-48-
and the assets of those trusts would be distributed, free of
trust, to their respective beneficiaries.”
Respondent’s argument to the contrary is summarized as
follows:
(1) it was not necessary to transfer stock from
Mr. Schutt’s revocable trust to the business trusts to
perpetuate his investment philosophy; (2) the record
establishes that obtaining valuation discounts for gift
and estate tax purposes was the dominant, if not the
sole, reason for forming the business trusts; and (3)
in any event, Mr. Schutt’s desire to perpetuate his
investment philosophy was itself a testamentary motive.
* * *
The totality of the record in this case, when viewed as a
whole, supports the estate’s position that a significant motive
for decedent’s creation of Schutt I and II was to perpetuate his
buy and hold investment philosophy. That decedent was in fact a
committed adherent to the buy and hold approach is undisputed.
His longstanding concern with disposition of core stockholdings
by his descendants is also well attested. Mr. Sweeney testified
that decedent “would raise, at least annually and, quite often,
more than annually, his concern about the ability of children or
grandchildren or whoever it might be to sell principal rather
than using the income from the principal”. Mr. Dinneen likewise
testified that decedent expressed concern about Schutt family
members’ selling of stock from “Back in the early seventies and
on a regular basis from there on out.”
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