capital stock, for the valuation placed upon the latter should include the former (Earl, J.). People ex rel. Twenty-third Street R. R. Co. v. Commissioners of Taxes, 95 N. Y. 554 (1884).

It seems that to arrive at the assessed value of real estate of a corporation for deduction from the value of its capital stock, if it is not situate in the town or ward, though within the State, reference may be had to the proper assessment-rolls. If it is without the State, the price paid, in the absence of other evidence, may be taken as the assessable value. Id.

In the case last cited, Earl, J., says: "We have not overlooked the fact that some of these views are in conflict with those expressed in People ex rel. Citizens' Gas-Light Company v. Assessors of Brooklyn, 39 N. Y. 81 (1868). All that was there said was not necessary to the decision of the case, and we think the construction we have given to the statutes is more likely to give just results, and to effectuate the intention of the lawmakers."

In assessing the capital stock of a corporation, the assessors are to ascertain the present value thereof, and from this to deduct the assessed value of the real estate (Laws 1857, chap. 456, § 3), and the fact that the whole capital was originally invested in real estate does not preclude them from doing this. While the indebtedness of a corporation is a proper subject for consideration in estimating the value of the capital stock, there is no provision of law which authorizes a deduction from the value after the estimate is made. People ex rel. Butchers, etc., Co., v. Asten, 100 N. Y. 597 (1885).

The commissioners of taxes in assessing the capital stock of the relator, a domestic corporation operating a railroad across the Isthmus of Panama, under its charter and a grant of an exclusive right from the government under which it is located, fixed the value of its real estate on the isthmus at the amount paid out therefor, and for the construction of the road. The relator proved its net income for three years, including the one for which the assessment was made, and claimed that the value of the real estate should be ascertained by deducting the value of the personalty from the amount which the average annual net income capitalized would indicate as the value of its whole property. Held, that as the income of the corporation came not only from the use of its real and personal property, but also from its franchises, which are not realty, the evidence afforded no proper basis upon which to reduce the assessment. People ex rel. Panama R. R. Co. v. Commissioners of Taxes, 104 N. Y. 240 (1887). The market value of the capital stock of an insurance company is only one of the elements to be considered. Though in estimating the value of the capital stock of a corporation the real estate is included at a sum greater than its appraisal, if the deduction for real estate corresponds to the assessed value for purposes of taxation, the assessment is not erroneous. People ex rel. Knickerbocker Fire Ins. Co. v. Coleman, 44 Hun, 410 (1887); affirmed in the following case:

Assessors may resort to any or all tests that they think will be most likely to give them the actual value of the stock, i. e., either" book value " or market value. The latter is usually, though not always, the best test of the value of the stock of a going concern. The Supreme Court alone, under chapter 269 of Laws of 1880, has power to correct the judgment of commissioners of assessment, when they have taken a wrong test in valuing capital stock for assessment. If a standard of value be taken that is not, in fact, any measure of value, the case is different. People ex rel. Knickerbocker Fire Ins. Co. v. Coleman, 107 N. Y. 541 (1888).

It seems that the assessment-roll may be made up as follows: In the first column insert the name of the corporation; in the second, the quantity of real estate, in the town or ward; in the third, the assessed value of the real estate, and in the fourth, the value of the capital stock after making the exemptions and deductions required. People ex rel. Twenty-third Street R. R. Co. v. Commrs. of Taxes, 95 N. Y. 554 (1884). In People v. New England Mut. Life Ins. Co., 26 N. Y. 303 (1863), it was held that Laws 1853, chap. 463, repealed the requirements of Laws 1851, chap. 95, §§ 1, 2, imposing the obligation on foreign life insurance companies to deposit $100,000 in securities with the comptroller of this State as security for policyholders, and that after such repeal, even if before, the securities were not to be regarded as property employed in its business so as to be taxable as such.

It is the duty of assessors to make a deduction for the contingent liability of insurance companies upon outstanding risks, in estimating the actual value of the stock thereof, and a refusal to do this is error reviewable on certiorari. People ex rel. Glens Falls Ins. Co. v. Ferguson, 38 N. Y. 89 (1868).

The commissioners assessed one-half the amount of unearned premiums as surplus earnings, which was the estimate of the company in its sworn statement to the insurance department of the amount required to discharge its liability upon its unexpired policies. Held, no error, since the statement was competent evidence for the consideration of the commissioners, and the rule was one recognized by the statutes concerning insurance. Held, also, that the relator was not entitled to notice and a hearing before such determination, without an application on its part therefor, although in its statement it had declared that it had no surplus earnings. People ex rel. Manhattan Fire Ins. Co. v. Commrs. of Taxes, 76 N. Y. 64 (1879).

