Source: https://www.legalcrystal.com/case/94802/minnesota-vs-first-national-bank-st-paul
Timestamp: 2016-10-23 08:00:58
Document Index: 597308599

Matched Legal Cases: ['§ 5219', '§ 5219', '§ 5219', '§ 5219', '§ 2023', '§ 2316', '§ 2301', '§ 1980', '§ 5219', '§ 5219', '§ 5219', '§ 5219']

Minnesota Vs First National Bank of St Paul - Citation 94802 - Court Judgment | LegalCrystal
Save as PDF Add a Tag Add a Note Semantics Visualize Minnesota Vs. First National Bank of St. Paul - Court Judgment	LegalCrystal Citationlegalcrystal.com/94802CourtUS Supreme CourtDecided OnMar-21-1927Case Number273 U.S. 561AppellantMinnesotaRespondentFirst National Bank of St. PaulExcerpt:.....to the supreme court of the state of minnesota
1. the taxation of national bank shares, authorized by rev.stats. § 5219, is against the holders of the shares ,and is to be measured by the value of the shares, and not by the assets of the bank without deducting its liabilities. p.
273 u. s. 564
2. a tax on national bank shares at a greater rate than that imposed on competing credits in the hands of individuals cannot be sustained upon the ground that the discrimination is removed in practice by deducting liabilities of the bank from its assets in valuing its shares, while allowing no deduction of their liabilities to individuals in valuing their credits. p.
3. the shares of corporations employing capital in the note.....Judgment:
Minnesota v. First National Bank of St. Paul - 273 U.S. 561 (1927)
3. The shares of corporations employing capital in the note brokerage business or in buying and selling securities are "moneyed capital in the hands of individual citizens" (R.S. § 5219),
the individuals holding the shares. P.
273 U. S. 566
4. The competition guarded against by § 5219 may arise from the employment of capital invested in a business, even though the competition be with some but not all phases of the business of national banks, or it may arise from the employment of capital invested by institutions or individuals in particular operations or investments like those of national banks. P.
5. The evidence sustains a finding by the state court that moneyed capital in the hands of individuals was in competition with the business of national banks, including the plaintiff. P.
273 U. S. 567
6. Surplus capital of individuals seeking investment and reinvestment in bonds, mortgages, and other evidences of indebtedness in competition with the capital of national banks is moneyed capital coming into competition with the business of national banks within the meaning of Rev.Stats. § 5219. P.
273 U. S. 568
The questions raised are similar to those considered in
First National Bank of Hartford v. City of Hartford, ante,
, and may be disposed of by the application to the present facts of the principles there considered.
Under the Minnesota statutes, shares of national banks and the moneyed capital of banks or mortgage loan companies organized under the laws of the state are assessed and taxed at 40 percent of their full value in the district where located. Gen.Stat. 1923, § 2023; Laws 1921, c. 416. Money and credits are taxed at the rate of 3 mills on the dollar of their full cash value, and are exempt from all other taxation. Gen.Stat. 1913, § 2316; Laws of 1911, c. 285. Mortgages upon real estate and executory contracts for the sale of real estate are separately taxed at a lower rate, 15 cents per $100 where the period to run is for five years or less, and 25 cents per $100 on mortgages and contracts for a longer period. Gen.Stat. 1913, § 2301,
Laws 1921, c. 445. Money is defined as gold and silver coin, all forms of currency, and all deposits subject to withdrawal on demand. Credits include every demand for money or other valuable thing. Gen.Stat. 1923, § 1980; Laws 1917, c. 130. Under these statutes, money and credits, as defined, are taxed at the 3-mill rate and mortgages on real estate at a lesser rate.
higher than the prescribed tax of 3 mills per dollar of full valuation of money and credits, and therefore was discriminatory. Petitioner argues that, in its actual operation, the tax on national bank shares is no greater than the tax on credits, since, under the statute, individuals are taxed at the rate of 3 mills upon the full value of their credits, without deducting their liabilities, whereas, in taxing bank shares, the liabilities of the banks are deducted from their assets in ascertaining the 40 percent valuation of their shares. Therefore, it is urged, if bank shares were taxed at the same rate without deducting the bank's liabilities in ascertaining the value of their shares, the amount of the tax would be approximately the same. This argument ignores the fact that the tax authorized by § 5219 is against the holders of the bank shares, and is measured by the value of the shares, and not by the assets of the bank without deduction of its liabilities,
, and that the bank share tax must be compared with the tax assessed on competing moneyed capital of individuals invested in credits, or the tax on capital invested by individuals in the shares of corporations whose business competes with that of national banks,
121 U. S. 156
269 U. S. 348
. Thus compared, the actual tax imposed upon the shares of respondent, like the tax imposed upon credits in the hands of individuals, is assessed without deducting the liabilities of their individual owners, but at different rates. This discrimination is prohibited by § 5219, if moneyed capital in the hands of individuals in Minnesota is employed in substantial competition with national banks within the state.
or in any other business. But, as we have held in
First National Bank of Hartford v. City of Hartford,
the competition guarded against by § 5219 may arise either from the employment of capital invested in a business, even though the competition be with some, but not all, phases of the business of national banks, or it may arise from the employment of capital invested by institutions or individuals in particular operations or investments like those of national banks.
That capital of individuals thus seeking investment and reinvestment in competition with the capital in national banks is moneyed capital coming into competition with the business of national banks within the meaning of § 5219 is the effect of our decision in
First National Bank of Hartford v. City of Hartford, supra,
and other cases there considered.