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Argument for Insurance Company.
McNeill v. Hagerty, 51 Ohio St. 255, 266; French v. Bobe, 64 Ohio St. 323, 341; State y. Matthews, 64 Ohio St. 419. For the construction of other state statutes similar to those of Ohio, see People v. Home Ins. Co., 29 California, 534, 544; Life Ins. Co. v. Commissioners, 28 How. Pr. 41, 57; Catlin v. Hull, 21 Vermont, 152; Hoyt v. Commissioners, 23 N. Y. 224; Life Ins. Co. v. Comptroller, 31 N. Y. 32. The treatment of Ohio of foreign insurance companies does not indicate the intentions attributed in the Halliday Case, 126 Fed. Rep. 257. See State v. Reinmund, 45 Ohio St. 214.
Appellant is a non-resident, absent from the State, and personal judgment cannot be rendered against it. Rev. Stat., Ohio, § 2859; Judson on Taxation, § 414; Cooley on Taxation, 3d ed., 24; Pomeroy's Remedial Rights, §1; State Tax on Foreign Held Bonds, 15 Wall. 300, 319; Dewey v. Des Moines, 173 U. S. 193, 201; New York v. McLean, 170 N. Y. 374; Bristol v. Washington County, distinguished, and see Assessors v. Comptoir National, 191 U. S. 388, 403; Lafayette Ins. Co. v. French, 18 How. 404.
The municipal bonds formerly on deposit being no longer within the State, the taxes levied with respect to them cannot now be collected by distraint or other proceeding in rem directed against the complainant's United States bonds now deposited in the State.
For construction of §§ 2838 and 2731, see Spence v. Frye, 2 Wkly. Law Gaz. 103; Citizens' Bank Assignment, 2 West. L. Monthly, 121; Chisholm v. Shields, 67 Ohio St. 374. See also as to freedom of bonds from lien, New Orleans v. Stempel, 175 U. S. 309.
The municipal bonds belonging to complainant formerly on deposit having been removed from the State eleven days prior to the day preceding the second Monday in April, 1903, no taxes can be assessed with reference to such bonds for the year then beginning or any part thereof.
As to construction on § 2737 see Shotwell v. Moore, 129 U.S. 590.
Argument for Bowland.
Mr. Augustus T. Seymour, with whom Mr. Wade H. Ellis, Attorney General of the State of Ohio, Mr. Edward L. Taylor, Jr., Mr. Karl T. Webber and Mr. Thomas Ross were on the brief, for Bowland and others, appellees in No. 360 and appellants in No. 361.
The bonds have a situs for taxation in Ohio and were properly taxed. West. Assurance Co. v. Halliday, 110 Fed. Rep. 259; S. C., 126 Fed. Rep. 257; S. C., 193 U. S. 673.
Municipal bonds are in such a concrete tangible form that they are subject to taxation where found, irrespective of the domicile of the owner, and a State has the right to tax such bonds whenever they can be localized within its jurisdiction. State Tax on Foreign Held Bonds, 15 Wall. 300; Savings Loan Society v. Multnomah Co., 169 U. S. 421; New Orleans v. Stempel, 175 U. S. 309; Bristol v. Washington Co., 177 U. S. 133; Judson on Taxation, § 394; Blackstone v. Miller, 188 U. S. 189; Board of Assessors v. Comptoir National, 191 U. S. 388, 403; Carstairs v. Cochran, 193 U. S. 10; Lee v. Sturges, 46 Ohio St. 153; Hubbard v. Brush, 61 Ohio St. 252.
Under the constitution and statute law of Ohio, investments in bonds held in that State and owned by non-residents of the State, are taxable within the State. Const. § 2, Art. XII; §3, Art. XIII; 44 Ohio Laws, 85; §§ 2734-2737, 2744, 2745, Rev. Stat.; Lee v. Sturges, 46 Ohio St. 153; Worthington v. Sebastian, 25 Ohio St. 1; Grant v. Jones, 39 Ohio St. 506; Sims v. Best, 25 Ohio Cir. Dec. 149; Heintz v. Cameron, 70 Ohio St. 491.
196 U. S.
The nature of the deposit required by § 3660 is not such as to exempt bonds so deposited from taxation within the State. British &c. Ins. Co. v. Commission, 18 Abb. Pr. 118; Int. Life Ins. Co. v. Commission, 28 Barb. 318; People v. Home Ins. Co., 29 California, 533.
Section 2745 provides a method of taxation for foreign insurance companies in addition to the general statutes au thorizing the levy of taxes, and the legislature had no power to substitute a special method of taxation for the provision of the general laws relating thereto.
Argument for Bowland.
Statutes which strip a government of any portion of its prerogative or give exemption from the general burden, should receive a strict interpretation. 1 Desty on Taxation, 180; Yazoo &c. Ry. Co. v. Thomas, 132 U. S. 174; New Orleans &c. Ry. Co. v. New Orleans, 143 U. S. 192; Chicago &c. Ry. v. Guffey, 120 U. S. 569; Phænix Ins. Co. v. Tennessee, 161 U. S. 174; Erie Ry. Co. v. Pennsylvania, 21 Wall. 492; Delaware R. R. Tax, 18 Wall. 206.
The privilege exercised by appellant under § 3660 to substitute United States bonds for the municipal bonds upon deposit with the superintendent of insurance, leaves the substituted bonds subject to all the obligations against the property originally on deposit.
