Stone v. Farmers Bank of Kentucky Farmers Bank of Kentucky v. Stone

• Decision Date: 15 May 1899
• Docket Number: Nos. 385 and 386,s. 385 and 386
• Citation: 19 S.Ct. 880,174 U.S. 409,43 L.Ed. 1027
• Parties: STONE, Auditor, et al. v. FARMERS' BANK OF KENTUCKY. FARMERS' BANK OF KENTUCKY v. STONE, Auditor, et al
• Court: U.S. Supreme Court

174 U.S. 409

19 S.Ct. 880

43 L.Ed. 1027

STONE, Auditor, et al.

v FARMERS' BANK OF KENTUCKY.

FARMERS' BANK OF KENTUCKY

v. STONE, Auditor, et al.

Nos. 385 and 386.

May 15, 1899.

These appeals were taken from a decree rendered in a suit in equity brought by the Farmers' Bank of Kentucky against Samuel H. Stone, auditor, Charles Finley, secretary of state, and G. W. Long, treasurer of the commonwealth of Kentucky, constituting a state board of valuation and assessment; the board of councilmen of the city of Frankfort; the county of Franklin; the city of Henderson; the county of Henderson; the city of Georgetown; and the county of Scott. The object of the bill and of an amended and supplemental bill was to restrain the valuation of the franchise of the complainant under the provisions of a revenue act of Kentucky, enacted November 11, 1892, as also the certification of such valuation and the collection of taxes thereon for the years 1895, 1896, 1897, and 1898.

It was averred in the bill that the complainant was chartered on February 16, 1850, to endure until May 1, 1880; and that in and by the fifteenth section of the charter of complainant it was provided as follows:

'It shall be the duty of the cashier of the principal bank on the 1st day of July, 1851, and on the 1st day of July in each succeeding yea during the continuance of this charter, to pay to the treasury of this commonwealth fifty (50) cents on each one hundred dollars of stock held and paid for in said bank, which shall be in full for all tax or bonus: provided, that no tax shall be paid until said bank goes into operation: and provided further, that the tax or bounus hereby proposed to be imposed on each share of stock in this bank, or such as shall hereafter be imposed on each share, is hereby set apart and forever dedicated to the cause of education on the common school system; and that whenever the same, or any part thereof, shall be diverted otherwise by legislative enactment, said bank shall then be exonerated from the payment of any tax or bonus whatever.'

It was further averred that on March 10, 1876, the charter of the bank was extended to May 1, 1905, by the following enactment:

'Section 1. That the charter of the Farmers' Bank of Kentucky as amended be extended for the period of twenty-five (25) years from the termination of its charter as therein fixed: provided, that said charter and amendments shall be subject to amendment or repeal by the general assembly by general or special acts: and provided further, that whilst the privileges and franchises so granted or repealed, no amendment or repeal shall impair other rights previously vested.'

It was then averred that after the extension of the charter, in consequence of an attempt of the county of Franklin to collect a tax from the bank for county purposes, under the authority of an act of Kentucky passed in 1876, which statute, it was alleged by the bank, was in violation of the charter exemption of the bank, the complainant brought, and carried to a successful termination in 1888, in the court of appeals of Kentucky, a suit to enjoin the county named from collecting the taxes complained of. The judgment rendered was...