142 Minn. 415 | Minn. | 1919
Edward C. Bodman, a resident of the state of New York, died testate on January 21,1917, possessed of real estate in St, Louis county, Minnesota, of the value of $16,670 and of 1,450 shares of the preferred capital stock of the Great Northern Railway Company, a Minnesota corporation, of the value of $169,650. His will was admitted to probate in the state of New York and was subsequently admitted to probate by the probate court of St. Louis county in this state. The probate court held that our statutes imposed an inheritance tax on the transfer of the capital stock of the railway company as well as on the transfer of the real estate, and
The railway company is incorporated under the laws of the state of Minnesota, but maintains its office for the transfer of its stock in the city of New York, and the courts of the state of New York can acquire jurisdiction of it by the service of process in that state. The relators contend that the capital stock here in question is not subject to the inheritance tax imposed by the statutes of Minnesota, because the decedent was domiciled in the state of New York and kept his certificates of stock in that state, and the transfer of such certificates can be enforced- in that state. The authorities do not bear out this contention. In the late work on' Inheritance Taxation by "Gleason and Otis'it is said, on page 247: “All the authorities agree that a state may tax the transfer of stock owned by nonresidents in domestic corporations, even though the certificates are physically kept without the state.” A lengthy list of authorities to the same effect will be found in Ann. Cas. 1918A, 555, And this court has expressly so held in State ex rel. Graff v. Probate Court of St. Louis County, 128 Minn. 371, 150 N. W. 1094, Ann. Cas. 1916A, 901. We see no reason for departing from the rule announced in the Graff case.
The relators rely largely on State v. Chadwick, 133 Minn. 117, 157 N. W. 1076, 158 N. W. 637, L.R.A. 1916E, 1288, but that case did not overrule the Graff ease and is plainly distinguishable therefrom. In that case it was held that bonds of this railway company held by a nonresident, and kept in another state and capable of being enforced without invoking the laws of this state, were not subject to the inheritance tax of this state. The holder of the bonds was merely a creditor, and could enforce payment of the debt in any of the several states in which the company operated its railroad. But the railway company owes its existence as a corporation to the laws of this state and is subject to the laws of this state. The issuance and transfer of its capital stock and the rights of the holders thereof in the corporation are governed by the laws of this state. The situation of a stockholder is quite different from that
The relators also contend in substance that personal property has its situs at the domicile of the owner, unless given a different situs by statute ; that the statutes, of Minnesota have hot given the capital stock in question a situs other than at the domicile of its owner; and that the conclusion follows that such stock has no situs in Minnesota and is not subject to the inheritance tax of Minnesota. We cannot sustain this contention. No express provision severing the situs of such property from the domicile of its owner is required to give it a taxable situs in this state. It is sufficient if the statute exerts jurisdiction over the property, and, as said in the Graff case, we are of opinion that the language of the taxing statute manifests an intention to tax all property that the state has the power to tax. Furthermore the legislature has emphasized its intention to tax the transfer of the capital stock of domestic corporations held by nonresidents by providing that: “No corporation organized under the laws of the State of Minnesota shall transfer on its books any shares of its capital stock standing in the name of a nonresident decedent, or in trust for a nonresident decedent, without the consent of the attorney general first procured as hereinbefore provided for,” and by further providing that: “Such consent shall be issued by the attorney general only in case there is no tax due hereunder; or in case there is a tax, when the same shall have been paid.” G. S. 1913, § 2281.
The relators further contend that, even if the transfer of the shares of stock is taxable in this state, the state cannot levy a tax “upon the proportion of the value of the shares represented by the property of the corporation in the states other than Minnesota,” and as only 27 per cent in value of the property of the corporation is located in this state, that only 27 per cent of the value of the stock is taxable in this state. We are unable to sustain this contention. The railway company is a Minnesota corporation, and the laws of Minnesota fix and determine the rights in the corporation possessed by the owners of its capital stock. Each share of capital stock entitles the owner to his proportionate share of all the profits of the corporation, whether earned within or without the
See also Welch v. Treasurer, 223 Mass. 87, 111 N. E. 774; Moody v. Shaw, 173 Mass. 375, 53 N. E. 891; Gardiner v. Carter, 74 N. H. 507, 69 Atl. 939; Matter of Bronson, 150 N. Y. 1, 44 N. E. 707, 34 L.R.A. 238, 55 Am. St. 632; Matter of Cooley, 186 N. Y. 220, 78 N. E. 939, 10 L.R.A.(N.S.) 1010.
Where the same company is incorporated in two or more states and thus becomes a domestic corporation of each of such states, the rule of apportionment contended for by the relators is usually applied. Kingsbury v. Chapin, 196 Mass. 533, 82 N. E. 700, 13 Ann. Cas. 738; Welch v. Treasurer, 223 Mass. 87, 111 N. E. 774; Gardiner v. Carter, 74 N. H. 507, 69 Atl. 939; Matter of Cooley, 186 N. Y. 220, 78 N. E. 939, 10
We are of opinion that the probate court determined the questions submitted to it correctly, and its judgment is affirmed.