Tide-Water Pipe Co., Ltd. v. Berry

• Decision Date: 18 March 1891
• Citation: 53 N.J.L. 212,21 A. 490
• Parties: TIDE-WATER PIPE CO., Limited v. BERRY, Collector.
• Court: New Jersey Supreme Court

21 A. 490

53 N.J.L. 212

TIDE-WATER PIPE CO., Limited

v. BERRY, Collector.

Court of Errors and Appeals of New Jersey.

March 18, 1891.

(Syllabus by the Court.)

Error to supreme court.

A. A. Clark, for plaintiff in error.

Ephraim Cutter, for defendant in error.

DEPUE, J. The prosecutor, a foreign corporation organized under the laws of Pennsylvania, is the owner of an iron pipeline, used for carrying crude petroleum from McLean county, Pa., to the Kill von Kull, at Bayonne, in this state. Its principal office is at Bayonne, in the county of Hudson, where the business of the company is carried on. The prosecutor was taxed for the year 1887 by the township of Woodbridge for seven miles of pipe laid in that township, extending across the township from Raritan township to the Railway river. The tax was assessed as a tax upon lands under the second section of the general tax act of April 11, 1866, (Revision, p. 1150.) The prosecutor was assessed and paid a tax under the act of April 18, 1884, entitled "An act to provide for the imposition of state taxes upon certain corporations, and for the collection thereof." Supp. Revision, p. 1016. Taxation under the act of 1884 was designed to provide revenue for the state. The tax laid by that act is a franchise tax, imposed for the privilege of transacting business in this state. Evening Journal Ass'n v. State Board, 47 N.J. Law, 36; State v. Richards, 52 M.J. Law, 156, 18 Atl. Rep. 582; Cable Co. v. Attorney General, 46 N. J. Eq. 270, 19 Atl. Rep. 733. The taxes imposed by the general tax act of 1866 (Revision, p. 1150) are laid upon property to provide revenue for local purposes. Both schemes of taxation apply as well to foreign as to domestic corporations; and the act of 1866, taxing property, has not been superseded by the act of 1884, imposing a franchise tax.

The principal contention is that the property taxed is not real estate within the meaning of the third section of the act of 1866. If it be personalty, the prosecutor was taxable for it at Bayonne, where its principal office is, pursuant to section 7 of the act of 1866. If it be lands within the meaning of the act of 1866, it was lawfully assessed, under section 6, in the township where the property is situated. The act of 1866 is a general law for the taxation of property. In the second section it is enacted that all real and personal estate within this state, whether, owned by individuals or by corporations, shall be liable to taxation at the full and actual value thereof. The fourth section defines what property, rights, and credits in the nature of personalty shall be comprised under the term "personal estate." Section 3 declares that the term "real estate" in the act" shall be construed to include all lands, all water-power thereon or appurtenant thereto, and all buildings or erections thereon or affixed to the same, trees and underwood growing thereon, and all mines, quarries, peat, and marl beds, and all fisheries." The prosecutor acquired a right to lay and maintain its pipe upon lands of private owners by a deed of grant under seal. The operative words of conveyance are that the grantor "grants a right of way over and through lands in Middlesex county for the purpose of constructing from time to time one line of iron pipe for the transportation of petroleum, in such manner as said grantee may deem necessary, with free ingress and egress to construct, operate, maintain, and from time to time repair and remove the same in such manner as may be desired." Under these grants, which contain apt words to create an estate in fee, the prosecutor acquired an interest in the soil, and a right of possession, upon the terms and subject to the conditions expressed in the grant; and the pipe-line is permanently affixed in the ground from two and a half to three feet below the surface. The deeds provide "that the pipe shall be so laid as not to interfere with the usual cultivation of the premises, nor with any buildings thereon, and that all actual damage done to crops, timber, or otherwise by the construction or operation of said pipe-line shall be paid for in full by the grantee." The fact that the grantor retains the surface for cultivation does not exclude the taxation of the prosecutor for its right and estate therein. Under the statute of 43 Eliz. c. 2, which laid a land tax on the...