American Mfg Co v. City of St Louis

Decision Date09 June 1919
Docket NumberNo. 365,365
Citation39 S.Ct. 522,250 U.S. 459,63 L.Ed. 1084
CourtU.S. Supreme Court

Messrs. S. Mayner Wallace and Shepard Barclay, both of St. Louis, Mo., for plaintiff in error.

Messrs. Everett Paul Griffin and Charles H. Daues, both of St. Louis, Mo., for defendant in error.

Mr. Justice PITNEY delivered the opinion of the Court.

The question is whether an ordinance of the city of St. Louis levying against manufacturers, especially as against plaintiff in error, a West Virginia corporation, a tax imposed as a condition of the grant of a license to carry on a manufacturing business in that city, but the amount of which is ascertained by and proportioned to the amount of sales of the manufactured goods, whether sold within or without the state, and whether in domestic or interstate commerce, is void as amounting to a regulation of commerce among the states and thus entrenching upon the power of the national Congress under article 1, § 8, of the Constitution, or as amounting to a taking of plaintiff's property without due process of law, in contravention of the Fourteenth Amendment.

A statute of the state (Rev. Stat. Mo. 1909, § 9857) authorizes cities to license, tax and regulate for local purposes the occupations of merchants and manufacturers and to graduate the amount of annual license imposed upon them in proportion to the sales made by such merchant or manufacturer during the year next preceding any fixed date. Pursuant to this authority the city, by the ordinance in question, in addition to an ad valorem property tax, requires every manufacturer in the city before doing or offering to do business as such to take out a license, and at a specified time to render a sworn statement of the aggregate amount of sales made by him during the year next preceding the first Monday of June, and within a short time thereafter to pay a license tax of $1 on each $1,000 of sales made. Failure or refusal to deliver the required statement or to pay the license tax within the time specified is made a misdemeanor punishable by fine and false statement under oath is made punishable false statement under oath is made punishable by forfeiture of the license in addition to a fine.

In a previous case (Manufacturing Co. v. St. Louis, 238 Mo. 267, 278, 142 S. W. 297), the Supreme Court of the state held that this tax did not apply to sales made of goods shipped from plaintiff's factory in the state of New York directly to purchasers in Texas, but only to sales from its St. Louis factory.

Int he present case, which was a suit brought in a state court by plaintiff in error against the city to recover so much of a disputed tax as is measured by sales of goods manufactured by plaintiff in the city, afterwards removed to storage warehouses outside of the state, and later sold from these warehouses to purchasers in states other than Missouri, the trial court at first gave judgment in favor of plaintiff on this item, and this having been reversed by the Supreme Court of the state (270 Mo. 40, 192 S. W. 402), a new trial resulting in favor of the city, and the second judgment having been affirmed (Mo., 198 S. W. 1183), the case comes here on writ of error.

In construing the statute and ordinance and defining the nature and effect of the tax, the Supreme Court expressed itself as follows (270 Mo. p. 45, 192 S. W. 403):

'It is not disputed that under the broad provision of its charter the city of St. Louis has the power to license and tax manufacturers within its limits; nor that the power includes the right to impose a tax upon the transaction of their business. Adopting substantially the definition we have quoted from the statute, it has, by ordinance, forbidden them to pursue their business within the city without procuring a license, and has prescribed the additional tax they shall pay for that purpose, which is graduated to accord with the amount of business they shall carry to the point of realizing the profit or liquidating the loss by the sale of the product of their work. They may only buy and sell in pursuance of their business as manufacturers. That his right to pursue this business is the one thing he receives as compensation for this tax is evident; and that the method of fixing its amount by the amount that he realizes from the licensed activity is a just and equitable one is not disputed; nor is the inherent justness and fairness of postponing the payment until the realization of the result of the work. The tax is none the less a tax upon the business of manufacture pursued in the city of St. Louis under the protection of the laws of this state and the ordinances of the city. * * * We hold that the tax in question is a tax upon the privilege of pursuing the business of manufacturing these goods in the city of St. Louis; that when the goods were manufactured the obligation accrued to pay the amount of...

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