Mr. Justice Day,
after making the foregoing statement, delivered the opinion of the court.
The tax in controversy was imposed under an amendment of the general transfer-tax law of the State of New York, chapter 284, Laws of 1897, which provides as follows:.
“Whenever any person or corporation shall exercise the power of appointment derived from any disposition of property made either before or after the passage of this act, such appointment when made shall be deemed. & transfer, taxable under the provisions of this act, in the- same manner as though the property to which sueh appointment relates belonged absolutely to the donee of such power and had been'bequeathed or devised by such donee by will; and"whenever any person or corporation possessing such a power of appointment so derived shall omit or fail to exercise- the- same within' the time provided therefor, in' whole or in part, a transfer taxable under the provisions of this act shall be deemed to take place to the extent of such omissions or failure,, in the same manner as though the persons or corporations thereby becoming entitled [473]*473to the possession or enjoyment of the property to which such power related had succeeded thereto by a will of the donee of the power failing to exercise such power, taking effect at the time of such omission or failure.”
The validity of this tax was attacked in the courts of New York upon objections pertaining to both the Federal’and state constitutions. The latter are not open here," and we shall consider the case only so far as it relates to the objections made to the validity of this statute by reason of alleged violations of the Federal Constitution. These are: First, that by the imposition of the tax the property of the beneficiaries is taken without due process of law, in violation of the Fourteenth Amendment; and, second, that such taxation violates the obligation of a contract within the protection of section 10 of Article 1 of the Federal Constitution.
The objection that the property is taken without due process of law is based upon the argument that the estate in remainder was derived from the deeds of William B. Astor and not under the power of appointment received from those deeds by Mrs. Laura A. Delano. In support of this contention, common law authorities are cited to the proposition that an estate created by the execution of a power takes effect in the same manner as if it had been created by the deed which raised the power; that the beneficiary takes, not under the execution of the power by the donee, but by authority and under grant from the grantor, in like -manner as if the power and the instrument which created it had been incorporated iiito one instrument. •4 Kent’s Com. 327; 2 Washburn, Real Property, 320. The argument is that the estate which arose by the exercise of the power came from William B.' Astor and not from Laura A. Delano, and was vested long before the passage of the amendment of 1897, under the authority of which the tax was imposed,- and to tax the exercise of the power therefore takes property without due process of law.
However technically correct it may be to say that the estate came from-the donor and not from the donee of the power, it is [474]*474self-evident that it was only upon the exercise of the power that the estate in the plaintiffs in error became complete. Without the exercise of the power of appointment the estates in remainder would have gone to all in the class named in the deeds of William B. Astor. By the exercise of this power some were divested of their estates and.the same were vested in others. It may be that the donee had no interest in the estate as owner, but it took her act of appointment to finally transfer the estate to some of the class and take it from others.
Notwithstanding the common law rule that estates created by the execution of a power take effect as if created by the original deed, for some purposes the execution of the power is considered the source of title. It is so within the purpose of the registration acts. A person deriving title under an appointment is considered as claiming under the donee within the meaning of a covenant for quiet enjoyment. 2 Sugden on Powers, 3d ed., 19.
“So on an issue to try whether the plaintiff was entitled by two writings, or any other, purporting a will of J. S., and the evidence was of a feoffment to the use of such person as J. S. should appoint by his will, in which case it was contended that the devisees were in by the feoffment and not by the will, the court held that this was only fictione juris, for that they were not in without the will, and therefore that was the principal part of the title, and such proof was good enough and pursuant to the issue, and a verdict was accordingly given for the plaintiff.” .2 Sugden on Powers, 19, citing Bartlett v. Ramsden, 1 Keb. 570.
So, in the present case, the.plaintiffs in error are not in without the exercise of the power by the will of Mrs. Delano.
