3 Mills Surr. 523 | N.Y. Sur. Ct. | 1903
The property sought to be subjected to the transfer tax consists of 100 shares of stock of the National Bank •of Commerce of the City of New York. The appellants claim that the assessment and taxation of this stock were erroneous for the reason that the decedent was a nonresident and the stock certificate was without the State.
In legal contemplation the property of the shareholder is where the corporation exists. It consists of his right to share in the net produce, and, eventually, in the net residuum of the corporate assets resulting from liquidation (Matter of Bronson, 150 N. Y. 1; Matter of James, 144 id. 6; Matter of Easton, 113 id. 174). In Germain v. Lake Shore & M. S. R. Co. (91 N. Y. 492) Judge Earl says: “A share of stock represents the interest which the shareholder has in the capital and net earnings of the -corporation. * * * Shares of stock should be distinguished from certificates of stock, which are meroly evidences as to the number of shares to which the holder of the certificate is en
The appellants urge that the transfer of stock belonging to a nonresident decedent can be taxed only where the shares are those of a domestic corporation; that the Rational Bank of Commerce of Rew York is a foreign corporation and consequently the present transfer is exempt.
A corporation created and organized under Federal law is a domestic corporation in each State in which it transacts business. Its residence is the place in which it is authorized to conduct its corporate affairs. A national bank exists solely in the locality where it is empowered to do business, and the Federal statutes provide expressly for the taxation of their shares
Our own Code of Civil Procedure (sec. 3343, subd. 18) declares that “A ‘ domestic corporation ’ is a corporation * * * located in the State, and created by or under the laws of the United States.” And Congress has enacted that “ all national banking associations established under the law of the United States shall, for the purpose of all actions by or against them, real, personal or mixed, and all suits in equity, be deemed citizens of the State in which they are respectively located; and in' such cases the Circuit and District Court shall not have jurisdiction other than such as they would have in cases between individual citizens of the same State ” (U. S. Rev. Stat., supplementary, 2d ed., vol. 1, p. 614).
In Cooke v. State N. B. of B. (52 N. Y. 96-111) Chief Justice Church quotes with approval the opinion of Wayne, J., in the Letson case (Louisville C. & C. R. R. Co. v. Letson, 2 How. (U. S.) Rep. 497) that “A corporation created by and doing business in a particular State is to be deemed to all intents and purposes as a person although an artificial person, an inhabitant of the same State for the purposes of its incorporation, capable of being treated as a citizen of that State as much as a natural person.” And at page 112, “ Their location (i. e., national banking associations) and place of business are fixed by the law of their creation. They are made inhabitants of the State for the purposes of taxation, and a majority of their managing officers •are required by law to reside in the States of their respective location. * * * These banks should be deemed citizens of the States where, by law, they are located.”
Order affirmed.