Norfolk v. Commonwealth of Pennsylvania

• Decision Date: 19 May 1890
• Parties: NORFOLK & W. R. Co. v. COMMONWEALTH OF PENNSYLVANIA
• Court: U.S. Supreme Court

136 U.S. 114

10 S.Ct. 958

34 L.Ed. 394

NORFOLK & W. R. Co. v. COMMONWEALTH OF PENNSYLVANIA.

May 19, 1890.

M. E. Olmsted, for plaintiff in error,

W. S. Kirkpatrick and John F. Sanderson, for defendant in error.

LARMAR, J.

The sixteenth section of an act of the legislature of the commonwealth of Pennsylvania, approved June 7, 1879, (P. L. 112, 120,) provides as follows: 'That from and after the first day of July, Anno Domini one thousand eight hundred and seventy-nine, no foreign corporation, except foreign insurance companies, which does not invest and use its capital in this commonwealth, shall have an office or offices in this commonwealth for the use of its offices, stockholders, agents, or employes, unless it shall have first obtained from the auditor general an annual license so to do; and for said license every such corporation shall pay into the state treasury, for the use of the common wealth, annually, one-fourth of a mill on each dollar of capital stock which said company is authorized to have; and the auditor general shall not issue a license to any corporation until said license fee shall have been paid. The auditor general and state treasurer are hereby authorized to settle and have collected an account against any company violating the provisions of this section, for the amount of such license fee, together with a penalty of fifty per centum for failure to pay the same: provided, that no license fee shall be necessary for any corporation paying a tax under any previous section of this act, or whose capital stock, or a majority thereof, is owned or controlled by a corporation of this state which does pay a tax under any previous section of this act.'

Under the authority vested in him by that statute, the auditor general of the state assessed a license tax against the Norfolk & Western Railroad Company, a corporation existing under the laws of Virginia and West Virginia, for each of the two years ending July 1, 1885, on its capital stock of $25,000,000, at the rate prescribed in the act, amounting to $6,250 a year, on account of its having an office for the use of its officers, stockholders, agents and employes in the city of Philadelphia. The case now before this court involves the claim of the state for the year ending July 1, 1884, only. As permitted by the laws of Pennsylvania, the company appealed from the auditor general's settlement tot he court of common pleas of Dauphin county, in that state. The case was tried in that court without the intervention of a jury, under an act of the state legislature approved April 22, 1874, and the court made the following findings of fact: '(1) The defendant is a railroad corporation existing under the laws of the states of Virginia and West Virginia, and its main line and branches lie wholly within these states. (2) Its line of railroad connects at several points with the railroads of other corporations; and by virtue of these connectons, and certain traffic contracts and agreements, it has become a link in a through line of road, over which, as part of the business thereof, freight and passengers are carried into and out of this commonwealth. (3) Its authorized capital stock is twenty-five millions of dollars. (4) From July 1, 1883, to July 1, 1885, it had an office in this commonwealth for the use its officers, stockholders, agents, and employes. Its main office is at Roanoke, Va. (5) During this period it expended a considerable amount of money in Pennsylvania in the purchase of materials and supplies for the use of its road; but, with trifling exceptions, it owns no property, and has no capital invested for corporate purposes, within this commonwealth. (6) It has paid no office license fee for the years named, as required by section sixteen of the act of 1879, (P. L. 120.) Upon this section these settlements are based.' Judgment was rendered against the company on that finding, sustaining the settlement made by the auditor general of the state, for the sum of $7,503.12. That judgment having been affirmed by the supreme court of the state, this writ of error was sued out. The assignment of errors is to the effect that the court below erred in refusing to sustain the following points, urged by the company, both in the trial court and in the supreme court of the state, viz.: '(1) Inasmuch as the sixteenth section of the act of June 7, 1879, denies to foreign corporations, and to the officers, agents, and employes of foreign corporations, the right to have an office or place of meeting in the state of Pennsylvania, the said section is in conflict with clause one of section two of article 4 of the constitution of the United States, which provides that 'the citizens of each state shall be entitled to all privileges * * * of citizens in the several states.' (2) The sixteenth section of the act of June 7, 1879, is an abridgment of the privileges and immunities of the citizens of the United States; it discriminates between corporations of the state of Pennsylvania and corporations of other states; it discriminates between corporations and natural persons having offices in Pennsylvania; it discriminates between foreign corporations; it denies to foreign corporations, and to natural persons connected with such corporations, particularly this defendant and its officers, agents, and employes, who were in the state maintaining an office and doing business at and before the passage of the said act, the equal protection of the laws, and is for these reasons void, because in conflict with article 14 of the amendments to the constitution of the United States, and also because in conflict with the act of congress, (Rev. St. § 1977.) (3) Inasmuch as the Norfolk & Western Railroad Company engaged in the business of transporting freight and passengers to or from other states out of or into the state of Pennsylvania, or from other states to other states,...