New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1867-01-25
FRIDAY, JANUARY e5, 1851.
CIVIL COURTS.

|
THE SHARES OF NATIONAL BANKS IN THE HANDS
OF CITIZENS ARE LIABLE TO STATE TAXATION,
m as OTHER PERSONAL PROPERTY ,-.,-,-
CIV Comfy YT Yors and TIE People q lie State Of
69l ~ i S,a Mes p'Ht5 y err' s me ne h
error othe Court Of Appeals q the state q Revlok
Mr.. Justice Nelson delivered the opinion OF the
! Court:
These cases are ws Of error to tie Court Of Appeals
owner Of 10 shares Of stock in the National Bank Cont
Inetce In NewYork The capital OF the bank consists OF
states securities and exempt from state taxation The
commissioner Of Taxes, IN making tneir assessne,s
same rae o. TAX as was imposed upon qIgr Rer4I
to the certloa state that IN estimating the value OF inc
shares they made no deduction on account Of the invest
! 56cdfiti6s That in ne. valuation. Of the personal
estate Of individuals these Securities held and owned
| by them were deducted and the tax assessed
made from the capital Of insurance companies
The assessment Of this tax the shares Of tho reator IN
tRe BANK OF commerce vas carried TO me supreme Court
oil me state ana after argument, affirmed and thence
20 INC Court OF Appeals, where the judgment OF the
error under the 25th of the judiciary act The first OBJ
ecton taken 70 the legality OF the tax on the GROUND tna
to deduct the amount Of capital Of the bank invested IN
Unteq states securities and, hence, refused 60 regard
ths 4euuSon N the valuation OF the sh9T95 In queS
ton has heretofore been considered ~ this Court and
Ii , ~ eiatlO, ueleInlicu III VIC Cd'S va 49,
Amen agl' inc Assessors Is wallace DO ana heed nos
again be examined That of large class 81
cases, Mnch were very thoroughly argued, ana received
at he lne the most careful examination OF the Court
The next ana perhaps the only material question In the
pro9iso OF the list section Of the National Bank Act
After referring TO the taxation Of these shares by state
| than Is assessed upon other mOneyed capital In
the hands of Individual citizens Of such states"
OF the relaor Is at greater rate than that OF the per
sonal property OF individual citizens, upon the ground
tat allowance was made on account or United states Sc
cuiteS held ana owned by them, when at the same time
the deduction was dsalowed to him The answer Is that
| Uf pt,
meaning ana intent OF the lawmakers that the rate
Of taxation Of tho shares should Dc the same or not
greater than upon the mOneyed capital Of the indi-
ydua citizen which subject or liable 90 taxation. That
is gcaterpCporon per centage Of tax in the yau
moncyed taxable capital m the hands OF the citiZes rms
rule seems 70 be effcctua test to prevent unjust
discrimination against the shareholders could well be
devised. ~ embraces class which constitutes the bedy
| Tor it's taxes. They cannot be greater than the
! citizens impose upon Themselves u IL known
/ that sound policy in every wellresated aud
enlightened staeor Government certain descriptions Of
property and also certain nsttuons-scf as churches
ompt from taxation; but these exemptions have never
been regarded disturbing the rates OF taxation, even
where the fundamental law had ordained that 1t should
De uniform. Tho objection Is a singular one Az tho
discrimination t was well known 60 that body that these
securities IN the hands Of the citizen exempt from
abundant caution had passed Into law The argument
founded on the objection n i proves anything proves
Of individuals 20 equaze the taXaon and HENCE that
Congress By this clause IN the prOylso intended TO subject
was error in the deduction This do not suppose 10
clamcd But II this IS not the result Of the argument
then the OthCr conclusion from 10 49, that Congress re-
| CURED that the Commissioners should deduct the
Securities, aud at the same umo intended the ded1c-
ton, IL made, should operate violation OF the
| rate OF tho tax prescribed. We dissent from
both CONCLUSIONS and think sound construction OF
the clause and one consistent with its words and intent
