People ex rel. Hatch v. Reardon

CourtNew York Court of Appeals
Writing for the CourtVANN
Citation77 N.E. 970,184 N.Y. 431
PartiesPEOPLE ex rel. HATCH v. REARDON.
Decision Date17 April 1906

OPINION TEXT STARTS HERE

Appeal from Supreme Court, Appellate Division, First Department.

Habeas corpus proceedings by the people, on relation of Albert J. Hatch, against Edward Reardon, a peace officer of the county of New York. From a judgment of the Appellate Division (97 N. Y. Supp. 535,110 App. Div. 821) affirming an order dismissing the writ and remanding relator to custody, relator appeals. Affirmed.

On the 8th of June, 1905, the relator was arrested under a warrant issued by a justice of the Court of Special Sessions of the city of New York, charging him with the commission of a misdemeanor in that on the 7th of June, 1905, at the city of New York, he violated chapter 241, p. 474, of the Laws of 1905 ‘by the sale and delivery of certain shares of stock of certain railroad corporations without making any bill or memorandum of such sale, or affixing any stamp or stamps to such a bill or memorandum, or in any way paying the tax as required by said ct.’ The complaint was made by a resident of the state of Connecticut against the relator, who is also a resident of that state. In his affidavit for the warrant the complainant swore that he was a broker by occupation and carried on that business at number 20 Broad street in the city of New York; that in said city, on the day named, the relator sold him ‘100 shares of the common capital stock of the Southern Railway Company, a corporation organized under and by virtue of the laws of the state of Virginia and owning and operating a system of railroads situated wholly without the state of New York, of the par value of $100 per share, for the sum of $30.75 per share in cash, that being the then market value of said shares, and 100 shares of the common capital stock of the Chicago, Milwaukee & St. Paul Railroad Company, a corporation organized under the laws of the state of Wisconsin, and owning and operating a system of railroads situated wholly without the state of New York, of the par value of $100 per share, for the sum of $172 per share, that being the then market value of said shares.’ On payment of the purchase price, amounting to $20,275, the relator delivered to the complainant two certificates of stock representing such shares, assigned in blank, ‘without affixing to any bill or memorandum thereof, or to any other paper, any stamp or stamps, and without paying any tax on making such sale and delivery, although requested by deponent so to do, in violation of the provisions' of said act. It did not appear when, by whom, from what place, or for what purpose, either certificate was brought into this state, or that it was brought here at all. The history of the certificates, so far as given, is simply that they were in the city of New York on the day named, and that they were then and there sold and delivered by the relator to the complainant. A writ of habeas corpus issued to test the validity of said statute was dismissed by the justice of the Supreme Court before whom it was returnable, and the usual order remanding to custody was made. Upon appeal to the Appellate Division the order was affirmed, one of the justices dissenting, and the relator appealed to this court.John G. Milburn and John F. Dillon, for appellant.

Julius M. Mayer, Atty. Gen., and William Travers Jerome, Dist. Atty. (E. Crosby Kindleberger and John R. Dos Passos, of counsel), for respondent.

VANN, J. (after stating the facts).

The issue of law joined by the petition, return and reply is whether the Legislature had power to enact, and did in fact enact, chapter 241, p. 474, of the Laws of 1905, which provides for a tax on the sale and transfer of stock certificates. That act is part of the tax law, which it amends by adding a new article known as No. 15. It imposes a tax ‘on all sales, or agreements to sell, or memoranda of sales or deliveries or transfers of shares or certificates of stock in any domestic or foreign association, company or corporation, made after the first day of June, 1905,’ of two cents ‘on each hundred dollars of face value or fraction thereof.’ Payment of the tax must be denoted by an adhesive stamp or stamps affixed in a manner adapted to the circumstances of the sale. A violation of the act by a transfer without payment of the tax is made a misdemeanor and may be punished by fine, or imprisonment, or both, and the offender is also subject to ‘a civil penalty of five hundred dollars for each violation,’ to be recovered by the state comptroller in any court of competent jurisdiction. The statute further provides that no transfer of stock without payment of the tax ‘shall be made the basis of any action or legal proceedings, nor shall proof thereof be offered or received in evidence in any court in this state.’ The taxes thus imposed ‘and the revenues thereof shall be paid by the state comptroller into the state treasury and be applicable to the general fund, and to the payment of all claims and demands which are a lawful charge thereon.’ The act is attacked as invalid on the ground that it was prematurely passed before it had been on the desks of the members of the Legislature in its final form for at least three calendar legislative days prior to its final passage, as required by section 15, article 3 of the Constitution; that it makes an improper classification; that the tax is imposed on a wrong basis; that it is imposed upon property without the state, and that the act violates the commerce clause of the federal Constitution. After carefully considering these objections, we have reached the conclusion that they are not well founded, and the following are our reasons, so far as we have found time to express them:

