quate consideration, in contemplation of the death of the grantor or donor, or to take effect in possession or enjoyment at or after such death.

The plaintiffs in error admit that if the statute had been in operation at the time of the transfer, the tax would have been due, so that it is not necessary to go into further particulars about the act. But they say that the [225] interest of the remaindermen after the death of Miller vested upon the execution of the deed, and that therefore the statute did not apply to them, and could not do so consistently with the Constitution of the United States.

We shall not discuss the postulate of the argument for the plaintiffs in error, -the notion that a tax upon transfers imposed by a statute passed after the transfers had taken place would be void. In this case the statute was passed before the date of the deed of trust, and therefore undeniably could have been drawn so as to tax the transaction. Reading as it did, it possibly might have been construed as doing so, notwithstanding the postponement of the date for its going into operation, and, so construed, would have been good as against constitutional objections.

But the plaintiffs in error say that what we pronounce possible is not what the supreme court of Nevada did. The supreme court of Nevada seems to have conceded that if the interest of those who took upon Miller's death was vested when the deed was delivered, the statute did not and perhaps could not apply. They reached the result by holding that the execution of the deed and will was one transaction, and gave no vested right until Miller's death. Thereupon the plaintiffs in error say that the above limitation to the statute being admitted, the state court could not avoid the supposed constitutional difficulty by assuming a view of the instrument that is deemed to be plainly untenable, as held by the Chief Justice, dissenting, and contrary to the law of California, where the parties lived and the transfer was made. Nickel v. State, 179 Cal. 126, 175 Pac. 641. But the answer to this is that when, as here, there can be no pretense that the court adopted its view in order to evade a constitutional issue, and the case has been decided upon grounds that have no relation to any Federal question, this court accepts the decision, whether right or wrong. Enterprise [226] Irrig. Dist. v. Farmers Mut. Canal Co. 243 U. S. 157, 164, 61 L. ed. 644, 648, 37 Sup.

Ct. Rep. 318. And when, as here, the statute unquestionably might have made the tax applicable to this transfer, we do not inquire very curiously into the reasoning by which the statute is held to justify the tax. "As there was state power to tax the question whether or not the interest [of the plaintiffs in error] under the circumstances was correctly subjected to the tax was a purely state question." Moffitt v. Kelly, 218 U. S. 400, 405, 54 L. ed. 1086, 1087, 30 L.R.A. (N.S.) 1179, 31 Sup. Ct. Rep. 79. The plaintiffs in error contend that this court is "concerned .. solely with the effect and operation of the law as put in force by the state." Corn Products Ref. Co. v. Eddy, 249 U. S. 427, 432, 63 L. ed. 689, 693, 39 Sup. Ct. Rep. 325. The operation of the law, if construed to cover this case, infringes no constitutional rights.

Judgments affirmed.

Writs of certiorari denied.

3. Until the highest court of the state decides otherwise, the Federal Supreme Court will assume that there is no such unconstitutional inequality of treatment in the taxation of franchises of domestic corporations between corporations with stock having a stated par value and those having no stated par value for their stock as is asserted to exist on the theory that the state court having decided that corporations with stock having no stated par value can be admitted to do business in the state, all such corporations fall within the statutory provision imposing a tax of only $25 upon foreign corporations without a capital stock.

[For other cases, see Courts, VII. c, 6: Constitutional Law, IV. a, 4, in Digest Sup. Ct.

1908.] Commerce state taxation franchise tax. 4. A state franchise tax upon a domestic railway company does not contravene the commerce clause of the Federal Constitution merely because the value of the franchise taxed is derived partly from the fact that the corporation does interstate business.

[For other cases, see Commerce, III. d, 7, in Digest Sup. Ct. 1908.]

Federal agency under Federal control.

7. The franchise tax imposed upon domestic corporations by Mo. Laws 1917, pages 237-242, must, in case of a corporation employing only a part of its capital within the state, be deemed to be intended to be measured by the proportion of capital stock and surplus within the state, although the statute says that "such corporation shall pay an annual franchise tax equal to 40 of 1 per cent of its capital stock employed in this state," since these words follow words laying the normal tax measured by stock and surplus, and the sentence quoted continues: "And for the purposes of this act, such corporation shall be deemed to have employed in this state that proportion of its entire outstanding capital stock and surplus that its property and assets in this state bear to all its prop[For other cases, see Taxes, I. c, 3, d, in Digest erty and assets, wherever located." Sup. Ct. 1908.]

[No. 636.]

5. The fact that a domestic railway company was under Federal control during the tax year does not exonerate it from a state franchise tax.

[For other cases, see Taxes, I. c, 2, In Digest Sup. Ct. 1908.]

