Wells Fargo Bank & Union Trust Company v CIR
GR No L-46720, June 28, 1940
FACTS:
Birdie Lillian Eye died on September 16, 1932 at Los Angeles, California, the place of her alleged last residence and domicile. Among the properties she left was her 1⁄2 conjugal shares of stock in the Benguet Consolidated Mining Co., an anonymous partnership, organized under the laws of the Philippines. She left a will duly admitted to probate in California where her estate was administered and settled. Wells Fargo was the duly appointed trustee. The Federal and California State’s inheritance taxes due thereon have been duly paid. The Collector of Internal Revenue in the Philippines, however, sought to subject the shares of stock to inheritance tax, to which Wells Fargo objected.
ISSUE:
Whether the shares of stock are subject to Philippine inheritance tax
RULING:
Yes. Originally, the settled law in the United States is that intangibles have only one situs for the purpose of inheritance tax, and such situs is in the domicile of the decedent at the time of his or her death. But the rule has been relaxed.
The maxim “mobilia sequuntur personam” up which the rule rests, has been decried as a mere fiction of law having its origin in considerations of general convenience and public policy and cannot be applied to limit or control the right of the state to tax properly within its jurisdiction and must yield to established fact of legal ownership, actual presence and control elsewhere, and cannot be applied if to do so would result in inescapable and patent injustice.
This rests on either of two fundamental considerations:
FACTS:
Birdie Lillian Eye died on September 16, 1932 at Los Angeles, California, the place of her alleged last residence and domicile. Among the properties she left was her 1⁄2 conjugal shares of stock in the Benguet Consolidated Mining Co., an anonymous partnership, organized under the laws of the Philippines. She left a will duly admitted to probate in California where her estate was administered and settled. Wells Fargo was the duly appointed trustee. The Federal and California State’s inheritance taxes due thereon have been duly paid. The Collector of Internal Revenue in the Philippines, however, sought to subject the shares of stock to inheritance tax, to which Wells Fargo objected.
ISSUE:
Whether the shares of stock are subject to Philippine inheritance tax
RULING:
Yes. Originally, the settled law in the United States is that intangibles have only one situs for the purpose of inheritance tax, and such situs is in the domicile of the decedent at the time of his or her death. But the rule has been relaxed.
The maxim “mobilia sequuntur personam” up which the rule rests, has been decried as a mere fiction of law having its origin in considerations of general convenience and public policy and cannot be applied to limit or control the right of the state to tax properly within its jurisdiction and must yield to established fact of legal ownership, actual presence and control elsewhere, and cannot be applied if to do so would result in inescapable and patent injustice.
This rests on either of two fundamental considerations:
-
(1) Upon the recognition of the inherent power of each government to tax persons, properties and rights within its jurisdiction
and enjoying, thus, the protect of its laws; and
-
(2) Upon the principle that as to intangibles, a single location in space is hardly possible, considering the multiple, distinct
relationships which may be entered into with respect thereto.
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