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lines everywhere, deducting a sum equal to the value of its real estate and machinery subject to local taxation within the state. Doubtless there is a distinction between the property of railroad and telegraph companies and that of express companies. The physical unity existing in the former is lacking in the latter; but there is the same unity in the use of the entire property for the specific purpose, and there are the same elements of value arising from such use. The cars of the Pullman Company did not constitute a physical unity, and their value as separate cars did not bear a direct relation to the valuation which was sustained in that case. The cars were moved by railway carriers under contract, and the taxation of the corporation in Pennsylvania was sustained on the theory that the whole property of the company might be regarded as a unit plant, with a unit value, a proportionate part of which value might be reached by the state authorities on the basis indicated. No more reason is perceived for limiting the valuation of the property of express companies to horses, wagons, and furniture, than that of railroad, telegraph, and sleeping-car companies, to roadbed, rails, and ties, poles and wires, or cars.

The unit is a unit of use and management, and the horses, wagons, safes, pouches, and furniture, the contracts for transportation facilities, the capital necessary to carry on the business—whether represented in tangible or intangible property--in Ohio, possessed a value in combination and from uses in connection with the property and capital elsewhere, which could as rightfully be recognized in the assessment for taxation in the instance of these companies as the others. We repeat that while the unity which exists may not be a physical unity, it is something more than a mere unity of ownership. It is a unity of use, not simply for the convenience or pecuniary profit of the owner, but existing in the very necessities of the case-resulting from the very nature of the business.

But the property of an express company distributed through different states is as an essential condition of the business united in a single specific use. It constitutes but a single plant, made so by the very character and necessities of the business.

There is here no attempt to tax property having a situs outside of the state, but only to place a just value on that within. Presumptively all the property of the corporation or company is held and used for the purposes of its business, and the value of its capital stock and bonds is the value of only that property so held and used. *

* The states through which the companies operate ought not to be compelled to content themselves with a valuation of separate pieces of property disconnected from the plant as an entirety, to the proportionate part of which they extend protection and to the dividends of whose owners their citizens contribute.

Considering as we do, that the unit rule may be applied to express companies without disregarding any other Federal restriction, we think it necessarily follows that this law is not open to the objection of denying the equal protection of the laws.

Decrees affirmed.






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223 U. S. 335. 1912.

United States Express Company was an unincorporated association, with its principal office in New York, and carried on an express business in the State of Minnesota, having about fifty offices in that State. A Minnesota law provides for the payment by express companies of a tax of 6% upon their gross receipts for business done in the State for each calendar year as determined by the Auditor, "which shall be in lieu of all taxes on its property."

The Express Company contended that the assessment of the tax upon its earnings from shipments by a consignor in the State of Minnesota to an ultimate consignee within the State, which shipments were forwarded by express between the points of origin and destination, over railroads partly within and partly without the State of Minnesota, was an unconstitutional exaction in that it was an attempt of the State to regulate interstate commerce, and was without due process of law. As to such shipments, the State Court held that 9 per cent. of the taxes claimed on this class of earnings should be deducted from the amount of the recovery allowed in the court of original jurisdiction, since it was disclosed that only 91 per cent. of the mileage was within the State. For this part of the decision the Minnesota court relied upon Lehigh Valley R. R. Co. v. Pennsylvania, 145 U. S. 192. The Supreme Court sustained this part of the State court's decision, saying: “An examination of that case shows that it is decisive of the present one on this point, and we need not further discuss this feature of the case.”

As to the transportation from points within the State to points without the State, from points without the State to points within the State, and from points without the State to points without the State, passing through the State, the transportation outside of the State being performed by connecting companies, the Supreme Court of Minnesota held that it was the intention of the legislature, in the statute under consideration, to include the earnings from these classes within the State in the gross receipts upon which the tax is based

The transportation was made upon a through rate and through bill of lading, and, it is stipulated, consisted of a single transportation transaction, commencing with the delivery by the shipper to the express company, and continuing until the delivery of the shipment to the consignee at the ultimate destination. The Federal question raised in this connection is: Is this tax a burden upon interstaté commerce, and therefore an infraction of the exclusive power of Congress, under the Constitution, to regulate commerce among the States ?

MR. JUSTICE DAY delivered the opinion of the court:
The Supreme Court of Minnesota construed the tax to be a prop-

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erty tax, measured by the gross earnings within the State, which, under their

construction of the tax, included the earnings here in question. That court held that the statute was part of a system long in force in Minnesota, passed under the authority of the State Constitution, and was intended to afford a means of valuing the property of express companies within the State. While the determination that the tax is a property tax measured by gross receipts is not binding upon this court, we are not prepared to say that this conclusion is not well founded, in view of the provisions and purposes of the law.

The statute itself provides that the assessments under it “shall be in lieu of all taxes upon its property.” In other words, this is the only mode prescribed in Minnesota for exercising the recognized authority of the State to tax the property of express companies as going concerns within its jurisdiction. If not taxed by this method, the property is not taxed at all. In this connection,

In this connection, the language of Mr. Justice Peckham in McHenry v. Alford, 168 U. S. 65, while it was not necessary to the decision of the case, is nevertheless opposite:

“When it is said, as it is in this act, that the tax collected by this method shall be in lieu of all other taxes whatever, it would seem that it might be claimed with great plausibility that a tax levied under such circumstances and by such methods was not in reality a tax upon the gross earnings, but was a tax upon the lands and other property of the company, and that the method adopted of arriving at the sum which the company should pay as taxes upon its property was by taking a percentage of its gross earnings.

