Source: http://supreme.justia.com/cases/federal/us/296/497/case.html
Timestamp: 2013-05-21 08:09:23
Document Index: 174115187

Matched Legal Cases: ['§ 25', '§ 5219', '§ 5219', '§ 5219', '§ 5219', '§ 6', '§ 25', '§ 11', '§ 14', '§ 16', '§ 24', '§ 5202', '§ 25', '§ 25', '§ 25']

Posadas v. National City Bank - 296 U.S. 497 (1936) :: Justia US Supreme Court Center
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Case	U.S. Supreme CourtPosadas v. National City Bank, 296 U.S. 497 (1936)Posadas v. National City BankNo. 114Argued December 11, 12, 1935Decided January 6, 1936296 U.S. 497CERTIORARI TO THE SUPREME COURT
The National City Bank of New York is organized under the National Banking Act, as amended from time to time since its enactment. In 1930, the bank, after complying with the requirements of § 25 of the Federal Reserve Act of December 23, 1913, c. 6, 38 Stat. 251, 273, as amended September 7, 1916, c. 461, 39 Stat. 752, 755, Page 296 U. S. 499 infra, established branches at Manila and Cebu in the Philippine Islands. A tax was levied by and paid to the Philippine government on the net income of these branches for the first six months of the year 1931 (R.S. § 5219), [Footnote 1] about which there is no controversy. The Philippine Government, however, in addition, levied capital and deposit taxes not permitted by § 5219, and, these having been paid by the bank under protest, this action was brought in the Court of First Instance of Manila to recover the amount. That court gave judgment in favor of the bank for only a part of the additional taxes; but the Philippine Supreme Court, upon appeal, reversed the judgment insofar as it was against the bank, and ordered a refund of the entire amount.
Section 25 of the Federal Reserve Act of 1913, supra, reproduced in the margin so far as it is pertinent here, [Footnote 2] Page 296 U. S. 500 authorizes the establishment of branches of national banking associations "in foreign countries or dependencies of the United States." It cannot be doubted that, viewing this section without regard to later legislation, the branches here in question were lawfully established, for, as will appear at a later point in this opinion, the Philippine Islands are included by the words "dependencies of the United States." In that view of the matter, the additional taxes imposed by the Philippine Government are invalid under Domenech v. National City Bank, 294 U. S. 199, 294 U. S. 204; Talbott v. Silver Bow County, 139 U. S. 438, and, were it not for the asserted effect of legislation subsequent to the passage of the Federal Reserve Act in 1913, which we shall examine in a moment, this case would be disposed of without further detail upon the authority of those cases. In the Domenech case, we held that the national banking laws extended to Puerto Rico; that a tax on a branch of a national bank is a tax on the bank, and that Puerto Rico, being a dependency of the United States, could not, except as permitted by R.S. § 5219, tax a national bank, since it is an agency of the United States. The Talbott case involved the power of a territory to impose a tax upon a national bank. This Court held, in the first place, that the same power of taxation in respect of national banks exists in the territories as in the states, and, in the second place, that this power of taxation in the territories was limited by the provisions of § 5219, although, in terms, that section refers only to the states. 294 U.S. 294 U. S. 204. We find nothing in the original Organic Act or in any of the early statutes relating to the Philippines referred to by petitioner which take those islands out of the controlling rule of the Domenech case that a "dependency may not tax its sovereign," and we come to the only remaining point which we deem it necessary to discuss. Page 296 U. S. 501
By §§ 6 and 31, it is clear that § 25 of the Federal Reserve Act of 1913, not being in conflict with any provision of the Organic Act of 1916, was continued in full force and effect. Page 296 U. S. 502
September 7, 1916, nine days after the passage of the new Organic Act, the act to amend the Federal Reserve Act, supra, was passed. It first is to be observed in respect of this amending act that it does not purport to enact a substitute for the Federal Reserve Act, or to repeal and reenact any portion, but only to amend certain specific sections thereof. The old act contains thirty sections. The Act of September 7, 1916, amends §§ 11, 13, subsection (e) of § 14, the second paragraph of § 16, §§ 24 and 25 of Federal Reserve Act, and § 5202 of the Revised Statutes. The introductory words as to § 25 are: "That section twenty-five be, and is hereby, amended to read as follows." The original section is then copied, the only change or addition so far as the question here is concerned being the insertion of the words "or insular possessions" after the word "dependencies." No reason appears from anything called to our attention, and we are not ourselves aware of any reason, for the addition of these words, since the comprehensive term "dependencies" would seem to include all insular possessions which we then had. But, in any event, the Philippine Islands constituted a dependency, for they were not possessions merely, but possession held by right of cession from Spain, and over which the United States undoubtedly had supreme power of legislation and government. See United States v. The Nancy, 3 Wash.C.C. 281, 286 et seq. Compare 34 Op.Attys.Gen. 287, 291. The only substantial change made in the old § 25 is the addition of a provision authorizing a national banking association to invest in the stock of other banks and corporations chartered or incorporated under the laws of the United States or of any state engaged in international or foreign banking, or banking in dependencies or insular possessions of the United States, and it is fairly plain that this addition constituted the sole reason for amending the section. Page 296 U. S. 503
It was not meant by this statement to say, as a casual reading of it might suggest, that the mere fact that the latter act covers the whole subject and embraces new Page 296 U. S. 504 provisions demonstrates an intention completely to substitute the latter act for the first. This is made apparent by the decision in Henderson's Tobacco, 11 Wall. 652, 78 U. S. 657, at the same term, where, in an opinion delivered by Mr. Justice Strong, it is said,
The question whether a statute is repealed by a later one containing no repealing clause, on the ground of repugnancy or substitution, is a question of legislative intent to be ascertained by the application of the accepted rules for ascertaining that intention. United States v. Claflin, 97 U. S. 546, 97 U. S. 551; Eastern Extension Tel. Co. v. United States, 231 U. S. 326, 231 U. S. 332. Page 296 U. S. 505 And, even in the face of a repealing clause, circumstances may justify the conclusion that a later act repeating provisions of an earlier one is a continuation, rather than an abrogation and reenactment, of the earlier act. Bear Lake Irrigation Co. v. Garland, 164 U. S. 1, 164 U. S. 11-13.
Applying the rule established by the foregoing and other authorities, we see nothing in the terms of the Federal Reserve Amending Act, in the provisions of the new Organic Act, or in the history of Philippine legislation which justifies the conclusion that, by the amendment of 1916, Congress intended to repeal the old § 25 of the Federal Reserve Act. The amendment is made in a well approved form -- a form which, indeed, many of the states compel by constitutional provision -- namely, by repeating the language of the original section with the additions to which we have heretofore called attention. Unless the contrary plainly appear, the employment of such form of amendment is simply to serve the causes of convenience Page 296 U. S. 506 and certainty. That is to say, by carrying the full text forward, the task of searching out and bringing together the various fragments which go to make up the completed whole, after specific eliminations or additions by amendment, is rendered unnecessary, and possible doubt as to the precise terms of the law as amended is avoided. Or, as Chief Judge Denio said in Ely and Others v. Holton, supra: