ESTATE OF SULLIVAN v. SULLIVAN (1984)

Sumiko Ushijima Sullivan (Sumiko) appeals from the order denying her motion to set aside the inheritance tax referee's determination of inheritance tax which is based upon the referee's finding that Sumiko is a stranger (Class C transferee).   The sole issue is whether a putative wife is a Class A transferee within the meaning of former section 13307, subdivision (a), Revenue and Taxation Code when the decedent is survived by a legal wife.

James D. Sullivan died September 21, 1980, leaving a will executed January 5, 1979.   In paragraph “FIRST” he declared:  “I am married to HELEN V. SULLIVAN.”   He further declared that he and Helen Sullivan (Helen) “have one child” and “have been separated and living apart since August 7, 1970.”   In paragraph “THIRD” decedent confirmed his legal wife's interest in the community property acquired prior to August 7, 1970, bequeathed to his son 50 percent of his share thereof, and stated, “The rest, residue and remainder of my property I give, devise and bequeath to SUMIKO D. USHIJIMA.”

The report of the inheritance tax referee reflects a determination that no inheritance tax is due on the property interest that passed upon decedent's death to Helen, who was accorded Class A transferee status, and that an inheritance tax in the amount of $13,789 was assessed against the interest that passed to Sumiko, who was determined to be a stranger (Class C transferee).

According to the declaration of Sumiko in support of her motion to set aside the inheritance tax referee's determination of inheritance tax, she participated in a marriage ceremony with decedent in Nevada on July 5, 1974.   Four years prior thereto decedent lived alone.   He told Sumiko that he had been divorced from Helen, and she believed him.   Sumiko and decedent lived together until his death.   In fact, it was not until less than 24 hours before his death that Sumiko learned decedent had never secured a divorce from Helen.

Former section 13307, Revenue and Taxation Code provided:  “ ‘Class A transferee’ means any of the following:  [¶] (a) A transferee who is the husband, wife, lineal ancestor, or lineal issue of the decedent.”  (Repealed eff. June 9, 1982, Stats., ch. 1535, § 14.)   Appellant contends that the term “wife” in former Revenue and Taxation Code section 13307 includes a putative wife.   We agree.

Similar language in other statutes has been construed as including putative spouses.  (See, e.g., Brennfleck v. Workmen's Comp. App. Bd. (1970) 3 Cal.App.3d 666, 84 Cal.Rptr. 50 [interpreting “surviving widow” in Labor Code section 4702];  Kunakoff v. Woods (1958) 166 Cal.App.2d 59, 332 P.2d 773 [interpreting “heirs” in Code of Civil Procedure section 377];  Estate of Krone (1948) 83 Cal.App.2d 766, 189 P.2d 741 [interpreting “wife” and “surviving spouse” in Probate Code, division 2, chapter 1, section 201].)

These cases demonstrate the existence of a strong legislative policy that a putative wife be treated as a wife with respect to property rights arising out of the putative marriage.   Consistency of analysis requires that Sumiko be taxed as a Class A transferee rather than as a stranger.

In Estate of Krone, supra, 83 Cal.App.2d at pages 769–770, 189 P.2d 741, Division Two of this court held that, upon the dissolution of a putative marriage by the death of the husband, the wife takes that share of the estate to which she would have been entitled as a legal spouse under Probate Code, division 2, chapter 1, section 201.¹

In Kunakoff v. Woods, supra, 166 Cal.App.2d 59, 332 P.2d 773, Manya Kunakoff, a surviving putative wife, sought to bring a wrongful death action as an heir under Code of Civil Procedure section 377.   At that time Code of Civil Procedure section 377 provided in pertinent part as follows:  “When the death of a person not being a minor ․ is caused by the wrongful act or neglect of another, his heirs or personal representatives may maintain an action for damages ․” ²  (Stats.1949, ch. 1380, § 4, p. 2401.)   The statute did not define the term “heirs” and did not expressly provide that such an action could be brought if a putative wife survived the death of her husband.   Relying on Estate of Krone, supra, 83 Cal.App.2d 766, 189 P.2d 741, and subsequent cases, the court held that, since a putative wife has a legal right of inheritance in the estate of the husband, she qualifies as an heir and can maintain an action for her husband's wrongful death.  (Kunakoff v. Woods, supra, 166 Cal.App.2d 59, 64–68, 332 P.2d 773.)

In Brennfleck v. Workmen's Comp. App. Bd. (1970) 3 Cal.App.3d 666, 84 Cal.Rptr. 50, the court was confronted with the issue whether a putative spouse had the right to death benefits under Labor Code section 4702.   At the time of the death of the employee, Labor Code section 4702 provided in pertinent part:  “Except as provided in the next paragraph, the death benefit in cases of total dependency, when added to all accrued disability indemnity, shall be the sum of seventeen thousand five hundred dollars ($17,500) except in the case of a surviving widow and one or more dependent minor children, in which case the death benefit shall be twenty thousand five hundred dollars ($20,500) ․”  (Stats.1965, ch. 1513, § 92, p. 3579.)

