Stanley Ex v. Board of Sup Rs of the County of Albany

• Decision Date: 02 May 1887
• Citation: 30 L.Ed. 1000,121 U.S. 535,7 S.Ct. 1234
• Parties: STANLEY EX'x, etc., v. BOARD OF SUP'RS OF THE COUNTY OF ALBANY
• Court: U.S. Supreme Court

121 U.S. 535

7 S.Ct. 1234

30 L.Ed. 1000

STANLEY EX'x, etc., v. BOARD OF SUP'RS OF THE COUNTY OF ALBANY.

May 2, 1887.

[

[Statement of Case from pages 535-537 intentionally omitted] Matthew Hale, for plaintiff in error.

[Argument of Counsel from pages 537-542 intentionally omitted] S. W. Rosendale and W. H. Peckham, for defendant in error.

FIELD, J.

The act of congress, in providing for taxation of the shares of national banks, by authority of the state in which such institutions are situated, imposes two restrictions upon the exercise of the power; namely, that the taxation shall not be at a greater rate than upon other moneyed capital in the hands of individual citizens of such state, and that the shares of any national bank owned by non-residents of the state shall be taxed in the city or town where it is located. Rev. St. § 5219.

In People v. Weaver, 100 U. S. 539, this court held, with reference to taxation thus authorized, that the prohibition against discrimination has reference to the entire process of assessment, and includes the valuation of the shares, as well as the rate of percentage charged, and therefore that a statute of New York, which established a mode of assessment by which such shares were valued higher in proportion to their real value than other moneyed capital in the hands of individuals, was in conflict with the prohibition, although no greater percentage was levied on such valuation. If this were not so, a rule of appraisement, applied to shares of national banks, different from one applied to other moneyed capital, might lead to such varied valuations as to materially affect the amount of taxes levied, although the same percentage should be charged on the valuations. There must be a uniform rule of appraisement of value, and the same percentage charged on the values determined, to meet the requirements of the statute.

This action is founded upon alleged disregard of this requirement by the assessing officers of the county of Albany, New York. The plaintiff, Edward N. Stanley, is a citizen of Illinois; and claiming to be assignee of certain shareholders of the National Albany Exchange Bank, located at Albany, in New York, sues to recover the amount of certain taxes alleged to have been illegally collected from them upon their shares in that bank during the years from 1874 to 1879, both inclusive, and paid into the treasury of the county of Albany. The original complaint contained several counts, all of which, except the fourth, were substantially the same, except as to the names of the stockholders and the amounts assessed and collected. They alleged the assessment by the board of assessors of the city of Albany of the shares held by the assignors of the plaintiff, acting under color of an act of the legislature of New York, passed April 23, 1866, being chapter 761 of the laws of that year, at $100 a share, being the par value thereof, after deducting therefrom such sum as was in the same proportion to such par value as was the assessed value of the real estate of the banking institution to the whole amount of its capital stock, and the collection of the amount levied, and its payment into the treasury of the county of Albany. They also alleged, upon information and belief, that chapter 761 of the Laws of 1866 was in conflict with the laws of the United States, and especially with the provisions that taxation by state authority of shares of stock in banking associations shall not be at a greater rate than is assessed upon other moneyed capital in the hands of individual citizens of such state, for the reason, among others, that the said act of New York did not permit debts of the owners of the bank stock to be deducted from the value thereof in its assessment, although such deduction of the debts of the owner was at the time, and is still, permitted and required by the laws of New York to be made from the value of every other kind of personal property, and moneyed capital other than bank stock, in assessing the same for the purpose of taxation.

They also alleged, upon information and belief, that the assessment of the shares of stock of the said banking association by the board of assessors was at a greater rate than their assessment upon shares of stock of banks organized under the laws of New York, and located in the same ward of the city, and was at a greater rate than was assessed upon other moneyed capital in the hands of individual citizens of the state. For these reasons the plaintiff alleged that the assessment of the shares of stock, and the levy of the tax thereunder, were illegal and void, and that the money received therefor was wrongfully collected and paid into the county treasury, and belonged of right to the shareholders, and not to the county.

The fourth count differed from the others in averring that the assignor of the plaintiff named in this count, Chauncey P. Williams, had presented to the board of assessors an affidavit stating that the value of his personal estate, including his bank stock, after deducting his just debts and property invested in the stock of corporations or associations liable to be taxed therefor, and his investments in the obligations of the United States, did not exceed one dollar, and requested the board of assessors to reduce his assessment to that amount, but that the board had refused to make such reduction; and that thereupon said Williams applied to the supreme court of the state for a writ of mandamus to compel the assessors to make the reduction; that the supreme court denied the application, on the ground that the act of the legislature did not permit such reduction, but required the assessment of the bank stock at its full value; that the court of appeals of the state, on appeal, affirmed the decision and judgment of the supreme court; that the supreme court of the United States reversed the judgment of the court of appeals, and held that the statute, chapter 761 of the laws of the state of 1866, in that it did not permit a reduction for indebtedness from the assessment of bank stock, which by the laws of the state was required to be made from the assessment of every other kind of personal estate and moneyed capital, was in conflict with the laws of the United States.

The answer of the defendant consisted in a specific denial of the several allegations of the complaint, with an averment that the assessments were duly and regularly made by a board of assessors having jurisdiction of the matter. In a supplementary answer, the defendant also set up that the assignment of the amounts in suit to the plaintiff was improperly and collusively made for the purpose of giving the court jurisdiction.

The action was twice tried; at both times by the court without the intervention of a jury, by consent of parties. On the first trial, which took place in October, 1880, the plaintiff recovered the whole amount upon the first ground stated, that the act of New York, chapter 761 of the Laws of 1866, was in conflict with the act of congress, in not permitting in the assessment of the value of the stock of the bank a reduction for the debts of the holder. The second ground of objection to the validity of the assessment—that it was at a greater rate than was assessed on other moneyed capital in the hands of individual citizens—was not considered. The case was then brought to this court for review. After full consideration, we held substantially this: that the statute of New York was in conflict with the act of congress, so far as it did not permit a stockholder of a national bank to deduct the amount of his just debts from the assessed value of his stock, while by the laws of the state the owner of all other personal taxable property was allowed to deduct such debts from its value; but that neither the statute nor the assessment under it was for that reason void. If the stockholder had no debts to deduct, the mode of assessment adopted was not invalid as to him; he could not complain of it, nor recover the taxes paid pursuant to it. If he had e bts, the assessment without a deduction for them in the estimate of the taxable value of the stock was only voidable. The assessing officers, in making the assessment, were acting within their authority until duly notified of the debts which were to be deducted. In such case, therefore, the duty devolved upon the stockholder to show to the assessing officers what his debts were, and to take such steps as were required by law to obtain a correction of the overassessment. We therefore decided that for the taxes colleted upon the assessment alleged in the fourth court the plaintiff was entitled to judgment; this court having held, in People v. Weaver, that assessment invalid, for the reason that the assessors had not allowed any deduction for the debts of the stockholder, (100 U. S. 539;) but that for the taxes collected upon the assessments alleged in the other counts no recovery could be had; the stockholders there mentioned not having produced any evidence that they had presented to the assessors an affidavit of the amount which they would be entitled to de- duct from the assessment of their shares, if the same rule had been applied to the assessment of bank shares which was applied to the assessment of other...