Goodwill passes on a partner's death despite deed restrictions, making the deceased partner's share includible in the estate.

Goodwill is capable of passing on the death of a partner, and a partnership clause providing for dissolution on death or denying the legal heir any claim to goodwill does not prevent that asset from being treated as property passing on death for estate duty purposes. On that basis, the deceased partner's share in the firm's goodwill was includible in the principal value of the estate. The valuation of the goodwill was not in dispute.

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Issues: Whether the deceased partner's share in the goodwill of the firm passed on death and was includible in the principal value of the estate notwithstanding a clause in the partnership deed denying any claim to goodwill.

Analysis: The controlling principle applied was that goodwill is an asset capable of passing on the death of a partner. A stipulation in the partnership deed providing for dissolution on death and denying the legal heir any claim to goodwill does not prevent the goodwill from being treated as property passing on death for estate duty purposes. The valuation of the goodwill was not in dispute.

Conclusion: The deceased's share in the goodwill passed on death and its value was includible in the principal value of the estate.

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