In Re Estate of Monfort

Stone, Justice. Appeal by the state from an order determining that the Brooklyn Trust Company, coexecutor (hereinafter referred to as executor) of the last will and testament of Henry A. Monfort, deceased, was legally entitled to a refund of $604.32, the amount of an inheritance transfer tax paid by it. The application for refund was made by the executor to the state auditor August 25, 1933. It recited that Henry A. Monfort died testate on October 11, 1930; that at the time of his death he was domiciled in the state of New York; that on August 1, 1931, the *595 attorney general of the state determined that an inheritance tax was payable by the estate pursuant to 1 Mason Minn. St. 1927, § 2302, upon the transfer of 220 shares of preferred capital stock of the Great Northern Railway Company (a Minnesota corporation) ; that the inheritance tax was accordingly imposed and paid; that the payment was made to secure the consent of the state of Minnesota to the transfer of the shares of stock; that the tax was erroneously -paid and that the assessment and imposition thereof by the state were unlawful and in violation of the fourteenth amendment to the constitution of the United States, in that the tax was imposed upon a transfer by death of shares of stock in a Minnesota corporation, forming part of the estate of a decedent who at the time of his death was domiciled in the state of New York; that at the time of the payment of the tax it had been determined by the supreme court of the state of Minnesota in In re Estate of Lund, 183 Minn. 368, 236 N. W. 626, that such a tax did not violate said fourteenth amendment; that later, January 4, 1932, the Supreme Court of the United States determined in First Nat. Bank v. Maine, 284 U. S. 312, 52 S. Ct. 174, 76 L. ed. 313, 77 A. L. R. 1401, that the exaction of such a tax was not within the power of a state under the fourteenth amendment; that the application for refundment was being made pursuant to 1 Mason Minn. St. 1927, § 2301, and L. 1933, c. 335, hereinafter quoted. The petitioner then prayed for the refundment of the $604.32, with interest. L. 1933, c. 335, provides in part: “Where the attorney general has, prior to the enactment of this chapter, made and determined that an inheritance tax is payable pursuant to Mason’s Minnesota Statutes of 1927, Section 2302, and a tax heretofore has been paid pursuant to such determination, and an application for the refunding of such tax is made, pursuant to Mason’s Minnesota Statutes of 1927, Section 2301, within three years from the date of such tax, whether such application is made before or after the passage of this act, any person aggrieved by the failure of the auditor of state to draw his warrant for the refundment of the amount of tax so paid may, within one year from the passage of this act, appeal to the district court of Hennepin County *596 or Ramsey Comity, Minnesota, by filing with the attorney general a notice in writing setting forth the payment of such tax under a determination of the attorney general, and that a claim for refundment of the tax has been made to the auditor of state, and that the auditor has refused to, or has failed to, draw his warrant therefor, and that he appeals from the refusal or failure of the auditor to draw his warrant, * * *.” 1 Mason Minn. St. 1927, § 2301, provides: “When any tax imposed by this act shall have been erroneously paid, wholly or in part, the person paying the same shall be entitled to a refundment of the amount so erroneously paid, and the auditor of state shall, upon satisfactory proofs presented to him of the facts relating thereto, draw his warrant upon the state treasurer for the amount thereof, in favor of the person entitled thereto; provided, however, that all applications for such refunding of erroneous taxes shall be made within three years from the payment thereof.” The auditor refused to draw his warrant upon the state treasurer, and an appeal was taken under L. 1933, c. 335, to the district court of Ramsey county. The decision was adverse to the state. The issues were tried upon agreed facts. Precisely, the stipulation was that the case “may be heard and determined upon” the facts stated. Such a stipulation carries a very plain implication that it includes all relevant facts. It was stipulated that Mr. Monfort died a resident of New York, owning the stock in question. Nothing more appearing, that was determinative. There were no pleadings in the formal sense. So the stipulation, in addition to the facts, stated the claims on each side. Those statements stand in lieu of pleadings. But, except for their admissions and as they frame the issues, pleadings are not the basis of decision. The facts adduced by the evidence, or as in this case by stipulation, control decision. There are in some cases, but not here, presumptions to aid or qualify facts proved or stipulated. On the record so made, there could have been no other decision than that the applicant was entitled to the refund. *597 The state suggests that the refundment authorized by § 2301 and L. 1933, c. 335, amounts to an appropriation of public money for a private purpose, contrary to art. 9, § 10, of the state constitution, which provides, wvber alia, that “the credit of the state shall' never be given or loaned in aid of any individual, association or corporation.” There is no unconstitutional appropriation to any individual or for any private purpose when the legislature recognizes a just demand, as. for money had and received, against the state and appropriates money wherewith to discharge the debt and direct its payment out of the money so appropriated. There is nothing in the constitution forbidding the state to recognize and pay its just debts. The original payment was made under protest. Whether it was voluntarily or involuntarily made we need not determine because that is immaterial under the language of L. 1933, c. 335. That statute does not condition the right to refundment which it creates and implements upon the fact either of payment under protest or compulsion. Hence, whether protest was made, or the payment so far under compulsion as to be involuntary in the accepted sense, is immaterial. If, as an administrative matter, before approving transfers of stocks of nonresident decedents, upon which there is no inheritance tax, the attorney general requires some proof that at the time of the decedent’s death they did not have a situs, local to Minnesota, probably nobody can object. And if, upon issues duly made and tried upon evidence, it is insisted that the burden of proof of that negative is upon the applicant for a refund, another question may be presented. But it is one not in this case because here all the facts were stipulated. Order affirmed.