Benjamin N. Cardozo

Name: Burnet v. Guggenheim — Opinion of the Court
Author: Benjamin N. Cardozo

Burnet v. Guggenheim — Opinion of the Court

Summary

“Burnet v. Guggenheim — Opinion of the Court”, is a work by Benjamin N. Cardozo. It explores elements such as transfer, trust and tax.

Quotes from Burnet v. Guggenheim — Opinion of the Court (Benjamin N. Cardozo)

Benjamin N. Cardozo, Burnet v. Guggenheim — Opinion of the Court

“ Congress did not mean that the tax should be paid twice, or partly at one time and partly at another. If a revocable deed of trust is a present transfer by gift, there is not another transfer when the power is extinguished. If there is not a present transfer upon the delivery of the revocable deed, then there is such a transfer upon the extinguishment of the power. There must be a choice, and a consistent choice, between the one date and the other. To arrive at a decision, we have therefore to put to ourselves the question, Which choice is it the more likely that Congress would have made? ”

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Source: Wikisource

Benjamin N. Cardozo, Burnet v. Guggenheim — Opinion of the Court

“ No doubt the draftsman of the statute would have done well if he had been equally explicit in the drafting of part 2. This is not to say that meaning has been lost because extraordinary foresight would have served to make it clearer. Here as so often there is a choice between uncertainties. We must be content to choose the lesser. To lay the tax at once, while the deed is subject to the power, is to lay it on a gift that may never become consummate in any real or beneficial sense. To lay it later on is to unite benefit with burden. ”

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Source: Wikisource

Benjamin N. Cardozo, Burnet v. Guggenheim — Opinion of the Court

“ One must strike a balance of advantage. It happens that the taxpayer before us made his deeds in 1917, before a transfer by gift was subject to a tax. We shall alleviate his burden if we say that the gift was then complete. On the other hand, we shall be heightening the burdens of taxpayers who made deeds of gift after the act of 1924. In making them, they had the assurance of a treasury regulation that the tax would not be laid, while the power of revocation was uncanceled, except upon the income paid from year to year. ”

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Source: Wikisource

Benjamin N. Cardozo, Burnet v. Guggenheim — Opinion of the Court

“ He was free at any moment, with reason or without, to revest title in himself, except as to any income then collected or accrued. As to the principal of the trusts and as to income to accrue thereafter, the gifts were formal and unreal. They acquired substance and reality for the first time in July, 1925, when the deeds became absolute through the cancellation of the power.
The argument for the respondent is that Congress in laying a tax upon transfers by gift made in 1924 or in any year thereafter had in mind the passing of title, not the extinguishment of dominion. ”

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Source: Wikisource

Benjamin N. Cardozo, Burnet v. Guggenheim — Opinion of the Court

“ Hardship there plainly is in exacting the immediate payment of a tax upon the value of the principal when nothing has been done to give assurance that any part of the principal will ever go to the donee. The statute is not aimed at every transfer of the legal title without consideration. ”

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Source: Wikisource

Benjamin N. Cardozo, Burnet v. Guggenheim — Opinion of the Court

“ On June 28, 1917, the respondent, a resident of New York, executed in New Jersey two deeds of trust, one for the benefit of his son, and one for the benefit of his daughter. The trusts were to continue for ten years, during which period part of the income was to be paid to the beneficiary and part accumulated. At the end of the ten-year period, the principal and the accumulated income were to go to the beneficiary, if living; if not living, then to his or her children ”

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Source: Wikisource

Benjamin N. Cardozo, Burnet v. Guggenheim — Opinion of the Court

“ They had good reason to suppose that the tax upon the principal would not be due until the power was extinguished or until the principal was paid. If we disappoint their expectations, we shall be illiberal to them. ”

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Source: Wikisource

Benjamin N. Cardozo, Burnet v. Guggenheim — Opinion of the Court

“ We think the voice of Congress has ordained that this be done.
Precedents are cited as opposed to our conclusion. We find none of them decisive.
United States v. Field, 255 U.S. 257, 41 S.Ct. 256, 65 L.Ed. 617, 18 A.L.R. 1461, holds that under the Revenue Act of 1916 (39 Stat. 777, c. 463) , the subject of a power created by another is not a part of the estate of the decedent to whom the power was committed. It does not hold that a revocable conveyance inter vivos is a perfected transfer by gift that will justify the immediate imposition of a tax upon the value. ”

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Source: Wikisource

Benjamin N. Cardozo, Burnet v. Guggenheim — Opinion of the Court

“ Gould, 245 U.S. 151, 38 S.Ct. 53, 62 L.Ed. 211. There are many facets to such a maxim. One must view them all, if one would apply it wisely. The construction that is liberal to one taxpayer may be illiberal to others. ”

Benjamin N. Cardozo

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