Saginaw Mfg. Co. v. Deland

• Decision Date: 07 January 1924
• Docket Number: No. 480.,480.
• Citation: 226 Mich. 1,196 N.W. 616
• Parties: SAGINAW MFG. CO. v. DELAND, Secretary of State.
• Court: Michigan Supreme Court

226 Mich. 1

196 N.W. 616

SAGINAW MFG. CO.

v.DELAND, Secretary of State.

No. 480.

Supreme Court of Michigan.

Jan. 7, 1924.

Petition by the Saginaw Maunfacturing Company for a writ of mandamus to be directed against Charles J. Deland, Secretary of State. Writ denied.

Argued before WIEST, C. J., and FELLOWS, McDONALD, CLARK, BIRD, SHARPE, MOORE, and STEERE, JJ.Humphrey, Grant & Henry, of Saginaw, for plaintiff.

Andrew B. Dougherty, Atty. Gen., Clare Retan, Deputy Atty. Gen., and J. E. Converse, Asst. Atty. Gen., for defendant.

MOORE, J.

The petitioner asks for the writ of mandamus to compel the secretary of state to accept and file its report of June 30, 1922, without requiring it to pay a privilege tax on $463,846.25 of bonds owned by it outside of the state.

This litigation requires a construction of some of the provisions of Act 85 of the Session Laws of 1921. The title of the act in part is:

‘An act prescribing the fees, taxes and charges to be paid to the state by corporations doing or seeking to do business in this state.’

Section 4 of the act reads:

‘Sec. 4. Every corporation organized or doing business under the laws of this state, excepting those hereinafter expressly exempted therefrom, shall, at the time of filing its annual report with the securtary of state of this state, as required by section seven hereof, for the privilege of exercising its franchise and of transacting its business within this state, pay to the secretary of state, an annual fee of three and one-half mills upon each dollar of its paid up capital and surplus, but such privilege fee shall in no case be less than fifty dollars nor more than ten thousand dollars.’

Section 5 reads in part as follows:

‘Sec. 5. In the case of computing the privilege fees prescribed in sections three and four of this act as to foreign corporations, such computation shall be made upon the proportion of the corporation's property owned and used in Michigan in the ratio that such property bears to the entire property of the corporation, and such ratio shall be applied by the secretary of state to determine the amount of the authorized capital stock of such corporation owned and used in Michigan, and to determine what portion of the corporation's paid up capital and surplus, severally, are owned and used in Michigan. The term ‘surplus,’ as used in this act, shall be taken and deemed to mean the net value of the corporation's property, less its outstanding indebtedness and paid up capital; but in no case, either as to domestic or as to foreign corporations, shall any deduction be made from the item of paid up capital, in computing the privilege fee thereon, by reason of any impairment of the same. None of the property or capital, of any corporation subject to paying the privilege fee prescribed in section four which is located without the state of Michigan, and none of the capital or surplus of such corporation represented by property exclusively used in interstate commerce, shall in any case enter into the computation of the net amount of the authorized capital, or the capital and surplus, as the case may be, upon which the computation of the privilege fees shall be made.'

The facts are not in dispute. The report shows that petitioner's place of business is Saginaw, Mich.; that it is engaged in the manufacture and sale of pulleys and washboards; that it has no real estate outside of Michigan; that it has no personal property outside...