People ex rel. Knickerbocker Fire Insurance v. Coleman

Majority

p. 29

People ex rel. Knickerbocker Fire Insurance Co., App’lts, v. Michael Coleman et al., Commissioners of Taxes.

(Supreme Court, General Term, First Department,

Filed May, 13, 1887)

Headnote

1. Taxes and assessments—Stock of corporations how valued.

The capital stock of a corporation is to be assessed for the purposes of taxation, at its actual value, which may be other than its market value.

2. Same—Valuation of land—Deduction for real estate.

The commissioners, for the purpose of determining the actual value of the capital stock of the relator, appraised its real estate at §125,000 (a valuation not claimed to be in excess of its actual value), but in making the deduction for real estate, required bylaw, only $75,000, the assessed value, was deducted. Held, that this was not error.

The relator is an insurance company, and its shares of stock, at par, amounted to §210,000. The highest rate at which such shares sold in the open market during 1884, was ninety; but the respondent assessed the same as of the actual value of 146, for the purposes of taxation.

This value was arrived at by valuing the gross assets at $374,872, including $125,000, as the value of the real estate, and making deductions amounting to $67,125,46, leaving the net value of the appellant’s assets, or capital stock, to be $307,747, or $146 per share of $100.

From this amount the respondents deducted, as required by law:

K. S. stocks........................................§186,840

The assessed value of the real estate................ 75,000

And 10 per cent on the capital..................... 21,000

$282,840

Leaving a balance of $24,904, for which the relator was assessed.

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The relator sought to review this assessment by certiorari, and it was confirmed by the court, and the relator, duly appealed from such judgment of confirmation.

8. B. Brownell, for counsel of relator and app’lt; George S. Golemam, of counsel for respondent.

It is apparent that the only question which was presented to thé court below was as to the right of the respondents to value for the purposes of taxation the capital stock of the relators at other than its market value.

The case of the People ex rel. v. Asten ( 100 N. Y., 597 ), and the cases there cited seems to settle this question, and it is not open for discussion.

The capital stock of a corporation is to be assessed at its actual value, the court say, and the commissioners of taxes act judicially in fixing such value, and they have the authority to act in accordance with their own knowledge and with such information as they are able to obtain from the sales in the market or otherwise by ascertaining the value of the property which the stock represented and by determining the dividend earning power of the corporation.

In the case at bar it is true that the stock sold in the market at ninety, but, as above stated, the market value is only one of the elements tobe considered by the commissioners in determining the “actual value of the capital stock” of a corporation for the purposes of taxation.

There is no evidence that in the valuation of the assets the respondents placed execssive or unwarranted value upon any of the items going to make up the aggregate, nor is any complaint made upon the ground, but the only claim advanced is that the market value was ninety, and the commissioners could not assess at a higher value. This position, as has been seen, is not well taken.

It is now claimed, however (a point which does not appear to have been raised below) that the respondents in appraising the assets of the corporation for the purpose of determining the actual value of capital stock, appraised the real estate at $125,000 (a valuation not claimed to be in access of its actual value), but that in making the deductions of real estate, only $75,000 was allowed, and that was error

The court of appeals in the case of People ex rel. v. Asten (supra), seems to have disposed also of this objection.

In the case cited, the real estate was valued for the purpose of ascertaining the actual value of the stock at what it cost, and being assessed only at one-half of such cost, such assessed value only was deducted as required by law.

This the court held was not error as the assessment of the real estate at one-half of what it actually cost did not affect the value of the stock, and only the assessed value could be deducted.

In the case at bar it is not claimed that the real estate' was not worth the $125,000 at which it was valued, nor that

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there was any excessive valuation of the assets, hence no error was committed by the respondents in their assessment, and the judgment appealed from should be affirmed with costs.

Daniels and Brady, JJ., concur.