## Facts

- Ethel Adine Murchie was a Canadian citizen married to Guy Murchie, a United States citizen.
- The couple established their domicile in Nassau, Bahamas.
- After visiting Canada, they traveled back toward Nassau but stopped in Florida during the trip.
- What began as a stopover lasted longer because Ethel’s health deteriorated.
- Guy rented a house in Florida for their stay, intending the rental to be temporary and to transfer the lease to a friend when they left.
- Ethel died in Florida before the couple returned to Nassau.
- At her death, Ethel had a small box that she routinely carried while traveling, containing jewelry and other personal effects valued at more than $30,000.
- Guy, as executor of Ethel’s estate, filed the required federal estate-tax return for a nonresident decedent.
- Collector of Internal Revenue Denis Delaney assessed an estate-tax deficiency, treating the contents of the traveling box as “property situated in the United States” and therefore includable in the taxable estate for a nonresident.
- Guy paid the assessed deficiency and filed a federal refund action in district court; the district court ruled for Guy, and Delaney appealed.

## Issues

1. Whether jewelry and personal effects kept in a traveling box and present in Florida solely during a nonresident decedent’s temporary stay are “property situated in the United States” for federal estate-tax purposes.
2. Whether the government may treat the items as U.S.-situated property based only on their physical location in the United States at the moment of death.

## Decision

- The First Circuit affirmed the judgment for Guy Murchie in the refund action.
- The court rejected the government’s position that mere physical presence in the United States at death automatically makes such movable personal property U.S.-situated for nonresident estate-tax inclusion.
- The contents of the traveling box were not includable in Ethel’s U.S. gross estate on these facts, and the deficiency tax collected on that basis was refundable.

## Legal Principles

- For a nonresident, non-domiciled decedent, federal estate tax reaches only property “situated in the United States.”
- For movable tangible items associated with a foreign domicile and carried as part of ordinary travel, situs is not determined solely by the property’s fleeting physical location at death.
- In applying a taxing statute to a nonresident decedent’s property, doubtful cases are construed against extending the tax beyond what the statute clearly covers.

## Conclusion

Delaney v. Murchie holds that a nonresident decedent’s jewelry and personal effects, kept in a box that traveled with her and happened to be in Florida during a temporary, illness-related stay, were not “property situated in the United States” for federal estate-tax purposes, so the government could not include those items in the U.S. taxable estate based only on their presence in the country at death.


Delaney v. Murchie, 177 F.2d 444 (1949)