Court Opinion

ID: 7166488
Source: CourtListenerOpinion
Date Created: 2022-07-24 16:21:41.537667+00
Date Added: 2024-06-11T16:15:34.067666
License: Public Domain

On Rehearing.
LAND, J.
The plaintiff company has been doing a life insurance business in the state of Louisiana for several years through its duly authorized agents, collecting annual premiums to the amount of some $60,000 or $70,000, and lending money to its policy holders on the pledge of their respective policies.
The argument that such loans were mere advances out of funds belonging to the policy holders is certainly not serious. The written contracts evidence loans on interest secured by a pledge of the policies, and the petition alleges that the plaintiff company was illegally taxed on “loans made to policy holders.”
That, under section 7 of Act No. 170, p. 350, of 1898, such credits arising out of the business transacted in this state are taxable, cannot be seriously disputed. See Metropolitan Life Insurance Company v. New Orleans, 205 U. S. 395, 27 Sup. Ct. 499, 51 L. Ed. 853. The distinction between taxing the average capital invested by a nonresident in business carried on in a particular state and the taxation of isolated credits due to nonresidents is obvious. The purpose of the section quoted is to place the resident and nonresident business concern on the same plane of equality. Section 7 of Act No. 170 of 1898 operated full notice to foreign corporations that if they engaged in business in the state of Louisiana they would be taxed in the same manner as similar local corporations.
The only issue raised by the pleadings is whether the plaintiff company is taxable on credits arising out of its business and representing capital invested in this state.
The proposed constitutional amendment of 1908 exempting loans on life policies from taxation reotogtiizes their taxability under the provisions of the Constitution of 1898.
Act No. 170 of 1908, making mortgage paper and other evidence of indebtedness taxable only at the domicile of the holder or owner thereof, has no retrospective operation.
Rehearing refused.