Court Opinion

ID: 9418684
Source: CourtListenerOpinion
Date Created: 2023-08-02 22:35:29.827582+00
Date Added: 2024-06-11T17:22:07.859104
License: Public Domain

*95Concurring opinion of
Mr. Justice Stone.
I concur in the result. It is enough to support it'that, as stipulated in the record, the Virginia assessment was levied against a trustee domiciled in Maryland upon' securities held by it in trust in its exclusive possession and control there, and so is forbidden as an attempt to tax property without the jurisdiction. Brooke v. Norfolk, 277 U. S. 27. But the question whether the Fourteenth Amendment forbids a tax on the beneficiaries, in Virginia, where they are domiciled, measured by their equitable interests, seems to me not to be presented by the record and so, under the settled rule of decision of this Court, ought not now to be decided. Burton v. United States, 196 U. S. 283, 296; Blair v. United States, 250 U. S. 273, 279; Flint v. Stone Tracy Co., 220 U. S. 107; Light v. United States, 220 U. S. 523, 538.
No attempt was made by Virginia to tax the equitable interests of the beneficiaries of the trust. That the thing taxed or the measure of the tax is different from the equitable interests of the beneficiaries, as affected by the specified contingencies, sufficiently appears from the fact that the one may well have been of different value than the other. In fact, the securities seem to have been assessed at their full value although the equitable interests of the beneficiaries are less than the whole.
It may be that Virginia, following its own view of the nature of vested and contingent interests, might tax the interests of these beneficiaries as though they were the whole, but it is sufficient for present purposes that it has not assumed to do so. In the face of the present record we are not required to speculate how far a tax, forbidden because assessed upon property beyond ..the jurisdiction, may be upheld because it may be passed on to the bene*96ficiaries in Virginia and the equitable interests thus reached by indirection.
If the question were here I should not be prepared to go so far as to say that the equitable rights in personam of the beneficiaries of the trust might not have been taxed at the place of their domicile quite as much as a debt secured by a mortgage on land in another jurisdiction, notwithstanding the fact that the land is also taxed at its situs. See Union Refrigerator Transit Co. v. Kentucky, 199 U. S. 194, 205; Bristol v. Washington County, 177 U. S. 133; Kirtland v. Hotchkiss, 100 U. S. 491; Savings Society v. Multnomah County, 169 U. S. 421, 431. In neither case, if the threat of double taxation were controlling, which under the decisions it is not, Fidelity & Columbia Tr. Co. v. Louisville, 245 U. S. 54, 58; Cream of Wheat Co. v. Grand Forks Co., 253 U. S. 325, 330; Citizens Nat’l Bank v. Durr, 257 U. S. 99, 109; cf. Swiss Oil Corporation v. Shanks, 273 U. S. 407, 413, would it seem that in any real sense is there double taxation, since the legal interests protected and taxed by the two taxing jurisdictions are different.
Me. Justice Brandéis concurs in this opinion.
Me. Justice Holmes:
The Special Court of Appeals was plainly right in holding that the deed of trust conferred an absolute gift upon the two beneficiaries, perhaps, though I doubt it, subject to be divested upon a condition subsequent. Gray, Perpetuities, 1st ed., § 108. If the beneficiaries could be taxed at all they could be taxed for the whole value of the property, because the whole title was in them, even if liable to be divested at some-future time in a not very' probable event.
I am of opinion that on principle they can be taxed. In the first place I do not think that it matters that the owners, residing in Virginia, have only an equitable title. To be sure the trustee having the legal title and posses*97sion of the bonds in Maryland may be taxed there. But that does not affect the right of Virginia by reason of anything that I know of in the Constitution of the United States. Bonaparte v. Tax Court, 104 U. S. 592. Kidd v. Alabama, 188 U. S. 730, 732, 733. Hawley v. Malden, 232 U. S. 1, 13. Cream of Wheat Co. v. Grand Forks, 253 U. S. 325, 330. Citizens National Bank v. Durr, 257 U. S. 99, 109. Blodgett v. Silberman, 277 U. S. 1, 10. Compare with the last case Wheeler v. Sohmer, 233 U. S. 434.
I see no other fact to cut down Virginia’s power. It is true that the conception of domicil has been applied to tangible personal property and it now is established that a State cannot tax the owner of such property if it is permanently situated in another State. But hitherto the decisions have been confined to tangibles that in a plain and obvious way owed their protection to another power. Union Refrigerator Transit Co. v. Kentucky, 199 U. S. 194, 206. It seemed to me going pretty far to discover even that limitation in the Fourteenth Amendment. It opens vistas to extend the restriction to stocks and bonds in a way that I cannot reconcile with Blodgett v. Silberman, 277 U. S. 1. Taxes generally are imposed upon persons, for the general advantages of living within the jurisdiction, not .upon property, although generally measured more or less by reference to the riches of the person taxed, on grounds not of fiction but of fact. Fidelity & Columbia Trust Co. v. Louisville, 245 U. S. 54, 58. Kirtland v. Hotchkiss, 100 U. S. 491, 498. The notion that the property must be within the jurisdiction puts the emphasis on the wrong thing. The owner may be taxed for it although it never has been within the State. Southern Pacific Co. v. Kentucky, 222 U. S. 63. It seems to me going still further astray to rely upon the situs of the debt. A debt is a legal relation between two parties and, if we think of facts, is situated at least as much with the debtor against whom the obligation must be enforced as it is with the creditor, To say tha: a debt *98has a situs with the creditor is merely to clothe a foregone conclusion with a fiction. The place of the property is not material except where inability to protect carries with it inability to tax. But that is an exceptional consequence. One State may tax the owner of bonds of another State, although it certainly contributes, nothing to their validity. Bonaparte v. Tax Court, 104 U. S. 592. It is admitted that Maryland could tax the trustee in this case although most ,at least of the securities handed over were beyond the power of Maryland to affect in any substantial way. The equitable owners of the fund were in Virginia and I think they could be taxed for it there. I do not understand that any merely technical question is raised on the naming of the trustee instead of the cestuis que trustent as the party taxed. Nor is there any question of the amount. Throughout the record, by the Court and by the trustee, the single issue is stated to be whether the fund'can be reached. In the words of the trustee it is: “Has such corpüs, so created and held, a taxable situs in Virginia within the sanction of section one of the 14th Amendment to the Constitution of the United States?” I think the judgment should be affirmed.