The opinion of the court was delivered by: J. Waldo Ackerman, Chief Judge.
This case concerns Plaintiff's complaint seeking a return of
gift taxes. Plaintiff is a guardian of Grace Pyle, a disabled
adult. Grace and Homer Pyle executed a joint and mutual will
on November 29, 1973. The will contained, among other things,
Third: I, Homer V. Pyle, hereby will, give,
devise and bequeath, all of my property, both
personal and real or mixed, and wheresoever
situated, to my wife, Grace S. Pyle, in fee
Fourth: I, Grace S. Pyle, hereby will, give,
devise and bequeath unto my husband, Homer V.
Pyle, all of my property, both personal, real or
mixed, and wheresoever situated to be his in fee
The will also provided for a detailed disposition of the
property on the death of the surviving spouse.
Homer Pyle died on March 27, 1978. On December 27, 1978,
Grace Pyle's attorney filed a gift tax return, and eventually
paid taxes and interest of $315,298.00 to the Internal Revenue
Service. Plaintiff later
claimed the gift tax computation was incorrect.
On January 10, 1981, the Illinois Circuit Court of the
Seventh Judicial Circuit construed the will as a joint and
mutual will. The Circuit Court held that the will established
a contractual obligation that restricted Grace Pyle from
alienating, transferring, conveying or disposing of any of her
property. Plaintiff could utilize the income or any corpus for
her health, support, comfort and maintenance requirements.
Accordingly, Grace Pyle appears to have retained a life estate
and the power to invade the corpus for her health, support,
comfort and maintenance. The Circuit Court later noted that
Plaintiff had the right to use all the assets, if necessary,
for her maintenance, support, comfort or health. The
Government argues that Grace Pyle made a gift of property when
the joint will became irrevocable at the time of Homer Pyle's
death. It contends Grace Pyle had only a life estate in her
property at that time, and that a gift of the remainder
interest was made to the donee's named as beneficiaries in the
will. Both parties have filed motions for judgment on the
pleadings or in the alternative summary judgment.
The focal point of this case is Grace Pyle's power to invade
the corpus for her health, support, comfort and maintenance.
If this power renders the gift of the remainder incomplete,
the gift tax was inappropriate. A retained power renders a
gift incomplete when it is not limited or ascertainable.
26 C.F.R. § 25.2511(g)(2).
It is without question that state law controls Grace Pyle's
ability to invade the corpus. Neither party has cited Illinois
cases concerning the meaning of health, support, comfort and
maintenance, and there appears to be a paucity of Illinois law
in this area. From a purely grammatical standpoint, it can be
presumed that the addition of the word comfort expands the
life tenant's ability to invade the corpus. The extent of this
expansion, however, is subject to varying interpretations.
This Court located several Illinois cases interpreting the
word comfort as it relates to a life tenant's ability to
invade corpus. See, e.g., Rock Island Bank and Trust Co. v.
Rhoads, 353 Ill. 131, 187 N.E. 139 (1933). In Rhoads, a
testator had made the following disposition of a portion of his
All the rest, residue and remainder of my estate,
both real, personal and mixed and wheresoever
situate, I give, devise and bequeath unto
well-beloved wife, Mary E. Robinson to have an to
hold the same unto her for and during her natural
life, with full authority to use and dispose of
so much of the same as may in her judgment be
necessary for her comfort and satisfaction in life.
Id. at 132, 187 N.E. 139 (emphasis supplied). The court held
that Robinson had an unlimited discretion to invade the corpus.
While the language in Rhoads is slightly different than that
employed in this case, the difference should not effect the
substantive rights of the life tenant. Grace Pyle had the right
to invade corpus for her health, support, maintenance and
comfort. Only Grace Pyle could determine what was necessary for
her comfort. There is no indication in any of the documents
filed in this Court that Grace Pyle had to exhaust specific
assets before she could invade the corpus for her comfort and
support. Nielsen v. Duyvejonck, 94 Ill. App.2d 224,
236 N.E.2d 743 (3d Dist. 1968). As long as Grace Pyle determined the
assets were necessary for her comfort she could use them.
Obviously this use could consume the corpus in its entirety.
Federal courts, of various jurisdictions, have held against
the government under substantially similar circumstances.
Comfort embraces a variety of activities, properties and
expenditures. It is not limited to the bare essentials of
life, but includes purchases that bring ease, contentment and
enjoyment. Doyle v. United States, 358 F. Supp. 300, 309
(E.D.Pa. 1973). Where comfort is used as a standard for the
invasion of corpus, it is not construed merely as the ability
to invade the corpus for maintenance and support. Under these
circumstances, invasion is allowed for the beneficiary's
contentment or enjoy." Id. at 309-10. See also, Lehman v.
United States, 448 F.2d 1318 (5th Cir. 1971).
The facts of this case are similar to Hambleton v.
Commissioner, 60 T.C. 558 (1973). In Hambleton, Charles and
Sallie Hambleton had executed a joint and mutual will disposing
of both parties' property. The survivor agreed to bequeath all
of their property to a trustee, who was to pay the survivor the
income and such principal as necessary to maintain and support
the survivor. The tax court held that the transfer was not a
taxable gift, but was only a transfer of her bare legal title
which did not result in the relinquishment of any rights to the
property. The tax court further noted that a will speaks only
at the time of the testator's death. Thus, Sallie Hambleton's
property would pass under the joint will when it was probated
as her testament. Id. at 563.
Accordingly, the Court finds for Plaintiff and against the
United States. The United States is ordered to ...