The court held that the term “surviving widow” included a surviving putative wife (Brennfleck v. Workmen's Comp. App. Bd., supra, 3 Cal.App.3d 666, 672–675, 84 Cal.Rptr. 50), reasoning as follows:  “ ‘[T]he right to succession is not an inherent or natural right.   It is only by virtue of statute that an heir is given the right to receive any of his ancestor's estate.’   [Citations.]  There is authority to the effect that the statutory requirements must be followed and the courts may not alter them, although the provision in question is unfair.  [Citations.]  However, it clearly appears that the courts did so in order to insure that the putative spouse would be protected.   It is important to note that the courts have, since the date of Krone, supra, treated the term ‘spouse’ as it appears in a statute as encompassing the term ‘putative spouse.’   The analogy is particularly in point where, as here, descent and distribution and workmen's compensation are defined as strict creatures of statute.  [Citation.]”  (Id., at p. 673, 84 Cal.Rptr. 50, emphasis in original.)

Inheritance taxation, like intestate succession and workers' compensation, is wholly statutory.   Just as the terms “wife” in Probate Code, division 2, chapter 1, section 201 and “widow” in Labor Code section 4702 have been construed as including a putative wife, the term “wife” in former Revenue and Taxation Code section 13307 should also be construed as including a putative wife.   The reasoning of the court in Brennfleck is directly in point.   Failure to classify a putative wife such as Sumiko as a Class A transferee would be inconsistent with the holdings of Krone, Kunakoff, and Brennfleck.   Each of these cases reflects the strong legislative policy that putative spouses be treated the same as spouses.  (See, e.g., Civ.Code, § 4452 [quasi-marital property divided as if it were community property];  Civ.Code, § 4455 [right of putative spouse to receive support payments].)   In Stafford v. L.A. etc. Retirement Board (1954) 42 Cal.2d 795, 270 P.2d 12, our Supreme Court stated, “ ‘[E]very statute should be construed with reference to the whole system of law of which it is a part so that all may be harmonized and have effect.  [Citations.]’  [Citations.]”  (Id., at p. 799, 270 P.2d 12.)   Classification of Sumiko as a Class A transferee would serve to harmonize former Revenue and Taxation Code section 13307 with other statutes relating to the death of a spouse.  (Ibid.)

Since Estate of Krone was decided in 1948, the Legislature amended former Revenue and Taxation Code section 13307 three times.   It may be presumed that the Legislature knew of the Krone decision when it amended former Revenue and Taxation Code section 13307 in 1953, 1968, and 1969 and that it was also aware of Kunakoff at the time of the latter two amendments.   (Stafford v. Realty Bond Service Corp. (1952) 39 Cal.2d 797, 805, 249 P.2d 241.)   If the Legislature had wanted to exclude putative wives from Class A status, it would have done so expressly.

In Adduddell v. Board of Administration (1970) 8 Cal.App.3d 243, 247–250, 87 Cal.Rptr. 268, the court was faced with the question whether the term “surviving spouse” in Government Code section 21364, which defines special death benefits under the Public Employees Retirement System, includes putative spouses.   When Adduddell was decided, Government Code section 21364 defined spouse as “a wife or dependent husband.”   The court held that the surviving putative wife was a putative spouse under this defintion.   (Adduddell v. Board of Administration, supra, 8 Cal.App.3d at pp. 247–250, 87 Cal.Rptr. 268.)

The above-cited statutes and cases recognize established California policy of treating a putative spouse as a legal spouse.   The reasoning utilized by the court in Brennfleck is equally applicable to the statute here under review.   Sumiko is a wife within the meaning of former Revenue and Taxation Code 13307 and should be taxed accordingly.

The rights of a surviving putative spouse are not determined by the happenstance of whether or not a legal wife also survives.   Although most of the cases analyzing the rights of putative spouses have not also involved legal wives, the existence of two spouses would not change their reasoning or results.   In Brennfleck, for instance, the court recognized the potential problem of two surviving spouses and concluded in dictum that the putative spouse would be entitled to a share of the death benefits even when that would reduce the share of a legal spouse.  (Brennfleck, supra, 3 Cal.App.3d at p. 674, 84 Cal.Rptr. 50.)

In fact the claims of putative spouses are recognized even when they are in direct conflict with the claims of legal spouses.   In Estate of Vargas (1974) 36 Cal.App.3d 714, 111 Cal.Rptr. 779, Division Two of this court faced a conflict between two spouses who survived an intestate.   The court noted that “the laws regulating succession and the disposition of marital property are not designed to cope with the extraordinary circumstance of purposeful bigamy at the expense of two innocent parties.”  (Id., at p. 718, 111 Cal.Rptr. 779, citations and footnote omitted.)   Therefore the court turned to equitable principles and divided the property equally between the putative spouse and the legal spouse.  (Id., at p. 719, 111 Cal.Rptr. 779.)   The same problem received the same solution in Estate of Ricci (1962) 201 Cal.App.2d 146, 151–152, 19 Cal.Rptr. 739.

