MCCAUGHN, COLLECTOR OF INTERNAL REVENUE,
v.
REAL ESTATE LAND TITLE & TRUST CO. ET AL., EXECUTORS

U.S. | 1936-03-30
No. 629
297 U.S. 606 Supreme Court of the United States (1936) Caution
Also reported at: 80 L. Ed. 879 · 56 S. Ct. 604 · 1936 U.S. LEXIS 541 · SCDB 1935-103
Cited by 80 cases

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Synopsis

Malcolm MacFarlan transferred property worth over $670,000 in trust to his children in 1920 and died in 1921, within two years of the transfer, triggering a statutory presumption that the transfer was made in contemplation of death under the Revenue Act of 1921. The Supreme Court held that the trial court's general verdict finding the transfer was made in contemplation of death was supported by evidence and that the Circuit Court of Appeals lacked authority to reweigh the evidence and overturn the trial court's factual findings, establishing that a trial court's general verdict in a non-jury case carries the same conclusive effect as a jury verdict on appeal.

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Per_curiam
Per Curiam.

Per Curiam.

On February 9, 1920, Malcolm MacFarlan, a physician of Philadelphia, Pennsylvania, made a transfer of real estate and securities, of the value of upwa'rds of $670,000, m trust for the benefit of his children and their wives and descendants. He died on December 8, .1921. As his death occurred within two year's after, the transfer, it-fell within the terms of the statute creating a presumption that the transfer was made in contemplation of death. Revenue Act of 1921, c. 136, § 402 (c), 42 Stat. 227, 277, 278. The remaining estate of the decedent, of which disposition was made by will (executed on the same day as the transfer in trust) was worth about $13,-000. The Commissioner of Internal Revenue included the property transferred as part of decedent’s gross estate, and demanded payment of an estate tax upon that basis. The payment was made, claim for refund was rejected, and this suit was brought by the executors of the decedent against the collector ' to recover the amount paid.

A jury was-waived. After the evidence had been received, both parties submitted requests for conclusions of law, and plaintiffs also requested special findings of fact. The court refused plaintiffs’ requests and affirmed certain conclusions of law requested by defendant, and plaintiffs were allowed exceptions.

Referring to decedent’s physical condition, the court said in its opinion that the evidence showed that at the time of the transfer decedent was seventy-eight years old, unusually vigorous and clear-minded-and, except for a condition common in men of his age, in good health. The court said that the most that could be claimed for that evidence was that it established, and the court specifically found, that the transfer was not made “under any consciousness or belief or apprehension that death was imminent.” The substance of the court’s conclusion on all the evideuce was that “the plaintiffs have failed to show that the motive that induced this transfer, whatever it was, was not of the sort which leads to testamentary, disposition, and, consequently have failed to meet the burden of proof placed upon them by the statute.” The court then found a general verdict in favor of the defendant and directed judgment accordingly. 7 F. Supp. 742. The Circuit Court of Appeals reviewed the evidence, decided that the transfer was not made in contemplation of death, and reversed the judgment. 79 F. (2d) 602.

The principles governing the determination whether a gift inter vivos is made “in contemplation of death” are set forth in United States v. Wells, 283 U. S. 102, and need not be restated. The instant case is controlled by the established rules relating to appellate review in actions at law where a jury trial has been waived. R. S. 649, 700; 28 U. S. C. 773, 875. Where a general verdict is found by the trial court, it has the same effect as the verdict of a jury. The appellate court cannot pass upon the weight of evidence. Norris v. Jackson, 9 Wall. 125, 128; British Queen Mining Co. v. Baker Silver Mining Co., 139 U. S. 222; Lehnen v. Dickson, 148 U. S. 71, 73; St. Louis v. Western Union Telegraph Co., 166 U. S. 388; Law v. United States, 266 U. S. 494; Fleischmann Construction Co. v. United States, 270 U. S. 349, 356, 357; Harvey Company v. Malley, 288 U. S. 415, 418, 419; Eastman Kodak Co. v. Gray, 292 U. S. 332, 336, 337.

Here, plaintiffs’ exceptions to the conclusions of law of the trial court, and to the refusal, of the court to reach other conclusions as requested, raised no question save the one of law, whether the court’s verdict was wholly without evidence to sustain it. That.question does not appear to be substantial. The ultimate question for the decision of the trial court was one of fact and its general verdict was conclusive. The Circuit Court of Appeals was without authority to weigh the evidence and to make its own findings.

The judgment of the Circuit Court of Appeals is reversed and that of the District Court is affirmed.

Reversed.

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Citator

Cited By (21 total)

  • Deputy v. du Pont, 308 U.S. 488 (U.S. 1940)
    …did not proximately result from, and were not ordinary expenses for the conduct of, respondent’s alleged business, it was error for the Circuit Court of Appeals to reverse the judgment for petitioners? McCaughn v. Real Estate Land Title & Trust Co., 297 U. S. 606. There remains respondent’s contention that these payments are deductible under § 23 (b) as “interest paid or accrued ... on indebtedness.” Clearly respondent owed an obligation to the Delaware Company. But although an indebtedness is an obligation…
  • Allen v. Tr. Co. of Ga., 326 U.S. 630 (U.S. 1946)
    …636] Of death.” United States v. Wells, supra, p. 119. Whether such a desire was the dominant, controlling or impelling motive is a question of fact in each case. We do not have here the type of problem presented in McCaughn v. Beal Estate Land Co., 297 U. S. 606, where the appellate court undertook to reverse the trial court on a review of the evidence. Here two courts have resolved that question of fact in favor of respondents. They have found, as we have said, that Mr. Spalding established the trusts to m…
  • Smails v. O'Malley, 127 F.2d 410 (8th Cir. 1942)
    …he court’s duty to consider the evidence and the inferences to be drawn therefrom in the light most favorable to the contentions of the appellee. “The appellate court cannot pass upon the weight of evidence.” McCaughn, Collector, v. Real Estate Co., 297 U.S. 606, 608, 56 S.Ct. 604, 605, 80 L.Ed. 879. It can only say whether as a matter of law there is any substantial evidence to support the finding of the jury. Colorado National Bank v. Commissioner, 305 U.S. 23, 25, 59 S.Ct. 48, 83 L.Ed. 20. It is next c…
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