People ex rel. Bay State Shoe & Leather Co. v. McLean

Prior to the year 1855, the only way of subjecting the property of foreign corporations to taxation, was to assess it in the name of' the agent or trustee in whose possession it might be found, and in. the town or -ward where he resided. (1 R. S., 389, § 5 as amended, by chapter 176 of the Laws of 1851.) The statute (1R-S., 387, § 1)> rendered all real and personal property within the State liable to> taxation, unless specially exempted by law. But under the system of assessment established, much personal property of non-residents, escaped taxation. For example, the personal property of a nonresident owner in his own possession could not be taxed, and a. single assessment of the personal property of a non-resident corporation within the State could not be made against the corporation by name as in the case of a domestic corporation, but it was necessary to seek such property in the hands of the agents of the?, corporation throughout the State, and assess each parcel in the name of the agent in the town or ward where he resided. To? remedy these evils among others, the Legislature passed chapter *20637 of the Laws of 1855, and thereby provided that “ all persons .and associations doing business in the State of New York * * * .shall be assessed and taxed,” not on the tangible property in possession of agents or trustees, but “ on all sums invested in any manner in said business the same as if they were residents of this State,” and they further provided that the tax should be collected from the property belonging to the persons or associations assessed. The changes in the law wrought by this statute are quite apparent. (1.) The subject of taxation is the capital invested in business and not the property in the hands of agents. The latter is by necessary implication excluded from liability to taxation, for if it were not the unjust burden of double taxation would be imposed. (2.) The mode of levying the tax is assimulated to that in respect to resident •taxpayers — that is to say if a non-resident individual is to be •taxed it must be done, not in the town or ward where the personal property happens to be, but in the town or ward where he-is at the time doing business, and if a foreign corporation in the town or ward where the principal office or place for transacting its financial •concerns shall be. (1 E. S., 389, §§ 5-6.) Such is the plain import of the statute, for the only way of taxing the property of .a non-resident mdividual, in the same manner as if he were a resi•dent, is to treat his place of business as his residence pro hac vice, .and the only way of executing the statute of 1855, in respect to ■foreign corporations, is to apply the rule which is prescribed by "the other statute relative to domestic corporations above cited.

I am of opinion, therefore, that the decision at Special Term is •correct. (Hoyt v. The Com’s of Taxes, 23 N. Y., 232; The Parker Mills v. The Same, id., 242; British Com. Life Ins. Co. v. Com’s, 31 id., 32; S. C, 1 Keyes, 303.) We think the remedy adopted to correct the error of the assessors was the proper one.

The order must be affirmed.

Order affirmed, with costs and disbursements.