Opinion
No. 3298.
Decided February 3, 1942.
After property has been placed under conservatorship the former owner can make no valid contract disposing of it without the conservator's approval. (P. L., c. 291, s. 17; P. L., c. 289, s. 26.)
PROBATE APPEAL. The plaintiff, who is the executor of the will of Ida D. M. Sleeper, was held liable by the Probate Court for a legacy tax assessed upon the sum of $8,385, claimed to be due Ethel H. Ball by virtue of a written agreement dated March 8, 1935, and signed by Ida D. M. Sleeper and herself. By the terms of this agreement Mrs. Ball was to provide Mrs. Sleeper with "reasonable board and room" and "personal care and attendance" during the remainder of Mrs. Sleeper's life.
The consideration for the agreement was stated to be $10,000, the receipt of which Mrs. Ball acknowledged. She was not paid this sum, however, but actually received during Mrs. Sleeper's lifetime only the sum of $1,650, which was paid her by F. E. Normandin after he became conservator of Mrs. Sleeper's property. The sum of $8,385 was paid her by F. E. Normandin in his capacity of executor. The agreement provided for the return to Mrs. Sleeper of a part of the consideration in case Mrs. Ball should die within six years — a "rebate" of $5,000 if she should die after two years but before the expiration of four years, a repayment of $2,500 if she should die after four years but before the expiration of six years.
The cause of Mrs. Sleeper's death was a cancer. She was admitted to the Laconia hospital on February 10, 1935, and discharged on February 24 to "be cared for at Mrs. Ball's." According to the defendant's contention, the evidence relating to her physical condition was such as to justify an inference that the agreement was made in contemplation of death.
On February 19, 1935, a conservator of Mrs. Sleeper's property was appointed. He filed a petition to resign on March 6, 1935, but his resignation was not accepted until April 17. He was succeeded by Fortunat E. Normandin. On June 15, 1935, Mrs. Sleeper made her will, leaving one-third of the residue of her estate to Mrs. Bail and stating that this bequest was "not in place of, but in addition to" the amount which Mrs. Ball was to receive under the agreement. Mrs. Sleeper died on January 28, 1936. She was then 76 years of age.
The plaintiff's petition to abate the tax was denied by the Probate Court. In the Superior Court the decision of the Presiding Justice, to whom the case was submitted on an agreed statement of facts, was as follows: "In so far as it is a question of fact the court finds and in so far as it is a question of law the court rules that the money paid and due under the contract between Mrs. Sleeper and Mrs. Ball is not taxable. The appeal is sustained and the tax is abated." The defendant's bill of exceptions was allowed by Young, C. J.
Normandin Normandin (Mr. Fortunat A. Normandin orally), for the plaintiff.
Ernest R. D'Amour, Assistant Attorney-General, for the defendant.
With certain exceptions not here material, section 1 of chapter 72 of the Public Laws provides that all property "which shall pass by will, or by the laws regulating intestate succession, or by deed, grant, bargain, sale or gift, made in contemplation of death, or made or intended to take effect in possession or enjoyment at or after the death of the grantor or donor, to any person, absolutely or in trust" shall be subject to a tax for the use of the State.
Section 38 of the same chapter provides that "The amount due upon the claim of any legatee named in the will, or of any person who is, or, in the absence of a will, would be an heir-at-law of a deceased person, arising under a contract for board, lodging, support, maintenance or personal care and attention, covering a period of more than six months, shall be subject to the same tax imposed by this chapter upon a legacy or succession of like amount, except to the extent that such claim is evidenced by a writing signed by the decedent containing an agreement for payment at some specified time or times within the decedent's lifetime."
The only reason assigned by the plaintiff as a ground of appeal from the decree of the Probate Court is because "the said sum [$8,385] is not taxable by virtue of . . . section 38." He argues that the purpose of this section is to render taxable a class of property not included in section 1, and that the qualifying provisions of section 38 apply to all contracts for support including those made in contemplation of death. The defendant, on the other hand, contends that contracts for support made in contemplation of death remain subject to the provisions of section 1, the purpose of section 38 being to prevent tax evasion.
It is unnecessary to resolve these differences of interpretation, however, for in our opinion the plaintiff cannot prevail even if section 38 be given the construction for which he contends. When the agreement was made, Mrs. Sleeper had placed her property in the hands of a conservator (P. L., c. 291, s. 16) and could not make a valid contract disposing of that property in her lifetime without his approval. See P. L., c. 291, s. 17; P. L., c. 289, s. 26.
No approval of the contract in question was obtained from the conservator originally appointed, and if his successor, who is now the executor, may be said to have recognized the agreement in any particular, it was not in respect to the provision that called for immediate payment of the consideration, for he paid Mrs. Ball during Mrs. Sleeper's lifetime only what her services were presumably worth. The plaintiff's contention "that Mrs. Ball could have enforced the terms of the written contract, in so far as the consideration is concerned, at any time she wished" overlooks the fact that, in view of the conservatorship, there was no valid written contract for payment of the consideration "within the decedent's lifetime" (P. L., c. 72, s. 38) to be enforced.
Appeal dismissed.
All concurred.