The Hawaiian gazette. [volume] (Honolulu [Oahu, Hawaii]) 1865-1918, 1897-02-16
IN UPPER COURT
Important Tax Suit De-
cided by Supreme Court.
Inker-Island S. n. Co. and o. r. &
L. Co. Have Cases Heard.
Sentence Day.


Company was decided by the Supreme
Court Saturday in favor of the assess
ment made by the Assessor. This case
directly involved the new tax law in an
important point, i. E.: The assessment
Of a corporation upon the market value
Of its stock. Regarded as separate
items, the total value of appellants
property of all descriptions was re-
turned at s269, 5000. But figuring the
market value of the stock as a part of
the base to work upon. the Assessor
found S471. 800 as his basis of assess
ment. The Court sustains this basis
as correct under the law.
In its decision the Court expresses
the opinion that the market value of
a corporations stock should not be ia
ken as "a sole or conclusive test of the
market value Of the property, but that
it is an important factor in determin-
ing such valuation
While the decision is very important,
it is the opinion among corporations
that other cases may arise under sim
liar issues It is pointed out that no
stock has a fixed market basis; and
prices paid for small blocks represent
a fictitious valuation and cannot be
used as a sole test or even compe-
tent basis. For instance, a few shares
of a certain sugar plantation has found
ready sale at $165 to S175. But a short
time ago a block of over 500 shares
tipped the maximum market at 1924.
Few corporations have the opportunity
Of testing, in this way, the real market
value of its stock, and stand liable to
assessment on the fictitious basis of
small sales.
In the case above cited, Messrs. Kin
ney & Ballou appeared for the appel
lants; Thurston & Stanley for Asses
soT Shaw.
James /. Dowsett and John K. Sum
ner vs.. Jonathan Shaw, Tax Assessor,
First Division, appeal from the Tax APP
peal Court, was also decided by the
Supreme Court Saturday morning, Car
ter, J., in place of Frear, J., disquali-
fed. This case is an appeal from the
Tax Court from the valuation of $751;
900 on the real estate of defendants
off the port of Honolulu An undivided
half interest in the estate reserves an
annual rental of $500. 1t was con-
tended that if half was worth $500
in rentals, the whole, or with the adj
ditional Unbiased half interest, would
be worth S11 900. Multiplying this as
sumed realization by eight, as by stat
ute provided, the Court declared the
valuation of the property to be sSS,OOO.
Appellants contention was that, as
only $500 was realized and no rent
ais had been received from the other
undivided half. the basis of valuation
should be $4,000. In its decision the
Supreme Court affrms the judgment
Of the Appeal Court, and fixes the val
uation for taxation purposes at SIS, 900.
Cecil Brown, for appellants; Thurston
& Stanley, for the Assessor.
The appeal of the Oahu Railway and
Land Company went against the Tax
Assessor. In condensing its findings
the Court said: "A Ieasehold may vary
in value from year to year. We might,
using our own judgment, and consid-
ering all the circumstances of this par
ticular case, put the valuation at va
rious amounts between that put by the
Assessor sos, 600 and that returned
by the taxpayer $4,000. But in view
OF the meager evidence before US, we
prefer not to make an arbitrary as
sessment which might be wide of the
mark, and We, finding the Assessors
method of calculating the value err
roneus, hold that the amount returned
by the taxpayer must stand. Cecil
Brown, for appellant; Thurston & Stan
ley. for the Assessor
The Supreme Court rendered a unan-
imOus opinion yesterday in the case of
James B. Castle. Collector General of
Customs, VS.. ia cases of crackers, 4S0
tins Of opium and cases containing
the same. consigned to the Washing
ton Feed Company, being an appeal
from the First Circuit Judge in Adj
miralty In the decision the appeal Of
claimant, the Washington Feed Com
pany. is dismissed, and the decree of
confscation is affirmed. The appeal
was on law points, and the claim was
set forth that only the cases of crack
ers in which the opium was found
should be confiscated, in addition to
the opium itself, which is by law con-
traband, and not the remainder Of the
invoice With regard to the contention
and pleadings made the Court says:
In an invoice Of ia cases of crack
ers, there were found eight cases con-
tanning opium, a drug which is pro-
hibited from importation by private
parties.
Held. that the said eight cases, with
all the merchandise named in the in
voice. was forfeited and confiscated to
the use of the Hawaiian Government
Held, also, that the innocence of the
importer did not prevent such impor-
tation
"Cleghorn. Coll. Gen1. of Customs
VS.. Opium Pills. S Haw. 461, affirmed. q"
". 0. Smith, for petitioner; Thurston
& Stanley. for respondents.
IATraTER-S pr AVFnRM