| Mass. | Jan 3, 1907
If the stocks bought and held by the petitioners for their customers had been bought upon a margin in the ordinary significance of that word, the legal title to them would have been in the petitioners, who in that event properly would have been taxed for their value, and the petition could not have been maintained. Chase v. Boston, 180 Mass. 458" court="Mass." date_filed="1902-02-27" href="https://app.midpage.ai/document/chase-v-city-of-boston-6427715?utm_source=webapp" opinion_id="6427715">180 Mass. 458. But that is not the case. All of these stocks were bought by the petitioners upon written orders from their customers, with a specific agreement that the ownership should be in the customers, subject only to a lien in favor of the petitioners for any indebtedness to them. Each of these orders directed the petitioners to buy a certain number of shares of specified stocks for the account and risk of the purchaser. If the petitioners made the purchase, they notified the customer of the price paid therefor, and he would pay either the whole or some
Manifestly upon these facts, if there were nothing more, it would appear that the petitioners held these stocks as pledgees, with the right to repledge them to others, and that the purchasers were the owners and pledgors. They were bound to keep, as it is found that they did keep, the stock of each customer distinct; they could not take a single certificate in their own name for all the similar stock purchased for all their customers ; and they were bound to deliver, as they were accustomed to deliver, to each customer the identical stock purchased for him. It would follow that not the petitioners, but the rightful owners respectively of these stocks should be taxed for them, that the petitioners were entitled to the abatement which they seek, and that the judgment of the Superior Court should be affirmed.
It is contended however for the respondent that the effect of St. 1903, c. 423, § 1, is to make the petitioners the general owners of the stocks in question, and so liable to taxation upon them. That statute provides that “ the delivery of a certificate of stock by the person named as the stockholder in such certificate or by a person entrusted by him with its possession for any purpose to a bona fide purchaser or pledgee for value, with a written transfer thereof, or with a written power of attorney to
But the object of this statute was merely to protect stock so transferred against attachments or other accruing claims against the apparent owner of record. It was not intended and cannot operate to raise the title of a pledgee into an absolute ownership. Mor was it designed to throw the burden of taxation upon the pledgee and to exonerate therefrom the general owner, even though the transfer was not upon its face expressed to be by way of security only. Manifestly an owner of stock could not escape his liability to be taxed therefor by merely pledging it to a cz’editor; manifestly he could not withdraw it wholly from the fund available for taxation in this Commonwealth by transferring it in blank and delivering the certificates in pledge to a foreign creditor who was beyond the reach of any of our local assessors. Such property is to be taxed to the pledgor, not to the pledgee. The latter does not escape taxation, for by our statutes he is to be taxed for the debts which are secured by the pledge, though entitled to an allowance for such debts as may be due frozn himself. R. L. c. 12, § 4, cl. 2. The provisions of
Accordingly we are of opinion that the petitioners were not liable to taxation upon the value of these stocks, and are entitled to the abatement which they claim.
Even if the main contention of the respondent were correct, however, it is at least difficult to see how the act of the assessors in rejecting the petitioners’ sworn statement and “ dooming ” them in the arbitrary sum of §300,000 could be upheld. The list of copartnership property contained in this statement was made up in accordance with the requirements of R. L. c. 12, §§ 42 et seq. It is provided by § 46 of this chapter that the assessors “ shall receive as true, except as to valuation, the list brought in by each person, unless, on being thereto required by the assessors, he refuses to answer on oath all necessary inquiries as to the nature and amount of his property.” It is found that the petitioners made no such refusal, and it did not appear from their examination that the list was not a true one. Hall v. County Commissioners, 10 Allen, 100. Apart from the fact that this list is now found to have been correct, it therefore seems to have been conclusive upon the assessors, as they did not choose to require any further answers upon oath from the petitioners. Moors v. Street Commissioners, 134 Mass. 431" court="Mass." date_filed="1883-03-05" href="https://app.midpage.ai/document/moors-v-street-commissioners-6420896?utm_source=webapp" opinion_id="6420896">134 Mass. 431. Lincoln v. Worcester, 8 Cush. 55, 64. Newburyport v. County Commissioners, 12 Met. 211, 223. We have preferred, however, to rest our conclusion upon the first and principal question in dispute, understanding this to be the desire of both parties.
In accordance with the terms of the report, the judgment of the Superior Court is to be Affirmed„