Estate of Elise Palmer v. Commissioner of Revenue (September 20, 2000)

COMMONWEALTH OF MASSACHUSETTS

APPELLATE TAX BOARD




ESTATE OF ELISE PALMER	  v.     COMMISSIONER OF REVENUE

Docket No. F223424		    	    Promulgated:
						    September 20, 2000


	
	This is an appeal under the formal procedure pursuant to G.L. c. 62C, § 39, from the refusal of the Commissioner of Revenue to abate an additional estate tax assessed under G.L. c. 65C.
	Commissioner Scharaffa heard the appeal and was joined in the decision for the appellee by Chairman Burns, then-Chairman Gurge and Commissioners Lomans and Gorton.
	These findings of fact and report are made pursuant to a request by the appellant under G.L. c. 58A, § 13 and 831 CMR 1.32.

	James T. Knight, Esq. and Lawrence B. Austin, Esq., for the appellant.
	
Mary C. Brown, Esq. and Philip Olsen, Esq., for the appellee.

FINDINGS OF FACT AND REPORT
	Based on an agreed statement of facts and testimony and exhibits offered at the hearing, the Appellate Tax Board ("Board") made the following findings of fact.
Elise M. Palmer ("decedent") died on July 29, 1987, in Jackson, Mississippi.  On October 31, 1987, pursuant to a valid extension, the Estate of Elise Palmer ("appellant") timely filed a non-resident Massachusetts estate tax return.  The appellant reported real and tangible personal property having an actual situs in Massachusetts of $136,016 and a tax due of $12,982.59.
The Commissioner determined that the decedent was a Massachusetts domiciliary at the time of her death, and on June 21, 1989, issued a notice of intention to assess an estate tax in the amount of $121,157.70, plus interest and penalties.  In October, 1989, the Commissioner issued a notice of assessment in the form of an estate tax closing letter showing a balance due of $134,022.05, plus interest, penalties having been waived.  
On November 6, 1989, the appellant filed an application for abatement on the ground that the decedent was not a Massachusetts domiciliary.  The Commissioner granted a partial abatement, based on adjustments made to the gross estate by the Internal Revenue Service.  The appellant then timely filed its petition with the Board.  On this basis, the Board found that it had jurisdiction over the subject appeal.
The sole issue in the present appeal is whether the decedent was a resident of Massachusetts at the time of her death.  G.L. c. 65C, § 1(i) defines "resident" as "any person domiciled in the commonwealth."  In the case of a non-resident decedent, an estate tax is imposed only upon "the transfer of . . . real and tangible personal property having an actual situs in Massachusetts . . . ."  G.L. c. 65C, § 4(a).  A resident decedent is subject to an estate tax on all property transferred, except for real and tangible personal property actually situated outside Massachusetts.  G.L. c. 65C, § 1(f).  It is conceded that if the decedent were domiciled in Massachusetts at the time of her death, the assessment is correct, and that if she were a non-resident at the time of her death, the appellant is entitled to an abatement of the full amount of the deficiency assessment. 
The decedent was born in Ebenezer, Mississippi on July 13, 1899 and moved to Massachusetts at the age of eighteen.  The decedent and her first husband, Alan W. Rucker, lived in Lexington, Massachusetts from the 1920s to the 1950s.  They had one son who served in the United States Army during World War II and was killed in France.  The decedent and Mr. Rucker were divorced in the 1950s.  
In the late 1950s, the decedent married her second husband, John G. Palmer.  Mr. Palmer worked as a director for Lloyds of London, an international insurance company with headquarters in London, England.  Mr. and Mrs. Palmer purchased a residence at 47 Chestnut Street, Boston and lived there until November, 1979.  At that time, Mr. and Mrs. Palmer moved to Temple, New Hampshire, where they had a summer home.  
After Mr. Palmer's death in February, 1981, the decedent moved into an apartment at 160 Commonwealth Avenue, Boston.  At that time, she moved all of her belongings into this apartment.  On August 23, 1985, the decedent entered into a four-year lease agreement for the Commonwealth Avenue apartment.  The decedent then sold both her New Hampshire and the Chestnut Street, Boston, residences.  The decedent continued to visit her family in Mississippi two to three times a year.
