State v. Shell Pipe Line Corp.

• Decision Date: 04 May 1940
• Docket Number: 36517
• Parties: The State v. Shell Pipe Line Corporation, a Corporation, Appellant
• Court: Missouri Supreme Court

139 S.W.2d 510

345 Mo. 1222

The State v. Shell Pipe Line Corporation, a Corporation, Appellant

No. 36517

Supreme Court of Missouri

May 4, 1940

Appeal from Franklin Circuit Court; Hon. Ransom A. Breuer Judge.

Reversed.

Thompson Mitchell, Thompson & Young, Robert Neill, Jr., and C. P. Berry for appellant.

(1) The judgment is invalid because Section 4641, Revised Statutes 1929, does not apply to defendant's business, and if applied it would violate the commerce clause of the Federal Constitution, and the due process provisions of the Fourteenth Amendment and Section 30, Article II of the Missouri Constitution, and the equal protection clause of the Fourteenth Amendment. Sec. 4641, R. S. 1929; State v Phillips Pipe Line Co., 339 Mo. 459, 97 S.W.2d 109. Meaning of "Engaged in Business." Secs. 4596-4599, 4608, 4613, 4618, 4631, 4641, 4644, R. S. 1929; First Natl. Bank v. Leeper, 121 Mo.App. 693, 97 S.W. 636; Wulfing v. Armstrong Cork Co., 250 Mo. 733, 157 S.W. 618; Flanders v. Benefit Assn., 226 Mo.App. 143, 42 S.W.2d 974; State v. Phillips Pipe Line Co., 339 Mo. 459, 97 S.W.2d 112. Construction of Section 4641. State ex rel. v. State Tax Comm., 282 Mo. 234, 221 S.W. 726; 25 R. C. L. 1092, sec. 307; Ozark Pipe Line Corp. v. Monier, 266 U.S. 562, 69 L.Ed. 442; State v. Phillips Pipe Line Co., 339 Mo. 459, 97 S.W.2d 112; Equitable Life Assur. Socy. v. Pennsylvania, 238 U.S. 147, 59 L.Ed. 1242; Yarbrough v. Gage & Co., 334 Mo. 1145, 70 S.W.2d 1061; James v. Dravo Contr. Co., 302 U.S. 158, 82 L.Ed. 171; Cooney v. Mountain States Tel. & Tel. Co., 294 U.S. 392, 79 L.Ed. 941; Dixie Ohio Express Co. v. State Revenue Comm., 83 L.Ed. 369; Pacific Tel. & Tel. Co. v. Tax Comm., 297 U.S. 413, 80 L.Ed. 763; Missouri Coal & Min. Co. v. Ladd, 160 Mo. 435, 61 S.W. 191. Defendant engaged solely in interstate commerce. State v. Phillips Pipe Line Co., 339 Mo. 459, 97 S.W.2d 112; State ex rel. v. Pub. Serv. Comm., 337 Mo. 809, 85 S.W.2d 890; State ex rel. v. Pub. Serv. Comm., 93 S.W.2d 675; State ex rel. v. Pub. Serv. Comm., 275 Mo. 493, 205 S.W. 36, 18 A. L. R. 754; Ozark Pipe Line Corp. v. Monier, 266 U.S. 555, 69 L.Ed. 439; Montgomery Ward & Co. v. Becker, 334 Mo. 789, 69 S.W.2d 676; Norfolk & W. Railroad Co. v. Pennsylvania, 136 U.S. 114, 34 L.Ed. 394; Heyman v. Hays, 236 U.S. 178, 59 L.Ed. 527; Cheney Bros. Co. v. Massachusetts, 246 U.S. 148, 62 L.Ed. 632; Anglo-Chilean Nitrate Sales Corp. v. Alabama, 288 U.S. 218, 77 L.Ed. 710; Missouri v. Kansas Natural Gas Co., 265 U.S. 298, 68 L.Ed. 1027; Helson v. Kentucky, 279 U.S. 249, 73 L.Ed. 686; Atlantic Coast Line Railroad Co. v. Riverside Mills, 219 U.S. 201, 55 L.Ed. 180; Carter v. Carter Coal Co., 298 U.S. 298, 80 L.Ed. 1182; Sherlock