c37:No. 4277

MAGRUDER, Circuit Judge
(dissenting in part).
While the provisions of § 811(c) .and 811(d) overlap to some extent, it is important to stress that whenever §.811(c) is applicable, the value of the corpus is included in the decedent’s gross estate, whereas in the case of transfers falling within § 811(d) there must be included only the value of the particular interests the enjoyment of which had been subject to a change through the exercise of a power in the decedent to alter, etc. Where the enjoyment of the primary life estate is subject to a power in the decedent to withhold the income and add it to principal, such power falls within the description of § 811(d), and the value of the life estate must be included in decedent’s gross estate. In the present case that would be true, it seems to me, as to all the transfers in trust, whether made before or after March 3, 1931.
But though the control which decedent had over the enjoyment of the life estates requires the value of those interests to be included in the gross estate, under § 811(d), it does not follow that the same control requires the corpora of the1 trusts' to be swept into the gross estate under § 811(c). The statutory language in § 811(c), describing the power over income which has the tax consequence of requiring the corpus of the trust to be included as part of the decedent’s gross estate, is markedly different from the language of § 811(d).
As the opinion of the court points out, the amendment to § 811(c) which Congress rushed through on March 3, 1931, was prompted by three decisions of the Supreme Court handed down March 2, 1931. Burnet v. Northern Trust Co., 283 U.S. 782, 51 S.Ct. 342, 75 L.Ed. 1412; Morsman v. Burnet, 283 U.S. 783, 51 S.Ct. 343, 75 L.Ed. 1412; McCormick v. Burnet, 283 U.S. 784, 51 S.Ct. 343, 75 L.Ed. 1413. In the first two of these cases the grantor reserved to himself a life interest in the income (See Commissioner v. Northern Trust Co., 7 Cir., 41 F.2d 732 and Commissioner v. Morsman, 8 Cir., 44 F.2d 902); and the 1931 amendment to § 811(c) covered these cases by providing that the value of the corpus should be included in the gross estate where the grantor had reserved to him■self the possession or enjoyment of or the right to the income from the property transferred. In the McCormick case, supra, the trustees had been directed to accumulate the net income and add the same to the principal, subject, however, to the following provision: “Said Trustee shall from time to time in each year pay out of said net income for charitable uses and purposes such sums and amount of money as said first party [the grantor] shall designate and request in writing, specifying to whom the same is to be paid and the particular charitable uses and purposes to which the same is to be applied”. The McCormick case obviously inspired the other phrase inserted by Congress in the 1931 amendment, “the right * * * to designate the persons who shall possess or enjoy * * * the income * *
I agree with the court that the foregoing phrase cannot be limited to cases where the power to designate the persons who shall enjoy the income is unrestricted. Indeed, in the McCormick case, the power was not unrestricted, for there the income was to be accumulated by the trustees, subject only to a power in the decedent to direct that income be paid to charities. The possible recipients of his bounty were thus limited to a class described in the trust instrument.
But it does not seem to me that a mere power to accumulate income aptly falls within the phrase “the right * * * to designate the persons who shall possess or enjoy * * * the income * * I think it more likely that if Congress had intended that the reservation of this very familiar power should have the drastic consequence of requiring the inclusion in decedent’s gross estate of the whole value of the corpus, it would have explicitly so provided. A power to withhold the income from the life tenant is not a power to designate who shall enjoy the income. If the income is withheld from the life tenant and added to principal, no one will enjoy it as income. Nor does the power to accumulate income enable the holder of the power to designate who shall ultimately receive the same as augmented corpus. That is rigidly determined by the provisions ■of the trust instrument and is subject to contingencies which were beyond the control of the decedent. At any particular time when a decision is made not to pay income to the life tenant but to accumulate it, it could not be known who would ultimately benefit by such accumulation.
I therefore think that § 811(d) applies here rather than 811(c).

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