,them.
The Decedent died testate March 14, 1956. Under
the terms of her will she devised certain properties to
Marlan. Throughout the will Marlan was referred to as her
"foster daughter."
. .
Honorable Robert S. Calvert, Page 2 (Opinion No. ``-626)
We will first consider whether under the above
recited facts, Marlan was the "legally adopted child" of
the Decedent.
From the time the first adoption st8tute was en-
acted In Texas In 18501 until the Act of 1931 repealed
all adoption laws then in effect, adoption was accomplished
by the means of a written instrument, In the nature of a
deed, which was signed by the adopting person and authentl-
cated or acknowledged as deeds are required to be. The
deed was required to be filed in the office of the county
clerk, such filing being essential to the execution of the
Instrument and constituting the act of adoption. 1 Tex.
,Jur.Supp. 137, 138, Adoption, Sets. 15, 16. The Act of
1931 repealed all adoption laws then In effect and substl-
tuted as a complete method of adoption a z,adlcallydifferent
procedure. 1 Tex.Jur.Supp. 134, 135, Adoption, Sec. 8.
The new act and its later amendments make the act of adop-
tion a judicial function. 1 Tex.Jur.Supp. 141, Adoption,
Sec. 21.
Various acts pertaining to the validation of
adoptions have been passed by the Legislature. Acts 1934,
43rd Leg., 2nd C.S., p. 93, oh. 39, !I1; Acts 1937, 45th
2%. > 1324, ch. 490, B 2; Acts 1947, 50th Leg., p. 1016,
. 431; 8 2; Aots 1951, 52nd Leg., p. 388, ch. 249, 8 4.
However, these validation acts apply to adoption
papers signed prior to August 21, 1931, and to adoption de-
crees theretofc-e entered by the District Court In Texas
based on proceedingswhich conformed to the adoption statutes
"as thereafter or hereby amended." Since the purported
adoption deed In the Instant case was executed at a time
when the only method for accomplishing adoption was the ju-
dicial method, the deed itself amounts to a nullity, and
there Is nothing to validate. Therefore, at the date of the
death of the Decedent, Marian was not her legally adopted
child.
Subsequent to the Decedent's death, Marlan instl-
tuted suit in the 1Olst Judicial District Court of Dallas
County, Texas* for a declaratory judgment naming a8 defen-
dants her foster father and all the heirs of the Deaedent
and next of kln of fir.Dooley. In this suit, she sued to
1
Pas. Dig. Art. 31.
2
Act6 1931, 42nd Leg., p. 300, ch. 177.
Honorable Robert S. Calvert, Page 3 (opinion No. ``-626)
have herself declared the adopted child of Mr. Dooley~and
the Decedent. Judgment was rendered In this suit on February
20, 1959. In the judgment the court made certain Findings
of Fact and Conclusions of Law. Incorporated In the Findings
of Fact are the facts previously stated. The court also
found as a fact that Marian was "held out to be the adopted
daughter" of the Decedent and her husband and that the !'Deed
of Adoption was Intended to be merely a confirmation of
their previous act of equitable adoption. . .'
The court.concluded as a matter of law that "By
such adoption procedure and by holding out to the world that
the said Marlan. . .was their adopted daughter, the said
Leslie B. Dooley and his said wife have equitably adopted
said Marlan. . .' (Emphasis supplied throughout) However,
the court further concluded that "The said Marian. I .ls In
le al effect the legally adopted child of Leslle~B. Dooley
&I~ wife .and was the le all adopted child of
the~.saidKatherl&'M&ie Dooley and-d&d me-the
time of~the death of the said Katherine Marie Dooley."
On the basis of Its Findings of Fact and Conclu-
sions of Law, the court decreed that certain questions con-
tained In Plalntlff~s Original Petition be answered In the
following way.
Question (2) ". . .dld not Leslie B. Dooley and his
said wife in legal effect adopt Marlan Jean Dooley Lee by
their act of acceptingcustody of the said Marlan. . .in con-
sidering and treating her always as their adopted daughter,
and In holding out to the world that she was In fact their
adopted daughter?" Yes.
Questions (3) and (4) pertained to the Dooley's
intention In executing the adoption deed and the effect of
such execution. The court concluded that In executing such
papers the parties Intended to confirm the previous act of
adoption and that such was the effect of said execution.
In response to Question (5), the court concluded
that Dooley and his wife Intended to take Marlan into their
family and give her the rights, privileges and duties of a
child and heir and that said child "In legal effect" had "the
rights, privileges and duties of'a child and heir."
