Postal Telegraph Cable Co v. Adams, 649

CourtUnited States Supreme Court
Citation155 U.S. 688,15 S.Ct. 268,39 L.Ed. 311
Docket NumberNo. 649,649
PartiesPOSTAL TELEGRAPH CABLE CO. v. ADAMS, Revenue Agent of State of Mississippi
Decision Date21 January 1895

By the revenue laws of Mississippi certain taxes were levied as privilege taxes on various corporations, such as express companies, telegraph companies, insurance companies, sleeping-car companies, banks of deposit or discount, gas companies, and the like, and on taverns, hotels, restaurants, brokers, auctioneers, peddlers, liquor sellers, dealers in malt liquors, and so on. Code Miss. 1880, c. 10, § 585; Sess. Laws Miss. 1888, c. 3. The tax required to be paid by telegraph companies was $3,000 on each telegraph company operating within the state 1,000 miles or more of wire, and on each telegraph company operating less than 1,000 miles of wire a tax of $1 per mile, and the tax thus levied was 'in lieu of other state, county, and municipal taxes.' During the fiscal years 1890 and 1891 the Postal Telegraph Cable Company, a corporation chartered under the laws of New York, operated within the state of Mississippi 391.28 miles of wire. The telegraph lines, equipment, and property appertaining thereto, owned and operated by the company within the limits of 19 counties of the state, were during these years worth and valued at the sum of $41,967.54. The tax levied on the company be the law of March 8, 1888, under the name of privilege tax, amounted annually to $391.28, or an aggregate for the two years of $782.56. Under the general revenue laws of the state the ad valorem tax on the property of the company for the two years would have been $1,188.56 for state and county purposes only, not including what might have been assessed and collected by municipalities in the way of ad valorem taxes for municipal purposes. For the years 1890 and 1891 the company failed to pay its taxes, and Adams, the state revenue agent of the state of Mississippi, brought suit in the circuit court of Hinds county, August 16, 1892, against the company therefor. The first count of the declaration was for the privilege taxes and the second count for ad valorem taxes in the several counties, which it was alleged had been duly levied for state and county purposes. The company demurred to the second count and pleaded specially to the first count, in substance so far as essential here, that it was a telegraph company duly incorporated and organized under the laws of the state of New York and was on the 1st days of January, 1890, 1891, and 1892, respectively, engaged in, and still continued to carry on, the business of a telegraph company, having offices in various cities and towns in the state of Mississippi for the purpose of receiving and sending telegraphic messages and maintaining and operating certain lines of telegraph on the various post roads, public roads, and railroads extending over, across, leading into and from the state of Mississippi to the state of Alabama, and other points in other states of the United States and the dominion of Canada; that it was also the lessee of the Atlantic Postal Telegraph Cable Company, a corporation duly organized under the laws of the state of New York, and by its charter authorized to construct and operate lines of telegraph in and between the various states of the Union, including the state of Mississippi; that as such lessee and owner it was engaged in the general public telegraph business of transmitting messages for commercial purposes by, along, and over its lines within, from, through, and across the state of Mississippi and many other states and territories of the Union, and had offices for the receiving and sending of messages by telegraph in each and every state and territory wherein the lines leased or owned by it extended, including the state of Mississippi; that on or about the 6th day of March, 1886, the company duly filed its written acceptance with the postmaster general of the United States of the restrictions and obligations of the act of congress entitled, 'An act to aid in the construction of telegraph lines and to secure to the government the use of the same for postal, military, and other purposes,' approved July 24, 1866, now title 65 of the United States Revised Statutes, and that in pursuance thereof it had been designated by the postmaster general as one of the telegraph companies that must transmit messages for the United States at a price and rate to be fixed by the said postmaster general; that defendant was engaged as a governmental agent of the United States, at the times mentioned, in transmitting messages for the government of the United States between its various offices, not only from points within the state of Mississippi to points without the state of Mississippi, but also for such government officers from points wholly within the state of Mississippi to other points also wholly within the state of Mississippi; and that all of the roads upon which the lines of said company were constructed were post roads of the United States.

Plaintiff demurred to the special pleas. The case came on to be heard upon these demurrers, and the circuit court sustained defendant's demurrer to the second count, and plaintiff's demurrer to defendant's pleas to the first count, with leave to defendant to plead over. This, defendant declined to do, and judgment was thereupon entered against the company for the amount of the so-called 'privilege taxes' for the years 1890 and 1891, with interest and costs. From this judgment an appeal was taken to the supreme court of Mississippi, and the judgment affirmed. The opinion of that court will be found reported in advance of the official series in 14 South. 36. A writ of error was then allowed to this court.

T. Moultrie Mordecal and P. H. Gadsden, for plaintiff in error.

[Argument of Counsel from pages 691-695 intentionally omitted] Marcellus Green, for defendant in error.

Mr. Chief Justice FULLER, after stating the facts in the foregoing language, delivered the opinion of the court.

It is settled that where, by way of duties laid on the transportation of the subjects of interstate commerce, or on the receipts derived therefrom, or on the occupation or business of carrying it on, a tax is levied by a state on interstate commerce, such taxation amounts to a regulation of such commerce, and cannot be sustained. But property in a state belonging to a corporation, whether foreign or domestic, engaged in foreign or interstate commerce, may be taxed, or a tax may be imposed on the corporation on account of its property within a state, and may take the form of a tax for the privilege of exercising its franchises within the state, if the ascertainment of the amount is made dependent in fact on the value of its property situated within the state (the exaction, therefore, not being susceptible of exceeding the sum which might be leviable...

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