95 N.J.L. 465 | N.J. | 1921
This is a dispute over the right of Jersey City to tax certain personal property of the bankrupt ñrm of Dailey & Ivins for taxes of the year 1918. The two principal questions are, first, whether the.property now in question was taxable at all under the laws of this state because of the title, possession, qualified ownership, or whatever it may be called, to which it was subjected at the taxing date, May 20th, 1918, and secondly, whether the property had such a situs within the taxing district of Jersey City as to' permit tire tax lien to attach. By the various appeals from the local assessors to the county board and thence to the state board, and the certiorari from the Supreme Court, all disputed matters seem to have been eliminated except a fund in bank, and a tugboat which, on May 20th, was moored (as we were informed on the argument) in the South cove of Jersey City.
As to the fund in bank, it is stipulated to be part of the proceeds of sale of a shipyard of Dailey & Ivins, and it is claimed that it should not be included in the valuation because the attorneys in the case stipulated “that the question of the right to assess against the proceeds of sales is not to be considered on this appeal” (to the state board). If it was meant thereby to stipulate a legal rule for the state board and the courts, such a stipulation, as the board properly-pointed out, is futile. The board held this fund taxable and the Supreme Court affirmed that ruling. Both tribunals properly took into consideration the questions of law involved ;' and our sole concern here is whether they rightly decided them. As the same reasoning applicable to this fund applies in part to the tugboat, both will be considered together in this aspect.
On this phase of the case the argument seems to be that the fund and the tugboat, being held by the trustee in bankruptcy, were in the custody of the law, and that property in' such custody is not taxable. On the broad question whether property of a bankrupt in the hands of a trustee in bankruptcy is exempted from state taxation, the answer of the United States Supreme Court is decidedly'- in the negative. Swarts v.
Appellant invokes the language of section 11 of the Tax act of 1903 (Comp. Stat., p. 5091) which, after prescribing the place of taxation, provides that “personal property in the possession or under the control of any person as trustee, guardian, executor or administrator, shall be assessed in his name as such,” and argues that because he, as trustee, did not have entire possession or control of the tug, ergo, it was. not taxable. But this statutory language is merely directory with respect to the differentiation of trust property from individual property in the name to which it is assessed, and in nowise as to it? general taxability. One good reason for such differentiation is to spare the trustee’s individual property from seizure for non-payment of taxes on trust property. 'Whatever the reason or reasons, the clause has. no bearing on taxability of the property. That is settled by section 2, which, in broad and sweeping terms, subjects, to taxation “all property, leal and personal, within the jurisdiction of this state, not expressly exempted by this act or excluded from its operation.” The argument, therefore, simmers down to this, that because appellant had not possession or control of the tug, the assessment in his name was erroneous. But this does not invalidate it; on the contrary, section 30 of tire act (Comp. Stat., p. 5109) provides that “no assessment of real or personal property shall be considered invalid because listed or assessed in the name of one not the owner thereof.” To quote appellant’s brief, “'the tax law does not deal with finespun theories of title.” So far as the clause relied on is concerned, we conclude that it had no effect at all on the liability of the tug to taxation.
As a preliminary to ascertaining whether this tug was exempt because in the custody of the marshal, it is necessary to determine the other question raised, whether apart from such claim of exemption it was taxable on May 20th, 1918, in the taxing district of Jersey City. In our opinion, it was so taxable. As an active tug plying in the waters of New York harbor it was taxable at the residence of the owners or the permanent situs of the property, it is immaterial which. American Mail Steamship Co. v. Crowell, 76 N. J. L. 54; Shrewsbury v. Merchants’ Steamboat Co., Id. 407; West Shore Railroad Co. v. State Board, 82 Id. 37; 84 Id. 768. But with the bankruptcy its condition became one of passivity ; it was a mere chattel secured from drifting and awaiting a sale. Had it been drawn out on a ship, railway, or even tied up to a wharf on the Jersey City water front, its taxable situs would- be indubitable. While the point does not seem to be definitely argued, we gather from the assertion that the tug was in the “tidewaters of New York bay” that it is claimed to have been out of the taxing jurisdiction of New Jersey because of the interstate treatj limiting the “jurisdic
The tug, then, being legally "found” in the taxing district of Jersey City, it only remains- to inquire whether, because under seizure by the marshal it’was exempted by any rule of law from taxation as against its general owners, Dailey & Ivins, or the trustee in bankruptcy, either by provision in the statute or rule laid down by decision of the courts. It is not exempted by statute; on the contrary, the language of the second section of the act of 1903, already quoted,_ plainly includes it in its purview.
But ¿appellant further invokes the rule laid down at the end of the opinion of this court in Trustees v. City of Trenton, 30 N. J. Eq. (at p. 686), where mortgages to the Chancellor in his official capacity were held exempt. This rule has
These considerations lead to an affirmance of the judgment.