The State ex rel. Campbell v. Brinkop

• Decision Date: 16 December 1911
• Citation: 143 S.W. 444,238 Mo. 298
• Parties: THE STATE ex rel. EDWARD T. CAMPBELL and AMERICAN INSURANCE COMPANY v. CHRISTIAN BRINKOP, President of the Board of Assessors, and EDMOND KOELN, Collector, of the City of St. Louis
• Court: Missouri Supreme Court

143 S.W. 444

238 Mo. 298

THE STATE ex rel. EDWARD T. CAMPBELL and AMERICAN INSURANCE COMPANY v. CHRISTIAN BRINKOP, President of the Board of Assessors, and EDMOND KOELN, Collector, of the City of St. Louis

Supreme Court of Missouri

December 16, 1911

Record quashed.

A. & J F. Lee and Charles M. Polk for relators.

(1) It was unlawful to include in the assessment of the shareholders of the insurance company the shares of stock owned by the insurance company on June 1, 1909, in national banks, in a State bank and in a trust company, the latter two organized under the laws of Missouri and all located in St. Louis, as such shares had already been taxed to the insurance company as the owner thereof and the taxes paid thereon on behalf of the insurance company, and to include the same in the assessment of the shareholders of the insurance company was in violation of the constitutional provisions of this State that taxes should be uniform and that all property should be taxed in proportion to its value, in that the same property of the insurance company was thus taxed twice, such double taxation not being authorized or permitted by any statute of this State, and being contrary to the decisions of the courts of this State. Constitution, art. 10, secs. 3-4; secs. 7098 and 11357, R. S. 1909; Hannibal, etc. Railroad v Schacklett, 30 Mo. 550; State v. Railroad, 37 Mo. 265; Life Ins. Co. v. Charles, 47 Mo. 462; Scotland County v. Railroad, 65 Mo. 123; State v. Railroad, 77 Mo. 202; Valle v. Ziegler, 84 Mo. 214; State v. Railroad, 196 Mo. 523; East Livermore v. Banking Co., 69 A. 306 (Maine) ; State v. Union Depot Co., 42 Minn. 142; School Directors v. Bank, 8 Watts, 289; Commonwealth v. Life & Trust Co., 9 Pa. Dist. 479; Commonwealth v. Coal & Navigation Co., 162 Pa. 603; Commonwealth v. Coal Co., 156 Pa. 488; Burke v. Badlam, 57 Cal. 594; State v. Simmons, 70 Miss. 485; Mail Co. v Barbour, 88 Ky. 73; Gillespie v. Gaston, 67 Tex. 599; Security Co. v. Hartford, 61 Conn. 89; Bank v. Mumford, 4 R. I. 478; In re Newport Reading Room, 21 R. I. 440; Frederick Co. v Bank, 48 Md. 117; Gordon v. Baltimore, 5 Gill (Md.), 231; Tax cases, 12 Gill & J. (Md.) 117. (2) It was unlawful to include in the assessment of the shareholders of the insurance company the shares of stock owned by the insurance company on June 1, 1909, in manufacturing and business corporations, organized under the laws of Missouri and all located in St. Louis, as the property of such corporations had already been assessed and taxed as the property of such corporations for all general taxes assessable and taxable thereon on June 1, 1909, and such taxes had been paid by such corporations, and to include the same in the assessment of the shareholders of the insurance company was in violation of the constitutional provisions of this State that taxes should be uniform and that all property should be taxed in proportion to its value, in that it was double taxation to assess both the property of such corporations and the shares therein owned by the insurance company, such double taxation not being authorized or permitted by any statute of this State and being contrary to the decisions of the courts of this State. Authorities under point one. (3) Neither the State nor any of its officers had jurisdiction to assess and tax the shareholders of the insurance company upon the insurance premiums due from non-residents of Missouri, payable to the insurance company outside of Missouri, for insurance policies executed by the insurance company outside of Missouri, upon property outside thereof, due on policies subject to cancellation at any time at the instance of either insurer or insured, such cancellation requiring proportionate abatement of the premium unearned at the time of cancellation, and on which premiums the insurance company was assessed and paid taxes to the states in which such non-residents lived, because: 1st, Such premiums were not property within the State of Missouri; 2d, They were not such property as the laws of Missouri seek to tax. R. S. 1909, sec. 11337; State ex rel. v. Howard County, 69 Mo. 454; Valle v. Ziegler, 84 Mo. 214; State v. Taylor, 47 Mo. 594; Wilcox v. Ellis, 14 Kas. 588; Fisher v. Commissioners, 19 Kas. 414; Poppleton v. Yamhill County, 18 Ore. 377; People v. Smith, 88 N.Y. 576. (4) Neither the State nor any of its officers had jurisdiction to assess and tax the shareholders of the insurance company upon a bank deposit of the insurance company subject to its check, kept by it in good faith outside of this State with no intent to avoid the taxation thereof in Missouri and taxable in the State were kept, because: 1st, Such premiums were not property within the State of Missouri. 2d, They were not such property as said laws seek to tax. Authorities under point three.

