New-York tribune., 1874-12-04
THE COURTS.
AN IMPORTANT INSURANCE SUIT.
ATTEMPT TO RECOVER ALLEGED ILLEGAL TAxgs
UPON EARNINGS.

ATTEMPT TO RECOVER ALLEGED ILLEGAL TAxgs
UPON EARNINGS.
Richard Franklin, as receiver Of the Yonkers
and New. York FIRE Insurance Com pany the Jefferson
Broadway, Home. 80. Nicholas H1nOycr. Hamilton,
star Empire. Mechanic3 and Tralers' and the lib
hard Fro Insurance Companies. began in the Supreme
Court Of the State suits against Mrshall BIks
and soe against John McIIarS Collectors of Internal
Revenue 20 recover In the aggregate $4,000 tax of
a per cent alleged TO nave beon Illegally tho
dividends and earnings as the companies for the last
five months OF 1870. Those suits removed ysser-
day by tho defendants to tho United states Circuit
Court where proceedings were begun de moro and where
rules entered requiring the defendants 10 answer
within 20 days. Tho following are the grounds upon
which the plaintiff, seek ID recover:
Section i22 OF tie act Of June 30, 1854. imposes
tax Of five per cent dgdrns declared. ana 0a ~.
dyIicd profits earned By corDoruOn" aal 'orporuOn
officers are required to make return. of an' 10 ts
collectors OF Internal Revenue. On jay IT, 1910. an acl
was passed. II section OF winch provides nat g
tOns 12) l2l Ia and 1913 of the act ~ jan. W ''
shall construed 10 impose the taxes therein mn
toned the 1st day Of August 7O bIt after tn' Has
ihose SECTIONS SECTION Is Of tie act ~ Jy Il, l51o
provides that there shan be levied and collected Tor
and during tue year 1871 tax OF = per cent On 40
amo mt interest Or coupons phb oi O'Dis OF v cF
evidences Of debt issued ana PAYABLE n one - more
years after date by any ~ the c"fpOao"S ID i ,vo,
ton hereinafter meDuoned. ana on thr amount "i AZ
dividends. earning income. or saIns renter 'Irtl
s1aU be PAYABLE, and on all nniiv ir1
Profits" The plaintiffs claim tbdt, un"cr o'cton
IL OF tho act Of July Is, 1870, there
was 10 be no tax upon Giyi lends after Aug L. 1870 All
that II any sucn tx go lcctabe lt nu : 0' Under
Section 10 OF nat act Iney also cl'I 'la' tno worms
hereinafter dccIted" are 70 be cOHSIeied !" c"Atc-
ton with the words in the beginning OF tc So LAX
tho tax should BE- for aud duilng the year I'I ah1
tnat wnen whole SECTION Is read toeetne' A. - eve
dent that Con|rcss Ohiy I.'enIed 10, T.''',s
for tax during 1871, aud also tnat J. va.
not intended 10 put di'idend' on Gu i'nt
basis from Interest, coupon, ana otA.r ..''sf
enumerated IN tho section ana Hh.ch, - - "I-Ir| =
were not things To be declLr d. Toe pl'iAiE 'ns
Their claim that ds the act pruYdtd ihit cjTPJi"o'
should make return 10 tue a,-r.-o, on Of 'ri'" 10
tenth day Uf he month following h1l !h wA.ch iIe VI
deud, were declared, and a. tu-r VAS -" power % .d'r
tbc act TO levy cOec- the taxes excepting hh Z
1871 it /, apparent that Congress dd not liehd tt
i.y sInu6 he levied upon IyIdeHd. G-c.drcd I4Vr To
tHdt year.
Following ia the position taken by the respondents
BY the use Of the words "Aercina.ter df' ar'n' ii
Section IS OF tho act, Congress made IL tt "u' Oh" 80"
ect tax Cf Il per cent upO1 al 1'l 'cu"' uI ~ -
ai'er the pass. 20 OF tue act " jay II, lsIJ
Merritt T.. sawyer tor too pliluIh - oII'cA o'a'''
DIstrIct-AttOrAey Bliss iOr tAe ucIeAdau'''