Succession of Sala

24 So. 674, 50 La. Ann. 1009, 1898 La. LEXIS 331

• Court: Supreme Court of Louisiana
• Decided: March 21, 1898
• Docket: No. 12,275
• Status: Published

Opinions

The opinion of the court was delivered by

Nicholas, C. J.

Pablo Sala, a resident of the parish of Orleans, died in said parish on the 25'th of October, 1894, leaving a last will and testament in which he^ appointed George. W.. Nott his testamentary, executor, and, in and, by. which be, constitute^ ; as, .bis, universal legatee bis sister,. Dona .Maria Sala, y. Fabrigas,. residi.ng,.in.jLlo.ret. de Mar in Spain. Inventories were taken of the succession from which it appeared that the deceased leftjln the State real estate and also movable property and credits. ' Nott qualified as executor. . >

In April, 1895, the Oharity Hospital at New Orleans brought suit in which it prayed that there be judgment in its favor, condemning the executor, Nott, to pay over and deliver to the treasurer of the Oharity Hospital the sum of twelve thousand five hundred dollars, or such sum as might be equal to ten per cent', upon all sums, or the value of all property which might fall to or become due to said Maria Sala, universal legatee of Pablo Sala.

' The demand was based upon the provisions of Act No. 130 of 1894 and upon the allegations that in this succession there fell to the universal legatee, Maria Sala, under and and by virtue of the last will and testament of the deceased, property and assets amounting to, at least, one hundred and twenty thonsand dollars after all the debts of the succession bad been paid or discharged. That George W. Nott was the executor of the deceased and was in charge of and had the administration of the succession property belonging to or falling to the universal legatee. That said legatee resided out of the State of Louisiana and was not a citizen of any other State or Territory of the United States, but a citizen or subject of the kingdom of Spain. That it was the duty of the executor to retain in his hands the tax for the benefit of the Oharity Hospital of ten per cent., for which, under the provisions of said Act No. 130, the said legatee was liable, and to pay the same to the ti’easurer of the Oharity Hospital.

The act referred to is entitled “An act to amend and re-enact Arts. 1221, 1222 and 1223 of the Civil Code relative to the tax due by foreign heirs, legatees and donees, repealed by Act No. 86, approved April 20, 1877.”

It reads as follows:

“ Be it enacted by the General Assembly of the State of Louisiana, That Arts. 1221, 1222 and 1223 of the Revised Civil Code relative to the tax due by foreign heirs, legatees and donees, repealed by Act No. 86 of 1877, Extra Session, be amended and re- enacted so as to read:

“Art. 1221. Each and every person not being domiciliated in this State, and not being a citizen of -any State or Territory-in thé Union,.who shall be ■ entitled - whether as heir, legatee or donee to the whole or.'any part of-the succession of a person'- deceased, whether'such person shall have died in this State or elsewhere, shall pay a tax for the benefit of the Charity Hospital in New Orleans of ten per cent, on all sums on the value of all property which he may have actually received from said succession, or so much thereof as is situated in this State, after deducting all debts; when the inheritance, donation or legacy consists of specific property, and the same has not been sold, the appraisement thereof in the inventory shall be considered as the value thereof.

“Art. 1222. Every executor, curator, tutor or administrator having the charge or administration of succession property belonging in whole or in p'art to a person residing out of the State and not being a citizen of any other State or Territory, shall be bound to retain in his hands the amount of the tax imposed and to pay over the same to the treasurer of said hospital, in default whereof every such executor, curator, tutor or administrator and. his securities shall be liable for the amount thereof.

“Art. 1223. It shall be the special- duty of clerks of court to see that the tax imposed by the preceding section be collected and paid over; and each of such clerks shall be bound to furnish the auditor and the treasurer of said hospital once in a year a statement or list of the successions opened in his parish whereof persons who are neither residents of this State nor citizens of any other State or Territory in the United States are heirs, legatees or donees, in whole or in part, and of the amount accruing to such persons, and any clerk failiug to furnish such statement or to comply with the provisions of the law relative to vacant successions shall be responsible to the State for the amount due.”

Before plaintiff’s petition was put at issue Dona Maria y Pabrigas was, by decree of the District Court, recognized as the universal legatee of the deceased and put in possession as such.

