Source: https://www.legalcrystal.com/case/97139/city-new-york-vs-feiring
Timestamp: 2018-02-18 18:42:40
Document Index: 170307604

Matched Legal Cases: ['§ 64', '§ 64', '§ 64', '§ 64', '§ 64', '§ 64', '§ 64', '§ 64', '§ 64']

City of New York Vs Feiring - Citation 97139 - Court Judgment | LegalCrystal
City of New York Vs. Feiring - Court Judgment
LegalCrystal Citation legalcrystal.com/97139
Case Number 313 U.S. 283
Respondent Feiring
.....are such as to constitute a tax within the meaning of § 64. 3. the tax imposed by the new york city sales tax law is a tax on the seller within the meaning of § 64 of the bankruptcy act, as well as on the buyer, since both are made liable for payment in invitum and subject to distraint of their property for its collection. p. 313 u. s. 287 . it is not any the less a tax laid on the seller because the statute places a like burden in the alternative on the purchaser, or because it affords to the seller facilities, of which he did not avail himself, to pass the tax on to the buyer. 118 f.2d 329 reversed. certiorari, post, p. 552, to review the affirmance of an order of the district court refusing priority of payment to a tax claim asserted by the.....
City of New York v. Feiring - 313 U.S. 283 (1941)
U.S. Supreme Court City of New York v. Feiring, 313 U.S. 283 (1941)
1. The question whether an obligation to a State is a tax entitled to priority under § 64 of the Bankruptcy Act is a federal question. P. 313 U. S. 285 .
2. The Bankruptcy Act is of nationwide application, and § 64 thereof is not to be construed or varied by the particular characterization by local law of the state's demand. P. 313 U. S. 285 .
3. The tax imposed by the New York City Sales Tax Law is a tax on the seller within the meaning of § 64 of the Bankruptcy Act, as well as on the buyer, since both are made liable for payment in invitum and subject to distraint of their property for its collection. P. 313 U. S. 287 .
Section 64 of the Bankruptcy Act, as amended June 22, 1938, 52 Stat. 840, 874, awards priority of payment in bankruptcy to "taxes legally due and owing by the bankrupt to the United States or any State or any subdivision thereof. . . ." Whether the present obligation is a "tax" entitled to priority within the meaning of the statute is a federal question. New Jersey v. Anderson, 203 U. S. 483 , 203 U. S. 491 ; cf. Burnet v. Harmel, 287 U. S. 103 , 287 U. S. 110 ; Palmer v. Bender, 287 U. S. 551 , 287 U. S. 555 ; cf. United States v. Pelzer, 312 U. S. 399 . Intended to be nationwide in its application, nothing in the language of § 64 or its legislative history suggests that its incidence is to be controlled or varied by the particular characterization by local law of the state's demand. Hence, we look to the terms and purposes of the Bankruptcy Act as establishing the criteria upon the basis of which the priority is to be allowed.
As was pointed out in New Jersey v. Anderson, supra, 203 U. S. 491 , the priority commanded by § 64 extends to those pecuniary burdens laid upon individuals or their property, regardless of their consent, for the purpose of defraying the expenses of government or of undertakings authorized by it. The particular demand for which the City now claims priority of payment as a tax is created and defined by state enactment. We turn to its provisions, and to the decisions of the state courts in interpreting them, not to learn whether they have denominated the obligation a "tax," but to ascertain whether its incidents are such as to constitute a tax within the meaning of § 64. Cf. Morgan v. Commissioner, 309 U. S. 78 , 309 U. S. 80 -81, and cases cited; United States v. Pelzer, supra; Ryerson v. United States, 312 U. S. 405 .
The present exaction is that which was considered, and its constitutionality sustained, in McGoldrick v. Berwind-White Co., 309 U. S. 33 . The discussion of it there will be supplemented here only so far as is needful for the
The statute thus contains provisions which, in its normal operation, are calculated to enable the seller to shift the tax burden to the purchaser, see Matter of Kesbec, Inc. v. McGoldrick, supra, 278 N.Y. 297, 16 N.E.2d 288; Merchants Refrigeration Corp. v. Taylor, 275 N.Y. 113, 124, 9 N.E.2d 799; cf. McGoldrick v. Berwind-White Co., supra, 309 U. S. 44 . But it is plain that both the vendor and the vendee are made liable for payment of the tax in invitum, without regard to those provisions by which the seller may shift the incidence of the tax to the buyer and the tax may be summarily collected by distraint of the property of either the seller or the buyer. A pecuniary burden so laid upon the bankrupt seller for the support of government, and without his consent, thus has all the characteristics of a tax entitled to priority of payment in bankruptcy within the meaning of § 64 of the Bankruptcy Act. New Jersey v. Anderson, supra. Cf. United States v. Updike, 281 U. S. 489 , 281 U. S. 494 . It is not any the less a tax laid on the seller because the statute places a like burden in the alternative on the purchaser, or because it affords to the seller facilities, of which he did not avail himself, to pass
the tax on to the buyer. While an action in debt may be resorted to for the recovery of a tax, it is evident that, in this case, the bankrupt is liable to the state only because it owes a tax. Price v. United States, 269 U. S. 492 , 269 U. S. 500 ; Milwaukee County v. White Co., 296 U. S. 268 , 296 U. S. 271 .