Court Opinion

ID: 6244408
Source: CourtListenerOpinion
Date Created: 2022-02-17 20:54:14.336752+00
Date Added: 2024-06-11T08:59:15.141648
License: Public Domain

Opinion by
Mr. Justice Fell,
There were no sales of the stock of the appellant company during the tax year 1895. Its treasurer appraised its shares at $25.00 each, and its total capital stock at $75,000. The facts upon which the auditor general and state treasurer base their appraisement of $250,000 are these: The company has a paid-up capital of $300,000, and a surplus of $17,480. During the tax year its gross earnings were $344,537.88, and its net earnings *354$50,475.97, and after the payment of dividends it added to its sinking fund $25,150. The only ground upon which it is possible to base an objection to the approval by the court of this appraisement is that the company owned no land and that the lease of certain anthracite coal lands upon which it had been engaged in mining coal would expire June 30, 1897, and according to the statement of the treasurer it was uncertain whether the lease could be renewed or a new one made upon terms which would warrant the company in continuing its operations.
This fact should of course be taken into consideration in appraising the capital stock, and it was considered, and full allowance for the uncertainty made. The company for the year earned over sixteen per cent, and its shares were assessed at only five sixths of their par value. It is true that in such a case as this an appraisement should not be based upon the earnings for any one year, and that there can be no fixed and certain standard. Large earnings in coal mining, as was said by the present Chief Justice in Commonwealth v. Edgerton Coal Co., 164 Pa. 284, may indicate large exhaustion of the coal, and consequent impairment of the capital, and “ to arrive at the actual value, possibilities and probabilities as well as things certain are properly considered.” A failure to secure a renewal of the lease would not necessarily or even probably end the business operations of the company, and the value of its capital stock did not depend entirely upon its ability to continue the lease of a particular mine. In making the appraisement full weight, we think, was given to the mere suggestions, unsupported by further proof, of the uncertainty of renewal.
The judgment is affirmed.