Chase v. City of Boston

• Citation: 62 N.E. 1059,180 Mass. 458
• Parties: CHASE et al. v. CITY OF BOSTON.
• Decision Date: 27 February 1902
• Court: United States State Supreme Judicial Court of Massachusetts

180 Mass. 458

62 N.E. 1059

CHASE et al. v. CITY OF BOSTON.

Supreme Judicial Court of Massachusetts, Suffolk.

February 27, 1902

In the above-entitled case the following are the agreed facts:

(1) The petitioners are partners, doing business in Boston as stockbrokers, of whom said Chase has a residence therein.

(2) The petitioners' method of doing said business is as follows The petitioners buy stocks in corporations, but only on orders of customers, and do not buy stocks for themselves. When the customers do not furnish the whole of the purchase money for the stocks, the petitioners furnish any balance required and buy the stocks, and this balance is a debt due from the customers to them; and the certificates therefor are delivered to the petitioners with a written transfer thereof in blank, signed by the owners. Such certificates are held by the petitioners, who sometimes transfer the certificates into their name, sometimes keep the certificates in blank as delivered to them, and sometimes use them to pledge to bankers and others as security for money borrowed by the petitioners to raise the balance aforesaid; and this is the only use they make of the same except to hold them to secure the balances due from the customers. At any time, on the payment of such balance by the customers, with interest and commission, the stocks so held are transferred and delivered to the customers. If at any time, on demand for such balance the customers fail to pay the same, the petitioners sell the stocks so held, and apply the proceeds to the payment of such balance, any surplus going to the customers, and any deficit being a debt due the petitioners from the customers; and it is understood between the petitioners and each customer that the above is the petitioners' method of doing business that they can use the stocks so purchased only as stated above, and that all dividends on stocks so purchased, while they are held by the petitioners, belong to the customers; and that all assessments levied on stocks so purchased while so held are to be paid by the customers.

(3) On the first day of May, 1900, the petitioners, in doing said business, held, as aforesaid, stocks in corporations to the value of two hundred thousand dollars ($200,000), on which, at the time of the purchase thereof, the customers had paid the petitioners forty per cent. of the amount paid therefor by the petitioners, and all said stocks were, on May 1, 1900, in pledge as aforesaid for temporary loans to the petitioners, obtained to pay so much of the cost of said stocks as had not been furnished by the customers.

(4) The petitioners duly filed, prior to June 8, 1900, as required by law, a list of property as required by the assessors of said city to be filed, a copy of which is annexed to the petition, and included in said list the indebtedness of all their customers to them for the balances due on the stocks so held, and did not include said stocks or the value thereof as property of the petitioners subject to taxation; and, if said stocks or the value thereof are not property of the petitioners, employed in their business and subject to taxation, said list is a correct list of the petitioners' taxable property.

(5) Said assessors assessed the petitioners a tax upon two hundred thousand dollars ($200,000) as the property of the petitioners employed in said business in said city subject to taxation; the petitioners duly applied to said assessors for an abatement of said tax; the assessors refused to abate the tax, and the petitioners duly appealed therefrom to this court.

(6) It is agreed that the court may draw such inferences from the foregoing statement as a jury would be authorized to do.

(7) If the assessors, under the above facts, could not legally assess said petitioners as aforesaid, the petitioners may have judgment in the sum of twenty-eight hundred fifty-one and 98/100 dollars ($2,851.98), with interest from November 1, 1900. If they could do so, the respondent may have judgment, or the court shall enter such judgment as law and justice shall require.

COUNSEL

Hutchins & Wheeler, for petitioners.

A. J. Bailey, for city of Boston.

OPINION

HOLMES C.J.

We have had some doubt in this case whether the statement of facts ought not to be discharged. Without more explicit statements we should not be willing to assume that the petitioners' relation to the stocks bought by them was different from the ordinary one of brokers carrying stock upon a margin, and on the other hand a turn is given to some of the expressions in the agreed facts that suggests a peculiar set of transactions....