Supp. 679, which was afterwards affirmed by the Court of Appeals in 196 N. Y. 561, without an opinion, was by three judges, while two others joined in a dissenting opinion." The above has been followed in the later case of Burnham v. Treasurer, 212 Mass. 165; 98 N. E. 603, and in the very recent case of Montague v. State, 163 Wis. 58; 157 N. W. 508. It may be safely assumed that the courts of the states which follow the language of the original New York Statute will sustain it and follow the Massachusetts doctrine. On the other hand, the portion of the section declared unconstitutional in the Lansing case was omitted from the statute in 1911 and the section as thus amended has been copied by Arkansas, Indiana, Oklahoma and West Virginia, all very recent statutes yet to be construed. It is to be assumed they will sustain it and follow the New York rule. 5. Development of the New York Rule. The rule that when the exercise of the power makes no material change from the devolution under the ancestor's will, in default of its exercise, the appointee may elect to take under the will of the ancestor who died prior to the statute and thus avoid the tax has led to much litigation in which the Lansing case has been sustained and applied. Matter of Backhouse, 110 App. Div. 737; 96 Supp. 466; aff. 185 N. Y. 544; 77 N. E. 1181. Matter of Spencer, 190 N. Y. 517; 83 N. E. 1132. Matter of Haggerty, 128 App. Div. 479; 112 Supp. 1017; aff. 194 Matter of Chapman, 61 Misc. 593; 115 Supp. 981; aff. 199 N. Y. 562; Matter of Haight, 152 App. Div. 228; 136 Supp. 557. Matter of Hoffman, 161 App. Div. 836; 146 Supp. 808; aff. 212 N. Y. Matter of Lewis, 194 N. Y. 550; 88 N. E. 1124. Where the donee of the power makes material changes in the devolution the rule in the Lansing case does not apply. Matter of Cooksey, 182 N. Y. 92; 74 N. E. 880. But where the exercise of the power disposed of onefifth of the property otherwise than it would have gone under the ancestor's will in default of its exercise; the tax attaches only to that one-fifth; the rest passes under the ancestor's will. Matter of Ripley, 122 App. Div. 419; 106 Supp. 844; aff. 192 N. Y. 536; 84 N. E. 1120. And where the donee exercised the power to pay her own debts out of the fund and left the balance to the same persons who would have received it in default of the power the tax is payable on the appointment to the creditors but the beneficiaries may elect to take the balance under the ancestor's will. Matter of Slosson, 216 N. Y. 79; 110 N. E. 166. In default of the power the remainder passed to the "children" of the donor of the power. The donee appointed her sister's children who were grandchildren of the donor. The word "children" in the donor's will could not be held to include "grandchildren" and the latter did not take under the ancestor's will but under the exercise of the power and their shares were taxed. Matter of King, 217 N. Y. 358; 111 N. E. 1060. Election to take under the will of the ancestor will be presumed where it avoids the tax. Matter of Mitchell, N. Y. L. J., Nov. 22, 1913. But a beneficiary under a power of appointment cannot accept its benefits in part and as to the rest elect to take under the will of an ancestor. Matter of Isabel Brush, N. Y. L. J., April 26, 1917. Nor can they actually receive the property under the exercise of the power and yet claim to take it under the will of the donor for purposes of the transfer tax. Matter of Warren, 62 Misc. 444; 116 Supp. 1034. 6. Construction of Wills. It frequently becomes a serious question whether a power has been conferred or whether the provisions of the will do not, in fact, confer a fee with remainders over that are void. In recent case of Appeal of Luques, 114 Me. 235; 95 A. 1021, the ancestor, who died before the statute, gave property to his wife absolutely but provided that if she should not dispose of it during life or by will then his sons should take. The widow devised to the sons but the court held they could not elect to take under the ancestor's will as the bequest to their mother was absolute and the remainder over void. On the other hand in a recent Arkansas case a husband devised a life estate to his wife with power to appoint during life." She appointed by will. It was held that the exercise of the power was void and that the property passed under her husband's will who died before the statute and hence was exempt from tax. State ex rel. McDaniel v. Gaugan, 124 Ark. 548; 187 S. W. 918. So, in a recent Kentucky case a life estate was devised with power to appoint but in such language that it was held the life estate was enlarged to a fee and, therefore, the appointees could not take under the ancestor's will. Commonwealth v. Stoll's Estate, 132 Ky. 234; 114 S. W. 279; 116 S. W. 687. 7. Questions of Residence. If the donor died in a state where the transfer is taxed only upon exercise of a power, obviously no tax can accrue. If the donee has moved to a state where the tax is against the estate of the donor- also no tax can accrue. This and other possible complexities have produced some puzzling questions. Where the donor of the power resided in another state and the property subject to the power was in the hands of a trustee in another state the exercise of the power by a resident is not subject to the tax. Walker v. Treasurer, etc., 221 Mass. 600; 109 N. E. 647. The test to be applied is "Would the property have been taxable if it had belonged to the donee of the power?" So where a non-resident donee exercised the power over a trust fund in the possession of Massachusetts trustees shares of stock in a foreign corporation in possession of those trustees held not taxable. Clark v. Treasurer, etc., 218 Mass. 292; 105 N. E. 1055. Exercise of power by non-resident donee taxed only as to taxable assets within the state though the donor of the power was a resident. Matter of Fearing, 138 App. Div. 881; 123 Supp. 396; aff. 200 N. Y. 340; 93 N. E. 956. The donor of the power died a resident. His wife, the donee, moved to New Jersey and there died exercising the power. Taxed only as against taxable property of a nonresident within the state. Matter of Kissel, 65 Misc. 443; 121 Supp. 1088; aff. 142 App. Div. 134; 127 Supp. 1217. Where a resident donee exercised the power over personal property without the state, held: taxable. Matter of Hull, 111 App. Div. 322; 97 Supp. 701; aff. 186 N. Y. 586; 79 N. E. 1107. Acting under a power of appointment in a will executed by his mother in Kentucky a testator residing in Minnesota exercised the power by will in favor of nephews residing in Tennessee. The property was in the custody of a resident of Kentucky. Held: that the tax was on the transfer as though the property belonged to the donee and the transfer was, therefore, taxable in Minnesota, citing Matter of Hull, supra. State v. Probate Court, 124 Minn. 508; 145 N. W. 390. Where the power was created by will of a non-resident and exercised by will of a resident, held: taxable. Matter of Frazier, N. Y. L. J., March 28, 1912. Bonds and mortgages on New York real estate transferred by a non-resident under the exercise of a power where there had been an intervening life estate, held: taxable under statute in force at date of creating of the power. Matter of Warden, 94 Misc. 563; 157 Supp. 1111. For questions arising under the taxation of transfers by power of appointment, see post Part III D Life Estates and Remainders. Transfers pursuant to the provisions of the common law are generally held not taxable under the usual language of the statutes taxing inheritances and must be specified in the act if they are not to escape taxation. 1. Dower. A widow does not take dower as heir of her husband and it does not pass by intestate law. Matter of Weiler, 122 Supp. 608; aff. 139 App. Div. 905; 124 Supp. 1133. Matter of Church, 80 Misc. 447; 142 Supp. 284. McDaniel v. Byrkett, 120 Ark. 295; 179 S. W. 491. Sandford v. Jackson, 10 Paige 266. Konvalinka v. Schlegel, 104 N. Y. 125; 9 N. E. 868. Kimbel v. Kimbel, 14 App. Div. 570; 43 Supp. 900. |