A fund of a fire insurance company, contingently liable for future liens and expenses of the company, but represented by scrip bearing interest, issued to its policyholders, to be redeemed as the fun increased —– held, subject to taxation as the property of the company. People ex rel. American Fire Ins. Co. v. Commrs. of Taxes, 28 Hun, 261 (1882).

The liability of fire insurance companies to refund a part of the premiums of unexpired policies when the same are surrendered, does not constitute a debt owing by them so as to justify the deduction of the

whole amount of unearned premiums from the value of their taxable property. People ex rel. Westchester Fire Ins. Co. v. Davenport et al, 91 N. Y. 574 (1883).

Under Laws 1857, chap. 456, § 3, it is the actual, tangible personal property of a corporation that is to be assessed and not its franchise, and it is the duty of the assessors to assess such property at its actual value. People ex rel. Manhattan Ry. Co. v. Barker, 146 N. Y. 304; S. C., 66 N. Y. St. Repr. 658 (1895).

A joint-stock association formed by the agreement of the individuals composing it, and not incorporated, is not taxable upon its capital as a corporation under the Revised Statutes. People ex rel. Winchester v. Coleman, 37 N. Y. St. Repr. 120; S. C., 13 N. Y. Supp. 833 (1891).

The words "capital stock" in Laws 1857, chap. 456, § 3, relating to the taxation of corporations, refer to the capital of the company and not the shares of stockholders. People ex rel. Union Trust Co. v. Coleman, 126 N. Y. 433; S. C., 38 N. Y. St. Repr. 237; revg. 36 id. 221; S. C., 13 N. Y. Supp. 67 (1891).

An assessment of a corporation based upon the market value of its shares is erroneous, since it is the corporate assets that is the subject of taxation. People ex rel. Bleecker St., etc., v. Barker, 85 Hun, 210; S. C., 66 N. Y. St. Repr. 474; 32 N. Y. Supp. 990 (1895).

The rules governing the assessment of such tax have been stated to be as follows: First. The subject of valuation and assessment is never the share of stock, but always the company's capital and surplus. Second, Such capital and surplus must be assessed at its own value, and when that is correctly known and ascertained, no other value can be substituted for it. Third. Where its amount and value are undisclosed and unknown the assessors may consider the market value of the share of stock and the general condition of the company as indicative of surplus or deficiency and of the probable amount of either. Fourth. They may further resort to such means of information when the amount of capital and surplus is disclosed, but the assessors have sufficient reason to disbelieve the statement and such reason is founded upon facts established by competent proof.

Under the act of 1857 the capital stock of corporations less the part thereof owned by the State, or by literary or charitable institutions, or exempted from taxation by the Revised Statutes, is to be assessed at its actual value, whether more or less than its nominal amount, deducting, however, from such actual value, the assessed value of its real estate, and in case of real estate outside the State, the actual value thereof, deducting also shares owned by it in taxable or foreign corporations, and also from its surplus or reserved funds, if any, an amount not exceeding ten per cent. of its capital. People ex rel. Panama R. R. Co. v Commissioners of Taxes, 104 N. Y. 240 (1887). See, also, Mohawk & Hudson R. R. Co. v. Clute, 4 Paige, 394 (1834); Bank of Utica v. City of Utica, 4 id. 401 (1834); Farmers' Loan & Trust Co. v. Mayor of New York, 7 Hill, 261

(1843); Utica Mfg. Co. v. Supervisors of Oneida, 1 Barb. Ch. 449 (1846); Albany, etc., R. R. Co. v. Osborn, 12 Barb. 223 (1851); Mfg. Bank of Troy v. Troy, 24 How. Pr. 256 (1859); Oswego Starch Factory v. Dolloway, 21 N. Y. 451 (1860); People ex rel. Citizens' Gas-Light Co. v. Board of Assessors of Brooklyn, 39 id. 82 (1868); People ex rel. B. R. R. v. Barker, 48 id. 79 (1871); People ex rel. Dunkirk Ry. v. Cassity, 46 id. 52 (1871); People ex rel. Trowbridge v. Commissioners, 4 Hun, 597; S. C., 62 N. Y. 630; People ex rel. U. & B. R. R. Co. v. Shields, 6 Hun, 556 (1876); People ex rel. Williamsburgh Gas Co. v. Assessors of Brooklyn, 76 N. Y. 203 (1879).

