These cases are governed by the decisions in | of John Kierns, deceased, in the sum of Muhlker v. New York & Harlem Railroad Company, ante, p. 522.

Argued April 27, 28, 1905. Decided May 15, less the right was acquired by the defend

ants to maintain the structure and operate the railroad by the payment of the sums IN ERROR to the Supreme Court of the awarded for the damages to the fee, injunc

I state of New Yorku po rei o uw of the tivar ch fold become operative against the

DELAWARE, LACKAWANNA, & WEST- | Laws of Pennsylvania for that year. The
ERN RAILROAD COMPANY, Plff. in sections of the act in question are 4 and 5,
Err.,
and are reproduced in the margin.†

COMMONWEALTH OF PENNSYLVANIA. stock of the plaintiff in error, pursuant to

Argued April 10, 1905. Decided May 15, every corporation, joint-stock association, and

the time the appraisement was made. This | state of New York, though its corporate contention was overruled by the state courts. The facts upon which the judgment rests were found by the court, and are as follows: "1. The Delaware, Lackawanna, & Western Railroad Company was organized under the special act of the general assembly of Pennsylvania approved March 11, 1853, by the consolidation of the Liggetts Gap Railroad Company, incorporated under the act of April 7, 1832, whose name was, by the act of April 14, 1851, changed to Lackawanna | & Western Railroad Company, and the Delaware & Cobbs Gap Railroad Company, incorporated by the act of April 7, 1849. Into the Delaware, Lackawanna, & Western Railroad Company, as formed by the merger of the Lackawanna & Western Railroad Company and the Delaware & Cobbs Gap Railroad Company were merged, December 27, 1865, the Keyser Valley Railroad Company; August 12, 1870, the Nanticoke Coal & Coke Company; and June 17, 1870, the Lackawanna & Bloomsburg Railroad Company. The company, as authorized by special act of Pennsylvania legislature, has its general office and treasury in the city and fifteenth days of November of each year, estimate and appraise the capital stock of the said company at its actual value in cash, not less, however, than the average price which said stock sold for during said year, and not less than the price or value indicated or measured by net earnings or by the amount of profit made and either declared in dividends or carried into surplus or sinking fund, and when the same shall have been so truly estimated and appraised they shall forthwith forward to the auditor general a certificate thereof, accompanied with a copy of their said oath or affirmation, signed by them, and attested by a magistrate or other person duly qualified to administer the same: Provided, That if the auditor general and state treasurer, or either of them, is not satisfied with the appraisement and valuation so made and returned, they are hereby authorized and empowered to make a valuation thereof based upon the facts contained in the report herein required, or upon any information within their possession or that shall come into their possession, and to settle an account on the valuation so made by them for the taxes, penalties, and interest due the commonwealth thereon, with right to the company dissatisfied with any settlement so made against it to appeal therefrom in the manner now provided by law; and in the event of the neglect or refusal of the officers of any corporation, company, jointstock association, or limited partnership for a period of sixty days to make the report and appraisement to the auditor general as herein provided, it shall be the duty of the auditor general and state treasurer to estimate a valuation of the capital stock of such defaulting corporation, company, joint-stock association, or limited partnership, and settle an account for taxes, penalty and interest thereon, from which settlement there shall be no right of appeal.

Sec. 5. That every corporation, joint-stock association, limited partnership, and company whatsoever, from which a report is required

home is in Pennsylvania. It is authorized by law to own coal lands in Pennsylvania, and to mine, buy, and sell coal and convey the same to market; and, in addition to its business of owning and operating an extensive system of railroads, is engaged in the business of mining, buying, and selling coal. The proper officers of the company returned and appraised its capital stock as of the actual value, between the first and fifteenth days of November, 1899, of $48,470,000, and in making up the claim of the state for taxes for said year, the auditor general made no deductions whatever, but charged tax at 5 mills upon said aggregate valuation of $48,470,000, the said tax amounting to $242,350. Amongst other property in addition to its railroad, the company owned coal located at points outside of Pennsylvania, in New York, Illinois, and other states, of the value of $1,702,443, and, as already stated, no deduction was made by the auditor general in his statement of account against the company for or with respect to this coal. All taxes assessed against the company for 1899 in other states, on coal lounder the twentieth section hereof, shall be subject to and pay into the treasury of the commonwealth annually a tax at the rate of 5 mills upon each dollar of the actual value of its whole capital stock, of all kinds, including common, special, and preferred, as ascertained in the manner prescribed in said twentieth section, and it shall be the duty of the treasurer or other officers having charge of any such corporation, joint-stock association, or limited partnership, upon which a tax is imposed by this section, to transmit the amount of said tax to the treasury of the commonwealth within thirty days from the date of the settlement of the account by the auditor general and state treasurer: Provided, That for the purpose of this act interests in limited partnership or joint-stock associations shall be deemed to be capital stock, and taxable accordingly: Provided, also, That corporations, limited partnerships, and jointstock associations liable to tax on capital stock under this section, shall not be required to make report or pay any further tax on the mortgages, bonds, and other securities owned by them in their own right, but corporations, limited partnership and joint-stock associations holding such securities as trustees, executors, administrators, guardians, or in any other manner, shall return and pay the tax imposed by this act upon all securities so held by them as in the case of individuals: And provided further, That the provisions of this section shall not apply to the taxation of the capital stock of corporations, limited partnerships and joint-stock associations, organized exclusively for manufacturing purposes, and actually carrying on manufacturing within the state, excepting companies engaged in the brewing or distilling of spirits or malt liquors, and such as enjoy and exercise the right of eminent domain: Provided further, In case of fire and marine insurance companies the tax imposed by this section shall be at the rate of 3 mills upon each dollar of the actual value of the whole capital stock.

