The Birmingham age-herald., 1922-04-16
SUPREME COURT TIS
 COMMENDED ON ITS
 TAX LAW DECISION
Justices Hold Federal Land Bank Must Pay Fee For Re- cording of Mortgages.
 ChaSSeII Comments
By FRED II. GoRMLEY Montgomery Bureau. The Age Herald. 22l-2 First National Bank Buildlng

Montgomery, April 15.-(Special.)- Alabama's supreme court was com mended for i.s ability by Secretary Chassell of the Farm Mortgage Bank CTS association in statement re- garding the courts decision recently which held that the federal land bank of New Orleans must pay the Ala bama fee for recording mortgages submitted for record by the bank. The statement of Secretary Chassell which wsa published in the financial sec ton of the New York Times referred particularly to the opinion of Chief Justice John c. Anderson of the Ala bama supreme court which was adopted by the court.
 Although deploring the necessity for the decision, Secretary Chassell said it was in line with many deci- sions of the supreme court of the United States supreme court and probably would mean that other states of the nation would impose a recording fee or privilege licenses on such instruments when filed for record. Mir. Chassell expressed the fear that the decision will retard the development of farm loan banks.
 Mir. Chassells statement deploring the decision but announcing that the supreme court of Alabama has a high reputation for ability and that the decision will stand, follows:
 The supreme court sustains the new Alabama law requiring the pay ment of IS cents for $100 on all mort gages recorded. The federal land bank of New Orleans several months ago refused to pay the recording tax on the ground that it's mortgages were exempt from taxation under fed eral statute, when Probate Judge Crosland of Montgomery county de- manded the fee. After several months of litigation the supreme court de- cidcd the test case in favor of the state and the federal land bank is directed to pay the fees.
 Is Privilege Tax
 The court holds that the tax Is not an ad valorem tax but privilege tax. There Is no law requiring the land banks to record their mortgages. The state of Alabama affords an op- portunity for recording and 1t i'm poses tax for the privilege and pro- tection thus furnished to parties owning mortgages. The law is uni form in it's application. The law im- poses no tax on the mortgage unless the holder exercises his option to have 1t recorded. Payment for this privilege must be made as provided by the state law.
 "The supreme court of Alabama has a high reputation for ability. The decision written by Chief Justice An derson is conclusive and in harmony with long line of decisions of the United States supreme court. In all probability the Alabama decision will be affirmed at Washington.
 Minnesota and several other states have recording tax laws. but in none except Alabama has the right of exemption ben tested in the courts. The legislature of over 40 states con vene in the coming year. In all pro- bability every one of them will enact recording laws similar to that of Alabama.
 The most important immediate effect of the Alabama decision will be to discourage the organization of more joint stock land banks. Conser- vativeN capitalists will hesitate after reviewing the decision in the test case"
 The schedule of the state revenue law which imposes the license tax for the recording of mortgages re- quires the lender to pay the tax but 1t has been the policy of many lenders of money on long time mortgages to require the borrower to pay the recording fee in additional to the in- terest and the fee for the prepara- tion of abstract of title.