First. The statute in question originated, as a bill, in the Senate, where it was amended from time to time and reprinted as often as it was amended. Printed copies thereof, as it was when introduced and as it was each time after it was amended, were promptly placed on the desks of the members of both houses when it was introduced and after each amendment. This was not required by any written rule of the Legislature but was in accordance with the general practice that has prevailed since the Constitution of 1894 was adopted. The bill was passed by the Senate on the 3d of April, 1905, was sent to the Assembly for its concurrence on the 4th, and was finally passed by that body on the 5th, neither the Governor nor the acting Governor having certified to the necessity of its immediate passage. The journal of the Assembly states that the bill was ‘printed and on the desks of the members in its final form at least three calendar legislative days prior to its final passage.’ These are, in substance, the facts relating to the subject as alleged in the petition for the writ and not denied in the return. The Constitution provides that ‘No bill shall be passed or become a law unless it shall have been printed and upon the desks of the members, in its final form, at least three calendar legislative days prior to its final passage, unless the Governor, or the acting Governor, shall have certified to the necessity of its immediate passage, under his hand and the seal of the state.’ Const. art. 3, § 15. The object of this provision, which first appeared in the Constitution of 1894, is to prevent hasty and careless legislation, to prohibit amendments at the last moment and to secure more publicity than had been required before. Care was taken to provide for emergencies by a certificate of necessity from the Governor, which authorizes immediate action. The requirement is not directory, but mandatory, as is obvious from the form of the command, which prohibits a bill from becoming a law without compliance therewith. The question is, who are meant by ‘the members' upon whose desks the printed bill is to be placed? Does the provision mean that the members of the Legislature are to have the bill on their desks for three days prior to its final passage, which was the fact in instance before us; or that the members of the house in which it originated must first have it on their desks for three days, and after they have passed it the members of the other house must have it on their desks for three days more before they can pass it? If the latter is the true meaning of the requirement, it was not obeyed, for the bill was passed by the Assembly on the second day after it was passed by the Senate.

The Constitution created the Legislature as an entity, consistingof two houses, the Senate and Assembly. In every article, except the last, which relates only to the date of operation, and in almost every section it recognizes the existence of the Legislature, as such. Grants of power are made to the Legislature and restrictions upon the exercise of power are directed to the Legislature, not to the Senate and Assembly. Both senators and assemblymen are members of the Legislature, and as such are required to take an oath of office. Article 13, § 1. The command of the people is addressed to the Legislature continuously throughout the fundamental law. Thus it provides that ‘no member of the Legislature shall receive any civil appointment within this State * * * during the time for which he shall have been elected,’ and that ‘no person shall be eligible to the Legislature under certain circumstances (article 3, §§ 7, 8); directs that ‘the members' shall not be questioned ‘for any speech or debate in either house of the Legislature (Id. & 12); that senators and members of Assembly shall be elected on a day named ‘unless otherwise directed by the Legislature (Id. § 9); that ‘no private or local bill, which may be passed by the Legislature, shall embrace more than one subject’ (Id. § 16); that ‘the Legislature shall not pass a private or local bill in certain cases (Id. § 18); that ‘the Legislature shall neither audit nor allow any private claim or account against the state (Id. § 19); that...

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