The power of the State to impose conditions upon a nonresident seeking to engage in business within its borders is beyond question. Waters-Pierce Oil Co. v. Texas, 177 U. S. 28; Cooper v. California, 155 U. S. 648; Judson on Taxation, § 158.
The provisions in the statutes for summarily collecting the taxes are not repugnant to the Fourteenth Amendment. The right of the sovereign to proceed in this manner is as old as the common law. 2 Desty on Tax. 750, 776; Judson on Tax. § 330; Palmer v. McMahon, 133 U. S. 660; Murray's Lessee v. Hoboken Land & Imp. Co., 18 How. 272, 281; Springer v. United States, 102 U. S. 586; Cooley on Tax. 302; Ohio Act of 1792, Chase's Statutes, 119; 1 Ohio Laws, 58; 25 Ohio Laws, 25; 29 Ohio Laws, 291; Rev. Stat. Ohio, § 1095.
There is no constitutional objection to the right of a State to collect unpaid taxes, assessed on account of personal property, owned by a non-resident, having a taxing situs within the State, by distraint of any property belonging to such nonresident found within the territorial limits of the State. Desty on Tax. § 6, pp. 7, 11, and cases cited; Black's Law Dict. 253; Blackstone, Bk. I, p. 138; Bk. II, pp. 2-15; 27 Am. & Eng. Ency. of Law, 648, 673. As to obligation to pay taxes, see Railway Co. v. Reynolds, 183 U. S. 475; Allen v. Armstrong,
Opinion of the Court.
16 Iowa, 512; Buck v. Miller, 147 Indiana, 586, 597; Green v. Gruber, 26 Louisiana, 694; Cappen v. Hull, 21 Vermont, 152; Remo on Non-Residents, §§ 25, 136; Picquet v. Swan, 5 Mason, 35; McGoon v. Scales, 9 Wall. 23; Drake on Attachments, § 57; Pyrolucite W. Co. v. Ward, 73 Georgia, 491; Waples on Attachments, § 32; State v. Meyer, 41 La. Ann. 439; Hall v. Am. Refrigerator Co., 24 Colorado, 291; Am. Refrigerator Co. v. Hall, 174 U. S. 70; Union Refrigerator Co. v. Lynch, 177 U. S. 149; New York v. McClain, 170 N. Y. 374; Dewey v. Des Moines, 173 U. S. 193, distinguished, and see Bristol v. Washington County, 177 U. S. 133, 145; Pullman Co. v. Pennsylvania, 141 U. S. 18; Marye v. Balt. & Ohio Ry. Co., 127 U. S. 117, 123.
196 U. S.
The United States bonds owned by a non-resident are subject to distraint to satisfy a charge against the owner. Plummer v. Coler, 178 Ohio St. 115; 27 Am. & Eng. Ency. of Law, 791. The auditor's duty to list property omitted to be returned does not depend on the presence of the property within the State. Sturges v. Carter, 114 U. S. 511, 518; Winona and St. Peter Land Co. v. Minnesota, 159 U. S. 526; Weyerhauser v. Minnesota, 176 U. S. 550; Gager v. Prout, 48 Ohio St. 89.
When the question under consideration is the right to an exemption from taxation the statute is strictly construed against the exemption. Railway Co. v. New Orleans, 143 U. S. 192; Insurance Co. v. Tennessee, 161 U. S. 174; Delaware R. R. Tax, 18 Wall. 206.
MR. JUSTICE DAY, after making the foregoing statement, delivered the opinion of the court.
These cases may be considered together, as they are appeals from a single decree and involve the right to assess and collect taxes upon the municipal bonds deposited by the insurance company under the laws of Ohio.
A considerable part of the opinion of the court below and the discussion in the briefs of counsel goes to the question of the
Opinion of the Court.
power of the State to tax bonds, held as these were, within its jurisdiction. At the oral argument, however, the learned counsel representing the insurance company conceded that there was legislative power to impose the taxes in question. A reference to the decisions of this court makes it perfectly plain that such taxation is within the power of the State New Orleans v. Stempel, 175 U. S. 309; Bristol v. Washington County, 177 U. S. 133; Blackstone v. Miller, 188 U. S. 189; Board of Assessors v. Comptoir National, 191 U. S. 388, 403; Carstairs v. Cochran, 193 U. S. 10.
The contention for the company is, that conceding the power of the State, it has never been exercised in the only way to make it effectual, which is by statutory enactment, and that the policy and statutes of Ohio have never authorized taxation of bonds deposited under the conditions shown in this
196 U. S.
The question, therefore, is, have the statutes of Ohio, read in the light of the construction placed upon them by the Supreme Court of the State, conferred the right to tax these municipal bonds?
Before entering upon a consideration of the statutes we may say, in general terms, that we agree with the learned counsel for the insurance company, that the scheme of taxation of personal property in Ohio involves the requirement that it shall be returned or listed by some person or corporation whose duty it is by law to return or list such property. Provision is not made for assessing or taxing personal property by proceedings in rem, but before a recovery for taxes can be justified. either by action or distraint, it must appear that it was required to be returned for the purpose of taxation under some law of the State.
The proceedings under which the taxes for the years included in this case were charged against the insurance company by the auditor of Franklin County are under a statute (Revised Statutes of Ohio, section 2781à), having for its purpose the correction of returns by those whose duty it was to return