In the instant case the two spouses are not even in competition.   Recognition of Sumiko's right to be taxed as a surviving spouse will not affect what the legal wife receives or how she is taxed.

The order is reversed.

I respectfully dissent.   To uphold appellant's position that as a putative wife she is entitled to be treated as a Class A transferee and not as a stranger, it is necessary to either bring “putative wife” within the ambit of “wife” as used in section 13307, subdivision (a), Revenue and Taxation Code, or add the words “putative wife” to the statute to enlarge the Class A transferee classification defined by the Legislature.   I am not prepared to do either.

This is not a contest among heirs or between a putative wife and a legal wife to determine whether the former shall inherit in the same manner as the latter, for clearly appellant takes under decedent's will, but it is a cause solely between a putative wife and the State of California challenging a determination made by the Inheritance Tax Referee for tax purposes under the Revenue and Taxation Code.

It is clear to me that the exemption of a wife as codified in section 13307, subdivision (a) envisions a valid marriage.   I cannot believe that the Legislature, in the context of California tax law intended that if a legal wife also survived a decedent a putative wife was to be included with the legal wife in the term “wife” as used in the statute and be entitled to the same exemption.   The statute is clear and unambiguous.   It “defines a classification for exemption and rate purposes and therefore ․ must be strictly construed in favor of the state and against the taxpayer.   [Citations.]”  (Estate of De Roulet, 20 Cal.App.3d 1072, 1076–1077, 98 Cal.Rptr. 277.)   The Legislature intended for married persons the benefits accorded Class A transferees.   To hold otherwise is to disregard statutory legislative intent to grant certain rights and privileges to persons who sought and obtained that special status.  (Estate of Edgett, 111 Cal.App.3d 230, 233, 168 Cal.Rptr. 686.)   Under the circumstances here I cannot indulge in a statutory construction to expand the classification to include a relationship like that of appellant and decedent not based on a valid marital union.

It is for the Legislature to determine whether such relationships as that which existed between Ushijima and decedent deserve the statutory protection afforded a lawful marriage;  so too, it is for the Legislature to define the class entitled to tax exemption and that, in the circumstances here, it should be accorded only to the surviving legal wife;  and it did so.   Thus applying section 13307, Revenue and Taxation Code, as it is written and construing it as was intended by the Legislature, it is my view that Helen V. Sullivan, the surviving legal wife of decedent who was entitled to the Class A transferee exemption having been accorded the same, appellant also cannot be accorded a Class A transferee status.   It is clear to me that section 13307 allows only one exemption to “wife,” and that has been accorded to decedent's surviving legal wife, Helen V. Sullivan.

I would affirm the order.

FOOTNOTES

1.   Division 2, chapter 1, section 201 of the Probate Code provides:  “Upon the death of either husband or wife, one-half of the community property belongs to the surviving spouse;  the other half is subject to the testamentary disposition of the decedent, and in the absence thereof goes to the surviving spouse, subject to the provisions of sections 202 and 203 of this code.”   Division 2 of the Probate Code was repealed by Statutes 1983, chapter 842, section 19 (5 Deering's Adv.Legis. Service, p. 765), operative January 1, 1985.

2.   Code of Civil Procedure section 377 was amended by Statutes 1975, chapter 334, section 1, page 784, to provide as follows:  “(a) When the death of a person is caused by the wrongful act or neglect of another, his heirs or personal representatives on their behalf may maintain an action for damages against the person causing the death ․  [¶] (b) For the purposes of subdivision (a), ‘heirs' mean only the following:  [¶] (1) Those persons who would be entitled to succeed to the property of the decedent according to the provisions of Division 2 (commencing with Section 200) of the Probate Code, and [¶] (2) Whether or not qualified under paragraph (1), if they were dependent on the decedent, the putative spouse, children of the putative spouse, stepchildren, and parents.   As used in this paragraph, ‘putative spouse’ means the surviving spouse of a void or voidable marriage who is found by the court to have believed in good faith that the marriage to the decedent was valid․”  (This version was subsequently amended.  (Stats. 1977, ch. 792, § 1, p. 2436.)   A similar version will become operative January 1, 1985.  (See Stats. 1983, ch. 842, § 12, 5 Deering's Adv.Legis. Service, pp. 763–764.))   Statutes 1975, chapter 334, section 2, page 784, provides:  “It is the intent of the Legislature that the amendments to Section 377 of the Code of Civil Procedure made by Section 1 of this act ․ include the putative spouse, children of the putative spouse, stepchildren, and parents within the class of persons who may maintain an action for wrongful death if they were dependent on the decedent.”

DALSIMER, Associate Justice.

GUTIERREZ, J.*, concurs.