Richmond dispatch. [volume] (Richmond, Va.) 1884-1903, 1884-07-08
COUPON N-DEdLERS.
The Special Licensc.fnx ON Them Declared
Void by Judge Atkins.

case of Colonel Richard l.. Maury, attorney
at law. indicted In several cases for dealing
In coupons OF Virginia state bonds without
having obtained license so TO do, Judge
Atkins sustained the motion OF defendant
and quashed the indictments.
The law requires those who sell these
coupons to pay specific license OF $1,000,
and in addition thereto 90 percentum on
the face value Of the coupons.
The cases before the Court were the out
growth Of the proceedings in the Circuit
Court, where, with the consent OF the At
tOrney-General. Colonel Maury paid in
coupons the licenses OF large number OF
liquor-dealers OF this city.
In bis decision Judge Atkins said:
"The real question to be passed upon f..
whether or not the act under consideration
imposes a tax upon coupons II it does,
the act Is void as beng in conflict with the
provisions Of the Constitution forbiddng
the passage OF any law which mpairs the
obligation OF contracts. III, on the contra
ry. no burden is thereby put upon the cou-
p0ns, then the statute is valid, and must be
enforced"
A large number OF cases were here eX-
amined and quoted by the Judge Several OF
which are referred to below, and he con-
cuded a. follows:
With these cases in view. and governed
by the rule announced by the Court in the
case Of Henderson Us. Macon supra, "thdt
in whatever language a statute may be
framed It's purport aud its constitutional
validity must be determined by the uatural
and reasonable effect OF Its provisions" we
will now consider the statute upon which
the prosecution IN this case Is based.
The coupons which are the subject OF
taxation in this case iii the amount de-
manded Of the broker by this law is tax
upon them) are not only free from taxation,
like the imported goods and other things
referred 10 in the decisions | have read,
whose non-taXable quality ceases at n GER
tam point, but they are non-taxsble as long
~ they are in eXistcnce-their freedom
iro,n taxation passes with them from hand
TO hand and never ceases. Until they
are paid or received for taxes by the State
for their full amount they are cOu-
pons upon which no tax, direct or in
direct, can be imposed. In this respect
they differ from the other subjects | have
named, and in this only. The minute a
package OF goods is sold, as in the Brown
case. or the Cook case, the article loses its
exemption from taxation, but not so with
the coupon. II bOndholder cuts a
coupon from his bond and sells il TO a
broker or other person. .fhe exemption from
taxation follows the coupon aud never de-
scrts it while it is outstanding from the
public treasury. II Is, therefore, free from
taxation in the hands Of the holder, no
matter hO be may be-taX-payer or broker.
The act Under consideration in this case
provides that "nO person shall sell tax
receivable coupons (cut) from bonds Of the
State OF Virginia without u special license,
for which privilege he shall pay $1,000 for
each Office or place OF business kept for
that purpose"
When the contract between the State and
her creditors was entered into no such law
as that | have Just read was upon our
stalute-books. The buying and selling Of
coupons and like evidences OF debt was the
business OF Stock-broker. and any person
who engaged IN that business was a stock
broker, aud liable TO pay tie license-fee OF
$3.50. The fee or tax for carrying on the
business Of broker still remains the
same. and under that license the law says
pny person shall have the right TO buy nj
sell for profit, or to sell on commission or
for other compensation, Government stocks
or other certificates Of public debt. (See
Code Of 1878, chapter 81. section 43.) That
coupons ale embraced within this deScrip-
L
no doubt.
The law taxing stockholders was in eX-
istence when the contract between the State
and her creditors was made, and therefore
enters into and becomes part OF that con-
tract; hence no objection could be raised
by the coupon-holder to the tax upon
stock-brokers as dealers in coupons.
The tax or fee imposed by this statute is
a aol n
not authorize the sale OF anything else.
II Is exclusively for the sale OF coupons.
This law requires all persons who sell tax
receivable coupons to take out u Specid!
license, meaning thereby that no matter
whether any other license authorizes the
sale Of these certificates OF Indebtedness or
not, a special license must be obtained to
deal in these.
II. then, licensC-fee to carry on par
ticular business is a tax upon the articles
dealt in, the fee in his case would be tax
upon coupons, that being the only article
which can be sold under the license.
AZ indicated in the Brown case. persons
who engage in business and deal in taxa
bic articles are liable to pay such license
and other taxes as the State may deem bro
per TO exact, though they may be unjust,
excessive, and oppressive, because no con-
uitutional prohibition extends to it. But
where the article dealt in Is free from tax
alton the State cannot impose any tax or
fee for the privilege OF carrying on the
business, which would, in the nature OF
things. be a tax upon the article sold.
We have seen in the cases OF Brown Us.
Maryl Ward U.s. Maryland, and Walton
Us. Missouri that law requiring a license
for the privilege OF selling n non-taXable
Z l., iprr faxy
upOn the article. / say nOn-taXable arti-
Gle, because under the circumstances OF the
cases ! have named no tax could be imposed
upon the article. In the light OF these
cases, decided by the highest court in the
isnd, it appears that the license fee or tax
OF $1,000 required OF all persons who sell
tax-reccivabe coupons is tax upon the
coupons, and inasmuch as no tax can be
imposed upon them rs decided by the same
court in the case OF Hartman Us. Green
how, the law is clearly unconstitutional
and void.
deem il unnecessary TO do more than
merely mention the additional tax OF twenty
per centum imposed upon the face value OF
the coupons. II is too plainly uncoDstitu-
tional to require comment. The bank-tax
cases, the passenger cases, Henderson Us.
The Mayor, Crandeli Us. Nevada. aud Cook
Us. Penn, are almost directly in point, and
are conclusive Of the question raised.
| have examined the cases cited by the
attorney for the Commonwealth and can
find nothing in them in conflict with this
decision. The decisions referred to were
based upon other points than those upon
which this case rests.
II Is pretty certain that the Commonwealth
will anneol from thiS decision