E. O. Bookwalter, District Director of Internal Revenue v. Marie Phelps, of the Estate of Calvin N. Phelps, Deceased

BLACKMUN, Circuit Judge

(dissenting).

I respectfully dissent. My concern is not so much with V.A.M.S. § 474.260 which authorizes a reasonable allowance for a surviving widow for her “maintenance during the period of one year after the death of the spouse” and which provides that that allowance “may be made payable in one payment or in periodic installments, and shall be made payable to the surviving spouse, if living, for the use of such surviving spouse * * If that statute were the only one before us, I might perhaps be persuaded, despite its “if living” condition, that this estate is entitled to a marital deduction for the allowance granted to Mrs. Phelps. That result would then be due to the interpretation the Saint Louis Court of Appeals gave the section’s different but nevertheless somewhat similar predecessors in the 1929 Revised Statutes, Monahan v. Monahan’s Estate, 232 Mo.App. 91, 89 S.W.2d 153 (1936), and to the legislative history of this particular section so effectively employed by Judge Oliver in his opinion at 210 F.Supp. 801.

But we are not now to live with § 474.260 alone. We also have § 474.300. This is a new statute without predecessors. It first appeared in 1955 long after Monahan was decided. Its first sentence reads:

“When a surviving spouse dies, * * * no allowance shall be made under section 474.260 for his maintenance for any period after such death * * *."

This language is clear, definite, and unambiguous. I think it is inescapable. It must and can only mean that if the surviving widow dies she is not entitled to allowance for any period after her death.

For purposes of the marital deduction the situation is to be viewed as of the date of the decedent’s death (in this case, June 30, 1956), and not as of some subsequent date as, for example, when the probate court’s maintenance order issues (in this case, October 3, 1956, “for the first year’s support”). United States v. Quivey, 292 F.2d 252, 255 (8 Cir. 1961) ; Bookwalter v. Lamar, 323 F.2d 664 (8 Cir. 1963); Cunha’s Estate v. Commissioner, 279 F.2d 292, 297 (9 Cir. 1960), cert. denied, 364 U.S. 942, 81 S.Ct. 460, 5 L.Ed.2d 373; United States v. Mappes, 318 F.2d 508, 510-11 (10 Cir. 1963). It would then appear necessarily to follow, from the language of the statute, that maintenance for Mrs. Phelps was contingent and dependent upon her continuing survivorship. In other words, her claim for maintenance was an interest terminable within the concept of § 2056 (b) (1) of the Internal Revenue Code of 1954 and was not indefeasibly vested as of her husband’s death. Being terminable, it fails to qualify as a marital deduction. Whether the probate court’s maintenance order called for periodic payments or for a lump sum is therefore of no consequence whatsoever.

But we are told (a) that the Missouri legislature, by its general revision of the state’s probate laws in 1955, and hence by the specific enactment of § 474.300, did not intend to change the nature of the spouse’s right to maintenance as it had been characterized in Monahan, and (b) that the district court’s conclusion is a permissible one not to be disturbed on appeal.

For me the answer to the intent argument is the plain and unambiguous language of the first sentence of § 474.300. The intent argument is a negative one, namely, that because commentators of the 1955 code, in mentioning proposed substantive changes, did not refer to § 474.300, the section therefore embraced no change. This does not convince me where language is so clear and. so positive. I am fortified in this by the fact that § 474.300 was not part of the proposed probate revision presented to the legislature by the Revision Committee but, instead, “was inserted by legislative amendment”. Consequently, comments on the code as proposed could not possibly be directed to § 474.300. I am further fortified by the recent decision of the Supreme Court of Missouri in Schubel v. Bonaeker, 331 S.W.2d 552 (1960), a case not cited by the district court here. It is true that that case concerned the homestead allowance under § 474.290 rather than the family allowance under § 474.260. But the court there held that even the homestead allowance was not vested indefeasibly and automatically; in any event the case did concern certain aspects of § 474.300 and the court dwelt upon and emphasized historical background and purpose, pp. 554-55 of 331 S.W.2d. A similar emphasis on purpose of the widow’s allowance would bring into focus the condition of continuing survivorship. Also, I doubt if it is a question, as the district court has suggested, p. 805 of 210 F.Supp., whether the state legislature “intended fundamentally to change the nature of a widow’s allowance from a non-terminable interest * * * to a terminable interest”. It would seem that federal estate tax impact was not in the legislature’s mind at all; if it had been, Missouri decedents’ estates would surely have been clearly protected and the plain and self-defeating language of § 474.300 would not have been permitted and employed. The important and inescapable facts are that the section’s first sentence exists and that it is unambiguous.

I fully appreciate the great caution which this court and its members, including myself, have exercised in diversity cases (which this is not) in upsetting the careful judgment of a federal trial judge upon a doubtful question of the law of his state. See Village of Brooten v. Cudahy Packing Co., 291 F.2d 284, 288-89, 301 (8 Cir. 1961); Campbell v. Village of Silver Bay, 315 F.2d 568, 575 (8 Cir. 1963). My concern is not alleviated by my awareness that a second Missouri federal district judge has now reached the same conclusion (although not mentioning § 474.300) on the issue before us, Gardner’s Estate v. United States, 220 F.Supp. 196 (E.D. Mo.1963), and that the Tax Court has done the same, Estate of Oliver,B. Avery, 40 T.C. 392, 400-401 (1963). Each of these opinions, as I read them, relies upon and follows the decision of the trial court in the present case. This court has not hesitated, nevertheless, when occasion demands, to reverse a federal trial judge on a question of state law if we have felt that his holding was improbable or less than “permissible”. See, for example, Massachusetts Bonding & Ins. Co. v. Julius Seidel Lumber Co., 279 F.2d 861, 869 (8 Cir. 1960); Archer-Daniels-Midland Co. v. Pauli, 293 F.2d 389, 397 (8 Cir. 1961); L. C. Eddy, Inc. v. City of Arkadelphia, 303 F.2d 473 (8 Cir. 1962). And very recently this court, in another marital deduction case turning on Missouri law, where language of a will was “plain, clear and unambiguous”, reversed the experienced Missouri federal judge who tried that case below. Bookwalter v. Lamar, supra. We did exactly the same thing, too, although another state’s law was involved, in United States v. Quivey, supra, 292 F.2d 252.

I am inclined to think that the trial court and the majority here are overly concerned with § 474.260, that they have overlooked or are under-concerned with § 474.300 and with its first sentence, and that they have rendered that sentence meaningless. We too readily avoid here the consequences of the specific terminable interest standard which conditions the marital deduction. After all, the burden of proof in this refund action is upon the taxpayer estate. Industrial Aggregate Co. v. United States, 284 F.2d 639, 644 (8 Cir. 1960), and cases cited; English v. United States, 270 F.2d 876, 879 (7 Cir. 1959). That burden, in my opinion, has not been met.

My personal dissatisfaction and distaste with making state law the criterion for terminability was set forth in my concurring opinion in United States v. Quivey, supra, p. 256 of 292 F.2d. See, also, Chief Judge Chambers’ concurrence in Jackson v. United States, 317 F.2d 821, 826 (9 Cir. 1963), certiorari granted, October 28, 1963. But if we must live with such a variable standard, then it seems to me that a plain statute ought to be given its plain meaning. If Quivey was right, and I think it was, this case is wrong. I would reverse.