By statute in England, for the. purposes of taxation, it has been provided that the donee of the power shall be regarded, in case of a general power, as the one from whom- the'estate came. In Attorney General v. Upton et al., L. R. 1 Ex. 224, the Court of Exchequer had under consideration the Succession Duty Act (16, 17 Viet. c. 51), and it was held that the [475]*475appointee under a general power of appointment, taking effect on the death happening since the commencement of the act, takes succession from the donee-of the power. The testator, Admiral Fanshawe, by will devised certain lands to the-use of his wife, Caroline Fanshawe, for life, remainder to such use as she should by deed or will appoint, and, in default of appointment, for the use and benefit of testator’s nephews, C. F. and J. F. Fanshawe, and their issue. She by deed appointed to the use that trustees should after her death receive an annuity during the lives of the wife of the testator’s nephew, and of the children of the nephew by her, in trust for the separate use of the wife, Elizabeth Fanshawe. • Section 4 of the act, which is there construed, provides that any person having a general power of appointment, under any disposition of property, taking effect upon the death of any person dying after the time appointed for the commencement of the act, shall, in the event of his making any appointment thereunder; be deemed to be entitled at the time of his exercising such power to the property or interest thereby appointed as a succession derived from the donor of the power. All the judges agreed that under section 4 of the act the nephew’s wife took the annuity as a succession from the testator’s widow and not from the testator himself; that, therefore, a duty of ten per cent was payable. Bramwell, B., was of opinion that the duty was also payable under section 2, which provides that “every past or future disposition of property, by reason whereof any person has or shall become beneficially entitled to any property . . . shall be deemed to have conferred, or to confer, on the person entitled by reason of any such disposition ... a succes- ' sion.” In speaking of this section the Baron said-:
“Now, will these annuitants take by -reason of the will of Admiral Fanshawe? We must look, not at the causa remota, but at the causa próxima, and that is the disposition of Caroline Fanshawe.
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Mr. Justice Day,
after making the foregoing statement, delivered the opinion of the court.
The tax in controversy was imposed under an amendment of the general transfer-tax law of the State of New York, chapter 284, Laws of 1897, which provides as follows:.
“Whenever any person or corporation shall exercise the power of appointment derived from any disposition of property made either before or after the passage of this act, such appointment when made shall be deemed. & transfer, taxable under the provisions of this act, in the- same manner as though the property to which sueh appointment relates belonged absolutely to the donee of such power and had been'bequeathed or devised by such donee by will; and"whenever any person or corporation possessing such a power of appointment so derived shall omit or fail to exercise- the- same within' the time provided therefor, in' whole or in part, a transfer taxable under the provisions of this act shall be deemed to take place to the extent of such omissions or failure,, in the same manner as though the persons or corporations thereby becoming entitled [473]*473to the possession or enjoyment of the property to which such power related had succeeded thereto by a will of the donee of the power failing to exercise such power, taking effect at the time of such omission or failure.”
The validity of this tax was attacked in the courts of New York upon objections pertaining to both the Federal’and state constitutions. The latter are not open here," and we shall consider the case only so far as it relates to the objections made to the validity of this statute by reason of alleged violations of the Federal Constitution. These are: First, that by the imposition of the tax the property of the beneficiaries is taken without due process of law, in violation of the Fourteenth Amendment; and, second, that such taxation violates the obligation of a contract within the protection of section 10 of Article 1 of the Federal Constitution.
The objection that the property is taken without due process of law is based upon the argument that the estate in remainder was derived from the deeds of William B. Astor and not under the power of appointment received from those deeds by Mrs. Laura A. Delano. In support of this contention, common law authorities are cited to the proposition that an estate created by the execution of a power takes effect in the same manner as if it had been created by the deed which raised the power; that the beneficiary takes, not under the execution of the power by the donee, but by authority and under grant from the grantor, in like -manner as if the power and the instrument which created it had been incorporated iiito one instrument. •4 Kent’s Com. 327; 2 Washburn, Real Property, 320. The argument is that the estate which arose by the exercise of the power came from William B.' Astor and not from Laura A. Delano, and was vested long before the passage of the amendment of 1897, under the authority of which the tax was imposed,- and to tax the exercise of the power therefore takes property without due process of law.
However technically correct it may be to say that the estate came from-the donor and not from the donee of the power, it is [474]*474self-evident that it was only upon the exercise of the power that the estate in the plaintiffs in error became complete. Without the exercise of the power of appointment the estates in remainder would have gone to all in the class named in the deeds of William B. Astor. By the exercise of this power some were divested of their estates and.the same were vested in others. It may be that the donee had no interest in the estate as owner, but it took her act of appointment to finally transfer the estate to some of the class and take it from others.
