Lumberville Del. Bridge Co. v. State Bd. of Assessors

• Decision Date: 09 June 1893
• Citation: 26 A. 711,55 N.J.L. 529
• Parties: LUMBERVILLE DELAWARE BRIDGE CO. v. STATE BOARD OF ASSESSORS.
• Court: New Jersey Supreme Court

26 A. 711

55 N.J.L. 529

LUMBERVILLE DELAWARE BRIDGE CO.

v. STATE BOARD OF ASSESSORS.

Supreme Court of New Jersey.

June 9, 1893.

Constitutional Law—Taxation of Corporate Stock—Interstate Commerce.

1. The federal constitution will not invalidate a state tax imposed upon domestic corporations generally because it incidentally affects one that, under state authority, is engaging in interstate commerce.

2. The yearly license fee imposed upon miscellaneous corporations under the act of April 18, 1884, (Supp. Revision, p. 1016,) is levied upon the right of the company to exist in corporate form, without regard to the powers that under such form it may exercise. Such a fee may be exacted by the state from which the right is derived, without reference to the nature of the business the corporation may be authorized to carry on, and is constitutional, even as against a domestic corporation created for the purpose of engaging in commerce with an adjoining state.

3. The right of corporate existence is, in its nature, indivisible, and the fee therefor must necessarily be an entirety, no matter where the property of the company is situated, or how its capital is invested or employed.

(Syllabus by the Court.)

Certiorari by the Lumberville Delaware Bridge Company against the state board of assessors to review assessments for taxation. Judgment for defendant.

The following state of facts is agreed upon for the purpose of the argument of the above-stated cause:

"First. It is admitted that by the compact between New Jersey and Pennsylvania, dated May 27, 1783, (Nix. Dig. p. 864,) it is declared that the river Delaware, from the northwest corner of New Jersey to the circular boundary of the state of Dela ware, in the whole length and breadth thereof, is, and shall continue to be and remain, a common high way, equally free and open for the use, benefit, and advantage of the contracting parties, and that each state shall enjoy and exercise a concurring jurisdiction within and upon the water between the shores of said river.

"Second. It is admitted that the Lumberville Delaware Bridge Company was incorporated by the concurrent legislation of said states, viz.:

"By an act of the legislature of the state of Pennsylvania entitled 'An act to incorporate the Lumberville Delaware Bridge Company,' approved April 7, 1835, (P. L. Pa. 1834-35, p. 114,) and by an act of the legislature of the state of New Jersey entitled 'An act to incorporate the Lumberville Delaware Bridge Company,' passed February 12, 1836, (P. L. N. J. 1836, p. 79.)

"Third. It is admitted that the incorporators duly organized, built, erected, and constructed a bridge across the river Delaware, from shore to shore, between said states, at or near Lumberville, in the county of Bucks, and state of Pennsylvania, and erected its tollgates on the westerly bank of said river, and have always demanded and collected all tolls thereat.

"Fourth. It is admitted that the president and treasurer of said company are residents of the state of Pennsylvania, and the secretary thereof is a resident of New Jersey, and that all meetings of said company are held at the office of said company established at Lumberville, Penn.

"Fifth. It is admitted that the prosecutors pay annually to the authorities of New Jersey taxes on one-half of said bridge, including the abutments and piers to the center of the river upon the New Jersey side, as part of the structure, without reference to the extent of travel upon it, or the profits derived therefrom, and that the prosecutors pay annually to the authorities of the state of Pennsylvania one-half of the taxes assessed under and by virtue of the acts of the legislature of said state, passed June 7, 1879, and June 1, 1889.

"Sixth. It is admitted that the prosecutors have paid to the state of New Jersey, under protest, all taxes assessed against it under and by virtue of the act entitled 'An act to provide for the imposition of state taxes upon certain corporations, and for the collection thereof, approved April 18, 1884,' and the several supplements thereto.

"Seventh. It is admitted that the state of Pennsylvania has never concurred in the passage of the last-mentioned act.

"Eighth. It is agreed that either party may refer to all laws, agreements, documents, or papers made or passed by either state in reference thereto.

"Wm. S. Gummere, Attorney for Prosecutors.

"John P. Stockton, Attorney General."

The following are the reasons relied upon:

"First. Because the said tax or impost is tax upon interstate commerce, and in violation of the constitution of the United States.