Is also consistent with al tc oct9 OF Congress on the sub
ec Tho Commissioners in their return, state that in
surance companies created under the laws OF the State
and doing business Ia the city OF NeW-Yorh were re,
specvey assessed upon the balance Of this capital and
surplus profits liable 20 taxation after deduct!ng there
from such part ash Invested I'm uHted states securities
Another objection taken that the taxation Of tic shares
of ne rsatOr s Illegal account OF their deductOHit
being departure nom the atgof assessment prescribed
clause does refer 10 the rate Of assessments upon in
sunce companies rs a test by which 10 prevent discimi
assesyments unOu m0ncyed capital I'm the hands OF in1
y.dull citizens These Institutions arc not within
rgcn lf thew were tho answer We have already given
20 the deduction OF these securities IN me assess
equally apriicabla % them Tho companies are taxed
on their capital ana not on InS m w., ,,te
There Is not much danger TO be npprchcnded OF dis
ro, ~ ibe citlz.n and OF course 10 the rights Of
the shareholders these National Banks who stand on
he same footing The Tcator in the second case, Ralph
Mead the holder and owner Of p shares OF stock m the
Corn Exchange Bank in Tie CRY Of New YORK inoop0r
1850 imposed tax on the shares Of these banks ~ - IN
sisted tiat te laA y 'tal o., aIons C W ,b
portion Of to capital STOCK Of the bank was invested
rae OF tbe last term OF which Van Allen agt The Colec
Tor was ono Of tLls class g Wallace SO. $50 and
| ssn and disposed o. Il was there said But
| In addition 10 this view the tax on the shares
il not q tax the capital or the BANK. me
Corporation is the legal owner OF an the Properly o. lg
up0n IL by the charter aud for the purposes for which II
Was created deal with the corporate property as an
s0iutry as private individual can deal with his own"
The interest Of the shareholder entities him to parlc
pate m tlenct profits earned b. the bank IN the employ
nent OF s capital during the existence o. it8 charter IN
pruporon 10 the number OF his shares and upon les dis
soupu or termination 90 his proportion Of the property
thai may remain, Oi the corporation, atcf tie payment
property held by the shareholder like any other property
that may belong TO him. aud, We add OF course Is SUP
! ject 20 like taxation. ~ was hupposeus On yle
/ argument that this principle was In conflict WIN
that which governed the decision % tms c9 or,
| in the case OF Gardner agt INC appear ~
| Court. g How, 1881 but thus i msiake
That turned upon the construction OF h act ol taJ
land cXcmptng the bank tron taxation on account OF
large bonus 10 the State for the extension OF INC ch9e
This Court held that upon airqe construction OF Ile
act tho stockholders were within the scope OF the eAelnp
ton The Court sny: IN whatever way we examine the
acts Of 1873 ana 1921 we areo opinion that tappears
from the II IN tosc acts 10 have been the intention on
the Legislatures which passed them, 60 exempt the stock
holders from taxation persons on account OF the 0och
which they owned I'm the banks some other questions
were discussed on the nrgumcnt beside those have
noticed but they questions oyor which TINS Court cam
not fake cognzancc. We have examined al Of them that
arc here under the 255 Of the Judiciary Acknowledgement
! Of the Court below affirmed.
! Mr.. ChicfJustice CHAsE.-In concurrence with my
brothers Wayne and Swayne, dissent from the opinion
inst read The OF dissent sufficiently appear In
or II aenug opinion IN tle OF Van Allen ogt Tie
ssrs read ~ the last term, ana do not think it
h. d. slmaii and john f. Burlin Of counsel for plain
tilis In error r. OGornau ana Charles OConOr OF cOu
/ sci for defendants IN error
/ SUPREME COURT -Cn,MnERs-.JAN. 2L-Before Mr.
| Justice BARNARD.
THE EIGHTH ALnEnI4EIC DISTRICT QUARREL
| william l. ~ agt John Moore and others =,
| The plaintiff brings suit against al thGother AL
dcrlncn of this city 20 restrain cm from taking any fur
Tier proceeding IN the matter Of the protest OF Peter
plaintiff claims that he elected In 1868, and Mcknight