N.J. Bell Tel. Co. v. State Bd. of Tx. and Assessment
| Decision Date | 06 December 1928 |
| Docket Number | No. 257.,257. |
| Citation | 143 A. 841 |
| Parties | NEW JERSEY BELL TELEPHONE CO. v. STATE BOARD OF TAXES AND ASSESSMENT. |
| Court | New Jersey Supreme Court |
(Syllabus by the Court.)
Certiorari by the New Jersey Bell Telephone Company against the State Board of Taxes and Assessment. Writ dismissed.
Argued October term, 1928, before MINTURN, BLACK, and CAMPBELL, JJ.
Wall, Haight, Carey & Hartpence, of Jersey City, and Frankland Briggs, of Newark, for prosecutor.
John Solan, of Trenton, and Edward L. Katzenbaeh, Atty. Gen., for defendant.
The certiorari in this case was allowed to review the taxes assessed by the state board of taxes and assessment against the prosecutor, the New Jersey Bell Telephone Company, for the year 1928, pursuant to the provisions of the Voorhees Franchise Tax Act. P. L. 1900, p. 502, as the same has been amended by P. L. 1917, p, 42, P. L. 1918, p. 907, P. L. 1927, p. 567, and P. L. 1928, p. 223. The latter act has no application to this controversy; that act simply imposes upon the prosecutor, as the successor to part of the business of the New York company, the tax to which the latter would have been subject under P. L. 1900, p. 502, had it continued to do business in New Jersey during the year 1928.
The sole reason assigned for setting aside the tax was the method by which the amount of the tax was computed. The allegation is that, in so far as it la based in part upon gross receipts derived from interstate commerce, it is a regulation of and burden upon interstate commerce, in violation of article 1, section 8, paragraph 3, of the Constitution of the United States.
The method which the state board of taxes and assessment adopted in calculating the tax under review is as follows:
Memorandum Showing Calculation of Gross Receipts Taxable and Amount of Tax for Year 1928.
This calculation is made in accordance with provisions of chapter 195, Laws of 1900, as amended, using gross receipts and lengths of line as reported by the New Jersey Bell Telephone Company in their annual report to this board:
Gross receipts of New York Telephone Company from January 1, 1927, to October 1, 1927:
From Intrastate business
From interstate business.
New York Telephone Company
5,516 miles
Taxable gross receipts, 5516/10829 x$25,002,546.37
Gross receipts of New Jersey Bell Telephone Company from January 1, 1927, to December 31, 1927:
$11,742,764 87
3,535,020 81
$15,277,785 68
$40,280,332 0*
Length of whole line, New Jersey Bell Telephone
Length of line on public highway, New Jersey Bell Telephone Company....... 8.403 miles
Taxable gross receipts, 8403/15203x$15,277,785 68
$ 8,444,335 52
$21,179,957 05
The pertinent parts of the statute under which the tax was calculated and assessed are as follows:
Section 1: "All the property, real and personal, and franchises of all persons, copartnerships, associations or corporations, other than municipal or corporations taxable under the Act," etc., that "have or may hereafter have the right to use or occupy and occupying the streets, highways, roads, lanes or public places in this State, shall hereafter be valued, assessed and taxed as hereinafter provided." P. L. 1900, p. 502, P. L. 1917, p. 42.
Section 8: "The franchise taxes imposed by this Act shall be in lieu of all other franchise taxes now assessed against the persons, co-partnerships, associations or corporations, subject to the provisions of this Act and their property." P. L. 1900, p. 502, P. L. 1902, p. 477.
Section 4: "All such persons," etc., "having part of his, her or its lines or mains in this state and part thereof in another state or states, or having part of his, her or its lines or mains on private property and part thereof on public streets, highways, roads, lanes or other public places, shall make a report showing the gross receipts of his, her or its business over, in, on and from the whole line or mains, together with a statement of the length of the whole line or mains and the length of the line or mains in this State along any street, highway, road, lane or other public place; and the franchise tax of such person," etc., "for business so done in this state, shall be upon such proportion of such gross receipts as the length of the lines or mains in this State, along, in, on or over any street, highway, road, lane or other public place bears to the length of the whole line or mains." P. L. 1927, p. 567, § 1.
This precise question was before this court in the case of Phillipsburg, etc., R. Co. v. State Board of Assessors, 82 N. J. Law, 49, 81 A. 1121. That case, however, was decided under P. L. 1906, p. 644; but that statute was a copy of P. L. 1900, p. 502, § 4, involved in this controversy. The same point was considered in the case of Phillipsburg Transit Co. v. State Board of Taxes and Assessment, 99 N. J. Law, 319, 124 A. 122, affirmed 101 N. J. Law, 225, 127 A. 925, under P. L. 1906, p. 644, § 4, P. L. 1918, p. 903.
The facts of the case under review and the law pertinent thereto are similar to the facts and the law involved in those cases. The act (P. L. 1906, p. 644, § 4) under which the Phillipsburg Case was decided and the act under discussion (P. L. 1900, p. 502), so far as this controversy is concerned, in the pertinent parts of the acts, are identical; as stated above, P. L. 1906, p. 644, was copied from P. L. 1900, p. 502.
So we feel bound to follow the case of Phillipsburg, etc., R. Co. v. State Board of Assessors, 82 N. J. Law, 49, 81 A. 1121. We think, however, that case was rightfully decided, and quite independent of that case we think the method adopted by the state board of taxes and assessment in the instant case was not illegal, and not in violation of the commerce clause of the United States Constitution, but in harmony with the decisions of the United States Supreme Court, the ultimate authority on the point here involved.
It would be a hopeless task to even attempt to harmonize the decisions of that court on this point; much more it would be a useless task, as that court is the sole and ultimate authority on the subject. The application of these decisions to specific cases, as they arise, must be made by that court, and, as has been said by this court in reference to those...
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New Jersey Bell Telephone Co v. State Board of Taxes and Assessment of New Jersey
...construed the statute is repugnant to the commerce clause. That court held the law valid, sustained the tax, and dismissed the writ. (N. J. Sup.) 143 A. 841. And its judgment was affirmed in the Court of Errors and Appeals, 146 A. As stated in its title, the act is one 'for the taxation of ......
- N.J. Bell Tel. Co. v. State Bd. of Taxes & Assessment