Bankers Trust Co. v. Blodgett

Background

Executors of Lena McMullen’s estate filed the required inventory after her 1919 death. The Connecticut Tax Commissioner claimed $10,286.39 under a 1915 statute that charges a two-percent annual tax on estate property that had no town or city tax assessed or paid during the year before death, applied to the five years before death. The executors appealed the claim under the state statute procedures, the State demurred, the Connecticut Supreme Court of Errors sustained the demurrer, and the Superior Court dismissed the executors’ appeal.

Reasoning

The core question was whether the statute unlawfully deprived heirs or creditors of property without due process or acted as an unlawful retroactive criminal punishment. The Court explained that estate property passes subject to existing liabilities, including tax obligations. The statute was treated as a civil penalty to enforce a tax duty, not as criminal punishment, and the amount and method of the penalty are legislative choices. Because the penalty is not criminal, the constitutional ban on retroactive criminal laws does not apply, and the Fourteenth Amendment due-process challenge failed.

Real world impact

The ruling lets Connecticut collect the claimed penalty tax from the estate and confirms that similar state penalty-tax schemes may be enforced. Executors and heirs must account for such state claims when administering estates. The decision resolves this dispute and leaves the statutory enforcement mechanism intact.