The tax in the present case is not like those held invalid in the Galveston Case and the Oklahoma Case, being in addition to other state taxation reaching the property of all kinds of the express company. The tax to be collected in part from the earnings of interstate commerce was part of a scheme of taxation seeking to reach the value of the property of such companies in the state, measured by the receipts from business done within the state. The statute was not aimed exclusively at the avails of interstate commerce (Philadelphia & S. Mail S. S. Co. v. Pennsylvania), but, as in the Maine Case, was an attempt to measure the amount of tax within the admitted power of the state by income derived, in part, from the conduct of interstate commerce. The property of express companies, being much of it of an intangible character, is difficult to reach and properly assess for taxation. This difficulty led this court in Adams Exp. Co. v. Ohio State Auditor, 165 U. S. 194, to sustain a tax upon the property of an express company, which property was considered a part of one money-earning organization extending through many states.

As this court said in Postal Teleg. Cable Co. v. Adams, 155 U. S. 688.

"Doubtless no state could add to the taxation of property according to the rule of ordinary property taxation, the burden of a license

or other tax on the privilege of using, constructing, or operating an instrumentality of interstate or international commerce, or for the carrying on of such commerce; but the value of property results from the use to which it is put, and varies with the profitableness of that use; and by whatever name the exaction may be called, if it amounts to no more than the ordinary tax upon property, or a just equivalent therefor, ascertained by reference thereto, it is not open to attack as inconsistent with the Constitution.”

We think the tax here in question comes within this principle. There is no suggestion in the present record, as was shown in Fargo v. Hart, 193, U. S. 490, that the amount of the tax is unduly great, having reference to the real value of the property of the company within the state and the assessment made. The statute embraces receipts from all the business done within the state, including much which is purely local.

Upon the whole, we think the statute falls within that class where there has been an exercise in good faith of a legitimate taxing power, the measure of which taxation is in part the proceeds of interstate commerce, which could not, in itself, be taxed, and does not fall within that class of statutes uniformly condemned in this court, which show a manifest attempt to burden the conduct of interstate commerce, such power, of course, being beyond the authority of the state.

We find no error in the judgment of the Supreme Court of the State of Minnesota, and it is affirmed.



125 U. S. 181. 1888.

The Pembina Consolidated Silver Mining and Milling Company was incorporated under the laws of Colorado for the purpose of carrying on a general mining and milling business in that state. Its principal office was in Alpine, Colorado, but it established an office in the City of Philadelphia, Pennsylvania, for the use of its officers, stockholders, agents and employes. The State of Pennsylvania assessed a tax against the corporation "at the rate of one-fourth of a mill on each dollar of its capital stock. The company refused to pay the tax upon the ground that the statute under which it was levied amounted to a regulation of interstate commerce.

The Supreme Court of Pennsylvania decided in favor of the constitutionality of the Statute. The case was then appealed to the Supreme Court of the United States.

MR. JUSTICE FIELD delivered the opinion of the court:
The exaction of a license fee to enable the corporation to have

an office for that purpose within the Commonwealth is clearly within the competency of its Legislature. It was decided long ago, and the doctrine has been often affirmed since, that a corporation created by one State cannot, with some exceptions, to which we shall presently refer, do business in another State without the latter's consent, express or implied. In Paul v. Virginia, 75 U. S. 168, this court, speaking of a foreign corporation (and under that definition the plaintiff in error, being created under the laws of Colorado, is to be regarded), said: “The recognition of its existence even by other States, and the enforcement of its contracts made therein, depend purely upon the comity of those States, a comity which is never extended where the existence of the corporation, or the exercise of its powers are prejudicial to their interests, or repugnant to their policy. Having no absolute right of recognition in other States, but depending for such recognition and the enforcement of its contracts upon their consent, it follows as a matter of course that such consent may be granted upon such terms and conditions as those States may think proper to impose. They may exclude the foreign corporation entirely; they may restrict its business to particular localities; or they may exact such security for the performance of its contracts with their citizens as in their judgment will best promote the public interests. The whole matter rests in their discretion." A qualification of this doctrine was expressed in Pensacola Telegraph Company v. Western Union Telegraph Company, 96 U. S. 12, so far as it applies to corporations engaged in commerce under the authority or with the permission of Congress.

The Legislature of Florida had granted to another company, for twenty years, the exclusive right to establish and maintain telegraph lines in certain counties of the State; but this exclusive grant was adjudged to be invalid as against the company acting under the law of Congress. And undoubtedly a corporation of one State, employed in business of the General Government, may do such business in other States without obtaining a license from them. Thus, to take an illustration from the opinion of Mr. Justice Bradley in a case recently decided by him, “If Congress should employ a corporation of ship builders to construct a man-ofwar, they would have the right to purchase the necessary timber and iron in any State of the Union," and, we may add, without the permission and against the prohibition of the State. Stockton v. Baltimore & N. Y. R. Co., 32 Fed. Rep. 9. These exceptions do not touch the general doctrine declared as to corporations not carrying on foreign or interstate commerce, or not employed by the Government. As to these corporations, the doctrine of Paul v. Virginia applies. The Colorado corporation does not come within any of the exceptions. Therefore, the recognition of its existence in Penusylvania, even to the limited extent of allowing it to have an office within its limits for the use of its officers, stockholders, agents, and employes, was a matter dependent on the will of the State. It could make the grant of the privilege conditional upon the payment of a license tax, and fix the sum according to the




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