v. Alling, 93 U.S. 103, 23 L.Ed. 820; Anderson v. Ship Owners' Assn., 272 U.S. 363, 71 L.Ed. 301; State Tax Comm. v. Interstate Natural Gas Co., 284 U.S. 41, 76 L.Ed. 156; Adams Mfg. Co. v. Storen, 304 U.S. 312, 80 L.Ed. 1380; Rosenberger v. Pacific Express Co., 241 U.S. 51, 60 L.Ed. 883; Toledo Rys. & Light Co. v. Hill, 244 U.S. 49, 61 L.Ed. 982; Alpha Portland Cement Co. v. Massachusetts, 268 U.S. 218, 69 L.Ed. 924; Indian Motorcycle Co. v. United States, 283 U.S. 570, 75 L.Ed. 1277. Immaterial that defendant was licensed to do business in Missouri. Sec. 4641, R. S. 1929; State v. Phillips Pipe Line Co., 339 Mo. 459, 97 S.W.2d 109; Ozark Pipe Line Corp. v. Monier, 266 U.S. 555, 69 L.Ed. 439; State ex rel. v. Pub. Serv. Comm., 337 Mo. 809, 85 S.W.2d 890; State ex rel. v. Pub. Serv. Comm., 93 S.W.2d 675; Anglo-Chilean Nitrate Sales Corp. v. Alabama, 288 U.S. 224, 77 L.Ed. 714. Immaterial that defendant had power of eminent domain. Ozark Pipe Line Corp. v. Monier, 266 U.S. 555, 69 L.Ed. 439; State ex rel. v. Pub. Serv. Comm., 93 S.W.2d 675; State ex rel. v. Pub. Serv. Comm., 337 Mo. 809, 85 S.W.2d 890. Contract letting pole space to Ajax Pipe Line is immaterial. 14-A C. J., 1276, sec. 3982; 12 R. C. L. 71, sec. 48; Meir v. Crossley, 305 Mo. 231, 264 S.W. 882; State ex rel. v. Hogan, 103 S.W.2d 497; Hurst Automatic Switch & Signal Company v. Trust Co., 216 S.W. 956; Wulfing v. Armstrong Cork Co., 250 Mo. 733, 157 S.W. 618; Shields v. Chapman, 240 S.W. 506; Mo. Coal & Mining Co. v. Ladd, 160 Mo. 435, 61 S.W. 191; Parker v. Wear, 230 S.W. 80; Republic Steel Corp. v. Atlas H. & L. Corp., 113 S.W.2d 159; Shields v. Chapman, 240 S.W. 506; 12 R. C. L. 69, sec. 48; State ex rel. v. Rutledge, 331 Mo. 1015, 56 S.W.2d 38; Wulfing v. Armstrong Cork Co., 250 Mo. 723, 157 S.W. 615; First Natl. Bank v. Leeper, 121 Mo.App. 693, 97 S.W. 636. Disregarding corporate entity. May Dept. Stores Co. v. Union Elec. L. & P. Co., 341 Mo. 299, 107 S.W.2d 55; Martin v. Dev. Co., 240 F. 45; Pittsburgh & Buffalo Co. v. Duncan, 232 F. 587; Peterson v. Chicago, R. I. & P. Ry. Co., 205 U.S. 393, 51 L.Ed. 853; United States v. Amer. Bell Tel. Co., 29 F. 17; 14 C. J. 53, sec. 5; State ex rel. v. Pub. Serv. Comm., 335 Mo. 448, 73 S.W.2d 393; U.S. Rubber Co. v. Query, 19 F.Supp. 191; La Varre v. International Paper Co., 37 F.2d 147; Meischke-Smith v. Wardell, 286 F. 785. Due process of law and equal protection of the laws. State ex rel. v. State Tax Comm., 282 Mo. 234, 221 S.W. 726; Raymond v. Chicago Union Trust Co., 207 U.S. 38, 52 L.Ed. 88. (2) Plaintiff's Exhibit B, an antitrust affidavit executed for defendant, was improperly admitted in evidence. Plaintiff's Exhibit C, a statutory affidavit made by defendant's chief agent in 1932, was improperly admitted in evidence. Wright v. Quattrochi, 49 S.W.2d 7; Graber v. Wells, 7 S.W.2d 721; State ex rel. v. Smith, 150 Mo. 89; Crockett v. Morrison, 11 Mo. 5.

