Philadelphia, &C. R. R. Co. v. Commonwealth.
| Decision Date | 01 October 1883 |
| Citation | 104 Pa. 80 |
| Parties | Philadelphia and Reading Railroad Company <I>versus</I> Commonwealth. |
| Court | Pennsylvania Supreme Court |
Before GORDON, TRUNKEY, STERRETT, GREEN and CLARK, JJ. MERCUR, C. J., and PAXSON, J., absent
ERROR to the Court of Common Pleas of Dauphin county: Of May Term 1883, No. 32.
COPYRIGHT MATERIAL OMITTED
James E. Gowen (with him W. B. Lamberton and D. Mumma), for the plaintiff in error.—Gross receipts, per se, are not taxable. The corporation did not, and could not, receive the gross receipts. The accounting officers declined to state the account against the receivers of the corporation who did receive them. The receivers are accountable not to the corporation, but to the United States Court which appointed them, and for the benefit of the mortgagees in the trust mortgage. The corporation is no more liable for the tax than if the United States Government had taken manual occupation of our road and run it, nor than a lessor of a railroad is liable instead of a lessee. The question of origin and ownership of the property has nothing to do with the question of liability to tax for a particular half year. The receivers spend all they get, and more, in operating the road, issuing certificates, &c. The income-tax was never assessed against an assignor for benefit of creditors on the receipts of the assignee. No relation of principal and agent, or trustee and cestui que trust, exists between the corporation and the receivers. If, however, the receivers were trustees, tax should be assessed against the trustees, not he cestui que trust. If this railroad had passed into the hands of its mortgagees who received the income, the Commonwealth would not claim, and lose, tax against the insolvent corporation. There is no form of law by which a tax due by A. can be collected by an account settled, or suit brought against B. The authorities cited on the other side relate to statutory receivers of insolvent corporations, or receivers of a partnership, and not to receivers appointed by a court on a mortgagee's bill, who act for the plaintiff. As to the lien, under § 14 of the Act of 1879, that Act was passed long after the date of the mortgage under which the receivers were appointed, hence the statutory lien is subsequent to the receiver's lien. The case being a tax case, the Act should be strictly construed.
Robert Snodgrass, deputy attorney-general (with him Lewis C. Cassidy, attorney-general), for the Commonwealth.— The tax on gross receipts is a tax on the franchise of the corporation, measured by the receipts: Philadelphia Contributionship, &c. v. Commonwealth, 2 Out. 48. The object of the Act of 1879 is to reach that franchise, no matter by whose hands the receipts are taken, whether the corporation itself, or lessees, mortgagees, or receivers. The receivers merely stand in the place of the management, exercising the corporation's...
To continue reading
Request your trial
-
State v. Illinois Cent. R. Co.
...v. A. & S. R. R. Co., 62 Ga. 468;Railway Co. v. Shinn, 52 Ark. 93, 12 S. W. 183;People v. Roberts, 92 Pa. 407;Philadelphia & Reading Railroad Co. v. Commonwealth, 104 Pa. 80;People v. Morgan, 114 App. Div. 266,99 N. Y. Supp. 711;Remington v. Field, 16 R. I. 509, 17 Atl. 551. In Union Pacifi......
-
Lowden v. State Corp.. Comm'n.
...N.Y. 512, 516, 98 N.E. 11; Armstrong, Receiver, v. Emmerson, Sec. of State, 300 Ill. 54, 132 N.E. 768, 18 A.L.R. 693; Philadelphia & R. R. Co. v. Commonwealth, 104 Pa. 80. It is the proper ground we think, upon which other similar cases should have been decided, although both groups are oft......
-
In re Detroit Props. Corp.
...(D. C.) 8 F.(2d) 304, 305. See, also, New York Trust Co. v. Island Oil & Transportation Corp. (D. C.) 7 F.(2d) 416;Philadelphia & R. R. Co. v. Commonwealth, 104 Pa. 80. To complete the review of authorities, we are informed by counsel that the federal District Court of the Western District ......
-
Michigan Trust Co. v. People of State of Michigan, 5745.
...Y. 512, 516, 98 N. E. 11; Armstrong, Receiver, v. Emmerson, Sec'ty of State, 300 Ill. 54, 132 N. E. 768, 18 A. L. R. 693; Phila. & R. R. Co. v. Commonwealth, 104 Pa. 80. It is the proper ground, we think, upon which other similar cases should have been decided, although both groups are ofte......