Court Opinion

ID: 9636489
Source: CourtListenerOpinion
Date Created: 2023-08-22 14:30:58.235992+00
Date Added: 2024-06-11T12:15:39.027220
License: Public Domain

L. HAND, Circuit Judge
(concurring). Although the Supreme Court of Indiana has not passed upon the question, I think that a personal liability was imposed upon Breed before his death, which was after March 1st. That is the date when the tax is imposed, and when the lien attaches to any property within the state. It can hardly be that the lien arises before the liability, and the assessment may be, and in my judgment should be, considered as no more than a liquidation of a liability already existing. Nor does the actual location of the property taxed affect the validity of this tax, which was personal. As to shares in corporations, there has, I think, never been any doubt, and negotiable bonds are now to be considered in the same class. Blodgett v. Silberman, 277 U. S. 1, 48 S. Ct. 410, 72 L. Ed. 749. Had any of the property consisted of chattels, coin, or bank notes, situated outside Indiana, another question would have arisen, but this was not the case. Hence it seems to me that the liability was valid; it is not even argued that, if so, it did not survive.
We must therefore decide whether a tax lawfully imposed in a foreign state can bo collected by suit in a federal court sitting in another state. Our jurisdiction is in this respect no different from that of a court of the State of New York; the law to be administered is certainly not the law of Indiana, whether it be the law of New York, or whether in such cases there is a common law independent of the laws of any State. Generally it is, of course, true that a liability arising under the law of a foreign state will be recognized by the courts of another, and it is not here relevant whether foreign liability is enforced, or another, precisely similar, raised by the law of the forum. A recognized exception is in the case of criminal and penal liabilities. The Antelope, 10 Wheat. 66, 123, 6 L. Ed. 268; Wisconsin v. Pelican Ins. Co., 127 U. S. 265, 8 S. Ct. 1370, 32 L. Ed. 239; Huntington v. Attrill, 146 U. 8. 657, 13 S. Ct. 224, 36 L. Ed. 1123; Huntington v. Attrill, [1893] A. C. 150; Arkansas v. Bowen, 3 App. D. C. 537; Dicey, Conflict of Laws, rule 54. In some few cases, this exception has been extended to include revenue laws as well. Colorado v. Harbeck, 232 N. Y. 71, 133 N. E. 357; Municipal Council of *604Sydney v. Bull, [1909] 1 K. B.7; Gulledge Bros. Lumber Co. v. Wenatchee Land Co., 122 Minn. 266, 142 N. W. 305, 46 L. R. A. (N. S.) 697; Canada v. Schulze, 9 Scotch L. T. 4. But so far as I can find the point has never been passed on by a federal court.
While the origin of the exception in the ease of penal liabilities does not appear in the books, a sound basis for it exists, in my judgment, which includes liabilities for taxes as well. Even in the ease of ordinary municipal liabilities, a court will not recognize those arising in a foreign state, if they run counter to the “settled public policy” of its own. Thus a scrutiny of the liability is necessarily always in reserve, and the possibility that it will be found not to accord with the policy of the domestic state. This is not a troublesome or delicate inquiry when the question arises between private persons, but it takes on quite another face when it concerns the relations between the foreign state and its own citizens or even those who may be temporarily within its borders. To pass upon the provisions for the public order of another state is, or at any rate should be, beyond the powers of a court; it involves the relations between the states themselves, with which courts are incompetent to deal, and which are intrusted to other authorities. It may commit the domestic state to a position which .would seriously embarrass its neighbor. Revenue laws fall within the same reasoning; they affect a state in matters as vital to its existence as its criminal laws. No court ought-to undertake an inquiry which it cannot prosecute without determining whether those laws are consonant with its own notions of what is proper.
Eor these reasons I concur.