DocketNumber: Docket No. 536-72
Citation Numbers: 61 T.C. 306, 1973 U.S. Tax Ct. LEXIS 17
Judges: Tietjens
Filed Date: 11/26/1973
Status: Precedential
Modified Date: 1/13/2023
1973 U.S. Tax Ct. LEXIS 17">*17
A West Virginia joint will, executed by decedent and his wife, contained language purporting to limit the wife's disposition of certain stock and real estate to a testamentary gift to her son.
61 T.C. 306">*306 OPINION
The Commissioner determined a deficiency of $ 28,796.12 in the Federal estate tax of Robert Abruzzino and an addition of $ 1,439.80 to that tax under section 6651(a). 1
Certain concessions have been made by both parties so that the only question remaining for decision is whether the estate is entitled to a marital deduction under
This case was fully stipulated pursuant to
Decedent died testate at the age of 69 on December 9, 1967, a resident of Sutton, W. Va. He was survived by his wife, Barbara, two daughters, and a son, William Abruzzino, who was nominated and appointed executor of the decedent's estate and who resided in Gassaway, W. Va., at the time of the filing of the petition in this proceeding.
The Federal estate tax return for decedent's estate was filed with the district director of internal revenue, Parkersburg, W. Va.
On December 14, 1967, a joint will, executed by Barbara and decedent on December 20, 1963, was admitted to probate in Braxton County Court, Sutton, W. Va., as the last will and testament of decedent. That will contains the following pertinent provisions:
LAST WILL AND TESTAMENT OF ROBERT ABRUZZINO AND BARBARA ABRUZZINO, HUSBAND AND WIFE, RESPECTIVELY
61 T.C. 306">*307 We, Robert Abruzzino and Barbara Abruzzino, husband and wife, respectively, of the Town of Cowen, County of Webster, and State of West Virginia, being of sound mind and disposing memory1973 U.S. Tax Ct. LEXIS 17">*20 and free from any undue influence, do hereby make, publish and declare this to be, jointly as well as severally, our last will and testament, thereby revoking all former wills which we or either of us may have made.
FIRST: The one of us first dying directs that his or her just debts and funeral expenses be first paid by the personal representative hereinafter named.
SECOND: In case my husband, Robert Abruzzino, survive me, I Barbara Abruzzino, give, devise and bequeath to my husband, Robert Abruzzino, all property (real, personal and mixed) of whatever kind and description and wherever located, of which I may die seized or possessed, and I hereby nominate and appoint my husband, Robert Abruzzino, executor of my estate and of this my last will and testament with full power and authority to execute the same according to its true intent and meaning and to serve without bond.
THIRD: In case my wife, Barbara Abruzzino, survive me, I, Robert Abruzzino, hereby give, devise and bequeath to my son William Abruzzino forty percent (40%) of my stock in Community Super Markets, Inc.; I give, devise and bequeath to my two daughters, Wilma Virginia Talerico and Frances Rosano, the sum of five dollars1973 U.S. Tax Ct. LEXIS 17">*21 ($ 5.00) each; and I give, devise and bequeath to my wife, Barbara Abruzzino, all the balance and residue of all property (real, personal and mixed) of whatever kind and description and wherever located, of which I may die seized or possessed; and I hereby nominate and appoint my son, William Abruzzino, as executor of my estate and of this my last will and testament with full power and authority to execute the same according to its true intent and meaning and to serve without bond.
FOURTH: In case of our simultaneous death or in case it is not known which one of us survived the other, then it shall be presumed that Robert Abruzzino survived Barbara Abruzzino. In case Barbara Abruzzino survive, she agrees not to dispose of the real estate or the stock in Community Super Markets, Inc., except as provided in the will of the survivor set out below.
FIFTH: The survivor of us, after payment of his or her just debts and funeral expenses, gives, devises and bequeaths unto our two daughters, Wilma Virginia Talerico and Frances Rosano, the sum of five dollars ($ 5.00) each; and the survivor of us gives, devises and bequeaths all the balance and residue of all property (real, personal and mixed) 1973 U.S. Tax Ct. LEXIS 17">*22 of whatever kind and description and wherever located of which the survivor of us may die seized or possessed to our son, William Abruzzino.
The Commissioner determined that decedent's estate was not entitled to a marital deduction for the value of the real estate and stock in Community Super Markets, Inc., devised and bequeathed to Barbara. He argues that, because Barbara is contractually bound to hold the real estate and stock for her life and to give them to her son at her death, her interests are terminable and not deductible under
Petitioner contends that Barbara is not contractually bound to retain the real estate and stock and give, devise, and bequeath them to her son. Petitioner argues that, even if Barbara is bound to give 61 T.C. 306">*308 the residue of her estate to her son, our holding in
Petitioner and the Commissioner recognize the necessity1973 U.S. Tax Ct. LEXIS 17">*23 of looking to the law of West Virginia to determine the nature of Barbara's interests in the real estate and stock.