This decree was rendered with the consent of the Board of Administrators of the Charity Hospital, under an agreement entered into between the board and the legatee, that in order to secure the Charity Hospital in case final judgment should be rendered in favor of the plaintiff on the present demand, a certain plantation; known as the Zeringue plantation, should not be sold by the legatee. Dona Maria Sala y Pabrigas (Maria Sala) having been placed in possession, answered plaintiff’s petition. Having first pleaded the general issue she admitted that she was the universal legatee of Pablo Sala, and that she was a subject aud citizen of the kingdom of Spain, but further answering she averred that she was not liable for the tax claimed, that the provisions of Act No. 130 of 189Q were inoperative and of no effect as to her for the reason that she is protected against the said law by the treaty of Spain with the United States of America, entered into of the 27th of October, 1795, notified on the 25th of April, 1796 and proclaimed on the 2d of August, 1796, which treaty was still in force and operation. That the inhabitants of the State of Louisiana are not subject to pay any dues, taxes or imposts of any kind upon successions, legacies, or donations to which they are, or may be, entitled, and that no such dues, _ taxes or imposts are imposed or levied upon them as such heirs, legatees or donees, and therefore she, under the treaty, was not liable to a tax. That Act. No. 130 of 1894 was in violation of Art. 35 of the Constitution.

The portion of the treaty relied on is its eleventh article, which is as follows:

Article XI.

“ The citizens and subjects of each party shall have power to dispose of their personal goods within the jurisdiction of the other by testament, donation or otherwise, and their representatives being sujects of the other party shall succeed to their said personal goods, whether by testament or ab intestato, and they may take possession thereof, either by themselves or others acting for them, and dispose of the same at their will, paying such dues only as the inhabitants of the country wherein the said goods are, shall be subject to pay in like eases.

“ And in ease of the absence of the representative, such care shall be taken of the said goods as would be taken of the goods of a native in like case until the lawful owner may take measures for receiving them.

“ And if questions shall arise among several claimants to which of them the said goods belong, the same shall be decided finally by the laws and judges of the land wherein the said goods are. And where on the death of any person holding real estate within the territories of the one party, such real estate would by the laws of the land descend on a citizen or subject of the other were he not disqualified by being an alien such subjects shall be allowed a reasonable time to sell the same and to withdraw the proceeds without molestation, and exempt from'all rights of detraction on.the part of the government of the respective States.”

The District Court rendered judgment in favor of the defendant, rejecting the claim of the Charity Hospital, and it appealed.

The position of the plaintiff is thus stated in the syllabus of the brief filed in their behalf:

“ Article XI of the Treaty of 1795 between the United States and the kingdom of Spain guarantees to the citizens or subjects of the contracting parties acquiring property by testament, donation or inheritance, situated in the territory of the other, specific rights as to movable and immovable property so acquired; the rights as to each class of property are different and distinct fiom the other; as to movables, the only guarantee given is that the citizens or subjects of the one shall pay no dues or charges not imposed upon the citizens or subjects of the other situated in'like circumstances (and a portion of our citizens are liable to this tax) ; that as to immovables, the only right conferred is that where the laws of the State in which the property is situated prohibit an alien from acquiring real estate, such alien shall have a reasonable time to dispose of his legacy or inheritance and to remove the proceeds without molestation.

• “ As under the laws of this State a Spaniard- may acquire real estate by a title either gratuitous or onerous, the case contemplated by the treaty can not arise.”

' Plaintiff maintains that it is the duty of the court to enforce the law in every respect in which its provisions are-not squarely covered by the treaty; that a portion of our own citizens are liable to pay this tax. Defendant urges that the words “ personal goods” in the treaty do not mean “ personal property” in the sense of the common law of England and the United States, or movables in the sense of the civil law. That it is evident that the expression “personal goods” is synonymous with the Spanish term “ bienes person-ales,” which, like the Breach word “biens personéis,” signifies “ property personal to the party,”, whether it be ■ movable or immovable, and ineludes'both. That personal or movable property in Spanish would be “ bienes meubles; * * * that as the article of the Spanish treaty saving the succession property of the citizens of both countries from taxation is the same verbatim as the article of the Italian treaty,:the decision in the Rixner succession (48 An. 552):.should,dispose .of the present..case.” ....