In response to Questions (6) and (7), the judgment
affirms the fact that Marlan had been considered by all
heirs and next of kin "to be in legal effect the le all'
adopted dau ter of LesneT.16ooley a-said wand
w
that Mar& consmered herself to be in legal effeot the
legally adopted daughter" of Dooley and his wife.
.
Honorable Robert S. Calvert, Page 4 (Opinion No. ``-626)
In response to Question (lo), the court found that
the attempted compliance with the adoption laws coupled with
holding Marian out to the world as their adopted daughter
was followed 'by reliance thereon and performance thereto"
by Marian.
In response to Question (ll), the court stated
that it would be Inequitable for Dooley and his wife and
their privies to deny the adoption of Marian and her status
as an adopted daughter.
. However, Question (12) reads as follows: "Is
Marlan Jean Dooley~Lee --
In legal effect the legally adopted
child of Leslie B. Dooley alflis me?" The court
answered this question in the affirmative.
We will now consider whether this judgment effec-
tuates Class A classification for Marlan. It Is evident
from the foregoing summation of the judgment that certain
portions thereof are inconsistent. The judgment might well
be construed as a decree that Marlan was a child adopted by
estoppel. On the other hand, the court's conclusion that
Marian was the "legally" adopted child of Dooley and the De-
cedent Is Inconsistent with a decree of adoption by estoppel.
A decree of adoption by estorpel establishes the property
rights of the child adopted by estoppel In so far as the
adoptive parents and their privies are concerned.~ Such de-
crees do not purport to change the status of a child adopted
by estoppel. Since adoption was unsto the common law,
the status of an adopted child can only be created by com-
pllamth the controlling adoption statutes. 1 Tex.Jur.
supp. 132, Adoption, Sec. 3. Thus If the,judgment decrees
that Marlan was a child adopted by estoppel, she cannot be
classified under the Class A provlslon for a "legally
adopted child. . .of the decedent" In view of the per curlam
opinion of the Supreme Court In Johnston v. Calvert,
Tex. -, 305 S.W.2d 778 (X57-).
The Court of Civil Appeals in Calvert v. Johnston,
304 S.W.2d 394 (1X7), held that the alleged adopted son
had failed to prove an adoption by estoppel and that he was
therefore properly classified for Inheritance tax purposes
under Class E--Article 7122. Mr. Justice Hughes concurred
solely on the ground that the alleged adopted child was not
a "legally adopted child. . .of the decedent" within the
meaning of Article 7118, Class A.
The Supreme Court refused the Application for Writ
of Error with the notation, "no reversable error." We quote
the Court's per curlam opinion which reads as follows:
. . .
Honorable Robert S. Calvert, Page 5 (Opinion No. ~626)
"We agree with the view expressed by
Mr. Justice Hughes 004 S.W.2d 398 that
Grant Lindsey, Jr. was not a 'lega2 ly
adopted child' within the meaning of Artl-
cle 7118, Class A, Vernon's Ann. Tex. Stats.
See Wooster v. Iowa State Tax Commission,
230 Iowa 797, 298 N.W. 922, 141 A.L.R. 1298.”
However, If the effect of the judgment of the court
Is to decree that Marlan had been legally adopted and had
the status of a legally adopted child of the Decedent, is
the State bound by this decree to place Marian within the
Class A classification for a "legally adopted child. . .of
the decedent" for Inheritance tax purposes?
As a general rule, a judgment determining personal
status is conclusive in subsequent litigation involving.the
same Issue. 50 C.J.S. 224, Judgments, Sec. 734. This Is so
because If a proceeding Is designed primarily to determine
status It Is ordinarily a proceeding In rem and conclusive as
a judgment In rem upon every person Interested In or affected
by the status thus adjudicated. 3 Freeman on Judgments (5th
Ed., 1925) 3145, 3146, Sec. 1534. Howev?r, we quote.the fol-
lowing excerpt from the above cited section of Freeman:
1,. . .l3utin order that such a proceeding shall be
one In rem It Is generally, If not always, neces-
sary that It should contemplate and be Intended to
create or effect a change In the legal status of
the person In question. It 1s not enough that sta-
tus be incldertally, even though necessarily, passed
upon In proceedings which are purely personal In
their nature or which are In rem as to some other
aspect of the status of such person. In other words,
an adjudication which creates or changes legal status
is In rem but one which finds or adjudicates the past
or present existence of a partlcular'status Is not
In that aspect a judgment In rem but must be treated
like any other judgment inter partes."
