Campbell v. California

Background

A woman who died in San Francisco left an estate that was divided among three brothers and a sister. California had a law from 1893 that taxed many collateral inheritances but exempted certain close relatives and charities. An 1899 change removed brothers and sisters from the list of exemptions, so they were taxed. The siblings challenged the tax in state court on local and federal equal-protection grounds; the California Supreme Court affirmed the tax. The U.S. Supreme Court noted California later passed a new inheritance law in 1905 but declined to treat that change as making the federal question moot.

Reasoning

The central question was whether the Fourteenth Amendment forces states to follow a strict “blood relationship” rule when choosing who pays inheritance taxes. The Court said it does not. States may classify relatives for tax purposes and prefer some classes over others, including relatives by marriage or adopted children. The Court relied on prior decisions and reasoned that such legislative choices are not inherently arbitrary or a denial of equal protection unless they are obviously unreasonable. Because California’s classification involved judgment and policy, the tax on brothers and sisters did not violate the Fourteenth Amendment.

Real world impact

The ruling lets states retain flexibility in deciding which relatives bear inheritance charges. Brothers and sisters can be taxed under state inheritance rules even when other non-blood relatives are exempt. The decision left unresolved any effect of California’s later 1905 law, which state courts may address.