Robertson v. Mississippi Valley Co.

• Citation: 120 Miss. 159,81 So. 799
• Decision Date: 26 May 1919
• Docket Number: 20685
• Court: United States State Supreme Court of Mississippi
• Parties: ROBERTSON, REVENUE AGENT v. MISSISSIPPI VALLEY CO

81 So. 799

120 Miss. 159

ROBERTSON, REVENUE AGENT v. MISSISSIPPI VALLEY CO

No. 20685

Supreme Court of Mississippi

May 26, 1919

1 TAXATION. Domestic corporations. Stock invested in stock of other companies.

Construing Code 1906, sections 4258-4264-4267 (Hemingway's Code sections 6891-6898-6901), in connection with sections 112 and 181 of the Constitution, the court held that a corporation cannot be taxed on that portion of its capital stock which is invested in shares of the capital stock of another domestic corporation.

2 COURTS. Decisions of supreme courts as precedent. Affirmance. By divided court.

Wherein an appeal by a revenue agent in his suit to back assess and subject to taxation by a city, the capital stock of a corporation, a decision by the supreme court was rendered in a like proceeding between the same parties involving the same question, which decision was an affirmance only on account of a divided court, such a decision is a judicial precedent, and should be followed unless and until overruled.

HON. J L. BATES, Judge.

APPEAL from the circuit court of Yalobusha county, HON. J. L. BATES, Judge.

Proceeding by States V. Robertson, State Revenue Agent, against the Mississippi Valley Company. From a judgment for defendant, the revenue agent appeals.

The facts are fully stated in the opinion of the court.

Affirmed.

Green & Green, Tim E. Cooper, R. B. Campbell and McLaurin & Arminstead, for appellants.

Wells, May & Sanders, Robt. B. Mayes, Edward Mayes, H. H. Creekmore, Price & Price, R. V. Fletcher, Blewett Lee, and W. I. Defenbaugh, for appellee.

SMITH C. J. STEVENS, J. dissenting.

OPINION

SMITH, C. J.

This is a proceeding by the state revenue agent under section 4740, Code of 1906 (section 7058, Hemingway's Code), to back-assess and subject to taxation by the city of Water Valley the capital stock of the appellee for the years 1908 to 1913, inclusive. In due course the cause reached and was tried in the court below, and at the close of the evidence the jury was instructed peremptorily to find for the appellee, and there was a verdict and judgment accordingly, from which the revenue agent appealed to this court.

The appellee is a domestic corporation domiciled at Water Valley. A portion of its capital stock is invested in real estate, and the remainder thereof is invested in the shares of the capital stock of several domestic railroad corporations, the property of which was assessed by the Railroad Commission in each of the years here in question, and the taxes due by the corporations thereon were paid.

During each of the years here in question the appellee was assessed with and paid taxes only on its real estate, and the claim of the revenue agent is that it should have been, and because it was not, should now be, assessed with the value of its capital stock less the value of its real estate.

Section 4267, Code of 1906 (section 6901, Hemingway's Code), provides that:

"All joint stock companies or corporations organized under the laws of, and doing business in, this state, shall be assessed for taxation and be taxed as follows: The president or other officer of any joint-stock company or corporation, other than banks and railroad companies, shall, on demand, on or before the first day of June in every year, deliver to the assessor of the county in which the company or corporation is domiciled or located, a written statement, under oath, of the capital stock paid in, and its market value, and to whom each share belongs; also a statement and the market value of all real estate owned by such company or corporation; all to be as of the first day of February of the year in which such statements shall be rendered. The capital stock of such company or Corporation shall be assessed to it for taxation to the extent of the full amount of the value thereof as shown by such statement, less the aggregate value of such real estate, which shall be deducted from the value of such capital stock, such real estate to be subject to separate assessment and taxation as other real estate is assessed and taxed."

None of our statutes provide for the assessment of the shares into which the capital stock of a corporation is divided to the owner thereof, consequently they are not taxed thereon ( State v. Simmons, 70 Miss. 485, 12 So. 477), and the contention of the appellee is that, when the statute hereinbefore set out is construed in connection with sections 112 and 181 of the Constitution, and sections 4258 and 4264, Code of 1906 (sections 6891 and 6898, Hemingway's Code), in the light of the decisions of this court in State v. Simmons, 70 Miss. 485, 12 So. 477; Bank v. Oxford, 70 Miss. 504, 12 So. 203; Panola County v. Carrier, 89 Miss. 277 42 So. 347, and People's Warehouse Co. v. Yazoo City, 97 Miss. 500, 52 So. 481, a corporation cannot be taxed on that portion of its capital stock which is invested in shares of the capital stock of another domestic corporation.

The record in the case at bar is practically identical with that on which the cash of Robertson, Revenue Agent v. Mississippi Valley Co., 77 So. 253, was tried, except as to the parties, the proceeding there being by the revenue agent for the use of the state of Mississippi and Yalobusha county, and here for the use of the city of Water Valley, and the questions there presented for determination are identical with those presented here. In that case, as here, the court below upheld the appellees' contentions, and on appeal to this court its judgment was affirmed, the judges of this court then and now being equally divided upon the questions of law there and here involved, so that the judgment here under consideration must be affirmed not only for the reason that a majority of us cannot say that it is erroneous, but for the further reason that the decision rendered in Robertson, Revenue Agent, v. Miss. Valley Co., supra, is a judicial precedent, and should be followed, unless and until it is overruled.

We are aware that all of the courts of last resort except the English House of Lords (Beamish v Beamish, 9 H. L. 274) and the Supreme Court of South Carolina (City of Florence v. Berry, 62 S.C. 469, 40 S.E. 871; Mortgage Co. v. Woodward, 83 S.C. 521, 65 S.E. 739) have held that a judgment of a court made on an equal division of the judges thereof does not decide any principle of law involved therein, and consequently is not a judicial precedent, but the reasons given therefor do not commend their decisions to our approval. No judgment can be rendered by any court without a decision by it of the principles of law involved therein, for every judgment results from the application by the court of some principle of law to the facts of the case in which the judgment is to be rendered, so that by affirming the judgment of the court below in Robertson v. Mississippi Valley Co., supra, this court necessarily decided that our statutes do not contemplate that a corporation should be taxed on that portion of its capital stock which is invested in shares of another domestic corporation. That no opinion was, or in fact could have been, written, setting forth the views of all or even of a majority of the judges participating in the decision, is not here material, for the principles of law in a case are settled, and the precedent is made by the court's decision, which is authoritatively evidenced,...