Roy McKittrick, Attorney General, and Max Wasserman, Assistant Attorney General, for respondent; Harry G. Waltner, Jr., of counsel.

(1) The Missouri Corporation Franchise Tax is upon the privilege to be a corporation, and to conduct business in corporate form whether that privilege is exercised or not and irrespective of how exercised. Secs. 4596, 4641, R. S. 1929; 59 C. J. 1043, sec. 620; State v. Phillips Pipe Line Co., 339 Mo. 459, 97 S.W.2d 112; Graham Paper Co. v. Gehner, 332 Mo. 155, 59 S.W.2d 52; State ex rel. Crutcher v. Koeln, 332 Mo. 1229, 61 S.W.2d 754; Sanderson v. Bateman, 253 P. 1100; State ex rel. Du Fresne v. Leslie, 50 P.2d 959, 101 A. L. R. 1034; State ex rel. Union E. L. & P. Co. v. Baker, 316 Mo. 859, 293 S.W. 401. Appellant was licensed to do business in Missouri. Ashley v. Ryan, 153 U.S. 436, 38 L.Ed. 773; Badger Dome Oil Co. v. Hallam, 99 F.2d 297. (2) Appellant's acts constitute doing of business in the State of Missouri. (a) In construction of their pipe line; Browning v. Waycross, 233 U.S. 22, 34 S.Ct. 578, 58 L.Ed. 832; General Railway v. Commonwealth of Virginia, 246 U.S. 500, 38 S.Ct. 360, 62 L.Ed. 858; Ohio River Contract Co. v. Gordon, 244 U.S. 68, 737 S.Ct. 599, 61 L.Ed. 1000; Fuller v. Allen, 46 Okla. 147, 148 P. 1018; Metal Door & Trim Co. v. Hunt, 101 A. L. R. 350, 170 Okla. 240, 39 P.2d 75; Natl. Refrigerator Co. v. S.W. Mo. Light Co., 288 Mo. 290, 231 S.W. 938; State v. Phillips Pipe Co., 339 Mo. 459, 97 S.W.2d 109, affirmed 58 S.Ct. 53. (b) In the construction, owning and renting of houses, and the purchase of substantial tracts of land, and; (c) In the furnishing of water and electricity; Ozark Pipe Line Co. v. Monier, 266 U.S. 555, 45 S.Ct. 184, 69 L.Ed. 439. (d) In leasing pole space to Ajax Pipe Line Co.; State ex rel. v. Robertson, 271 Mo. 485, 196 S.W. 1135. (e) In maintaining storage facilities for fuel. Nashville, Chattanooga & St. Louis Railroad Co. v. Wallace, 288 U.S. 249, 53 S.Ct. 345, 77 L.Ed. 730. (3) The construction put upon a state statute by the highest court of the State is binding on the Supreme Court of the United States. Ozark Pipe Line Corp. v. Monier, 266 U.S. 555, 45 S.Ct. 184, 69 L.Ed. 442; State v. Phillips Pipe Line Co., 339 Mo. 459, 97 S.W.2d 112; People of State of Michigan v. Michigan, 286 U.S. 334, 52 S.Ct. 512, 76 L.Ed. 1139. (4) Interstate commerce is a "practical conception". Eureka Pipe Line Co. v. Halahan, 257 U.S. 265, 66 L.Ed. 232; Utah P. & L. Co. v. Pfost, 286 U.S. 165. (5) The tax herein sought to be recovered is not a substantial burden upon interstate commerce. International Shoe Co. v. Shartel, 277 U.S. 54, 48 S.Ct. 454, 73 L.Ed. 785; Hump Hairpin Mfg. Co. v. Emmerson, 258 U.S. 290, 42 S.Ct. 305, 66 L.Ed. 625; Atlantic Ref. Co. v. Commonwealth, 165 Va. 492, 183 S.E. 246; 105 A. L. R. Ann. 16. (6) Appellant has exercised the power of eminent domain. So. Ill. & Mo. Bridge Co. v. Stone, 73 S.W. 453, 174 Mo. 32. (7) Disregarding corporate entity. Humble Oil & Refining Co. v. Railroad Comm., 128 S.W.2d 12; State v. Lone Star Gas Co., 86 S.W.2d 491; McCurdy v. Spokane Western Power & Traction Co., 174 Wash. 470, 24 P.2d 1083; Trustees System Co. of Pennsylvania v. Payne, 65 F.2d 107. (8) Due process of law and equal protection of the laws. State ex rel. Wabash Railroad Co. v. Williams, 224 S.W. 822, 284 Mo. 456; St. Louis-San Francisco Ry. Co. v. Middlecamp, 256 U.S. 231, 41 S.Ct. 491, 65 L.Ed. 913; St. Louis S.W. Ry. Co. v. Arkansas, 235 U.S. 350, 35 S.Ct. 99, 59 L.Ed. 265; Great A. & Pac. Tea Co. v. Grosjean, 301 U.S. 412, 57 S.Ct. 772, 81 L.Ed. 1200. (9) Respondent's Exhibits B and C constitute admissions of appellant that it transacted intrastate commerce. 18 Fletcher, Cyclopedia of Corporation, sec. 8804, p. 692. (10) Appellant is estopped to deny the doing of intrastate business. State ex inf. Shartel v. Mo. Utilities, 331 Mo. 351, 53 S.W.2d 399; McFarland v. McFarland, 278 Mo. 16, 211 S.W. 27; DeLashmutt v. Teetor, 261 Mo. 440, 169 S.W. 41.

Cooley, C. Westhues and Bohling, CC., concur.

OPINION

COOLEY

Action by the State of Missouri to recover of defendant, appellant, corporation franchise tax for the year 1934. Judgment for ...