The decedent was first diagnosed with malignant melanoma in 1982.  As a result of her condition, a portion of the decedent's heel was removed by doctors at Massachusetts General Hospital ("MGH").  The cancer eventually spread to other parts of the decedent's body, and in 1983, the decedent had another surgery to remove lesions on her leg.  Experiencing problems with healing, the decedent was referred to plastic surgeons at MGH for skin grafts.  
As the decedent's health continued to deteriorate over the next few years, she relied more and more on her doctors at MGH.  Her ability to lead an active social life declined and in November, 1985, the decedent hired Kathy Campo to care for the Commonwealth Avenue apartment, to assist with her daily living tasks and to be a companion.  Ms. Campo lived in the decedent's apartment providing 24-hour care.  In addition, she hired two nurses who did eight-hour shifts.
From February to July, 1987, the decedent was admitted to MGH on three separate occasions.  On February 2, 1987, she had additional lesions removed from her legs.  After her discharge from the hospital, the decedent returned to her Commonwealth Avenue apartment.  At that time, her sister, Lucille Wells, traveled to Boston.  Upon Ms. Wells' arrival, she contacted their nephew Alan Murtagh and asked him to come to Boston to assist in winding up the decedent's business affairs.  The decedent then started to dispose of her personal belongings, which she no longer needed, giving some items to various charities in Boston.  According to Mr. Murtagh, he and Ms. Wells were trying to "get [the decedent's] business in shape where we could move her to - Mississippi."  At this time, the decedent gave both Mr. Murtagh and Ms. Wells power of attorney.  On February 25, 1987, in Boston, the decedent executed her Last Will and Testament which listed her address as Boston, Massachusetts.
On April 1, 1987, the decedent was again admitted to MGH after hitting her head in a slip and fall accident.  The decedent was discharged on April 5th, and on April 24th she was admitted for a subdural hematoma.  After surgery on her head, the decedent was released on May 20, 1987.  Slightly over a month later, on June 20, 1987, the decedent was admitted to MGH due to a general deterioration of her health.  By this time, the doctors had determined that the cancer had spread to the decedent's liver and possibly her lungs and brain.  The decedent was now in the "end-stage" of cancer and her prognosis was poor.  Doctors were uncertain of her life expectancy.  A "do not resuscitate" order was entered on her records so that medical personnel would not take extraordinary measures to revive her.  Her medical treatment at that time was limited to "comfort measures."  The decedent's condition continued to mandate round-the-clock care.
On or about July 14th, while the decedent was in MGH, Mr. Murtagh again traveled to Boston, at the request of Ms. Wells, to make arrangements for moving the decedent.  On July 25, 1987, the decedent was discharged from MGH and transported, via air ambulance, to St. Dominic's Hospital in Jackson, Mississippi.  The decedent lapsed into a coma that evening and died four days later on July 29, 1987.  
In support of the contention that the decedent was a domiciliary of Mississippi at the time of her death, the appellant offered the testimony of friends and family of the decedent.  These individuals suggested that the decedent had been contemplating her move back to Mississippi since Christmas of 1986.  According to Ms. Campo, in January, 1987, she started to pack the decedent's belongings.  Mr. Murtagh claimed that he and Ms. Wells had traveled to Boston in February, 1987, to assist the decedent with her anticipated move.   
Mr. Murtagh claimed that, beginning during his February visit and continuing over the months, he had attempted to arrange an early termination of the decedent's apartment lease, but to no avail.  At the time of her death, the decedent was still a resident of the apartment at 160 Commonwealth Avenue, Boston, as further evidenced by the address listed on the death certificate.  Although Mr. Murtagh testified that he had discussions with a moving company about moving the decedent's belongings, nothing was ever finalized.  At the time of her death, all of the decedent's belongings were still in Boston. 
Also present during the February visit was Mr. Gene Wilkinson, a Mississippi attorney.  Mr. Wilkinson had traveled to Boston, at the request of Ms. Wells to discuss with the decedent her estate plans.  Allegedly, Mr. Wilkinson discussed with the decedent various housing options, including condominiums and nursing homes, and outlined assistance available in Jackson, Mississippi.  Mr. Wilkinson also claimed that they discussed the use of a Mississippi bank to handle the decedent's affairs, although there was no evidence that a bank account was established in Mississippi.  According to his testimony, Mr. Wilkinson indicated that it was Lucille Wells who wanted the decedent to return to Mississippi.  It was Ms. Wells who retained Mr. Wilkinson as counsel, and he billed Ms. Wells for services rendered.