She- pleads- the uneonstitutionality of- Act No. 180 of 1894-should the plea be necessary to protect her rights. We think that the two governments in stipulating that “ heirs, legatees and donees-should pay such dues only as the inhabitants of the country'wherein the said- goods are shall be subject to pay in like cases,” intended-' tó giv'é to the very flexible word “inhabitants” as broad a signification as-would be needed to insure to the citizens of each country the full protection which it was the obvious intention of both the' contracting parties to secure. Were it true (although the tax imposed by the act of 1894 is referred to in the title of the act as a tax due by “foreign heirs, legatees and donees”),- that the General Assembly had in view the imposition of a succession tax upon citizens of Louisiana living away from the State, we would not be justified in holding that that fact would bring • the defendant under the provisions of that act. Upon that hypothesis only an extremely small and exceptional fraction of the people of Louisiana would be brought under the operation of the statute, and we would see no parallelism in our imposing a tax on citizens absent from this State and imposing, one on Spanish heirs or legatees absent from Louisiana. It was suggested on one occasion by a judge of this court.that a similar statute (subsequently repealed) was enacted partially with a view of striking a blow at absenteeism, then prevailing to a great exteut, but if such was really the motive it would be difficult to find a ground on which we could predicate an intention on the part of either country to extend the provisions of such a qaasi-peaal statute so as to make it cover citizens of the other residing-at their own home. To extend a statute imposing a succession tax upon heirs or legatees citizens, of Louisiana who reside abroad to Spanish heirs- or legatees, living in their own country, would be to take out of the treaty most of its life, leaving its benefits almost nominal. We would not feel warranted in giving to the treaty the narrow scope contended for, leading, as it would,- to results evidently not contemplated. We are of the opinion .that the object of the treaty was tosecure the citizens or subjects .of-each from being discriminated against under the laws of the other for or on aaceoünt of their alienship. This object would -' be entirely thwarted if the Spanish heirs- and legatees living in Spain coúld-be -successfully discriminated: against by being - made' to .fall uhde-r vhe han ¡b'f-'Státüte discrimination,. either aotuálly or apparently aimed at what would be (if so aimed) only exceptionally and at a very small proportion of the people of the State. Most Spanish heirs and legatees would be in that precise situation. We would hold that Spanish heirs and legatees under the treaty were entitled to share in the-benefits accorded generally to the people of the State. We do not think, however, that the statute of 1894 was aimed at any portion of our people. The title of the act, as we have already noticed, discloses that its provisions were directed against aliens, for the tax is therein referred to as one due by “ foreign ” heirs, legatees and donoes. The first section of the statute, which is that which imposes-the tax, designates as the parties to be taxed persons not domiciliated in the State and not citizens of any State or Territory in the Union. This designation of the parties to be charged with the tax is not broadened by any subsequent section of the statute — the first section controls the act throughout. For a double reason we think . that plaintiff’s demand against defendant, in so far as it is based upon the movable assets of the succession, is not well founded.

We are next to consider what the situation is in respect to the tax claimed upon the immovables of the estate. The treaty deals directly and expressly eo nomine with immovables only in respect to the legal results which would be made to flow under the laws of either country, should foreigners be prohibited from owning real estate. It concedes, the existence of a continuing power and authority in the two governments to control and regulate the disposition of immovable property within their respective borders — a power of control which governments have much more jealously and tenaciously adhered to- and insisted upon than they have upon a similar control over movables. Oivil Code, Arts. 9 and 10. In view of that continuing power and with reference to a possible exercise of the same by either country in its harshest and broadest discrimination against foreigners through an obsolete prohibition of their owning immovable property the two governments stipulated that should this reserved power be so brought to bear by either upon aliens the citizens of the other should be none the less protected in their substantial rights of ownership in respect to the same. The property was to be made to enure to the benefit of the foreign heir by being converted into money and the money so obtained was to be received and held free from all charges against it by the government. The immovable was .to be considered practically for the purpose of ultimate ^benefit to the Spanish heir as if it had been a movable from the opening of the succession. By relation back and for that purpose it was to be dealt with as a movable.