Elmendorf v. Taylor, 6 L. ed. U. S. 290; Jackson ex dem. St. John v. Chew, 6 L. ed. U. S. 583; Mitchell v. Burlington, 18 L. ed. U. S. 351; United States ex rel. Butz v. Muscatine, 19 L. ed. U. S. 490; Forepaugh v. Delaware, L. & W. R. Co. 5 L.R.A. 508, and Snare & T. Co. v. Friedman, 40 L.R.A.(N.S.) 380.

As to state licenses or taxes, generally, as affecting interstate commercesee notes to Rothermel v. Meyerle, 9 L.R.A. 366; American Fertilizing Co. v. North Carolina Bd. of Agri. 11 L.R.A. 179; Gibbons v. Ogden, 6 L. ed. U. S. 23; Brown v. Maryland, 6 L. ed. U. S. 678; Ratterman v. Western U. Teleg. Co. 32 L. ed. U. S. 229; Harmon v. Chicago, 37 L. ed. U. S. 217; Cleveland, C. C. & St. L. R. Co. v. Backus, 38 L. ed. U. S. 1041; Postal Teleg. Cable Co. v. Adams, 39 L. ed. U. S. 311, and Pitts

the United States for the Western District of Missouri to review a decree which refused a preliminary injunction to restrain the collection of a franchise tax. Affirmed.

The facts are stated in the opinion.

burg & S. Coal Co. v. Bates, 39 L. ed. U. S. 538.

On state regulation of interstate or foreign commerce-see notes to Norfolk & W. R. Co. v. Com. 13 L.R.A. 107, and Gloucester Ferry Co. v. Pennsylvania, 29 L. ed. U. S. 158.

On corporate taxation and the commerce clause-see note to Sanford v. Poe, 60 L.R.A. 641.

On taxation of corporate franchises in the United States-see note to Louisville Tobacco Warehouse Co. v. Com. 57 L.R.A. 34.

As to what property is part of franchise of corporation for purposes of taxation-see note to Yellow River Improv. Co. v. Wood County, 17 L.R.A. 92.

On constitutional equality in relation to corporate taxation-see note to Bacon v. State Tax Comrs. 60 L.R.A. 321.

Double taxation in Missouri is prohibited by the Constitution of that state. State v. St. Louis, K. C. & N. R. Co. 77 Mo. 202; State ex rel. Pearson v. Louisiana & N. River R. Co. 196 Mo. 535, 94 S. W. 279.

The state of Missouri assessed and collected a tax on all the property of appellant in Missouri, tangible and intangible, the intangible property being classified under the head "all other property," and this tax was paid. In assessing this tax, all of the franchises of appellant, other than the right to be a corporation, were taxed. One of those franchises was the right to transact business in Missouri. The attempt to impose a further tax upon this franchise is in violation of the provisions of the Constitution of Missouri, above set forth, as interpreted and applied by the supreme court of that state.

State ex rel. Kansas City v. East Fifth Street R. Co. 140 Mo. 548, 38 L.R.A. 218, 62 Am. St. Rep. 742, 41 S. W. 955; State ex rel. Wabash R. Co. v. Roach, 267 Mo. 311, 184 S. W. 969; State ex rel. Marquette Hotel Invest. Co. v. State Tax Commission, 282 Mo. 213, 221 S. W. 721.

The tax imposed was on appellant's right to transact business in Missouri during the year 1919. As appellant's railroads and property were in possession of and operated by the Federal government during that entire year, it was not doing business in Missouri, and the privilege being thus denied, the tax could not be imposed.

United States v. Emery, B. T. Realty Co. 237 U. S. 28, 59 L. ed. 825, 35 Sup. Ct. Rep. 499; McCoach v. Minehill & S. H. R. Co. 228 U. S. 295, 57 L. ed. 842, 33 Sup. Ct. Rep. 419; Public Service R. Co. v. Herold, 144 C. C. A. 184, 229 Fed. 902; Ohio v. Harris, 144 C. C. A. 174, 229 Fed. 892.

Sup. Ct. Rep. 53; Eidman v. Martinez, 184 U. S. 578, 583, 46 L. ed. 697, 701, 22 Sup. Ct. Rep. 515; Swan & F. Co. v. United States, 190 U. S. 143, 146, 47 L. ed. 984, 986, 23 Sup. Ct. Rep. 702; State ex rel. Crow v. West Side Street R. Co. 146 Mo. 169, 47 S. W. 959; Bankers' Life Co. v. Chorn, Mo. 186 S. W. 685; State ex rel. Koeln v. Lesser, 237 Mo. 318, 141 S. W. 888; Leavell v. Blades, 237 Mo. 700, 141 S. W. 893; State ex rel. Carleton Dry Goods Co. v. Alt, 224 Mo. 513, 123 S. W. 882.

The Act of 1917 is in violation of the Federal Constitution, in that it fails to provide for any notice, hearing, or review for the taxpayer, either before or after the assessment of the tax, or the imposition of the severe penalties therein denounced.