During his July trip to Boston, Mr. Murtagh closed one of the decedent's bank accounts and had her Merrill Lynch brokerage account transferred to Mississippi.  The decedent was hospitalized during this period.  Mr. Murtagh suggested that after returning to Mississippi, and upon being released from the hospital, the decedent would live with her sister until she found a place of her own. 
Despite the fact that the decedent required round-the-clock care due to her failing health, there was no evidence that the decedent had arranged for any assistance in Mississippi.  Although the decedent allegedly asked Ms. Campo if she would be interested in relocating to Mississippi, nothing was finalized.  It was simply left that they would "be in touch."  The appellant claims that the plan was for the decedent to live with her sister, even though the evidence demonstrated that the sister would have been unable to provide the necessary care for the decedent on a 24-hour basis.
After the decedent's death, Ms. Wells petitioned the Chancery Court of the first Judicial District of Hinds County to admit the decedent's last will and testament and codicils to probate in Mississippi.  Based on the testimony of the attesting witnesses, the Court concluded that the will and codicils were valid.  Then, based on the testimony of Dr. Robert Bolduc, Ms. Geraldine Doering and Mrs. Alexandra Eacker, the Court found that "Elise M. Palmer departed this life, having at the time of her death a place of residence and being an adult resident citizen of Jackson, [] Mississippi."  Accordingly, the decedent's will and codicils were admitted to probate in Mississippi. 
Two of the three witnesses, Dr. Bolduc and Ms. Eacker, were long-time friends of the decedent.  The third witness, Ms. Doering, was a former employee of the decedent.  All three witnesses testified that the decedent had expressed longing for Mississippi over the years.  The witnesses also noted, however, that the decedent with her health failing felt very connected to Massachusetts since that was where her doctors were.  Ms. Doering suggested that rather than return to Mississippi to live, the decedent simply wanted to return to die.  
At first, Mr. Bolduc stated that he was unaware of any permanency to the decedent's move to Mississippi.  Contradicting himself, he then stated that the move was permanent.  He noted, however, that there were several things to consider, including her apartment lease.  Lastly, Ms. Eacker simply stated that the decedent always wanted to return to Mississippi but noted that she had remained in Massachusetts of her own free will.  Ms. Eaker's testimony also underscored the decedent's reliance on her doctors at MGH.
Based on the evidence, the Board found that from the 1920s until the date of her death, the decedent spent all but fifteen months residing in the Commonwealth.  At all times, she either owned a home or rented an apartment located in the Commonwealth.  From 1982 until her death in 1987, the decedent received medical treatment from several doctors at MGH and, given her declining health in her later years, she was dependent on her Massachusetts doctors, visiting nurses and Ms. Campo, her live-in caregiver and companion.  
At the time of her death, the decedent did not own or lease a home or apartment in Mississippi.  She had a bank account in Massachusetts and no Mississippi bank accounts.  On her death certificate, the decedent's address was listed as 160 Commonwealth Avenue, Boston, Massachusetts.  Her will, executed just five months prior to her death, listed Boston, Massachusetts, as her address.  The Board found that Massachusetts was the center of the decedent's domestic, social and civic life.  The Board further found that the decedent's domicile was Massachusetts, that she did not abandon her Massachusetts domicile and that she did not intend to move to Mississippi with an intent to remain there permanently or indefinitely.  
Although the Mississippi Chancery Court found the decedent to be a Mississippi "resident" at the time of her death, for the reasons set forth in the following Opinion and on the basis of the evidence presented, the Board found that the decedent was domiciled in Massachusetts at the time of her death on July 29, 1987.  Accordingly, the Board issued a decision for the appellee.

