dissenting: The difficulty with the majority view, in my opinion, is that it is essentially based on the erroneous idea that the petitioner had by the testator been given a power of appointment over the life interest in income which she was given. The nature of a power is that action thereunder is taken for and on behalf of the donor of the power, the action being his and not that of donee of the power. Here the petitioner had been given, outright, the net income of share C during her natural life (together with a true power, that of disposing of the capital fund by will). This placed an equitable estate in the income in her — unless as the majority opinion holds, a power in her over such life income was set up by the further words, “I authorize and empower her * * * to not only to retain to her own use, but also to appoint any person or persons being of my blood she shall think fit to receive the whole or any part of the income of this share during her life (and to the extent that she lawfully may during the life of my son Lewis, or for any shorter time * * *.”) I have placed in parenthesis the provision authorizing her to dispose of the income during the life of Lewis, for, to the extent that she was empowered to appoint the income during his life after her own life, I think a true power was conferred. But, in my view, neither logic nor law permits a power to be set up over the subject matter of an outright gift (the petitioner’s life estate in income) merely because a testator adds altogether superfluous words authorizing and empowering disposition of the gift. The law as to powers is that of the domicile of the donor; 49 C. J. 1260; and his domicile appears to have been in New York. It has been held in that jurisdiction that “To cut down an absolute and restricted power of disposal given by will, precatory words must plainly and imperatively indicate the requisite testamentary intent so to do.” Keefe v. Keefe, 236 N. Y. S. 176. There the will gave testator’s property to his wife “for her sole use and benefit during her lifetime,” but added “At or before my said wife’s death, it is my wish that all that may remain of my estate * * * may be equally distributed by my said wife’s Executor and given to” certain nephews; and it was “held to give wife a life estate, accompanied by an absolute power of disposition for her sole use and benefit.” The court said:
A wish stated in a testament can of course father and mark the testamentary thought and intention, and thus convey the disposing will. But to have that effect it must survive over any repugnant rights and powers concurrently given. Clay v. Wood, 153 N. Y. 134, 47 N. E. 274; Street v. Gordon, 41 App. Div. 439, 58 N. Y. S. 860; Matter of Barney’s Will, 207 App. Div. 25, 201 N. Y. S. 647. * * *
In the instant case it is plain that, as in the Keefe case, supra, there is outright gift, not to be restricted or cut down by later words even more plainly than in that case, indicating lack of requirements set by the testator.
Since the majority opinion here stresses the evidence as to the testator’s desires, expressed aliunde the will, we note In re Atkins' Will, 137 N. Y. S. 88, holding:
1. On the probate of a will making an absolute gift but expressing testator's confidence that the estate will be distributed by the donee in accordance with a memorandum attached to the will, the memorandum, admitted in evidence over the objection, must be ignoted.
2. Where an estate is given in one part of a will in clear and decisive terms, it cannot be taken away or cut down by subsequent words that are not as clear and decisive as the words giving the estate.
Since the majority opinion in the instant case expresses the view that petitioner held her power of revocation as trustee, we quote the Atkins case:
That the testator trusted his legatee, called him his “trustee,” expressed his confidence that his undisclosed wishes would be respected, and implicitly believed that the estate would be appropriated as nearly as possible in accordance with a certain letter, all evince a personal reliance upon the beneficiary’s fidelity and an assurance of his loyalty in the disposition of the estate; but none of these expressions alone constitutes a trust. To believe another to be trustworthy and to request him to justify such belief in respect to a conveyance or devise to him must fall far short of erecting a trust as the estate conveyed or devised, unless the estate is both given and taken upon the trust not only asserted but defined.
If a memorandum attached to a will, and expressing the desires of the “testator, can not override or restrict an absolute gift, then I suggest that the words used by the testator and the oral expressions of desire in this matter are altogether insufficient to do so. Moreover, the orally expressed desires, in my view, negative rather than confirm any idea that petitioner’s gift of life income was affected or restricted by any power. The whole evidence on the point indicates affirmatively that the testator wished to have the matter entirely within the control and discretion of his daughter, with no rights whatever enforceable by the son. Therefore, when the petitioner in 1920 "passed her life interest to the son, but revocably, and did not give up power to revoke until 1938, the income from 1932 and after was taxable to her. That it has above been noted that there was a power in her to appoint the income after her life during that of her brother is immaterial, for by the instrument in 1920 she appointed Lewis to receive the income “as long as he may live during my lifetime, but limited to our joint lives.” Therefore she exercised no power as to a period after her death.
Since the majority opinion refers to Mabel F. Grasselli, 7 T. C. 255, I point out that therein the petitioner’s own life interest (in one-half of the income) was not involved. It was paid to the petitioner and not the subject of the deficiency. The point as to income prior to her conveyance in 1941 was whether she was subject to gift tax on the other one-half of the income going to the other beneficiaries from whom by exercise of her power of appointment she might have taken it, but did not exercise her power. The other beneficiaries took the other income under the trust instrument, without any action by the petitioner. Clearly, the situation is not parallel to that here involved, where the majority opinion itself is on the theory that Lewis could take only by exercise of power by the petitioner.
For the same reason Edith Evelyn Clark, 47 B. T. A. 865, seems inapplicable here. The petitioner there not only held a power over the rights of others, but the beneficiaries could take under the original instrument without any appointment.
The conclusions above expressed render it unnecessary to consider more particularly the action taken by the petitioner in 1938 as to income for her lifetime. She then gave up the right of revocation and completed the gift of the life income made in 1920, thus becoming subject to gift tax. Burnet v. Guggenheim, 288 U. S. 280; Margaret White Marshall, 43 B. T. A. 99. In so far as she at that time also appointed Lewis to receive income after her lifetime she was, under Sanford v. Commissioner, 308 U. S. 39, and the GrasseUi case, swpra, not subject to gift tax, since she merely exercised that limited power of appointment. It is immaterial Whether she also exercised or relinquished, at the same time, a power of appointment over the capital fund. No deficiency in gift tax is based on disposition of that fund. I respectfully dissent.
Tukner, Leech, Tyson, Harron, and LeMire, JJ., agree with this dissent.