Commonwealth v. Philadelphia & Reading Coal & Iron Co.
| Decision Date | 14 March 1892 |
| Docket Number | 17 |
| Citation | 23 A. 809,145 Pa. 283 |
| Parties | COMMONWEALTH v. PHILA. ETC. C. & I. CO |
| Court | Pennsylvania Supreme Court |
APPEAL BY PLAINTIFF FROM THE COURT OF COMMON PLEAS OF DAUPHIN COUNTY.
No. 17 May Term 1890, Sup. Ct.; court below, No. 512 September Term 1887, C.P.
On October 6, 1890, the judgment of the court below was reversed in the Supreme Court, on the appeal of the plaintiff in the case of the Commonwealth against the Philadelphia & Reading Coal & Iron Company -- see Commonwealth v. Coal & Iron Co., 137 Pa. 481, -- and judgment entered for the plaintiff, and against the defendant, for the sum of $44,227 and costs, accompanied with the following memorandum:
Subsequently Mr. Wm. B. Lamberton, for the defendant company, filed a motion for a re-argument, urging, inter alia, that the penalty of ten per cent was improperly included in the judgment, for the following reasons:
1. The treasurer of the company having, in accordance with the provisions of the act of assembly, reported to the auditor general, on oath, the amount of indebtedness of the corporation owned by residents of this commonwealth, as nearly as the same could be ascertained, and having assessed each and every of the scrip, bonds, and evidences of indebtedness at its nominal value, as appears by his said report, the company defendant was not in default in any respect of any duty to be performed by it.
2. The company defendant was not in default by reason of a failure to pay the tax claimed within fifteen days after the thirty-first day of December, 1886, no account having been settled against the said company until the twenty-first day of July, 1887, and the right to appeal from said account being reserved to the said company, under the provisions of the act of March 30, 1811, [ .]
3. The imposition of said penalty, if for a failure to pay the said tax within the time limited by the act of 1885, is inconsistent with the right of appeal in said company under the laws of the commonwealth. The objections of the defendant to the said settlement were held valid as to certain of the bonds taxed, and were sustained by the court below with respect to the tax on the $6,809,500 bonds above mentioned.
4. The penalty of ten per cent under the fourth section of the act of 1885, is to be imposed by the auditor general only, for every failure to assess and pay said tax and make report as aforesaid. Being a penal statute, the act is to be construed strictly.
7. The penalty was not imposed by the auditor general, and was not demanded by the commonwealth in any stage of the above appeal.
8. The above stated case was an appeal to the Supreme Court from the Court of Common Pleas of Dauphin county, and the right of the commonwealth to recover the penalty, and the obligation of the company defendant to pay it, was not passed upon in the court below.
9. The Supreme Court assumed original jurisdiction to pass upon the liability of the company defendant for the penalty, which is a liability distinct from its liability for the tax, in contravention of article V., § 3, of the constitution of Pennsylvania.
10. No default was charged at any time, or in any stage of the above stated case, against the corporation defendant, whereby it might become liable for said penalty; no evidence of such default was produced before any tribunal, and no opportunity was afforded to defendant to answer, or defend against such charge. The imposition of the said penalty was therefore in contravention of article I., § 9, and of article I § 11, of the constitution of Pennsylvania. For the same reason, the imposition of said penalty is in contravention of article V., of the amendments to the constitution of the United States, and of § 1 of article XIV. of the amendments to the constitution of the United States.
11. The interest at twelve per cent is itself a penalty: Easton Bank v. Commonwealth, 10 Pa. 451; Commonwealth v Standard Oil Co., 101 Pa. 119, 150. The charge of annual interest at twelve per cent, attorney general's commission, five per cent, and penalty, ten per cent, making together in this case more than one half of the amount of tax recovered, is in contravention of article I., § 13 of the constitution of Pennsylvania, which forbids that excessive fines be imposed; and if the act of 1885 authorizes and directs the imposition of such an excessive fine, it is in so far unconstitutional and void.
The judgment heretofore entered by this court is modified by striking out the item for penalty; the interest is re-calculated, and judgment is now entered as of this date for forty-six thousand one hundred and ninety-nine dollars and fifty-two cents.
The judgment entered on March 14, 1892, is amended by striking out the interest from October 6, 1890, and is thereby reduced to forty-one thousand three hundred and eight dollars.
Before PAXSON, C.J., STERRETT, GREEN, CLARK, WILLIAMS, McCOLLUM and MITCHELL, JJ.
A re-argument is asked for, especially on the imposition of the statutory penalty by this court in its final judgment. The question is of considerable practical importance; and, as it affected a number of other cases pending at the time, this motion was held over until the argument of those cases, in order that it might receive full consideration and final settlement. It was in the hands of our late Brother CLARK at the time of his lamented death. This much I have thought it proper to say, in explanation of the delay in disposing of the motion.
We are not convinced that the court exceeded its proper authority in entering judgment for the penalty, notwithstanding the failure of the officers of the commonwealth to claim it and ...
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