Metropolitan Life Ins. Co. v. Com.
| Decision Date | 18 May 1908 |
| Citation | 84 N.E. 863,198 Mass. 466 |
| Parties | METROPOLITAN LIFE INS. CO. v. COMMONWEALTH. |
| Court | United States State Supreme Judicial Court of Massachusetts Supreme Court |
Guy W. Cox, for petitioner.
Dana Malone, Atty. Gen., and Fred T. Field, Asst. Atty. Gen., for the Commonwealth.
The decision of this case involves two questions: First, whether the taxation upon insurance companies incorporated in other states, provided for in sections 24 and 28 of Rev. Laws, c 14, is to be imposed under both sections, and taxes are to be collected of the companies under each section, or whether the sections provide two separate and independent modes of taxation, of which one only can be adopted in any particular case, so that the commonwealth has no right to collect under section 28 unless the amount assessable under that section is larger than the amount that would be payable under section 24. Secondly, whether the rate named in section 28 is to be so construed as to impose a heavier burden of taxation upon the company, in proportion to the premiums charged and received, than is imposed upon Massachusetts companies by the laws of the state in which the foreign company is incorporated. Section 28 is as follows: 'A life insurance company, association or partnership, incorporated or associated by virtue of any other state of the United States by the laws of which a tax is imposed upon the premium receipts of life insurance companies chartered by this commonwealth and doing business in such state, or upon their agents, shall annually, so long as such laws continue in force, pay a tax or excise upon all premiums charged or received upon contracts made in this commonwealth, at a rate equal to the highest rate so imposed during the year.'
The history of the legislation of which section 28 is a part makes it plain that the section was intended only to create reciprocal relations between the taxation of our domestic companies in another state and the taxation of similar companies of that state in this commonwealth. It seems clear that the taxation resorted to under this statute is to be the only taxation to which the foreign company should be subjected. The section was enacted in substantially its present form in St. 1873, p. 562, c. 141, before the provision for taxation upon the net value of policies, now contained in section 24, was made by St. 1880, p. 177, c 227. The latter statute did not repeal the former one, and both were included in Pub. St. 1882, c. 13, §§ 25-31, and re-enacted in the Revised Laws. The effect of the Attorney General's contention would be to tax all companies, foreign and domestic, under section 24, in the form of an excise upon the net value of their policies, at such a rate as is deemed proper for the franchises which they enjoy. But if a tax is imposed on Massachusetts companies by another state in another form, namely, upon their premium receipts, the companies incorporated in that state, doing business in Massachusetts, would also be taxed in this form at the same rate as our companies are taxed there, while no other foreign companies would pay any tax of this kind in Massachusetts. This would be very unjust.
The first provision in Massachusetts on this subject is found in St. 1856, p. 179, c. 252, § 47 , and it requires 'the same taxes, fines, penalties, deposits and obligations' of foreign companies doing business in Massachusetts as are imposed on Massachusetts companies doing business in the other state. This law was continued unchanged in Gen. St. 1860, c. 58, § 70. In Pub. St. 1882, c. 119, § 215, the language is 'like fines, fees, penalties deposits, obligations and prohibitions (not being less in amount than those required by other provisions of law of this commonwealth in similar cases) are imposed,' etc. All these provisions are intended to be reciprocal, and to govern the subject of taxation upon companies incorporated in other states, where taxation upon premium receipts is imposed upon Massachusetts companies to an amount greater than the taxation of net values under section 24. The practice...
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