Montgomery County sentinel. [volume] (Rockville, Md.) 1855-1974, 1878-03-01
State VS.. Baltimore and Ohio Railroad

In the Court of Appeals, on Friday last a
decision was rendered in the gross receipts tax
case Of the State vs.. the Baltimore and Ohio
Railroad Company. The opinion of the Court
was delivered by Judge Robinson, Chief Judge
Bartol and Judges Miller, Brent and Grason
concurring. Judges Alvey, Bowie and Stew
art dissented. The points of the decision
may be summarized rs follows:
/. After referring to the express exemption
OF the shares OF capital stock of the company
from the imposition Of any tax or burthen,
granted by the eighteenth section of the com
pany's charter, TACT of 1926, the court re-
affirm the decision OF Judge Dorsey, in 6 Gils
reports, that the exemption of the stock is an
exemption OF the property which is represented
by the stock. The court say ''rhis decision
was made in case in which the Baltimore
and Ohio Railroad Company was party, and
upon the very section of its charter now un-
der consideration. From that time to the
present, period of thirty years, it has been
the accepted law of the State and upon the
faith OF il millions of dollars have been in
vested in the property of the company. Every
consideration, therefore. OF public policy and
Of private right demands that the decision of
the court then submitted shall be deemed final
and conclusive"
Q Having thus reaffirmed the decision of the
court in 9th Gill, that the property and stock
of the company are exempt from taxation, the
court next proceed to consider whe her the
exemption covers the franchises of the road
The court say Considering the question as
one Of first impression, we are of opinion that
the 18th section exempts the property and
franchises from taxation. II the franchises
are exempt, II would necessarily follow that
the gross receipts derived from the exercise Of
its franchises are also exempt"
3. The court dismisses the suggestion that
inasmuch as the company was required to
complete the road TO the Ohio river by 1853,
and oae track was completed by that time, the
exemption must be limited TO the franchises
necessary to operate that one track and to The
property owned by the company at that time,
as "a narrow construction, which There is
nothing to justify in the spirit or letter of the
charter" Therefore, p" say the court, 1--WE
are OF opinion that the gross receipts Of the
appellee's entire road, from Baltimore TO the
Ohio river, and the gross receipts derived from
all lateral roads built by the appellee, and from
all buildings and works necessary and expedi-
ent to the operation Of its road, are exempt
from the imposition of anv tax or burthen"
This is without reference 10 whether such
roads, buildings, Be-, were bull: from money
derived from the subscription to The com
panys stock, or loans, or from the undistri-
buted profits Of the company.
4. AS TO what buildings and works are
necessary and expedient" TO the operation of
the company's road was to be embraced in the
exemption, the court say that this is no die
tionary question, and that it is clear that the
Legislature meant to exempt such buildings
and works as was reasonably convenient snd
appropriate to the maintenance and operation
of the road
The elevators, wharves, piers, and docks OF
the company are, therefore, exempt, so far as
they are necessary for the business of the
company as common carrier So far as they
are used by the company in the general and
ordinary business OF UarehouSenaan they are
taxable according to valuation as real prop
erty, unless by act of 1881 the company is an
thorized to carry on such business. 10 that
event only the gross receipts are taxable under
the act of 1872.
6. Hotels and buildings necessary to the
company's business for the accommodation of
passengers over its road are taxable The
Viaduct and Cumberland hotels are declared
thus to be exempt The Deer Park and Oak
land hotels, not being necessary in the same
sense, but simply places OF summer resort, are
taxable as other real property.
Z. The gross receipts of the Metropolitan
Branch are taxable, said road not having been
huilt under the original power given by the
charter to build lateral roads" hut under a
separate and special act, TACT of 1865 which
contains no exemption from taxation.
8. The receipts or dividends derived by the
company from investments in steamboat or
steamship lines are taxable as gross receipts
The power to acquire and hold such property
is given not by the original charter, but by
the act Of 1861 chapter All.
8. The interest derived from bonds, and gen.
orally from anv properties and investments
held aud owned under franchises granted sub
seqnent to the charter, is taxable as gross re-
ceipts. IL held outside of any franchise, such
property is taxable according to its value.
10. The tax is imposed only on such gross
receipts as are earned in this Stale.
Such are the points of the decision of the
Court of Appeals, under which the case is re-
manded to the lower court for retrial. -Balto
Sun.