Union Tank Line v. Wright
| Decision Date | 24 March 1919 |
| Docket Number | No. 170,170 |
| Citation | 249 U.S. 275,63 L.Ed. 602,39 S.Ct. 276 |
| Parties | UNION TANK LINE v. WRIGHT, Comptroller General of Georgia |
| Court | U.S. Supreme Court |
Mr. Douglas Campbell, of New York City, for plaintiff in error.
Mr. Clifford Walker, of Monroe, Ga., for defendant in error.
This cause requires us to consider the power of a state to lay and collect taxes upon instrumentalities of interstate commerce which move both within and without its jurisdiction.
Union Tank Line—plaintiff in error—an equipment company incorporated in New Jersey which has never carried on business or had an office in Georgia, owns 12,000 tank cars suitable for transporting oil over railroads and rents them to shippers at agreed rates, based on size and capacity. The roads over which they move also pay therefor stipulated compensation. Under definite contract certain of these cars were furnished to the Standard Oil Company of Kentucky and all of those which came into Georgia were being operated by the Oil Company under such agreement. They were not permanently within that state but passed 'in and out.'
March 16, 1914, the Tank Line made the following tax return to the comptroller general for 1913:
Name of company................................. Union Tank Line
Value of real estate owned by
company in or out of Georgia................... None
Number of miles of railroad lines
in Georgia over which * * *
cars are run................................... 6976.5
Total value of * * * cars and
* * * other personal property
(in Georgia and elsewhere)..................... $10,518,333.16
Value franchise (in Georgia).................... No franchise
Total number of miles railroad
lines over which * * * cars
are run (in Georgia and
elsewhere)..................................... 251,999
Total value of property taxable
in Georgia..................................... $47,310.00
Union Tank Line Company had
an average of 57 tank cars in
Georgia during 1913, which at a
value of $830 per car equals................... $47,310.00
Defendant in error expressly admitted that the average number of cars in Georgia during 1913 was 57, the value of each being $830—total $47,310; that the owner had paid into the state treasury as taxes the full amount required on such valuation and during that year had no other property in the state. Acting upon information contained in return above quoted, the comptroller general assessed the Tank Line's property for 1913 at $291,196, its franchise at $27,685, and demanded payment. In explanation of this action he wrote to it as follows:
Thereupon, plaintiff in error instituted this proceeding in Fulton county superior court alleging invalidity of the assessment, that to enforce the tax would violate the Fourteenth amendment, and asked appropriate relief. The cause was tried upon pleadings and agreed statement of facts. Among other things, the parties stipulated:
'On April 7, 1914, when the defendant entered an as sessment in his office of property and franchise of the plaintiff as shown hereinbefore, he had no other information for any of the years 1907 to 1914 inclusive than was contained in the said return filed by the plaintiff on March 16, 1914, and embraced in this statement and which was refused by the defendant, and did not know what cars defendant had had in Georgia during any of said named years nor did he ascertain the value of such cars, but his action was taken on such information hereinbefore shown; and that the assessment so entered by the defendant in his office against the plaintiff's property during said period for each of said years embraces the valuation of about three hundred cars in excess of what the plaintiff actually had in the state of Georgia, during said years of the approximate value of $250,000.00 each year; and that the true value of a tank car is about eight hundred and thirty ($830.00) dollars per car.
'That for the year 1914 the assessment entered against plaintiff by defendant covered the value of at least three hundred and fifty cars in excess of the number of cars plaintiff actually had in the state of Georgia for the time said tax was assessed.
'That defendant in entering said assessment never undertook to ascertain the actual property of plaintiff's located in the state of Georgia during the said years or to assess its property at its real value for taxation, otherwise than by simply ascertaining the percentage of its entire property shown by the ratio of the railroad traversed by its equipment in Georgia and the railroad mileage traversed by its equipment everywhere as shown by its said return filed on March 16, 1914.'
The trial court adjudged the assessment good as to both franchise and physical property. The Supreme Court held no taxable franchise existed, but that the physical property had been assessed as required by statutes not in conflict with either state or federal Constitution. 146 Ga. 489, 91 S. E. 680. It said (Wright v. Union Tank Line, 143 Ga. 765, 769, 771, 773, 85 S. E. 994, 996, 997):
'The case relates to two matters, namely: a tax assessment against tangible property of the company; and second, a claim of right to assess a franchise tax. * * * The effort was to tax property in this state, and in doing so to apply the statute designed as a rule to ascertain the property so coming into the state and its proper valuation.'
After quoting sections 989, 990, and 1031 Civil Code of Georgia, copied in the margin,1 the opinion continues:
A state may not tax property belonging to a foreign corporation which has never come within its borders—to do so under any formula would violate the due process clause of the Fourteenth Amendment. In so far, however, as movables are regularly and habitually used and employed therein, they may be taxed by the state according to their fair value along with other property subject to its jurisdiction, although devoted to interstate commerce. While the valuation must be just it need not be limited to mere worth of the articles considered separately but may include as well 'the intangible value due to what we have...
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