Notwithstanding the common law rule that estates created by the execution of a power take effect as if created by the original deed, for some purposes the execution of the power is considered the source of title. It is so within the purpose of the registration acts. A person deriving title under an appointment is considered as claiming under the donee within the meaning of a covenant for quiet enjoyment. 2 Sugden on Powers, 3d ed., 19.
“So on an issue to try whether the plaintiff was entitled by two writings, or any other, purporting a will of J. S., and the evidence was of a feoffment to the use of such person as J. S. should appoint by his will, in which case it was contended that the devisees were in by the feoffment and not by the will, the court held that this was only fictione juris, for that they were not in without the will, and therefore that was the principal part of the title, and such proof was good enough and pursuant to the issue, and a verdict was accordingly given for the plaintiff.” .2 Sugden on Powers, 19, citing Bartlett v. Ramsden, 1 Keb. 570.
So, in the present case, the.plaintiffs in error are not in without the exercise of the power by the will of Mrs. Delano.
By statute in England, for the. purposes of taxation, it has been provided that the donee of the power shall be regarded, in case of a general power, as the one from whom- the'estate came. In Attorney General v. Upton et al., L. R. 1 Ex. 224, the Court of Exchequer had under consideration the Succession Duty Act (16, 17 Viet. c. 51), and it was held that the [475]*475appointee under a general power of appointment, taking effect on the death happening since the commencement of the act, takes succession from the donee-of the power. The testator, Admiral Fanshawe, by will devised certain lands to the-use of his wife, Caroline Fanshawe, for life, remainder to such use as she should by deed or will appoint, and, in default of appointment, for the use and benefit of testator’s nephews, C. F. and J. F. Fanshawe, and their issue. She by deed appointed to the use that trustees should after her death receive an annuity during the lives of the wife of the testator’s nephew, and of the children of the nephew by her, in trust for the separate use of the wife, Elizabeth Fanshawe. • Section 4 of the act, which is there construed, provides that any person having a general power of appointment, under any disposition of property, taking effect upon the death of any person dying after the time appointed for the commencement of the act, shall, in the event of his making any appointment thereunder; be deemed to be entitled at the time of his exercising such power to the property or interest thereby appointed as a succession derived from the donor of the power. All the judges agreed that under section 4 of the act the nephew’s wife took the annuity as a succession from the testator’s widow and not from the testator himself; that, therefore, a duty of ten per cent was payable. Bramwell, B., was of opinion that the duty was also payable under section 2, which provides that “every past or future disposition of property, by reason whereof any person has or shall become beneficially entitled to any property . . . shall be deemed to have conferred, or to confer, on the person entitled by reason of any such disposition ... a succes- ' sion.” In speaking of this section the Baron said-:
“Now, will these annuitants take by -reason of the will of Admiral Fanshawe? We must look, not at the causa remota, but at the causa próxima, and that is the disposition of Caroline Fanshawe. Again, the act says, that the term predecessor ‘sháll denote the settlor, disponer, testator, obligor, ancestor, or other persón from whom the interest of the successor is or [476]*476shall be derived.’ From whom, then, is the interest derived? As I said in Barker’s case (1), these are ordinary English words, and ought to be construed by lawyers as ordinary Englishmen would construe them. Now, not one man in a hundred would say that this interest was derived from Admiral Fanshawe or from any other person than the donee of the power. I do not mean to deny or attempt to cast any doubt on the rule of law ■that an appointee*, takes his estate from the donor of the power, but I say that it is a rule not applicable to the construction .of this statute, and it is not true, as is supposed, that there is any decision of the House of Lords to the contrary.”
The -learned Baron seems to have gone farther, as to section 2, than his brethren were willing to. Attorney General v. Mitchell, L. R. 6 Q. B. D. 548. His observations are nevertheless suggestive.
While the entire bench recognized the common law rule that the estate is taken to come from the donor of the power, it enforced the statutory change as to a subsequent exercise of the power, treating the estate as coming from the donee, by-whose act it was appointed to the beneficiary.
The statute of New York in question acts equally upon all persons similarly situated. It affects an estate which only became complete by the exercise of a power subsequent to its enactment.
The exercise of the power bestowing property in the present case was made by will. And we need not consider the case, expressly reserved by the Court of Appeals in its opinion, as to the result if it had been exercised by deed.
