The sale and transfer of the stock in the Charles Cory & Son, Inc., by the executors of Charles Cory to John M. Cory, pursuant to the contract made by Charles Cory in his lifetime, does not, in my opinion, come within either the letter or spirit of the Transfer Tax Law.
After giving the history of the development of the law imposing taxes on the transmission of or succession to the property of a decedent, under the Roman and ancient law and the modern law of France, Germany and other continental *878countries, of England and her colonies, of the United States and the several states of the Union, Mr. Justice (now Chief Justice) White said: “Although different modes of assessing such duties prevail, and although they have different accidental names, * * * nevertheless tax laws of this nature in all countries rest in their essence upon the principle that death is the generating source from which the particular taxing power takes its being and that it is the power to transmit, or the transmission from the dead to the living, on which such taxes are more immediately rested.” (Knowlton v. Moore, 178 U. S. 41, 56.)
The New York Transfer Tax Law has been upheld and its constitutionality affirmed upon the theory that the right to dispose of property by will or by deed to take effect upon death of the grantor is not an inherent or natural right, but exists solely by legislative enactment, and hence is subject to regulation, limitation and tax. (United States v. Perkins, 168 U. S. 625, 628; Keeney v. New York, 222 id. 525, 533.) The right of the owner to sell his property is an inherent and natural right. He has the right also to contract to sell upon a valuable consideration and to bind his executors to perform the contract and the performance of such a contract by the executors would not render the purchaser liable to pay a transfer tax, nor has it ever been contended that a sale of property by executors,- pursuant to a power and direction to sell contained in a will, rendered the purchaser liable to a transfer tax.
In the case at bar the mutual promise of each to purchase from the executors of the other the shares of stock in Charles Cory & Son., Inc., which the one first dying owned at the time of his decease, was a valuable consideration for the contract of September 12, 1913. Each thereby relinquished his right to bequeath the stock, and each secured the benefit of obtaining, at a price therein fixed, the share of the business represented by the stock certificates of the other. So that instead of owning one-half, he could become the owner of the entire business. The right to purchase the stock became vested at the time of the signing of this agreement. It cannot be doubted that the executors of Charles Cory could have enforced the contract and compelled John M. Cory to purchase and pay for the stock at *879the price therein fixed. The contract did not become testamentary in its character, although the obligation of the contract to sell did not become due until after the death of the one first dying. The obligation to sell at the price named was the outgrowth of the contract entered into by the parties in their lifetime upon a valuable consideration. The right to the stock grows out of the contract and not from the death of the party.
In principle this case cannot be distinguished from the other cases of contracts made during lifetime upon a valuable consideration to be performed after death (Johnston v. Spicer, 107 N. Y. 185; Carnwright v. Gray, 127 id. 92; Hegeman v. Moon, 131 id. 462), which have been held not to come within the Transfer Tax Law. (Matter of Miller, 77 App. Div. 473, 481; Matter of Baker, 83 id. 530; affd. on opinion below, 178 N. Y. 575.)
The words “transfer * * * by deed, grant, bargain, sale or gift,” used in subdivision 4 of section 220 of the Tax Law (Consol. Laws, chap. 60 [Laws of 1909, chap. 62], as amd. by Laws of 1911, chap. 732),* all refer to transfers without consideration and operative by way of gift. In Matter of Miller (supra, 481) the presiding justice said: “I do not consider that the statute has reference to transfers made upon a valuable consideration, but that it relates merely to voluntary transfers without consideration.” In construing the meaning of similar language used in the Federal War Revenue Act of 1898 (30 U. S. Stat. at Large, 464, § 29) the Supreme Court of the United States groups them all as gifts. (Knowlton v. Moore, supra, 67; Vanderbilt v. Eidman, 196 U. S. 480, 493.) In my opinion the said words in our statute do not refer to deeds or contracts made during lifetime for a valuable consideration although the time for performance may be fixed after the death of one of the parties, but to voluntary conveyances or agreements made without a valuable consideration. (Blair v. Herold, 150 Fed. Rep. 199, 202; affd., Herold v. Blair, 158 id. 804; Hagerty v. State, 55 Ohio St. 613.)
*880The case of Matter of Kidd (188 N. Y. 274), relied upon by the majority of the court, is clearly distinguishable. The contract in that case was that Kidd was to leave his property by will to the daughter of his prospective wife. The court said (p. 278): “It was not a contract to convey, but a contract to make a will in her favor. Had the deceased performed his agreement and given her his property by will, the estate would have been subject to the tax,” thus showing that the property would have been transferred not by right of contract but by virtue of a will and hence was a transmission of property by death and subject to the payment of death duties.
I am not unmindful of the fact that persons seeking to transfer their property to take effect after their death, naturally desire to have it transmitted undiminished by tax, and that ingenious schemes are adopted by fertile minds to evade the law. Where such attempt appears the courts have been swift to brush aside the form adopted and to consider the intent. The possibility of abuse is not a controlling element in construction.
If a transfer is attempted to be made without present valuable consideration to take effect after death, the courts will impose the tax no matter in what language the instrument is framed.
The order, in my opinion, should be affirmed.
Order reversed, with ten dollars costs and disbursements to appellant payable out of the estate, and proceeding remitted to surrogate.
Since amd. by Laws of 1915, chap. 664, and Laws of 1916, chap. 323.— [Rep.