Palmer v. Mahon

• Decision Date: 03 March 1890
• Parties: PALMER v. McMAHON, Receiver of Taxes. 1
• Court: U.S. Supreme Court

133 U.S. 660

10 S.Ct. 324

33 L.Ed. 772

PALMER v. McMAHON, Receiver of Taxes.¹

March 3, 1890.

[Statement of Case from pages 660-665 intentionally omitted] Wm. H. Field, for plaintiff in error.

David J. Dean, for defendant in error.

Mr. Chief Justice FULLER, after stating the facts as above, delivered the opinion of the court.

We are bound by the decision of the court of appeals of the state of New York adversely to the plaintiff in error, as to failure to comply with the state statute in relation to the method of procedure, form of assessment, oath of assessors, etc., in respect to which it may be further remarked that the attack in this case is in its nature collateral. Stanley v. Supervisors, 121 U. S. 535, 7 Sup. Ct. Rep. 1234; Supervisors v. Stanley, 105 U. S. 305. We proceed to examine, therefore, whether the assessment was invalid because the statute under which it was laid contravened the constitution or laws of the United States, and whether the proceedings authorized by chapter 230 of the Laws of 1843 operated to deprive the citizen of liberty or property without due process of law. Section 5219 of the Revised Statutes, title 62, 'National Banks,' reads as follows: 'Nothing herein shall prevent all the shares in any association from being included in the valuation of the personal property of the owner or holder or such shares, in assessing taxes imposed by authority of the state within which the association is located, but the legislature of each state may determine and direct the manner and place of taxing all the shares of national banking associations located within the state, subject only to the two restrictions that the taxation shall not be at a greater rate than is assessed upon other moneyed capital in the hands of individual citizens of such state, and that the shares of any national banking association owned by nonresidents of any state shall be taxed in the eity or town where the bank is located, and not elsewhere. Nothing herein shall be construed to exempt the real property of associations from either state county, or municipal taxes, to the same extent, according to its value, as other real property is taxed.' CHAPTER 596 OF THE LAWS OF NEW YORK OF 1880 is entitled 'an Act to pRoviDe for the taxation of banks and of moneyed capital engaged in the business of banking, receiving deposits, or otherwise;' and its third section reads thus: 'The stockholders in every bank, banking association, or trust company, organized under the authority of this state, or of the United States, shall be assessed and taxed on the value of their shares of stock therein. Said shares shall be included in the valuation of the personal property of such stockholders in the assessment of taxes at the place, city, town, or ward where such bank, banking association, or trust company is located, and not elsewhere, whether the said stockholder reside in said place, city, town, or ward, or not; but in the assessment of said shares each stockholder shall be allowed all the deductions and exemptions allowed by law in assessing the value of other taxable personal property owned by individual citizens of this state, and the assessment or taxation shall not be at a greater rate than is made or assessed upon other moneyed capital in the hands of individual citizens of this state. In making such assessment there shall also be deducted from the value of such shares such sum as is in the same proportion to such value as is the assessed value of the real estate of the bank, banking association, or trust company, and in which any portion of their capital is invested, in which said shares are held, to the whole amount of the capital stock of such bank, banking association, or trust company. Nothing herein contained shall be held or construed to exempt the real estate of banks, banking associations, or trust companies from either state, county, or municipal taxes; but the same shall be subject to state, county, municipal, and other taxation, to the same extent and rate, and in the same manner, according to its value, as other real estate is taxed.' 1 Laws N. Y. 1880, pp. 888, 889.

We have decided that so much of the capital of national and state banks as is in vested in United States securities cannot be subjected to state taxation, (People v. Commissioners, 2 Black, 620; Bank Tax Case, 2 Wall. 200,) but that shares of bank-stock may be taxed in the hands of their individual owners at their actual instead of their par value, (People v. Commissioners, 94 U. S. 415; Hepburn v. School Directors, 23 Wall. 480,) without regard to the fact that part or the whole of the capital of the corporation might be so invested, (Van Allen v. Assessors, 3 Wall. 573; Bradley v. People, 4 Wall. 459; People v. Commissioners, Id. 244,) and that, under acts permitting the deduction of debts from the value of all a person's taxable property, such deduction must be permitted from the value of such shares, (People v. Weaver, 100 U. S. 539, 546,) but that a statute is not void because it does not provide for a deduction, nor is the assessment void if deductions are not made, but voidable only, (Supervisors v. Stanley, 105 U. S. 305.) We have also held that individual instances of omission or undervaluation cannot be relied on to invalidate an assessment, (Supervisors v. Stanley, supra,) and that, because a state statute does not provide for the taxation of shares in corporations other than banks, it does not follow that the tax on moneyed capital invested in bank-shares is at a greater rate than that of the moneyed capital of individual citizens invested in other corporations, nor are the shareholders in national banks discriminated against because the taxation of such other corporations is arrived at under a separate system, (Bank v. New York, 121 U. S. 138, 7 Sup. Ct. Rep. 826.) In...