GREENOUGH V. TAX ASSESSORS, 331 U. S. 486 (1947)

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U.S. Supreme Court

Greenough v. Tax Assessors, 331 U.S. 486 (1947)

Greenough v. Tax Assessors of Newport

No. 461

Argued March 7, 1947

Decided June 9, 1947

331 U.S. 486


1. A Rhode Island municipality assessed a tax against a resident of Rhode Island for half the value of intangibles held jointly by him and a resident of New York as trustees under the will of a resident of New York. The evidences of the intangible property were at all times in New York, and the life beneficiary of the trust resided there, the future beneficiaries being undetermined. The Rhode Island resident did not actually exercise his powers as trustee in Rhode Island.

Held: the tax did not violate the due process clause of the Fourteenth Amendment. Pp. 331 U. S. 491-498.

2. So long as a state chooses to tax the value of intangibles as a part of a taxpayer's wealth, the location of evidences of ownership is immaterial. P. 331 U. S. 492.

3. Since intangibles have no real situs, the domicile of the owner is the nearest approximation, although other taxing jurisdictions may also have power to tax the same intangibles. P. 331 U. S. 493.

Page 331 U. S. 487

4. Since normally intangibles are subject to the immediate control of the owner, this close relationship between intangibles and the owner furnishes an adequate basis for the tax on the owner by the state of his residence as against any attack for violation of the Fourteenth Amendment. P. 331 U. S. 493.

5. The same rules apply to the taxation of intangibles held by a trustee as assets of a trust, since the trustee can sue and be sued as such and in this way the state of his residence affords him protection as the owner of intangibles. Pp. 331 U. S. 493-496.

6. Brooke v. Norfolk, 277 U. S. 27; Safe Deposit & Trust Co. v. Virginia, 280 U. S. 83; Graves v. Schmidlapp, 315 U. S. 657, distinguished. Pp. 331 U. S. 496-497.

7. It is not constitutionally significant that the Rhode Island trustee is not the sole trustee of the New York trust, since the tax was only upon his proportionate interest, as a trustee, in the res, and he possessed an interest in the intangibles sufficient to support a proportional tax for the benefit and protection afforded to that interest in Rhode Island. P. 331 U. S. 498.

8. State courts are the final judicial authority upon the meaning of statutes of their states; but where their judgments collide with rights secured by the Federal Constitution, this Court has power to protect or enforce such rights. Pp. 331 U. S. 489, 331 U. S. 497.

71 R.I. 477, 47 A.2d 625, affirmed.

The Supreme Court of Rhode Island sustained a tax against a resident of Rhode Island for one-half of the value of intangibles held jointly by him and a resident of New York as trustees of a New York trust, and remanded the case to the Superior Court of Newport County, Rhode Island. 71 R.I. 477, 47 A.2d 625. On appeal to this Court, aff'd, p. 331 U. S. 498.

Page 331 U. S. 488

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