1. Taxation : Collateral Inheritance Act: conveyances effective prior to grantor’s death. The property subjected by the trial court to the payment of an inheritance tax is land which for many years was owned in part by one A. J. Litteer and in part by his wife, Mary L. Litteer, both of’ whom are now deceased. On September ,16. 1910, and in the lifetime of both Litteer and his wife, they entered into a written contract with the plaintiff, Ernest Lewis, in the following form:
“Conway, Iowa. September 16th, 1910.
“Contract and Article of Agreement, between A. J. Litteer and Mary L. Litteer, parties of the first part, and Ernest Lewis, party of the second part, agree. and enter into the following: We, A. J. Litteer and wife, parties of the first part, agree to give, will and bequeath, at the death of the last one of us living, our farm of 420 -acres known as the A. J. Litteer farm one and one-half milesPage 740south of Conway, 2G0 acres being in Clayton Township and 160 acres being in Marshal Township, Taylor County, Iowa, to said party of second part, Ernest Lewis, our nephew, we- considering said second party an heir as though he were our son by blood and birth, farm to be as described according to Plat Book of Taylor County, Iowa, For and in consideration of which the said second party agrees to pay an allowance of twelve hundred dollars per year to said first parties during their lifetime or the lifetime of either of them. The said second party further agrees to take same care of. said first parties should they or either of them become enfeebled in mind or body as though they were his own parents by blood. This contract to be in full force and effect from date.
“Parties of the first part:
“A. J. Litteer.
“Mary L. Litteer.
“Second party:
“Ernest Lewis.
“Witnesses:
“Claud Johnston.
“J. B. Dant.”
. This contract seems to have been rewritten, in substantially like terms, under date of September 24, 1910. At the date of this contract, plaintiff was, and for several years had been, in possession of the land under an agreement of lease, wherein Litteer furnished the capital necessary to carry on the farm and plaintiff undertook to account for one half the income or profits. Thereafter, Litteer and wife having both died, litigation ensued between Lewis and the collateral heirs of the Litteers, over the validity and effect of such instrument. The history and incidents of that litigation are immaterial upon the question now up for consideration, except the fact that the controversy between the parties
“The court finds for the cross-petitioner, Ernest Lewis, on the contracts known in the record as Exhibits 1 and 2, and finds that said contracts were executed by A. J. Litteer in his lifetime for a valuable consideration, and that they conveyed the real estate referred to or described therein to-the cross-petitioner, Ernest Lewis, as of the date of said contracts, to wit, on September 16th, 1910, and that said Lewis at that time entered into possession under said contract. * * It is therefore ordered, adjudged, and decreed by the court that Ernest Lewis is the owner in fee simple of the following described real estate, to wit: * * And that the title to said land be quieted in him against the plaintiffs and defendants, and that each of them and all persons claiming by, through, or under them or any of them, and that all taxes against said real estate shall be paid by said Ernest Lewis, and that all parties other than Ernest Lewis are forever barred and estopped from having or claiming any interest in said real estate adverse to the estate of Ernest Lewis.”
Thereafter the treasurer of state having laid claim to an inheritance or succession tax upon the property in question, the district court entered a supplementary finding or judgment, sustaining the claim and fixing such tax at $1,442.29. The plaintiff appeals.
The pertinent provisions of the inheritance tax statute (Section 1467, Code Supplement, 1907), as it stood at the date of the instruments which are the source of plaintiff’s title, are as follows:
“Sec. 1467. All property within the jurisdiction of this state * * * which shall pass by will or by the statutes of inheritance of this or any other state, or by deed, grant, sale or gift made or intended to take effect in possession or in enjoyment after the death of the grantor or donor.Page 742* ' * * shall be subject to a tax of five per centum of its value.”
Subsequent to the date of said instruments, but before the death of Litteer, this statute was amended by inserting therein, after the word “gift,” the following: “or transfer made in contemplation of the death of the donor.” See Chapter 68, Acts of the Thirty-fourth General Assembly.
2. Judgment : conclusiveness: collateral proceedings. The matters which we have recited, being all we regard as material upon this appeal, are without dispute in the record. The one question so presented for our consideration is whether, upon these conceded facts, the plaintiff acquired his title subject to the imposition of a succession tax. The property and title so acquired by the plaintiff were neither a testamentary devise nor a gift. It was (and has been so adjudged and determined) a presently valid and binding contract, by which the owners of the property bound themselves to transfer it to the plaintiff for a valuable consideration, and plaintiff, on his part, bound himself to make such grantors an annual payment, or “allowance,” of $1,200, until the death of the survivor of them, and to maintain and care for them, should they become enfeebled in mind or body. This agreement, as the decree to which we referred finds, was at once made effective by the plaintiff’s taking and retaining possession of the land, and he remained in such possession and enjoyment until his obligation toward the Litteers was terminated by their death. The fact that the Litteers and the plaintiff, or either of them, spoke of the yearly payment which the latter bound himself to pay as “rent,” is of no ma- . . _ . . ___ _ , tcnal consequence m this case. The claim that the contract between them was one of lease only, and that the real relation between the parties was that of landlord and tenant, and the further claim that the writing was, at best, testamentary in character and without valid consideration, has been judicially determined
4. statutes: construction: retroacrive statutes. In the case before us, the rights of plaintiff and the Litteers with respect to this property Avere fixed and made irrevocable, except by mutual consent, on the date when the papers were executed and plaintiff acquired possession thereunder; and, if we may assume that it was competent for the state to thereafter enact or amend a statute to impose- a tax upon such transfers of title, the retrospective character and effect of such enactment must clearly appear, and, in the absence of anything showing such intent, the courts will give it prospective effect only. There is nothing in this amendment indicating any legislative intent to give
We hold, therefore,' that the trial court erred in sustaining and confirming the claim of the state treasurer and adjudging the property in question liable to a succession tax, and the judgment to that effect is, therefore, — Reversed.