Taber v. Indian Territory Illuminating Oil Co

• Decision Date: 01 February 1937
• Docket Number: No. 280,280
• Citation: 300 U.S. 1,57 S.Ct. 334,81 L.Ed. 463
• Parties: TABER, Treasurer of Payne County, Okl., v. INDIAN TERRITORY ILLUMINATING OIL CO. *
• Court: U.S. Supreme Court

300 U.S. 1

57 S.Ct. 334

81 L.Ed. 463

TABER, Treasurer of Payne County, Okl.,

v INDIAN TERRITORY ILLUMINATING OIL CO.^*

No. 280.

Argued Jan. 6, 1937.

Decided Feb. 1, 1937.

Messrs. Leon J. York and Guy L. Horton, both of Stillwater, Okl., for petitioner.

Messrs. Donald Prentice and Wm. P. McGinnis, both of Bartlesville, Okl., for respondent.

[Argument of Counsel from pages 1-3 intentionally omitted] Mr. Chief Justice HUGHES delivered the opinion of the Court.

The respondent, Indian Territory Illuminating Oil Company, holds an oil and gas lease covering lands of restricted Pawnee Indians. The question relates to the constitutional authority of the state of Oklahoma to tax certain property used by the respondent in its operations as lessee. The Supreme Court of Oklahoma held that the property was not taxable because the lessee was a federal instrumentality and Congress had not consented to its taxation. 177 Okl. 67, 57 P.(2d) 1167. We granted certiorari (299 U.S. 528, 57 S.Ct. 38, 81 L.Ed. —-) October 12, 1936.

The property is described as 'one dwelling, portable, one garage, one tool house, engines, pump, water well equipment, tanks, derricks, casing, tubing, rods, pipe-lines, and one trailer truck, of the aggregate value of $15,869.23.' The tax is an ad valorem tax for the year 1933—34. There is no allegation or finding that the tax was discriminatory, the sole contention being that the property was not subject to ad valorem taxation because of its use as an adjunct to the production of oil and gas from the leasehold.

Our decisions distinguish between a nondiscriminatory tax upon the property of an agent of government and one which imposes a direct burden upon the exertion of governmental powers. In the former case where there is only a remote, if any, influence upon the exercise of governmental functions, we have held that a nondis criminatory ad valorem tax is valid, although the property is used in the operations of the governmental agency. This distinction, recognized by Chief Justice Marshall in McCulloch v. Maryland, 4 Wheat. 316, 436, 4 L.Ed. 579, was stated and applied after full consideration in Thomson v. Union Pacific Railroad Co., 9 Wall. 579, 591, 19 L.Ed. 792, and Union P. Railroad Company v. Peniston, 18 Wall. 5, 31—36, 21 L.Ed. 787. Recent illustrations are found in Alward v. Johnson, 282 U.S. 509, 514, 51 S.Ct. 273, 274, 75 L.Ed. 496, 75 A.L.R. 9, where the tax which was sustained was laid upon property used in operating an automotive stage line between points in California under a mail carrier's contract; and in Tirrell v. Johnston, 293 U.S. 533, 55 S.Ct. 238, 79 L.Ed. 641, where a tax known as the 'gasoline road toll' was held to be payable by a rural mail carrier who delivered the mail by means of his own motor vehicle. See, also, Thomas v. Gay, 169 U.S. 264, 273, 18 S.Ct. 340, 42 L.Ed. 740; Baltimore Shipbuilding Co. v. Baltimore, 195 U.S. 375, 382, 25 S.Ct. 50, 49 L.Ed. 242; Choctaw, O. & G.R. Co. v. Mackey, 256 U.S. 531, 536, 537, 41 S.Ct. 582, 583, 65 L.Ed. 1076; Willcuts v. Bunn, 282 U.S. 216, 226, 51 S.Ct. 125, 127, 75 L.Ed. 304, 71 A.L.R. 1260; Susquehanna Power Co. v. State Tax Commission (No. 1), 283 U.S. 291, 294, 51 S.Ct. 434, 435, 75 L.Ed. 1042; Eastern Air Transport v. Tax Commission, 285 U.S. 147, 153, 52 S.Ct. 340, 341, 76 L.Ed....