In Re Brown's Estate , 122 Mont. 451 ( 1949 )

I think the delivery of possession of the bonds in question was compatible with a joint ownership thereof. The donor did not retain sole possession and control as in the Perier Estate Case,122 Mont. 9, 195 P.2d 989. I think my associates have overlooked the point that there is a vast difference between the possession of one in sole ownership and the possession of each of two joint owners. My associates erroneously hold that a donor of bonds held in joint ownership must surrender complete control and possession thereof to the donee in order to give the donee any interest therein. I think if the donees in the instant case had available to them the means of realizing on the bonds, that is, if sufficient access to the bonds was made available to them so that they could have sold them if they so desired, then there was sufficient delivery to constitute them joint owners. Compare In re Myers' Estate, 359 Pa. 577, 60 A.2d 50. I think the evidence was sufficient to warrant the finding made by the court that decedent did not retain exclusive possession of the bonds.

The fact that the donor retained the right to sell the bonds herself is one of the incidents of joint ownership much the same as in the case of a joint bank account. In the creation of a joint ownership in personal property there need not be such delivery to one of the joint owners by the other as would meet the requirements of a completed gift of the whole interest in the chattel as in the case of Chambers v. McCreery, C.C., 98 F. 783, relied upon by appellants and as contemplated by the authorities relied on in the majority opinion, all of which have to do with gifts of chattels and not with the creation of joint ownership interests.

Appellants also rely upon the case of In re Sawyer's Estate, Ohio Prob., 75 N.E.2d 695. But the Ohio statute on the taxability of a joint estate is so different from ours that the case is not helpful here.

I think this case calls for application of subdivision 6 of section 10400.1, R.C.M. 1935, reading: "Joint estates. Whenever any property, real or personal, is held in the joint names of two or more persons, or as tenants by the entirety, or is deposited in banks or other institutions or depositaries in the joint names of two or more persons and payable to either or the survivor, upon the death of one of such persons, the right of the surviving tenant by the entirety, joint tenant, or joint tenants, person or persons, to the immediate ownership or possession of such property shall be deemed a transfer of one-half or other proper fraction thereof as though the property to which such transfer relates belonged to the tenants by the entirety, joint tenants, or joint depositors as tenants in common, and had been bequeathed or devised to the surviving tenant by the entirety, joint tenant, or joint tenants, person or persons, by such deceased tenant by the entirety, joint tenant, or joint depositor, by will, except such part thereof as may be shown to have originally belonged to the survivor and never to have belonged to the decedent."

The court I think erred in holding that the bonds were not held in the joint names of two or more persons within the meaning of subdivision 6 of section 10400.1, supra.

The federal regulations set out in Re Myers' Estate, supra, treat the alternate owners of such bonds as joint owners with the right of survivorship. The fact that those regulations as pointed out in the majority opinion regard the bonds for federal estate tax purposes as those of the person furnishing the money unless redeemed before his death is immaterial. It is our statute and not federal regulations which controls the taxability of such bonds for state inheritance tax.

There is language used in both the majority and minority opinions in the Perier case, supra, which is open to the interpretation that bonds held in the alternate names of two owners can never be held in joint ownership within the meaning of subdivision 6 of section 10400.1. Doubtless this language was so interpreted by the lower court. I think since the federal government treats such bonds exactly the same as if they were issued in the names of two owners conjunctively, the fact that they are named as owners in the alternative is of no importance.

The conclusion in the Perier case, so far as the bonds there involved were concerned, was correct. The bonds there concerned were not jointly owned because the donor retained exclusive possession and control of them and the donees were not given access to them such as the court was warranted in finding was given here.

I think the order of the court should be ordered modified so as to permit one-half of the value of the bonds to be assessed for the inheritance tax.