was assessed in the wrong ward, if not made in due time before. the assessors, should properly be disregarded at special term on certiorari. People ex rel. Citizens El. Ill. Co. v. Neff, 26 App. Div. 542 (1898). But, under the New York Charter, an assessment made by default in the wrong borough is invalid. People ex rel. Moller v. O'Donnell, 183 N. Y. 9 (1905).

AS TO CHANGE OF PRINCIPAL PLACE OF BUSINESS Where residence is not fixed by statute.-When the statute under which a telephone company was incorporated does not fix its residence, and where it removed its office from New York City prior to the second Monday of January and ceased to transact any business there, it was not a resident of that city and consequently not taxable therein, but might change its office to any place within the state where it was actually engaged in business. Austen v. Hudson Riv. Tel. Co., 73 Hun, 96 (1893).

Where residence is fixed by certificate.- Where a company was incorporated under the manufacturing act of 1848, which required its principal office to be stated in the certificate, such designation in the certificate was conclusive for the purpose of taxation, and it cannot change its principal office by resolution of its board of directors. People ex rel. India Rubber Co. v. Barker, N. Y. Law Journal, Apl. 28, 1894.

Where there is a disputed question of fact as to the location of the principal office of a domestic corporation, the court in a collateral proceeding by the receiver of taxes, to collect the tax may discredit the statement of the president of the company that the certificate of incorporation named Tarrytown, Westchester County, as the company's principal office. McLean, Receiver of Taxes v. Couper Milling Co., 14 N. Y. Supp. 509; aff'd 60 Hun, 578, 133 N. Y. 603 (1892).

Proceedings to change principal office.-Proceedings may be taken for changing the principal office of a corporation under section 13 of the Stock Corporation Law.

Place of taxation of foreign corporation engaged in business within the state.-Chapter 37 of the Laws of 1855 taxed nonresidents on all sums invested in business "the same as if they were residents of this state." It was held that under this Act the place of assessment for purposes of taxation of a foreign insurance corporation doing business in this state is where the principal business of the corporation is carried on, and not at the residence of the comptroller of the state, even as to securities deposited with him. British Commercial Life Ins. Co. v. Com'rs of Texas, 31 N. Y. 32 (1865).

A foreign corporation doing business in this state and having a principal office here is taxable for moneys invested in the state in the town or ward where such office is located, and the assessment at such place must be exclusive, and embrace all its personal property liable to taxation within this state. The assessment of personal property of a foreign corporation in the possession of an agent in a town, other than where such office is located, is void. People ex rel. Bay State Co. v. McLean, 80 N. Y. 254 (1880); aff'g 17 Hun, 204; 5 Abb. N. C. 137.

The personal property, within the state, of a corporation, whether domestic or foreign, is taxed at the place where its principal office, within the state, is located without regard to the particular situs of the property. The People ex rel. Keystone Gas Co. v. Assessors of Olean, 15 N. Y. State Rep. 461 (1888).

Where a foreign corporation has established two places for the sale of its goods within the state, it is taxable on its capital employed anywhere in the state at the place designated by it in its certificate filed under section 16, General Corporation Law, as its principal office within the state. People ex rel. Armstrong Cork Co. v. Barker, 157 N. Y. 159 (1898).

CHAPTER V.

MANNER OF ASSESSING CORPORATIONS: CAPITAL STOCK AND SURPLUS, HOW ASSESSED: DEDUCTIONS OF

SURPLUS AND REAL ESTATE.