Plaintiff’s position is that the effect of the failure of the two governments in express terms to take any action in the treaty in reference to immovable property other than the special action just mentioned, is to leave the law of 1894, except under that special condition of affairs, operative against foreign heirs and legatees in-all other respects as to that species of property, unless the law itself be unconstitutional. We are therefore called on to see whether we-are authorized to give to the words “ personal goods” found in the first paragraph of the eleventh article of the treaty the meaning attributed to them by the defendant and make them' cover immovable property. The treaty appears to have been drawn up in English. Whether there was or was not a' Spanish duplicate of the same we do not know. If there was a duplicate we have not been informed what words appear therein as those corresponding to the terms we are now considering. Defendant concedes that as English words they convey an idea opposed to that for which she is contending. The right of disposal in connection with the words “ personal goods” in the first paragraph of the article is there referred to as-an absolute one, not one which was in contemplation of parties, susceptible of being withdrawn by either, while the language employed in dealing with the special case of aliens who might be prohibited from inheriting real estate does not, though found in the-same article, present the case by way of proviso or exception to-what had already gone before, but as an independent proposition on an independent subject not connected with the rights which had. already been therein fixed and provided for.

We are of the opinion that the words “personal goods” in the-first clause of Art. XI of the treaty were intended to cover and do-refer to and cover movable property exclusively, and that immovable property or real estate is referred to and dealt with in the> •treaty only in its third clause.

We are further of the opinion that the only a'etion taken by the-two governments in respect to immovable property was to deal withi and provide for the consequences of the special case where foreign~ ers in either country should have been prohibited from inheriting-real estate, and that the effect of this limited action is to leave the; •act of 1894 (unless unconstitutional) operative upon immovable •property as against foreign heirs and legatees, except to the exient' ■that it is controlled and limited under the third clause of the treaty •under the condition of affairs therein specially anticipated and provided for.

The view which we take of the treaty forces upon us an examination of the constitutionality of Act No. 130 of 1894. The statute is attacked as being in conflict with Art. 35 of the Constitution, which requires' that all bills for raising a revenue and appropriating money to originate in the House of Representatives. It is conceded that the act originated in the Senate. Plaintiff denies that the act is one raising •revenues, or appropriating money, It claims that the statute is a legal limitation upon the right of inheritance; that it simply affixes •as a necessary condition for the existence of a capacity to receive by •succession the payment of a certain sum; that the claimant can not urge the rightand, atthesame time, repudiate the condition on which it was granted; that the money ordered to be paid is that of the individuals who pay it and not funds of the State, and therefore there can be no “appropriation” made in the sense that term is •employed in Art. 35 of the Constitution; that the House of Repré-' ■sentatives is designated as the body to originate bills for revenue •upon the theory that the citizens of th'e different parishes are Specially concerned in the imposition of taxes, as it is from them and their proporty that they are to be taken, and the members of the lower house are considered more directly the representatives of the taxpayers than are members of the Senate — that these money's aré to be drawn from aliens, and the people of the State have nó interest or concern in the question whether they should be made pay, and if so, bow much the amount should be.

’ We see nothing in the language of the statute making the payment •of the tax a condition precedent to a right of inheritance. The law permits the foreigner to inherit, but, having so inherited, charges him with the payment of the tax. The property and property rights of the foreigner found within the Státe are subject to taxation as is other property." C. C. 9. Its ownership is immaterial. The fact ¡that a succession right accrues to foreign heirs or legatees, and the funds to arise therefrom are liable to be immediately transferred' to '.a foreign country, furnishes no good ór suffieiept legal reason why, ¡■While in the'State, they or their owners should not be'taxedlike other persons, or other property therein. The legislation is proper revenue legislation.

The beneficiary of the fund to be raised from foreign heirs, legatees and donees under the act of 1894 — the Charity Hospital — is a public institution of the State — one sustained almost exclusively by State appropriations, authorized to be made on its behalf under Art. 204 of the Constitution. All moneys reaching its administrators under the act would reach it as having been derived really irom the State, lightening, to that extent, the necessity of State direct aid. Neither the mere form or process by which and through which the funds would be transmitted to the institution, nor the limited number of persons to be affected by the legislation, would change the character of the contribution or alter the real source from which they came. In our opinion the act is one intended to raise a revenue by a tax on property rights in the State, and one in reality appropriating the revenue to be'derived therefrom to one of the public institutions of the State. That legislation of the character of that contained in the act of 1894 has been considered in the light of legislation concerning taxation will appear from an examination of the revenue acts of 1848 and 1850.

. For the reasons herein assigned it is ordered, adjudged and decreed that the judgment appealed from be and the same is hereby affirmed.

Mr. Justice Watkins concurs in the decree and that part of the .opinion which relates to the unconstitutionality of the legislative act. Mr. Justice Miller concurs in the decree.