cated there, have been paid, according to the belief, and so far as the secretary of the company can now, May 25, 1901, recall.

"There were other items in dispute in addition to the coal, and they were covered by defendant's appeal, but the attorney general, on behalf of the commonwealth, and counsel for the defendant, entered into an agreement in writing as follows, viz.:

""And now, to wit, April 10, 1901 it is hereby agreed that the jury shall deduct, and not include in its verdict, any tax upon $1,702,444, being the value of coal held and owned at points in states other than Pennsylvania, according to the facts as set forth in the depositions of Fred. F. Chambers and W. H. Truesdale, defendant's treasurer and president, respectively, hereto attached and made part hereof. The said deduction having been made, final judgment shall be entered upon the verdict of the jury in favor of the commonwealth, and against the defendant. The question of defendant's liability to the commonwealth of Pennsylvania for taxes upon or in respect of said coal held, owned, and stored at points in states other than Pennsylvania, is hereby reserved, and it is agreed that it shall be submitted for the determination of the court. If the court shall be of the opinion that, upon the facts stated in the aforesaid depositions of Fred. F. Chambers and W. H. Truesdale, attached to and made part hereof, the defendant is liable for tax to the commonwealth of Pennsylvania upon coal thus held, owned, and stored at points in states other than Pennsylvania, then judgment shall be entered in favor of the commonwealth, and against the defendant, for the further sum of $8,512.21, being 5 mills upon the said $1,702,443, the value of the said coal, to which amount there shall be added the usual attorney general's commission of 5 per cent, either of the parties to be at liberty to file exceptions to, and appeal from, the decision of the court upon the said reserved point with like effect as if the case had been tried by the court without a jury, under the act of April 22, 1874.'"

"The judgment entered upon said verdict has been paid by defendant, leaving open only the one question submitted to the court, as aforesaid, of the defendant's liability to taxation with respect to capital stock invested in coal located outside of Pennsylvania.

"4. The facts agreed upon by counsel for the commonwealth and the company are set forth in the affidavits of W. H. Truesdale, president, and Fred. F. Chambers, the secretary and treasurer of the company, and, in so far as they relate to the reserved question, are as follows, viz.:

"Under powers conferred by special charter previous to the adoption of the present Constitution of Pennsylvania, the Delaware, Lackawanna, & Western Railroad Company is largely engaged in the mining and purchasing of anthracite coal in Pennsylvania, nearly all of which coal it transports to points without said state, and there sells. By far the greater part of this coal is transported from the mines for immediate delivery at points in other states, and is not kept or held in stock in said other states longer than is necessary for the purpose of transferring possession from this company to the purchaser; but at certain points in other states, as, for instances, at Buffalo, New York, and at Chicago, Illinois, the company keeps constantly on hand a stock of coal for purposes of sale, the same being stored in yards or upon docks maintained by the company for that purpose. The coal thus on hand awaiting sale between the first and fifteenth days of November, 1899, the date when the company's capital stock is required by law to be appraised for taxation, was of the value of not less than $1,702,443, and was included in the valuation of the company's capital stock upon which tax was charged in the auditor general's account. The coal thus on hand at that date was approximately the amount usually kept in stock at such points. The said coal when shipped from Pennsylvania was destined to said points in other states, with no intention of ever returning the same to Pennsylvania. On the contrary, said coal was intended to, and did, become part of the general mass of property in said other states, and the company is there annually taxed upon or in respect to the same, and was so taxed for 1899. When the coal thus kept in stock in the states of New York, Illinois, and other states outside of Pennsylvania, is sold, the proceeds are returned to the company's treasury in the city and state of New York. "In 1899 the company sold and delivered coal at points outside of the state of Penn136 88 sylvania of the aggregate value of not less than $18,587,258, but this was either con$2.874 67 tracted for before it left the mines or deliv

"3. The case having been submitted to the jury, a verdict was rendered as follows,

$111,250 00

8,512 21

$102,737 79 Less payment on account..... 100,000 00

Add attorney general's commission of 5 per cent....