That the will was effectual to transfer the estate was ruled by the Court of Appeals, and its decision on this question is binding here, as was held in Orr v. Gilman, 183 U. S. 278, which came here for a review of a decision of the Circuit Court of Appeals of New York, rendered in Matter of Dows, 167 N. Y. 227, a case which arose under the same statute of 1897. In that case the testator devised real estate in trust to pay the .income to .his son for life, and, upon his death, to vest abso[477]*477lutely and at once in his children and the issue of his deceased children, as his son should appoint by will. If, however, the son should die intestate the estate was to vest absolutely and at once in his children then living, and the issue of the deceased children. The son exercised the power of appointment by his last will, probated in 1899. The Court of Appeals held that the property was subject to the taxation imposed by the' act of 1897; that such tax was on the right of succession and not on the property. ' It became important in that case to determine whether the property passed by virtue of the will of the donor, David Dows, Senior, and then became vested in the grandchildren, or only became vested in them when the power of appointment was exercised by the will of David Dows, Junior.
This court held that the answer to this question must, of course, be furnished by the Court of Appeals in that case. 183 U. S. 282. In other words, the Court of Appeals of New York had the exclusive right to construe instruments of title in. that State, and determine for itself the creation and vesting of estates through wills under the laws of the State. “The Court of Appeals held that'it was the execution of the power of appointment which subjected grantees under it to the transfer tax.- This conclusion is binding upon this court in so far as it involves a construction of the will and of the' statutes.” 183 U. S. 288. In the present case the New York Court of Appeals has spoken in no uncertain language upon the subject:
“As the tax is imposed upon the exercise of the power, it is unimportant hów the power was created. The existence of the power is the important fact, for what may be done under it is not affected by its origin. If created by deed its efficiency is the same as if it had been created in the same form by will. No. more and no less could be"done by virtue of it in the one case than in the other. Its effective agency to produce the result intended is neither strengthened nor weakened by the nature of the- instrument used by the donor, of the power to create it. The power, however or whenever created, authorized the donee by her will to divest certain defeasible estates [478]*478and to vest them absolutely in one person. If this authority had been conferred by will, instead of by deed' the right to act would have been precisely the same, and the power would have neither gained nor lost in force. . . . 176 N. Y. 493.
“As we said through Judge Cullen in the Dows case: ‘Whatever be the technical source of title of •■the grantee under a power of appointment, it cannot be denied that in reality and substance it is the execution of the power that gives to the grantee the property passing under it.’ This accords with the statutory definition of a power as applied to real estate, for it includes an authority to create or revoke an estate therein. (Real Property Law, § 111.) Such was the effect of the exercise of the power under consideration, for it both revoked and created estates in the real property and the interests in the personal property. No tax is laid on the power, or on the property, or on the original disposition by deed, but simply upon the exercise of the power by will, as an effective transfer for the purposes of the act.” 176 N. Y. 494.
As in Orr v. Gilman, 183 U. S. supra,, we must accept this decision of the New York Court of Appeals holding that it is the exercise of the power which is the essential thing to transfer the estates upon which the tax is imposed. That power was exercised under the will of Laura Delano, a right which was conferred upon her under the laws of the State of New York and for the exercise of which the statute was competent to impose the tax in the exercise of the sovereign power of the legislature over the right to make a disposition of property by will. United States v. Perkins, 163 U. S. 625, 628; Magoun v. Illinois Trust & Savings Bank, 170 U. S. 283, 288.
We cannot say that property has been taken without due process of law, within the protection of the Fourteenth Amendment, by the manner in which the Court of Appeals has construed and enforced this statute. Orr v. Gilman, 183 U. S. supra.
Nor do we perceive that the effect has been to violate any contract right of the parties. It is said that this is so, because [479]*479instead of disposing of the entire estate, ninety-five per cent of the property included in the power has been transferred and five per cent taken by the State; but as there was. a valid exercise of the taxing power of the State, we think the imposition of such a tax violated no contract because it resulted in the reduction of the estate.
Certainly the remaindermen had no contract with the donor or with the State. For whether the remaindermen received aliquot parts of the entire estate or the same was divested in whole or in part for the benefit of others in the class, depended upon the exercise of the power by the donee. The State was not deprived of its sovereign right to exercise the taxing power upon the making of a will in the future by which the estate was given to the appointees.
We find no error in the judgment of the Surrogate’s Court entered on the remittitur from the Court of Appeals, and the same is
Affirmed.