§ 13. Stockholders of bank taxable on shares.-The stockholders of every bank or banking association organized under the authority of this state, or of the United States, shall be assessed and taxed on the value of their shares of stock therein; said shares shall be included in the valuation of the personal property of such stockholders in the assessment of taxes in the tax district where such bank or banking association is located, and not elsewhere, whether the said stockholders reside in said tax district or not.

[Revisers' Note.-L. 1882, chap. 409, pt. of § 312; R. S.. 8th ed., 1580,

without change. See Revised Statutes of United States, § 5219. The Consolidated School Law, tit. VII, § 63, provides for the assessment of school taxes on banks.]

Section 23 requires reports from banks of a list of its stockholders, the number of shares held by each, etc. Section 24 provides for the manner of assessment.

Section 5219 of the Revised Statutes of the United States is as follows: § 5219 "Nothing herein shall prevent all the shares in any association from being included in the valuation of the personal property of the owner or holder of such shares, in assessing taxes imposed by authority of the State within which the association is located; but the legislature of each State may determine and direct the manner and place of taxing all the shares of national banking associations located within the State, subject only to the two restrictions, that the taxation shall not be a greater rate than is assessed upon other moneyed capital in the hands of individual citizens of such State, and that the shares of any national banking association owned by nonresidents of any State shall be taxed in the city or town where the bank is located, and not elsewhere. Nothing herein shall be construed to exempt the real property of associations from either State, county or municipal taxes, to the same extent, according to its value, as other real property is taxed."

Under section 5219 the shares of stockholders in a national bank are subject to State taxation, without regard to the fact that a part or the whole of the capital of the bank is invested in United States

securities declared by Congress to be exempt from taxation by State authority, but only when the act of the legislature authorizing such tax provides that it shall not exceed the rate imposed upon the shares of any of the banks organized under the State laws. Van Allen v. Assessors, 3 Wall. 573 (1865); reversing City of Utica v. Churchill, 33 N. Y. 161 (1865).

The shares of national banks are subject to taxation, under the laws of the State, though such tax must not be at a greater rate than upon other moneyed capital in the hand of individuals, nor must such tax exceed the rate imposed upon the shares of any of the banks organized under authority of the State. People ex rel. Kennedy v. Commrs. of Taxes, 35 N. Y. 423 (1866).

This case was affirmed and the doctrine of Van Allen v. Assessors was reaffirmed in People v. Commrs., 4 Wall. 244 (1886); S. C., sub nom. People ex rel. Duer v. Commrs. of Taxes of New York, 6 Am. Law. Reg. (N. S.) 246, and in People v. Commrs. of Taxes, 94 U. S. 415.

The Court of Appeals, in City of Utica v. Churchill, 33 N. Y. 161, reversed as above, had held that the State statute in question did not exceed the limitations prescribed by the act of Congress of 1864, although it did not contain the express provision regarded as essential by the United States Supreme Court.

Section 5219 applies to valuation as well as to the rate of percentage. Therefore, a State statute permitting the deduction of debts due by the taxpayer, from the valuation of all his personal property except such shares, is void as to them. People v. Weaver, 100 U. S. 539 (1879); Williams v. Weaver, 75 N. Y. 30 (1878); reversing Albany City Nat. Bank v. Maher, 6 Fed. Repr. 417 (1881).

1

National bank shares can be assessed above par. No unjust discrimination against national banks arises from the fact that State banks can divide up all their surplus while national banks are required to accumulate a surplus. People ex rel. Gallatin Nat. Bank v. Commrs. of Taxes, 67 N. Y. 516; affirming 8 Hun, 536; and affirmed in 4 Otto, 415. The State act for the taxation of corporations generally (Laws 1880, chap. 542), does not exempt individuals from assessment on shares thereof as part of their personal estate, so that the imposition of a higher assessment and heavier tax upon the shares of a national bank, under Laws 1880, chap. 596, than upon the capital stock and personalty of other corporations, does not contravene the restriction of section 5219 of the U. S. R. S. Laws 1880, chap. 596, was repealed by Laws 1882, chap. 402, § 1, but was substantially incorporated in Laws 1882, chap. 469. Albany City National Bank v. Maher, 6 Fed. Repr. 417 (1882, 2d U. S. Circuit). Laws of 1866, chap. 761, is not wholly void in prohibiting the deduction of debts from the valuation of national bank stock. If the stockholder has debts to deduct he can still procure the deduction to be made, and the assessment is only voidable. Supervisors v. Stanley, 105 U. S. 305 (1881).