OPINION
	The sole issue in the present appeal is whether the decedent was domiciled in Massachusetts or Mississippi at the time of her death.
	The Massachusetts estate tax is imposed upon the transfer of the Massachusetts taxable estate of every deceased resident of Massachusetts.  G.L. c. 65C, § 2.  "Resident" means any person domiciled in the Commonwealth.  G.L. c. 62, § 1(f).  A person's domicile is primarily a question of fact, but the elements to be considered in determining a person's domicile present a question of law.  Reiersen v. Commissioner of Revenue, 26 Mass. App. Ct. 124, 124-25 (1988).
In general, domicile is where a person intends to make his home.  Commonwealth v. Davis, 283 Mass. 41, 50 (1933).  Home, in turn, is the place where a person dwells, and which is the center of his domestic, social and civic life.  Reiersen, 26 Mass. App. Ct. at 124.  Although a person may have more than one residence, his or her domicile is "the place of actual residence with intention to remain permanently or for an indefinite time and without any certain purpose to return to a former place of abode." Davis, 284 Mass. at 50; McMahon v. McMahon, 31 Mass. App. Ct. 504, 505 (1991).  Doubtless one may change his or her domicile in order to live under different tax laws.  However, "a man cannot elect to make one place his home for the general purpose of life, and another place his home for the purpose of taxation."  Davis, 284 Mass. at 50.
Once established, domicile is "presumed to continue until a new one is acquired."  Davis, 284 Mass. at 49.  "A change of domicile occurs when a person with capacity to change his domicile is physically present in a place and intends to make that place his home for the time at least; the fact and intent must concur."  Reiersen, 26 Mass. App. Ct. at 125, citing Hershkoff v. Board of Registered Voters of Worcester, 366 Mass. 570, 576-577 (1974).  "Mere absences from home even for somewhat prolonged periods do not work a change of domicile."  McMahon, 31 Mass. App. Ct. at 506.
The appellant has the burden of proving that the decedent in fact changed her domicile from Massachusetts to Mississippi.  Davis, 284 Mass. at 49.  In the present appeal, the Board found that the decedent did not intend to remain permanently or indefinitely in Mississippi without any certain purpose to return to her former place of abode in Massachusetts.  The Board, therefore, ruled that the appellant did not meet its burden of proving that the decedent changed her domicile From Massachusetts to Mississippi.
Although some of the appellant's witnesses testified that the decedent wanted to move to Mississippi, the Board found these statements to be unconvincing.  "Testimony as to intention is not conclusive.  The credibility of witnesses is ordinarily entirely for the fact finding tribunal."  Davis, 284 Mass. at 51.  The Board "is not obligated to believe uncontradicted testimony if on the whole they find it not credible from the appearance of the witness, from his interest in the controversy or from other circumstances."  Id.  Ultimately, "the credibility of witnesses, the weight of the evidence, and inferences to be drawn from the evidence are matters for the [judgment of the] board."  Cummington School of the Arts, Inc. v. Assessors of Cummington, 373 Mass. 597, 605 (1977).
In the present appeal, the Board found that the decedent, a dying woman, maintained strong ties with the Commonwealth.  She had entered into a four-year lease on an apartment in Boston, where all of her personal belongings were located.  None of her belongings were in Mississippi.  Her doctors were located at MGH.  She had a live-in caretaker in Boston, as well as additional nurses, with no such arrangements in Mississippi.
The Board further found that it was, in fact, Ms. Wells who sought to have the decedent moved to Mississippi.  It was Ms. Wells who enlisted the services of Attorney Wilkinson.  It was Ms. Wells who traveled to Boston to arrange the decedent's affairs.  Lastly, it was Ms. Wells and her nephew who had the decedent transported to Mississippi just four days before her death.
The appellant also cites the fact that the Mississippi Chancery Court allowed the decedent's last will and codicils to be admitted to probate.  The Mississippi Court determined that the decedent died "having at the time of her death a place of residence and being an adult resident citizen of Jackson [] Mississippi."  If the Mississippi Court found merely that the decedent's place of residence was in Mississippi, that ruling would not be binding on the Board.  An individual's place of residence is not necessarily his or her domicile; one can have multiple residences but can have only one domicile.  See Reiersen v. Commissioner, 26 Mass.App.Ct. 124, 128, n. 6; Shea v. Commissioner, 20 Mass. App.Tax Bd. Rep. 206, 215 (1997).  Moreover, even assuming, as appellant argued, that the Mississippi Court's conclusion meant that, under Mississippi law, the decedent was "domiciled" in Mississippi at the time of her death, that ruling is also not binding on the Board.  
It is possible that two states can each find a person to be domiciled in their state using the same legal criteria yet arriving at different conclusions.  In re Dorrance's Estate, 309 Pa. 151, 163 A. 303, cert. denied, 287 U.S. 660 (1932); 115 N.J. Eq. 268, 170 A. 601 (1934) cert. denied, 298 U.S. 692 (1936).
In Worcester County Trust Co. v. Riley, 302 U.S. 292, 299 (1937), the Supreme Court said:  
[b]ut conflicting decisions upon the same issue of fact do not necessarily connote erroneous judicial action.  Differences in proof and the latitude necessarily allowed to the trier of fact in each case to weigh and draw inferences from evidence and to pass upon the credibility of witnesses, might lead an appellate court to conclude that in none is the judgment erroneous.

The Supreme Court went on to note that the "full faith and credit clause [does not] require[] uniformity in the decision of the courts of different states as to the place of domicile, where the exertion of state power is dependent upon domicile within its boundaries."  Id. citing Thormann v. Frame, 176 U.S. 350 (1900).  "Neither will be bound by an adverse determination of domicile in the other's forum."  State of California v. State of Texas, 437 U.S. 601, 602 (1978).
Based on all the evidence, the Board found and ruled that a move to a Mississippi hospital four days before her death was not enough to establish the decedent's domicile in Mississippi.  Accordingly, the Board found and ruled that the decedent, Elise Palmer, was domiciled in Massachusetts at the time of her death on July 29, 1987.  Therefore, the Board issued a decision for the appellee.


						   APPELLATE TAX BOARD

						By:					____
						   Abigail A. Burns, Chairman


A true copy,
Attest:					
  	    Clerk of the Board

17


ATB 2000 - 779