Hannis Distilling Co. v. Mayor

the opinion of the court.

The city of Baltimore sued to recover from the Hannis Distilling Company, a West Virginia corporation, $18,218.(58, of which $9,259.29 .was the amount of. state and city taxes for 1902 on an assessment of 50,996 barrels of distilled spirits, and $8,959.49 was the sum of state and city taxes for 1903

“ Sec. 214. There shall be levied -and collected upon all distilled spirits in this State, as personal property, the' same rate of taxation which is imposed b'y the laws of the State on other property for átate and county purposes.

“Sec. 215. For the-pürpose of such assessment and collection it is hereby made the duty of each distiller, and every owner or proprietor of a" bonded or other warehouse in which .distilled spirits are stored and of every person or corporation having custody of such spirits to make report to the state tax commissioner, on the first day of January in each and every year, of all the distilled spirits on hand at such date, and the tax for the ensuing year from the said first of January shall be levied and paid on the amount of distilled spirits so in hand, as representing the taxable distilled spirits for such year; provided, however, that the same distilled'spirits shall not be taxed twice for. the same year.”

By tho remaining provisions of the act the machinery for levying and collecting the taxes'for which the act provided was created. Such regulations afforded those interested an opportunity to be heard as to the amount of any assessment, ■made it the duty of the person having the possession, control or custody of the spirits assessed to pay the taxes levied thereon, and gave to the persons thus made liable to make

Because of diversity of citizenship the defendant removed the case to the Circuit Court of the United States for the District of Maryland. In that court two pleas, to the declaration were'filed. By the first, it was alleged that the corporation was not only incorporated under the laws of West Virginia, but had always been exclusively a citizen and resident of that State, and of no other. The corporation, it was averred, was not, at the time when the taxes sued for were levied, the owner of the distilled spirits upon which the levy was made, or any portion thereof,. and, indeed, had never at any- time since the assessment and levy had1 any interest, direct or indirect, in the distilled spirits in question. Under these circumstances it was charged “ that under the provisions of article Í5 of the bill of rights of the constitution of Maryland, as the same has been construed by the .Court' of Appeals of Maryland . . . the respective taxes levied on. the assessed’" value of all of the said barrels of distilled spirits . . . were levied on the owners of said barrels of distilled spirits, who were and are persons other than this defendant, and the said taxes were not and could not have been levied on this defendant.” The plea then proceeded to aver that at all times prior to the day when the assessment had been made and since, the spirits assessed had been stored in the defendant’s bonded warehouse subject to the acts of Congress applicable to bonded warehouses, and that the defendant had'at no time “any further custody or control of the spirits than is by the acts of Congress applicable to the subject.” The plea further charged that the corporation had no funds in its possession or under its control, belonging to the owners of the spirits with which to pay the taxes;-that the corporation had not agreed to pay them, .that it had never borne any other -relation to the owners than that of creditor, and therefore there was no right to recover the taxes from the corporation or to compel it to pay them. It

A demurrer filed by the city to both pleas, on the ground that they stated no defense, was sustained without an opinion. The distilling company, electing to stand upon its pleas, judgment was entered against it for the’amount of the taxes. Thereupon a writ of error directly from this court was prosecuted upon the assumption that Questions under the Constitution of the United States were involved which gave a right to an immediate resort to this court for their, solution. Upon the correctness of such assumption our jurisdiction depends. The assumption, however, may not be indulged in simply because it appears from the record that a Federal question was- averred, if such question be obviously frivolous 6r plainly unsubstantial, either because it is manifestly devoid of merit or because.its unsoundness so clearly results from the previous decisions of this court as to foreclose the subject and •leave no room for the inference that the questions sought to be raised .can be the' subject of controversy. Leonard v. Vicksburg, S. & P. R. Co., 198 U. S. 416 , 421, and cases cited; . Delmar Jockey Club v. Missouri, 210 U. S. 324 , 335; McGilvra v. Ross, 215 U. S. 70 .

The assignments merely charge that error was committed

In Carstairs v. Cochran, 95 Maryland, 488, 498, suit was brought by Cochran, as treasurer and tax collector, to recover . from Carstairs and- another the amount of taxes assessed and levied in respect of distilled spirits in a warehouse of the defendants, the assessment and levy having been- made under the identical law by virtup of which the assessment and levy here' in controversy was made. The Court of Appeals of Maryland upheld the statute and consequently sustained the' validity of the tax. In opening its opinion the court said:

“ This' appeal constitutes the third attack upon the validity of the act. of 1892, c. 704, as now amended tyy the act of 1900, ,c. 320, .being §§ 204 and 213, inclusive,- of Article 81 of. the ' Supplement to .the Public General Code of Maryland, providing for the collection of taxes upon distilled ’ spirits in this State.

“The appellants admit that all the features of "the law-which are here assailed upon constitutional, grounds were considered by the court in Monticello Distilling Co. v. City of Baltimore, 90 Maryland, 416; and that- while the act was there held invalid, as it then stood, because of the failure to provide for a hearing in respect to the valuation to be placed on the

spirits for the purposes of-taxation, it was declared to be 'in .other respects free from constitutional objections.’ ”

After then stating that it was contended that, as the Monticello case had been decided on the ground that, the statute did not provide adequate notice, the declarations of the court in that case upholding the constitutionality of the law. in other respects were obiter, the court proceeded to consider that contention and hold that it was not well founded, because the reasoning in the Monticello case concerning the constitutionality of the statute was directly responsive to the contentions made, and therefore involved in the case - as presented. Although reaching this conclusion, in view cif the court’s estimate of. the importance of the subject, it nevertheless proceeded to reconsider all the contentions concerning the constitutionality of the statute. As a prelude to the reinvestigation the court said (95 Maryland, 500):

“The provisions of the act-of 1892,, c. 704, were sufficiently detailed in the opinion rendered in Monticello Distilling Co. v. City of Baltimore, supra, and that sta.temfent-will be adopted for this case without repeating it here. That act is assailed here,as it was there, as fundamentally vicious, and upon precisely the same grounds, with the exception of the want of notice of assessment, which has been . cured by act 1-900, c. 320. These grounds are twofold: First, that it lays.a tax upon property, and not upon the owner of the property; and, second, that it- compels one not the owner of the spirits to • pay the tax due by the owner, who is usually unknown to the,, party compelled to pay.”

And after an- elaborate consideration of all the contentions the conclusions reached in the Monticello case -were .adhered-to and the constitutionality of the statute .imposing the tax was reaffirmed.' The case was brought to this court (Carstairs v. Cochran, 193 U. S. 10 ) and the repugnancy of the statute to the Constitution of the United States was elaborately ' pressed. Preliminarily to a . consideration of the Federal questions which were presented for decision the court at the

It follows that at the .time the writ of error directly from this court was sued out, upon the assumed, théory that thq Maryland. act imposing the taxes sued for was repugnant' to the due process clause of the Constitution of' the United States, such contention^had been expressly decided to be without foundation -by this court, and therefore the propositions, of Federal right upon which alone the jurisdiction of this court depended was foreclosed and. not open to controversy,' and afforded no substantial basis for the writ of error, unless for some of the reasons alleged by counsel the .case is taken out of this general principle.

Dismissed for want of jurisdiction.