Lambert E. Walther and William E. Baird for respondents.

(1) The tax in question, like the tax in the case of banks and trust companies, is a tax upon the shares in the company and not a tax upon the property of the company. Bldg. & Savings Assn. v. Lightner, 42 Mo. 421; Lionberger v. Rowse, 43 Mo. 67; Ins. Co. v. Charles, 47 Mo. 373; State ex rel. v. Board of Assessors, 56 Mo. 503; Springfield v. Bank, 87 Mo. 441; State ex rel. v. Catron, 118 Mo. 280; State ex rel. v. Bank, 160 Mo. 640; State ex rel. v. Shryack, 179 Mo. 424; State ex rel. v. Bank, 180 Mo. 717; State ex rel. v. Bank, 196 Mo. 516. (2) In determining the value of the shares there must be considered all the property of the corporation except its real estate, legal reserve and unpaid policy claims. R. S. 1909, secs. 7098 and 11357; Savings Assn. v. Lightner, 47 Mo. 393; St. Louis Ins. Co. v. Charles, 47 Mo. 373; State ex rel. v. Catron, 118 Mo. 280; State ex rel. v. Bank, 160 Mo. 640; State ex rel. v. Shryack, 179 Mo. 424. (3) The tax being a tax on the shares of stock in the hands of the shareholders and not a tax on the property of the company, it is proper and legal, in fixing the value of the shares, to include property of the company which has already been taxed to the company or which is exempt from taxation. R. S. 1909, secs. 7098 and 11357; Savings Assn. v. Lightner, 47 Mo. 393; State ex rel. v. Shryack, 179 Mo. 424. (4) Although the property included in fixing the value of the shares has been taxed to the company or is exempt from taxation in this or any other State, it is not double taxation to consider such property in determining the value of the shares for the purpose of taxing the shareholders; because the shares of stock are an independent and distinct species of property. Cases cited under points 1, 2 and 3; Cooley on Taxation (2 Ed.), pp. 225, 231 and 232; Van Allen v. Assessors, 3 Wall. 573; Lionberger v. Rowse, 43 Mo. 67; Savings Assn. v. Lightner, 47 Mo. 393; Lionberger v. Rowse, 9 Wall. 468; Bank v. Britton, 105 U.S. 325; Bank v. Tennessee, 161 U.S. 134; Trust Co. v. Lander, 184 U.S. 111; Bank v. Des Moines, 205 U.S. 503; Hepburn v. School District, 23 Wall. 480; People v. Coleman, 126 N.Y. 433; Bank v. Kinsella, 201 Ill. 31; Bank v. Chambers, 182 U.S. 556; Coal Co. v. Commrs., 59 Md. 185; State v. Ins. Co., 70 Conn. 590; Bank v. Richmond, 94 Va. 316; People v. Commrs., 64 N.Y. 541; Light & Power Co. v. State, 79 Md. 63; Cook v. Burlington, 59 Iowa 251; Commrs. v. Tile Co., 13 Allen 391.

OPINION

In Banc

Certiorari.

VALLIANT C. J.

On the petition of relators a writ of certiorari issued to respondents, requiring them to send up the records held by them showing the assessments for taxes, made by the assessors, of the shares of stock of the American Central Insurance Company, and relators' appeal therefrom to the board of equalization, and the action of the board on that appeal, to the end that this court may pass judgment on the legality of the assessment which relators claim to be unlawful. In obedience to the writ the records have been sent up. There is no dispute as to the facts.

The American Central Insurance Company is a Missouri corporation, a fire insurance company. In the assessment made of the value of the stock of the corporation for taxation the relators say that items were included that should not have been taken into account. The petition states that the insurance company, by one of its chief officers, made its return to the assessor of all the property taxable, as the property of the corporation, against its shareholders, which amounted to $ 734,848.55, which, according to the uniform rule of equalization adopted by the board of equalization, should have been assessed at fifty-five per cent of its actual value, that is, $ 404,166.69, but the assessor added to the list of property returned by the corporation certain other items, which increased the amount of actual values to $ 2,938,074, of which fifty-five per cent was $ 1,615,950. It appears from the petition that, after the return above mentioned, an assistant secretary of the company, in the absence of the president and without authority, sent a statement to the assessor of the assets of the corporation containing the items which it is now claimed were improperly listed for taxation, and it was upon that information that the assessor acted in adding those items to the return previously made by the company; that as soon as it was discovered, the company applied to the assessor for its correction, and on his refusal appealed to the board of equalization, which also refused to strike those items from the list. It is stipulated, however, that that act of the assistant secretary in no way estops the relators from questioning the legality of the assessment.

The items in the assessment of which the relators complain are:

1. Shares of stock owned by the insurance company in national banks, a State bank and a trust company, the latter two Missouri...