194 A. 870 | N.J. | 1937
Where, within the state, is the location of the "chief" office of a corporation for the purpose of levying a personal property tax upon its intangibles pursuant to our *165
General Tax act (Pamph. L. 1918, ch.
The stipulated facts disclose that the prosecutor was incorporated under our General Corporation act on December 26th, 1914; that its registered office is 490 Main street, East Orange, New Jersey. No business, however, is conducted there; no persons are employed there, and the intangible property of the corporation is not taxed there. Prosecutor operates two places of business for the sale of automobiles; one is in Newark, New Jersey, where its corporate books are kept and where most of the business is done, and the other is in Belleville, New Jersey. Prosecutor filed a personal property tax return for the year 1936 with the city of Newark, in which taxable assets, exclusive of intangibles, in the amount of $27,598.32 were shown. It is conceded that this item is subject to taxation by the city of Newark. As a matter of fact, prosecutor's contention before us is that the ultimate assessment as made be reduced to this figure. Its intangible assets totaled $46,595.90. A claim for deduction for liabilities and debts due creditors, amounting to $85,395.56 was filed. This claim was not allowed because it was not in statutory form; neither was it signed nor sworn to. The disallowance of this claim, although assigned as a ground for setting aside the assessment, is not argued. We, therefore, consider it abandoned. Marten v. Brown,
It is, of course, well settled that intangibles are taxable at the domicil of the owner. Blodgett v. Silberman,
Our Corporation act (1896) as amended and supplemented furnishes little, if any, aid in answer to this question. While that act speaks of "principal" and "registered" offices synonymously (section 43b), it establishes such offices merely as the place where service may be made upon a registered agent (section 126b); where the stock and transfer books of the corporation are to be kept (section 33); and where notices to the corporation may be sent (section 43c); but it does not provide that the "principal" or "registered" office be the "chief" office for the purpose of taxation.
We have no decisions in our state directly on point. With us the problem is one of first impression. None of the cases cited is on point. The case of State v. Haight,
Although our Corporation act and our decisions afford no solution to this problem, we are not entirely without precedent. Decisions of our sister states indicate a rather well defined division of opinion on the subject. One view, chiefly represented by New York and Ohio, holds that the place designated in the certificate of incorporation conclusively fixes the domicil of the corporation for the purpose of taxation despite the fact that most of the business may be carried on elsewhere. The other and the majority view is that the principal office, as named in the incorporation papers is not, for the purpose of taxation, conclusively the domicil of the corporation. See 2 Cooley Tax.
(4th ed.) § 486. And so it has been held that a corporation resides in that taxing district "where the vital acts of its existence are daily done and transacted." Inter-Southern LifeInsurance Co. v. Louisville,
Thus because we are without precedent in our own state, and because the courts of our sister states are divided on the subject, we are free to adopt that view, which, to us, appears to be the sounder and better one. We are of the opinion that the location of the "chief" office of a corporation for the purpose of a personal property tax upon its intangibles is largely a question of fact. Accordingly, we hold *168
that the designation of a "principal" or "registered" office in a certificate of incorporation is not conclusive as to the "chief" office of a corporation for the purpose of taxation. See 2 Cook, Corporations, § 572a. Bearing in mind that the ordinary meaning of the word "chief," to wit. — "head, leading, paramount, of foremost importance" (See Webster's New International Dictionary, second edition, 1937), we must necessarily examine the factual situation presented in each particular case in order to determine the location of the "chief" office of a corporation. Only by so doing do we lend force and effect to our holding that "taxation is an intense reality." Universal Insurance Co. v.State Board of Tax Appeals,
Our careful examination of the proofs and the proper deducible inferences to be drawn therefrom, impels the conclusion *169 and, in so concluding, we find as a fact, that prosecutor's "chief" office was in the taxing district of the city of Newark, where, under the facts and circumstances of this particular case, most of its business is done. Its intangibles, therefore, should have been, as they were in fact, taxed in that district.
Accordingly, the judgment of the state board of tax appeals is affirmed; the writ of certiorari is dismissed, with costs. *170