dissenting: The reasoning in this case strikes me as illogical. The problem is to discover the value of present interests in gifts. If property were placed in trust for A, the trust deed requiring payment of the income to A during his life and permitting corpus, not to exceed $1,000 in any one year, to be paid to A in the discretion of the trustees, the value of the gift of a present interest to A could not be less than the present right to receive the income from the trust during his life. A was bound to receive at least that benefit and might receive a greater one if, and to the extent that, corpus was paid to him. The present case differs to this extent, that property was placed in trust and an equal part of the income was to be paid to each member of a group during his life, while corpus, not to exceed a certain amount, could be paid to members of the group during that period. It is held that the value of the gift of a present interest to A is less than the present value of his right to receive an equal share of the income of the entire corpus during his life because a part of that corpus may be given to B outright. Similar reasoning is then applied to minimize the value of B’s present interest although the group is bound to get either all income from the entire corpus or the more valuable corpus itself. This leáds to the result that the total of the values of the gifts of a present interest to each member of the group would be less than the value of the gift of present interests to the group as a whole. The sum of the parts should equal the whole. I doubt if any such result was intended by Congress in allowing the exclusions for gift tax purposes. The case differs from Margaret A. C. Riter, 3 T. C. 301, where the corpus could go to an outsider not a life beneficiary.
Leech, J., agrees with this dissent.