Commonwealth v. Railroad Co.

• Decision Date: 12 June 1891
• Citation: 145 Pa. 96
• Parties: COMMONWEALTH v. DEL., L. & W. R. Co.
• Court: Pennsylvania Supreme Court

Page 96

145 Pa. 96

COMMONWEALTH v. DEL., L. & W. R. Co.

Supreme Court of Pennsylvania.

Argued June 3, 1891.

Decided June 12, 1891.

Before PAXSON, C. J., STERRETT, GREEN, CLARK, WILLIAMS, McCOLLUM and MITCHELL, JJ.

APPEAL BY COMMONWEALTH FROM THE COURT OF COMMON PLEAS OF DAUPHIN COUNTY.

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Mr. W. U. Hensel, Attorney General, and Mr. Jas. A. Stranahan, Deputy Attorney General, for the Commonwealth.

Counsel cited, generally: Commonwealth v. Standard Oil Co., 101 Pa. 119; Pennsylvania v. Trenton Bridge Co., 9 Am. L. Reg., N. S., 298; Commonwealth v. Railroad Co., 29 Pa. 370; Commonwealth v. Railroad Co., 2 Pears. 391; Pittsb. etc. Ry. Co. v. Commonwealth, 66 Pa. 73; Pennsylvania Co. v. Commonwealth, 22 W. N. 340; Pullman's Pal.-Car Co. v. Commonwealth, 107 Pa. 156. As to the taxation of the equipment of a domestic corporation: Commonwealth v. Dredging Co., 122 Pa. 386; Pacific R. Co. v. Cass Co., 53 Mo. 17; Orange R. Co. v. Alexandria, 17 Gratt. 176; Hays v. Steamship Co., 17 How. 596; St. Louis v. Wiggins Ferry Co., 11 Wall. 423; Sangamon etc. R. Co. v. Morgan Co., 14 Ill. 163 (56 Am. Dec. 497); Welkey v. Pekin City, 19 Ill. 160; Ontario Bank v. Bunwell, 10 Wend. 187; Burroughs on Taxation, 186; Cooley on Taxation, 273; Balt. & O. R. Co. v. Allen, 17 Am. & Eng. R. Cas. 464. As to its leasehold interests: State v. Railroad Co., (44 Conn.?) 7 Am. & Eng. R. Cas. 238; Archer v. Railroad Co., 102 Ill. 493 (7 Am. & Eng. R. Cas. 249.)

Mr. M. E. Olmsted, for the appellee.

Distinguishing Commonwealth v. Dredging Co., 122 Pa. 386, counsel cited: Pullman's Pal.-Car Co. v. Commonwealth, 107 Pa. 156; Pullman's Pal.-Car Co. v. Twombley, 29 Fed. R. 658. As to defendant's interest in the Warren railroad: Commonwealth v. Standard Oil Co., 101 Pa. 119; Commonwealth v. Dredging Co., 122 Pa. 386; Caldwell v. Fulton, 31 Pa. 475; Delaware etc. Co. v. Sanderson, 109 Pa. 583; Cincinnati College v. Yeatman, 30 Ohio St. 276.

PER CURIAM:

We are unable to see that the ruling of the court below is in conflict with Commonwealth v. Standard Oil Co., 101 Pa. 119. That company is a foreign corporation, and it was held that it was not the intention of our taxing acts to tax the whole capital stock of such corporations doing business within this commonwealth, irrespective of the place of its investment, but to tax the property of such company, that is to say, its capital stock, to the extent that it brings such property within the state in the transaction of its business. This is the only equitable rule which will secure to the commonwealth its fair proportion of tax, and yet enable such corporations to carry on their legitimate business. For, if a corporation having its situs in one state, and transacting business in every other state of this country, can be taxed in each state to the full amount of its capital stock, the result is confiscation.

The defendant here is a domestic corporation, and it was contended that its capital invested in equipment, used interchangeably on its main line in this state and its leased lines in other states, is not exempt from taxation in this state. The court below held otherwise, and from this decision the commonwealth has appealed.

It is true that the situs of a domestic corporation is in this state, and that for many purposes the domicile of the person, whether natural or artificial, draws to it the personal property belonging to such owner. That this is so as to such intangible property as is not the subject of taxation elsewhere, such as money at interest, may be conceded; but for the purposes of taxation tangible personal property has a situs wherever it may be found. Hence it was held in Pullman's Palace-Car Co. v. Commonwealth, 107 Pa. 156, the said company being a foreign corporation, that the proportion of the capital stock of the company, invested and used in Pennsylvania, is taxable here, and that the amount of the tax may be properly ascertained by taking as a basis the proportion which the number of miles operated by the company in this state bears to the whole number of miles operated by it, without regard to the question where any particular car or cars are used; this court saying in its opinion: "They (the cars) are operated within this state. They are daily passing from one state to the other. They are used in performing the functions for which the corporation was created. The fact that they were also used and operated in other states, cannot wholly exempt them from taxation here." This case has recently been affirmed by the Supreme Court of the United States, although the report of the case has not yet reached us.^* On the other hand, we held in ...