American Coal Co. v. Allegany County Com'rs

• Decision Date: 21 December 1882
• Parties: THE AMERICAN COAL COMPANY v. THE COUNTY COMMISSIONERS OF ALLEGANY COUNTY.
• Court: Maryland Court of Appeals

59 Md. 185

THE AMERICAN COAL COMPANY v. THE COUNTY COMMISSIONERS OF ALLEGANY COUNTY.

Court of Appeals of Maryland

December 21, 1882

APPEAL from the Circuit Court for Allegany County.

The case is stated in the opinion of the Court.

The cause was argued before ALVEY, ROBINSON, IRVING, and RITCHIE J.

William Walsh, for the appellant.

Benjamin A. Richmond, and William Brace for the appellees.

ALVEY J., delivered the opinion of the Court.

This action was instituted by the appellees against the appellant, a coal mining corporation, incorporated by the law of this State, to recover certain taxes, assessed for county purposes, upon the shares of stock issued by the appellant, for the year 1880.

The declaration counts upon the claim for taxes, as if the same had been assessed to and levied upon the property of the appellant primarily, without reference to the assessment upon the shares of the individual stockholders.

The appellant pleaded, 1st. Never indebted as alleged; 2nd. Never promised as alleged; and 3rd. Payment.

The case was tried and determined in the Court below on an agreed statement of facts.

By this agreed statement of facts, it is shown that the capital stock of the appellant is divided into 58,800 shares, of which 58,700 are owned by non-residents of the State, and only 100 shares by a resident stockholder of this State, and who resides in Allegany County.

It is also shown, that the appellant was regularly assessed with its real property in Allegany County, valued at $400,000, for the year 1880, and that the tax assessed thereon was duly paid. The State Tax Commissioner, however, under the Act of 1878, ch. 178, as amended by the Act of 1880, ch. 20, after deducting the value of the real estate so assessed, from the aggregate value of the total number of shares of the capital stock of the appellant, as directed by the statute, ascertained and determined the assessable value of each share of stock to be $3.33 1/3, amounting in the whole to the sum of $196,000, in addition to the assessed value of the real estate of the appellant.

It is further shown that the rate of taxation for county purposes, for the year 1880, was 75 1/4 cents on each $100 of assessed value, and that the total amount of taxes claimed to be due the county from the appellant, in respect of the assessed value of the shares of stock at $3.33 1/3 per share, is $1474.90, with interest from the 1st of January, 1881.

It is also agreed that the appellant owns real estate in the State of New Jersey, needed and used as a wharf for purposes of its business as a coal mining company, of the value of $150,000, which enhances the market value of the stock of the company, and which market value, so made up, determined the assessable value of the stock, as fixed by the State Tax Commissioner.

It is further agreed, that the certificate of the State Tax Commissioner, as to the assessable valuation of the stock of the appellant, for county purposes, as directed by the statute, was not furnished to the appellees until about the 23rd of July, 1880, and that it was not until immediately after the receipt of such certificate that the appellees charged the appellant with the assessable value of its stock, thus ascertained and determined, and levied the tax of 75 1/4 cents per $100 on such assessable value of the stock so returned.

It is upon these facts that the appellant insists that the judgment below should be reversed by this Court; that judgment being for the amount of the taxes claimed by the appellees.

For the purpose of fixing the situs of the stock held in the various corporations of this State, by non-resident shareholders, in respect to the right of taxation, the Code, Art. 81, as re-enacted by the Act of 1874, ch. 483, sec. 132, after declaring that the stock of certain kind of corporations shall be considered as situate at the place of the location of the principal office of business, within this State, of such corporations, declares that the stock of mining, manufacturing, and other like corporations, shall be taken as situate at the place where the works of such corporations, or the greater part of their operations, respectively, shall be conducted, and that such stock "shall be assessed in like manner, in the county or city where such works are situate." That is to say, that notwithstanding the owners of the shares of stock may be non-resident of the State, such shares of stock shall be liable to assessment in the county or city where the operations of the corporations are conducted, in the same manner as if the owners of such shares were residents of such county or city.

In this case the appellant is a coal mining corporation, incorporated under the authority of this State, and conducts its works and mining operations in Allegany County, within this State.

Such being the case, the shares of stock of this and all corporations, liable to taxation are required to be assessed to the owners of such shares, whether the owners be residents or non-residents of the State, and not to the corporation. This is expressly required by the general assessment Act of 1876, ch. 260, sec. 17, and also by the Act of 1878, ch. 413 sec. 2; the latter Act providing that all shares of stock in corporations of this State, whether owned by residents or non-residents of the State, " shall be liable to be valued to the respective owners thereof, and to be assessed and taxed as the property of such respective owners." And by the Code, Art. 81, sec. 149, as enacted by the Act of 1878, ch. 178, creating the office of State Tax Commissioner, that officer is invested with the power, and required to perform the duties, that theretofore devolved upon the Comptroller of the State in respect to the valuation and assessment of the shares of the capital stock of corporations, for the purposes of State taxation; and by the sec. 151 of Art. 81 of the Code, as reenacted with amendments by the Act of 1880, ch. 20, which took effect from the 26th of February, 1880, it is provided that--

"At the time of making the returns of stockholders to the County Commissioners and Appeal Tax Court of Baltimore City, as required by law, the president, or other proper officer, of every bank or other incorporated institution incorporated under the laws of this State, or doing business therein, and of every joint stock company doing business in this State shall furnish to the County Commissioners of each county in which such bank or other incorporated institution, or joint stock company, shall own or possess any real property, and to the Appeal Tax Court of Baltimore City, if such bank or other incorporated institution or joint stock company shall own or possess any real property in said city, a true statement of such real property, situated or located in such county or city, and such real property shall be valued and assessed by said County Commissioners and Appeal Tax Court, respectively, to the said bank or incorporated institution, or joint stock company, so owning the same, and said County Commissioners and Appeal Tax Court shall give duplicate certificates of such valuation and assessment to such president or other officer, who shall transmit one of such duplicate certificates with his return to the State Tax Commissioner; and State, county or city taxes, shall be levied upon and paid by such bank or other incorporated institution, or by such joint stock company, on such assessment, in the same manner as the same are levied upon and paid by individual owners of real property in such county or city. The respective taxable values of the shares of stock in such banks, corporations and joint stock companies, shall be ascertained by the State Tax Commissioner in the manner following: He shall deduct the assessed value of such real property belonging to the respective banks, corporations, or joint stock companies, from the aggregate value of all the shares of such respective banks, corporations or joint stock companies, and divide the residuum by the number of the shares of the capital stock, or shares of such respective banks, corporations, or joint stock companies, and the quotient shall be the taxable value of such respective shares for State purposes; and when the valuation and assessment of the shares of the capital stock; or shares of such bank, corporation or joint stock company, shall have been finally determined or made for State purposes, the State Tax Commissioner shall certify to the County Commissioners of each county...