The Supreme Court of Appeals of West Virginia has held that a joint will or mutual wills may represent a contract which entitles its beneficiaries to its enforcement in equity once the survivor has accepted benefits under the will of the first to die. See, for example,
The reasoning upon which this holding is based seems to be that the fact of execution of a joint will is of itself proof positive that both of the parties had full knowledge of the terms and provisions of the will, that the reciprocal dispositions show a consideration moving from each to the other, and hence that it must be supposed that they entered into the agreement in a contractual sense. * * *
Considering the reasoning on which the
1973 U.S. Tax Ct. LEXIS 17">*26 61 T.C. 306">*309 The language of the second sentence of article Fourth supports our conclusion that the provisions of the will are contractually binding. That sentence states: "In case Barbara Abruzzino survive, she
Petitioner argues that the second sentence of article Fourth is binding only in the event of the simultaneous death of Barbara and decedent and, since they did not die simultaneously, that sentence never became operative. Such an interpretation of the will leads to contradiction, for, if in the event of simultaneous death decedent is presumed to have survived under the first sentence of article Fourth, the provisions of the second sentence, conditioned on Barbara's survival, 1973 U.S. Tax Ct. LEXIS 17">*27 would never operate.
Numerous statements of the West Virginia Supreme Court of Appeals require us to construe the will in such a way that it does not contradict itself. See, for example,
A will should not be read so as to contradict itself. If the apparent contradiction can be harmonized or reconciled, the courts should do so, deducing a consistent interpretation from all of the words and clauses used. * * *
Also see
Accordingly, we construe the second sentence of article Fourth as restricting Barbara's disposition of the real estate and stock whenever she received that real estate and stock by surviving the decedent. We note that that sentence logically precedes article Fifth which gives the terms of the disposition.
Petitioner asserts that article Third gave Barbara a "fee simple absolute, a perfect estate under the law," and 1973 U.S. Tax Ct. LEXIS 17">*28 that the language of article Fourth cannot be applied to limit that estate. He cites two cases,
After all my just debts are paid, I will give and bequeath all my property both real and personal to my beloved husband * * *. He is to dispose of said property as he sees fit -- If he chooses to sell it he may do so, in order he may be able to use 61 T.C. 306">*310 it for his comfort. Should there be any thing left after his death I desire it to be given to the cemetery for the upkeep of our lot. * * *
The court held that the testatrix had given her husband a fee simple and, therefore, that the gift to the cemetery was void. The court believed that the husband's power to dispose of the estate indicated the testatrix's intent to create a fee simple. 1973 U.S. Tax Ct. LEXIS 17">*29 The court found ambiguous the language making a gift to the cemetery, for the court could not ascertain from the will how much of her estate the testatrix wanted given to the cemetery. The court concluded (
In
a gift in fee simple, unequivocally made in one clause of a will, can not be taken away, limited or diminished by a subsequent clause, except by provisions which are equally as clear and decisive as the words of donation. * * *
Neither
More significantly, neither
Appellant contends that the third clause of the M. H. Willis will amounts to a limitation over to third parties, and, since it conflicts with the fee simple devises and the bequests of the second clause of said will, it is void. Cases cited would seem to sustain this contention, but in such cases the Court was considering1973 U.S. Tax Ct. LEXIS 17">*31 the construction of one will having conflicting provisions. However, here we are not construing the effect of a single will, but enforcing an agreement under the obvious terms of which the third clause of the will was intended to be supplementary to the second clause, and no conflict exists. To approve and uphold an avoidance of the third clause of the will would amount to an avoidance of the testamentary agreement, which, in equity, we cannot do.
That court's answer necessarily controls our own and leads to our conclusion that the joint will of Barbara and decedent requires Barbara 61 T.C. 306">*311 to retain the real estate and the stock and to dispose of it only in accordance with article Fifth.
Since we have concluded that Barbara is contractually bound to hold the real estate and stock for her life and to give it to her son at her death, our decision in
Petitioner argues 1973 U.S. Tax Ct. LEXIS 17">*32 that our decision in
That case was decided under Minnesota law and we held that the will there in issue granted "a fee simple absolute title" (an absolute estate) to the surviving spouse. The will under consideration in the instant case does have specific contractual language, and the New York law is clear that a contract does exist and that the interest of Mae [the surviving spouse] in such property is
Similarly, West Virginia law is clear that a contract does exist and that Barbara's interests in the stock and in the real estate are not absolute.
Further, our holding in
Accordingly, we hold that Barbara holds terminable interests in the real estate and stock and that those interests do not qualify for the marital deduction.
1. All statutory references are to the Internal Revenue Code of 1954, unless otherwise stated.↩
2. In
3. The will is not strictly reciprocal. Under art. Second, Barbara would have given decedent all her property remaining after payment of her just debts and funeral expenses. On the other hand, under art. Third, the decedent gave Barbara the residue of his estate after payment of his just debts and funeral expenses and after gifts of $ 10 and 40 percent of his stock in Community Super Markets, Inc., to his children. But there can be no question of the sufficiency of that residue to serve as consideration for a contract since the parties have stipulated that decedent's stock in Community Super Markets, Inc., was worth $ 182,752.↩
Estate of Edward N. Opal, Deceased, Mae Opal, Now by ... , 450 F.2d 1085 ( 1971 )
Estate of Saul Krampf, Deceased, Ida Krampf v. Commissioner ... , 464 F.2d 1398 ( 1972 )
Weiss v. Soto , 98 S.E.2d 727 ( 1957 )
Wooddell v. Frye , 110 S.E.2d 916 ( 1959 )
Underwood v. Myer , 107 W. Va. 57 ( 1929 )
Wilson v. Starbuck , 116 W. Va. 554 ( 1935 )
Turner v. Theiss , 129 W. Va. 23 ( 1946 )