The Saint Paul globe. (St. Paul, Minn.) 1896-1905, 1901-11-23
UNITED STATES COURT DECIDES
AGAINST CHICAGO TRACTION
COMPANIES
EQUALIZATION BOARD UPHELD
Decision Holds That, While stock
Market Values Are Not to Gov
ern, They May Be Taken
Into Consideration.
$4,000 900 ADDED TO ROLLS

SPRINGFIELD, ILL.,, Nov. 22.-The ap-
plcation of the Chicago Union Traction
company and the Consolidated Traction
company for an injunction restraining
the board of equalization from assessing
the capital stock of those companies for
1860 was denied by Judges Grosscup and
Humphrey, in the United States circuit
court. The temporary Injunction issued
by Judge Grosscup in Chicago on Tues
day was dissolved.
No written opinion in the case was
fled Judge Grosscup stated orally at
length the reasons for the decisions, eX-
planning that later Judge Humphrey
would file written opinion. The law OF
Illinois, Judge Grosscup said, had erect
ed certain machinery for the administra-
tion of the taxing power. The initial ma
chinery was found in the local assessor.
The duty of the state board of equaliza-
tion, generally speaking, is to equalize
the assessment with respect to the whole
state. This board possesses the final re-
viewing power. 1t is in the highest de-
gree one of the tribunals of the state.
and is meant to be an independent
tribunal ut has no more right, said
he, ito depart from the exercise of It's
own judgment than a court Of law or
equity has right to depart from It's
conscience
The method to be followed in determin-
ing the value of capital stock for pur-
poses of taxation was discussed by Judge
Grosscup at length. AS to bonds, he
said, the judgment of the money lender
might be reasonably safe, but with capi-
tai stock it was different. 1t would be
grossly unfair to base the assessment
upon the stock value quoted on the stock
exchange These were frequently, if not
ton
quite distinct from the real value of the
stocks in question.
Stock Market Values Not Good.
He cited as an illustration the North
ren Pacific furry of few months ago.
Then nobody would contend that the
real value Of the stock exceeded par, yet
the quoted price reached $1,000. 1t was
the decision of the supreme court OF
Illinois in the franchise tax case recently
decided, he said, that these prices mere
ly must be taken into consideration.
It still remained for the equalization
board to exercise it's judgment in de-
termining the real value OF capital stock
for purpose of taxation.
Concerning the Union Traction COM
pany, Judge Grosseup said that its fail
ure to introduce in the litigation in the
state court evidence respecting the real
value Of its stock had not been explain
ed. ''The probability is" said he, that
the Union Trac.lon company knew that
1t had been escaping taxation, and be-
lieved it could continue to escape, and
that 1t chose not to make public the real
intrinsic facts upon which a fair vaIua-
ton Of its stocks could have been ar
rived at
1--WE believe, and are bound to believe,
that the board will exercise its func-
: ton as contemplated by the law. If it
transpires that the board of equalization,
through piQue or under the lash and
spur of some power, or through person
al fears, or moved by any other con-
sideration than the impartial and inde-
pendent discharge of its own duty, at
tempts to certify an assessed valuation
that in It's effect would be fraud upon
any taxpayer, the courts still remain open
to the injured taxpayer. This we wdll
assume until the contrary appears
Immediately after the decision was
announced assessments aggregating $75,-
OOO,000 and involving over 81 100000 in
1900 taxes, were made by the state board
of equalization as the fair cash value
of the capital stock of the traction COM
panies, over and above the assessment
on their tangible property. The $4,000
000 valuations made take the place OF
S3,500,000 valuations made last year as
representing the fair cash value of the
property assessed. The Teachers fed
Grafton estimate was SIZE. ,OOO