42 Minn. 142 | Minn. | 1889
The sole question presented by this appeal is the liability of the defendant, under the act of March 10, 1873, (Gen. St. 1878, c. 11, §§ 128, 129,) to pay, as taxes, a percentage on its receipts or gross earnings. It was organized under title 1, c. 34, Gen. St., and the general nature of its business, as stated in its articles of incorporation, is “to build, purchase, or lease and operate transfer tracks or railways in the city of St. Paul, open alike to the use of all railroads now constructed, or which may hereafter be constructed, to or into St. Paul, to and between each of said roads and each and all important industries in said city whose business requires special railroad accommodations by means of transfer tracks, etc., and in connection therewith to build, lease, or otherwise provide and maintain in said city a union passenger depot, and proper tracks for access thereto; and to that end to construct, purchase, lease, or otherwise secure, maintain, and operate lines of railway in said city.” In connection with these articles, and as in fact a part of
In accordance-with this act, all of the stock of defendant which has ever been issued was apportioned among and issued to, and has always been and still is owned and held by, the seven (since reduced, by consolidation, to five) railroad companies whose roads then ran into St. Paul, and who then used and still use the depot and
It is evident from this statement of facts that the sole and only function .performed by the defendant corporation is to furnish, at cost, a union depot and terminal facilities for the common use of these different railway companies, and that the scheme' of forming a corporation for that purpose, and issuing stock, is but a more convenient and economical method of holding the property and managing the business than it would be to hold and manage it as tenants-in common. It is also apparent that what is charged the railway" companies and received by the depot company for these terminal facilities is nothing more or less than a part of the expenses of the former in transacting their railway business, and that what are called, the “earnings” of the depot company are for services for which the-railway companies charge their patrons, and are all included in the-gross earnings of the companies, on which they pay a percentage to-the state. To collect a percentage on these gross earnings, and also-a percentage on the gross earnings of the depot company, would be,. pro tanto, double taxation of the same thing. Or take another view of the case. The stock of the Union Depot Company represents and is the exact equivalent of all the property of that corporation. It is held by the railway companies, under legislative authority, for railroad uses, as fully as would be the depot itself if held by them as tenants in common. Hence payment of the required percentage on the gross earnings of the companies constitutes payment of taxes on this stock, and consequently on the property which it represents, and to tax the stock in the hands of the stockholders, and then tax the property which it represents against the corporation, would clearly be illegal or double taxation. The identity of the property taxed is not affected by the
We attach no importance to the fact that after its organization defendant’s board of directors notified the state of its election to accept the provisions of the act of March 10, 1873. If it was liable to tax
Order reversed.