Since it Is evident that the judgment In the ln-
stant case dld not purport to create or change Marlan's legal
status but rather was an adjudication of her part and pres-
ent status, it Is doubtful, to say the least, that It should
be treated as a judgment In rem but rather It should be
treated like any other judgment Inter partes with the result
that the State, not being a party, would not be bound.
Even If this distinction were not recognized, there
Is authority to the effect that "A judgment In rem, while
_. .
Honorable Robert S. Calvert, Page 6 (Opinion No. w-626)
binding and conclusive on all private rights, does not con-
clude the State, Its public agencies and mandatories, unless
the law authorizing the proceedings contemplated such a re-
sult, since the State without its consent, express or im-
plied, Is not subject to suit." 3 Freeman on Judgments, 5th
Ed., 1925, 3115, Sec. 1527; 1 Freeman on Judgments, 1088,
1089, Sec. 506; 26 Tex. Jur. 209, Judgments, Sec. 551. It
was-suggested ln Prairie Oil and-,GasCo. v..State,-214 S.W.
363 (Tex.Clv.App. 1919) modified on other polnts'(Com.App.),
231 S.W. 1088 (1921), that any strtute which would make a
judgment rendered In a suit to which the State was not a party
binding upon the State would be violative of the due process
clause provisions of both the State and Federal constitutions.
At least two courts have held that the State In
collecting Inheritance taxes is not bound by prior adjudl-
cations to which It was not a party. In McDougald v. First
Federal Trust Co., 199 P. 11 (Cal.Sup. 19: 9 the husr
Eveyed'certaln community property wlthout'the wife's con-
sent. After the husband's death. the wife successfully sued
to recover her community Interest:?!hin?under California law
she obtained as the heir of the husband; therefore, the
property In question was liable for an inheritance tax. At
page 12 the court said:
"The right of the state of Callfo?nla to an lnherlt-
ante tax was not litigated In that proceeding, the
state was not a party thereto, and the judgment In
favor of the wife has no bearing upon the right of
the state of California ts recover an Inheritance
,tax except as It shows tllatthe widow has success-
fully~maintained her right to succeed to the con-
munlty property awarded to her by the judgment."
In Hasbrouck v. Martin, 183 A. 735 (Perogative
Court of N.J. 19361, the decedent had made certain bank de-
posits and-the &r&ship of the deposits was litigated after
her death. In suing to collect the Inheritance taxes, the
tax commissioner did not dispute the correctness of the judg-
ment adjudicating title. At page 737 the court said:
"The State Is of coursesnot bound In this proceeding
by the result In the chancery suit to which It was
In nowlse a party. Cf. In re Dorrance's Estate,
115 N.J. Eq. 268, at page 272, 170 A. 601; affirmed
Dorrance .I.Martin, 176 A. ,902, 13 N.J. Misc. 168;
In re Fischer's Estate, 118 N.J. Eq. 599, at page
605, 180 A. 633; Freudenrloh v. Mayor, etc., Falr-
view, 114 N.J. Law, 290, 176 A. 162.
. . ,
Honorable Robert S. Calvert, Page 7 (Opinion No. ``-626)
"It would therefore have been open to the commis-
sioner in this tax proceeding to find, if the
evidence before him so indicated, that no valid
trusts had been created. He made no such finding,
however, and makes no such contention on this
appeal; he conced&s that valid trusts were created;
and the evidence in the record leads to the same
conclusion."
For the reasons stated In these opinions as well
as those heretofore,given we are of the opinion that Marian
cannot be given Class A classification as a "legally~adopted
child" of the Decedent. You are therefore advised that she
must be classified for inheritance tax purposes under Class E.
SUMMARY
Where a foster daughter of the Deced~ent
was not adopted in accordance with the con-
trolling adoptio? statutes, a judgment rendered
subsequent to Decedent's death declaring said
foster child to be the legally adopted child of
the Decedent AndyDecedent's child adopted by
estoppel does not bind the State in classifying
the alleged adopted child for Inheritance tax
purposes. Sald~child cannot be classlf-ledunder
Article 7118, V.C.S., as a "legally adopted
child. .of the decedent" but must be classi-
fied under Article 7122, V.C.S.
Yours very truly,
WILL WILSON
Attorney General
MMP:bct
APPROVED:
OPINION COMMITTEE: Assistant
Geo. P. Blackburn, Chairman
William E. Allen
Henry G. Branwell
Lawrence Jones
Raymond V. Loftin, Jr.
J. Mllton Richard,son
REVIEWED FOR THE ATTORNEY GENERAL
BJ : W. V. Geppert