Velilla, administrator of the estate of Arthur Graydon Moody v.

Posadas, CIR

FACTS
 Arthur G. Moody, from Harry Potter, is an American citizen, who came here (1930s)
and engaged actively in business up to his death in India. He had no business
elsewhere and left an estate consisting principally of bonds and PH stock, bank
deposits and other intangibles and personal property – all in PH.
 He executed a will here where he bequeathed all his property to his only sister, Ida
M. Palmer, an American citizen and resident.
o A petition for appointment of special administrator was filed by W. Maxwell
(no mention of who he
is). Subsequently, a petition was filed by Ida M. Palmer, asking for the probate
of said will of the deceased, and the same was, after hearing, duly probated by
the court and it was declared that Ida Palmer is the sole and only heiress of
Moody. However the will does not cover the respective values of said
properties for the purpose of the inheritance tax. So BIR assessed.
 The estate of the late Arthur Graydon Moody paid a total of P90k under protest
(income tax + inheritance tax). The protest was overruled by the BIR.
 The petitioner contends that that there is no valid law or regulation of the PH
Government under or by virtue of which any inheritance tax may be levied,
assessed or collected upon transfer, by death and succession, of intangible
personal properties of a person not domiciled in the Philippine Islands.

ISSUE + RULING:
Was Moody legally domiciled in the Philippine Islands on the day of his death? YES.
 According to the Court, the fact that Moody accumulated a fortune from his
business in the Philippines and that he lived in the Elks’ Club in Manila for many
years and was living there up to the date he left Manila proved that his domicile at
the time of his death was in the Philippines.
o And that the only reason why he left the country was that he was afflicted
with leprosy in an
advanced stage and had been informed that he would be reported to the
Philippine authorities for confinement in the Culion Leper Colony as required
by the law .
o Distressed at the thought of being thus segregated and in violation of his
promise to his doctor that
he would voluntarily go to Culion, he surreptitiously left under cover of night,
on a broomstick (freighter), without ticket, passport or tax clearance
certificate.
 He lived with a friend in Paris, France, during the months of March and April of the
year 1929 where he was receiving treatment for leprosy at the Pasteur Institute.
There is no statement of Moody, oral or written, in the record that he had adopted a
new domicile while he was absent from Manila.
o Though he was physically present for some months in Calcutta prior to the
date of his death there,
admin Velilla does not claim that Moody had a domicile there although it was
precisely from Calcutta that he wrote and cabled that he wished to sell his
business in Manila and that he had no intention to live there again.
o Much less plausible is the claim that he established a legal domicile in Paris.
 The record contains
no writing of Moody from Paris + there is no evidence as to where in Paris he
had any fixed abode that he intended to be his permanent home. There is no
evidence that he acquired any property in Paris or engaged in any settled
business on his own account there or of any affirmative factors that prove the
establishment of a legal domicile there. His short stay of three months in Paris
is entirely consistent with the view that he was a transient in Paris for the
purpose of receiving treatments.
 The evidence in the record indicates clearly that Moody’s continued absence from
his legal domicile in the Philippines was due to and reasonably accounted for by his
leprosy (motive: did not want to go to the Leper Colony + sought treatment abroad).
 Art. 40, OCC defines the domicile of natural persons as "the place of their usual
residence." The record before us leaves no doubt that the "usual residence" of
Moody, who was described as a "fugitive" and "outcast", was in Manila where he
had lived and toiled for more than a quarter of a century, rather than in any foreign
country he visited during his wanderings up to the date of his death in Calcutta. To
effect the abandonment of one’s domicile, there must be a deliberate and provable
choice of a new domicile, coupled with actual residence in the place chosen, with
a declared or provable intent that it should be one’s fixed and permanent place of
abode, one’s home. There is a complete dearth of evidence in the record that
Moody ever established a new domicile in a foreign country.