Method of assessing corporations before 1853.-Prior to 1853 moneyed corporations were assessed on their capital stock at the nominal or par value. The Revised Statutes of 1828 (I. R. S. 414) provided that all moneyed or stock corporations deriving an income from their profit or capital or otherwise, should be liable to taxation on their capital. The amount of the tax was to be computed upon the capital stock actually paid in or secured to be paid in, excepting the actual cost of the real estate of the company and the amount of the capital stock held by the state and incorporated literary or charitable institutions. The regulations as to the method of assessing incorporated companies were also prescribed, and required that the proper officer of the company furnish the assessors of the town or ward where it was liable to be taxed upon its capital, with a statement of the amount of its capital paid in or secured, the amount invested in real estate, with the actual cost thereof, and the amount of the capital stock held by the state, or others, which was exempt from taxation. The principal object appeared to be to ascertain the amount of the capital stock to be taxed as the personal estate of the corporation, and it also provided that the amount of the capital stock so ascertained be inserted in the assessment roll in the column of personal estate, after deducting therefrom the cost of the real estate, and the stock exempt from taxation. It would seem to be evident from these different provisions, that the legislature intended to tax corporations upon the nominal amount of the stock itself and not upon its actual value to the stockholders. (This did not apply to manu

facturing, turnpike and marine insurance companies where a different principle applied.) Bank of Utica v. City of Utica, 4 Paige Chancery, 399 (1834).

In the year 1853 and again in 1857, the statute was amended, and the present system of taxing capital stock at actual value introduced. People ex rel. Cagger v. Dolan, 36 N. Y. 59 (1867).

The statute.-The capital stock of every company liable to taxation, except such part of it as shall have been excepted in the assessment roll or shall be exempt by law, together with its surplus profits or reserve funds exceeding ten per centum of its capital, after deducting the assessed value of its real estate, and all shares of stock in other corporations actually owned by such company which are taxable upon their capital stock under the laws of this state, shall be assessed at its actual value. (Sec. 12 of present and former Tax Law.)

Source: L. 1857, ch. 456, sec. 3, without change of substance.

The words "and taxed in the same manner as the other personal and real estate of the county" contained in section 3, Chapter 456, Laws of 1857, are omitted in the Tax Law. It was argued in People ex rel. Cornell Steamboat Co. v. Dederick, 161 N. Y. 195, that the omission of these words indicated a legislative intent that corporations should not deduct their debts, but the court held otherwise. The words were perhaps omitted, because the intent was clear without them, and their retention might create ambiguity.

"Capital stock" defined.-The words "capital stock" in Laws of 1857, Chapter 456 section 3 (section 12, Tax Law), refer to the capital of the company and not the shares of the stockholders. People ex rel. Union Trust Co. v. Coleman, 126 N. Y. 433 (1891). It denotes the property owned by the corporation, and not the par or actual value of the shares of the stockholders. People ex rel. Second Ave. R. R. v. Barker, 72 Hun, 126 (1893).

Capital stock shall be assessed at actual value.-The capital stock of a corporation is to be assessed at its actual value, irrespective of its par or nominal value. Oswego Starch Factory v. Dolloway, 21 N. Y. 449 (1860); People ex rel. Panama R. R. v. Com'rs, 64 How. Pr. 405 (1883).

Where indebtedness exceeds assets capital stock should not be assessed. In assessing the capital stock of a corporation the actual value of the stock is the basis, and where it is of no value, because of its indebtedness, it should not be assessed. People ex rel. West Side & Yonkers R'y Co. v. Com'rs of Taxes, 31 Hun, 32 (1st Dept.), 1883.

Market value and cost sometimes considered.- Where the value of the assets of a corporation cannot be definitely ascertained the market value may be considered. People ex rel. Malcolm Brewing Co. v. Neff, 19 App. Div. 596 (1897); aff'd 154 N. Y. 437. Cost may sometimes be considered. People ex rel. Reinhardt v. Feitner, N. Y. Law Journal, Nov. 12, 1900.

“Book value" may also be considered, though not the usual or best test. In fact, assessors may resort to any and all tests which 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. People ex rel. Knickerbocker Fire Ins. Co. v. Coleman, 107 N. Y. 541 (1887); aff'g 44 Hun, 410.

The cost or book value may be taken as the basis, in the absence of satisfactory proof as to the market or actual value. People ex rel. John Turl's Sons v. O'Donnell, N. Y. Law Journal, June 27, 1905.

On the subject of "book value" see case of People ex rel. J. B. Co. v. Roberts, 37 App. Div. 1.