Verdict for..

$2,737 79

"5. The corporation defendant is authorized by law to transact business and to hold lands in other states for depot, wharfage, and coal-yard accommodations, and to make such agreements and contracts with corporations and individuals of other states as may be necessary and expedient for the transporting and vending of coal mined and purchased by it, and defendant is also authorized to have and maintain its general office and place of business, and to hold its stockholders' meeting, in the state of New York, and to have as president, directors, and other officers nonresidents of the state of Pennsylvania. The company is taxable upon the value of the property represented by its capital stock, and not upon the amount of the latter."

Messrs. M. E. Olmsted, Walter W. Ross, and A. C. Stamm for plaintiff in error. Messrs. Hampton L. Carson and Frederic W. Fleitz for defendant in error.

ered upon, or within a comparatively short | case the court held that the coal was proptime after, its arrival at the points in other erly taxed by the state of Louisiana, though states to which it was to be delivered. it had but lately arrived from the state of What I have said above was with reference its origin (Pennsylvania), and was, at the only to coal kept in stock at points outside time of the taxation, awaiting sale in Louisof Pennsylvania for purposes of sale.' iana, and was, in fact, soon thereafter, sold and taken out of the country to a foreign state. It was said that the coal, on arrival at New Orleans for the purpose of sale, at once became intermingled with the general property of the state of Louisiana, and was taxable like any other tangible property therein. In Coe v. Errol, 116 U. S. 517, 29 L. ed. 715, 6 Sup. Ct. Rep. 475, the question was relative to the validity of the tax on the lumber imposed in the state of its origin, as that state had taxed the lumber before it had actually left the state, although it was intended for transportation to another state for sale. It was held that the tax was proper, so long, and so long only, as such transportation had not yet actually commenced. After that the state had no right to tax it. In the case at bar the coal had been transported to and was actually resting in another state for sale when the appraisement was made, and, under the foregoing cases, it was then intermingled with property in the foreign state where it rested, and was at that time liable to taxation therein. The right of the foreign state to tax under such circumstances was again upheld in Pittsburg & S. Coal Co. v. Bates, 156 U. S. 577, 39 L. ed. 538, 5 Inters. Com. Rep. 30, 15 Sup. Ct. Rep. 415, where the coal was taxed while awaiting sale in such state. See Kelley v. Rhoads, 188 U. S. 1, 47 L. ed. 359, 23 Sup. Ct. Rep. 259; Diamond Match Co. v. Ontonagon, 188 U. S. 82, 47 L. ed. 394, 23 Sup. Ct. Rep. 266. We must, therefore, take it as plain, under the foregoing decisions, that this coal, at the time of the appraisement of the value of the capital stock for taxation by Pennsylvania, had become intermingled with the mass of property in the other states, to which portions of it had respectively been sent, and that it was a proper subject for taxation for both state and local purposes in such states. Where the proceeds of the sale might go when the coal was sold, whether into the treasury of the company, at its offices in New York city, or indirectly to the state of its incorporation, is not important. The coal had not been sold when the appraisement of the value of the capital stock was made, and at that time it was outside the jurisdiction of the state of Pennsylvania. A tax on that coal, eo nomine, or specifically, could not then be laid by that state, as counsel concede.

Mr. Justice Peckham, after making the foregoing statement, delivered the opinion of the court:

The supreme court of Pennsylvania bases its decision in this case on the authority of Com. v. Pennsylvania Coal Co. 197 Pa. 551, 47 Atl. 740, which it regards as controlling upon the question involved. The right to include the value of the coal in question in the valuation of the capital stock of the company is based upon the construction given by the supreme court of Pennsylvania to the Pennsylvania statute of 1891, and this court is concluded by that construction. People v. Weaver, 100 U. S. 539, 541, 25 L. ed. 705, 706.

The only question for this court to determine is whether, in refusing to deduct the value of the coal mined in Pennsylvania, and which, at the time of the appraisement, was situated outside the jurisdiction of the state, from the value of the capital stock, the state court denied any right of the plaintiff in error which was protected by the Federal Constitution.

The coal itself, when the appraisement of the value of the capital stock was made, was concededly beyond the jurisdiction of the state of Pennsylvania. It was taxable (and in fact was taxed) in the states where it rested for the purpose of sale, at the time when the appraisement in question was made. Brown v. Houston, 114 U. S. 622, 29 L. ed. 257, 5 Sup. Ct. Rep. 1091. In that In that

Now, was this tax, in substance and effect, laid upon the coal which was beyond the jurisdiction of Pennsylvania? The su