In re Pa. Tel. Co.

• Decision Date: 24 November 1890
• Citation: 20 A. 846,48 N.J.E. 91
• Parties: In re PENNSYLVANIA TEL. Co.
• Court: New Jersey Court of Chancery

20 A. 846

48 N.J.E. 91

In re PENNSYLVANIA TEL. Co.

Court of Chancery of New Jersey.

Nov. 24, 1890.

(Syllabus by the Court.)

On petition for injunction.

John P. Stockton, Atty. Gen., for the State. Wm. S. Gummere, for defendant.

BIRD, V. C. The defendant, in its answer to the petition in this case, admits its liability to be assessed under the act of April 18, 1884, (Supp. Revision, 1016,) but denies its liability for the whole amount of assessment imposed by the state board of assessors. The law provides "that every telegraph, telephone, cable, or electric light company, not owned by a railroad company and otherwise taxed, doing business in this state, should pay an annual tax for the use of the state, by way of a license for its corporate franchises." The law requires every such company, on or before the first Tuesday of May, to state the gross amount of its receipts from the business done in this state for the year preceding the 1st day of January prior to the making of such report. If any such company shall neglect or refuse to make such return within the time limited as aforesaid, the state or its assessors shall ascertain and fix the amount of such receipts in such manner as may be deemed by them most practicable, and the amount fixed by them shall stand as the basis of taxation of such company under said act. By virtue of said act, each of said companies are made liable to pay taxes of 2 per cent. upon the amount of its gross receipts so returned or ascertained. On or before the first Tuesday of May, 1888, the defendant did make a report showing the amount of its gross receipts for the business done in this state for the year ending December 31, 1887. By such report such proceeds appear to be $3,643.47. It also reported, at the request of the state board of assessors, its gross receipts for business originating within this state and terminating without, $3,122.53, and also the gross amount of receipts from business originating in Pennsylvania, and terminating within this state, which amount was $7,398.03. On the 25th day of June, 1888, the defendant paid the state $72.87, the amount properly assessed upon its gross proceeds of the business done within this state, but the whole amount assessed by the state board of assessors was $135.32. This shows that the assessors were not contented with the gross proceeds returned by the defendants of business done within this state, but proceeded, as they supposed they might under the act, to ascertain what in their judgment was the proper amount of gross proceeds to be assessed from other sources, and assessed $3,122.53, in addition to $3,643.47. This additional assessment the defendant insists is unlawful. Its resistance to the payment of this additional tax is based upon the doctrine that it is unconstitutional for any state to attempt to regulate commerce between the states; and that business of this character originating in one state and terminating in another is such commerce. I believe this principle was so recognized in the case of Cable Co. v. Attorney...