"Second. Because the said Lumberville Delaware Bridge Company is not incorporated under the laws of the state of New Jersey, within the meaning of the terms of the act entitled 'An act to provide for the imposition of state taxes upon certain corporations, and for the collection thereof,' approved April 18, 1884, and the several supplements thereto, passed by the legislature of the state of New Jersey.

"Third. Because, upon the principles of public law, it is clear that the power of erecting a bridge, and taking tolls thereon, over a navigable river which forms the coterminous boundary between two states, can only be conferred by the concurrent legislation of both states; and such charters are subject to alteration, amendment, or repeal by like concurrent legislation only.

"Fourth. Because the legislature of the state of New Jersey cannot impose a tax by way of a license fee upon a foreign corporation, or its franchises, carrying on its business, or any part thereof, without the jurisdiction of the state of New Jersey.

"Fifth. Because the assessment was made upon an erroneous principle; that is to say, it was measured by the amount of its capital stock issued by the laws of the state of Pennsylvania, as well as the amount thereof issued by virtue of the laws of the state of New Jersey, whereas it should have been measured by one-half of the total amount of its capital stock issued and outstanding.

"Sixth. Because the act of April 18, 1884, and the supplements, do not authorize the imposition of any tax, by way of license fee or otherwise, upon foreign corporations. It only applies to domestic corporations.

"Seventh. Because the said corporation is a foreign corporation, and demands and receives all tolls at its gates erected and maintained within the jurisdiction of the state of Pennsylvania.

"Eighth. Because the title of the act of April 18, 1884, and supplements, does not embrace foreign corporations, and if it did the same would be void for duplicity.

"Ninth. Because the said assessments are, in divers and other respects, uncertain, erroneous, and illegal, and ought to be set aside and reversed."

Argued February term, 1893, before VAN SYCKEL and GARRISON, JJ.

W. S. Gummere, for prosecutors.

William Y. Johnson, for defendant.

GARRISON, J. (after stating the facts.) The Lumberville Delaware Bridge Company, a corporation created in 1836 by the legislature of this state, resists the payment of the license fee imposed under the fourth section of "An act to provide for the imposition of state taxes upon certain corporations, and for the collection thereof," (P. L. 1884, p. 232.)

The pertinent provision of this section is in these words: "All other corporations incorporated under the laws of this state, and not hereinbefore provided for, shall pay a yearly license fee or tax of one-tenth of one per cent on the amount of the capital stock of such corporations."

The first ground of opposition is that the imposition of this tax upon the prosecutor is a burden upon, and hence a regulation of, commerce between the states, in violation of the exclusive jurisdiction of the federal congress.

It is not questioned that the power to regulate commerce between the states has been, by the constitution of the United States, committed exclusively to congress; and it is furthermore established that the omission of congress to legislate with reference to the matter thus committed to it implies, not that the states may legislate with respect thereto, but that commerce shall be free from all statutory regulations until congress see fit to impose them. Robbins v. Taxing Dist., 120 U. S. 489, 7 Sup. Ct. Rep. 592, and cases there cited.

It is also established law that no state has the right to lay any impost upon interstate commerce, in any form, whether by way of duties upon the subject of transportation, or by way of license fee imposed upon the occupation or business of carrying it on.

These doctrines, while they secure to congress the exclusive right to make laws having for their object the control of commerce among the states, and the regulation of any and all of the incidents of that commerce, do not invalidate state laws, otherwise legitimate, merely because they casually affect interstate commerce. In Robbins v. Taxing Dist., 120 D. S. 489, 7 Sup. Ct. Rep. 592, Mr. Justice Bradley, speaking of the exclusive right of congress to make express regulations for interstate commerce, says: "It is also an established principle, as already indicated, that the only way in which commerce between the states can be legitimately affected by state laws is when, by virtue of its police power, and its jurisdiction over persons and property within its limits, a state provides for the security of the lives, limbs, health, and comfort of persons, and the protection of property, or when it does those things which may otherwise incidentally affect commerce, such as the establishment and regulation of highways, canals, railroads, wharves, ferries, and other commercial facilities, and the imposition of taxes upon persons residing within the state, or belonging to its population. * * * But in making such internal regulations no discrimination can be made adversely to the persons or property of other states, and no regulation can be made directly affecting interstate commerce."

And in Leloup...