Coe v. Armour Fertilizer Works, 237 U. S. 413, 59 L. ed. 1027, 35 Sup. Ct. Rep. 625; Security Trust & S. V. Co. v. Lexington, 203 U. S. 323, 333, 51 L. ed. 204, 208, 27 Sup. Ct. Rep. 87; Central of Georgia R. Co. v. Wright, 207 U. S. 127, 138, 52 L. ed. 134, 141, 28 Sup. Ct. Rep. 47, 12 Ann. Cas. 463; Embree v. Kansas City & L. B. Road Dist. 240 U. S. 242, 60 L. ed. 624, 36 Sup. Ct. Rep. 317; Londoner v. Denver, 210 U. S. 373, 52 L. ed. 1103, 28 Sup. Ct. Rep. 708; Turner v. Wade, 254 U. S. 64, ante, 134, 41 Sup. Ct. Rep. 27.

The state taxing authorities erroneously interpreted and administered the Act of 1917 by failing to give to the word "surplus" in said act its plain, usual, and customary meaning as excess of assets over liabilities, and in erroneously interpreting and applying the word "surplus" as denoting gross assets of appellant, less only its liability to its stockholders in respect of their capital stock.

The tax under the Act of 1917, imposed on domestic corporations transacting business in other states as well as in Missouri, is based solely on the amount of capital stock of such corporations employed in business in Missouri. The taxing authorities ignored the plain mandate of the statute in assessing the tax in controversy.

ex rel. Teare v. Dungan, 265 Mo. 368, 177 S. W. 604; State ex rel. Stone v. Christian County Bank, 234 Mo. 197, 136 S. W. 335; Hamilton v. Rosenblatt, 8 Mo. App. 241; National Bank v. Staats, 155 Mo. 55, 55 S. W. 626.

There is no provision for a hearing on the part of a taxpayer under the Franchise Act of 1917, and the figures submitted by the appellant in its report to the tax commission in fact were not adopted by the tax commission as reported.

Security Trust & S. V. Co. v. Lexington, 203 U. S. 323, 333, 51 L. ed. 204, 208, 27 Sup. Ct. Rep. 87; Central of Georgia R. Co. v. Wright, 207 U. S. 127, 138, 52 L. ed. 134, 141, 28 Sup. Ct. Rep. 47, 12 Ann. Cas. 463; Coe v. Armour Fertilizer Works, 237 U. S. 413, 59 L. ed. 1027, 35 Sup. Ct. Rep. 625.

Mr. Frank W. McAllister, former Attorney General of Missouri, argued the cause, and, with Mr. Jesse W. Barrett, Attorney General, and Mr. Merrill E. Otis, filed a brief for appellees:

Double taxation is not prohibited by the Constitution of Missouri in express terms, and is invalid only when the uniformity section is thereby violated. The assessment required by the Act of 1901 is for property taxation, and is not a franchise, excise, or privilege tax. Double taxation in a legal sense does not exist unless the double tax is laid on the same basis upon the same property.

State ex rel. Marquette Hotel Invest. Co. v. State Tax Commission, 282 Mo. 213, 221 S. W. 721; St. Louis-San | Francisco R. Co. v. Middelkamp (June 29, 1920, D. C. Mo.); St. Louis Southwestern R. Co. v. Árkansas, 235 U. S. 350, 59 L. ed. 265, 35 Sup. Ct. Rep. 99; Flint v. Stone Tracy Co. 220 U. S. 107, 161, 55 L. ed. 414, 417, 31 Sup. Ct. Rep. 342, Ann. Cas. 1912B, 1312; Ohio Tax Cases, 232 U. S. 576, 593, 58 L. ed. 738, 746, 34 Sup. Ct. Rep. 372; Shaffer v. Carter, 252 U. S. 37, 58, 64 L. ed. 445, 459, 40 Sup. Ct. Rep. 221; State ex rel. Gaston v. Shields, 230 Mo. 100, 130 S. W. 298; State v. Taylor, 186 Mo. 614, 85 S. W. 564.

The act of Congress providing for Federal control of railroads during the War specifically preserves unimpaired the power of the state to assess and collect taxes, including a tax of the character here in question, during Federal control.

Wabash R. Co. v. Board of Review, 288 Ill. 159, 123 N. E. 259.

The context clearly discloses that it

was the intention of the legislature to impose the tax on both capital stock and surplus of all corporations subject to the tax, and that the omission of the words "and surplus" between the words "capital stock" and "employed in this state," in the second clause of § 1, is a mere clerical error and inadvertence, which the courts will correct by construction, to give effect to the manifest intention of the legislature.

United States ex rel. Atty. Gen. v. Delaware & H. Co. 213 U. S. 366, 53 L. ed. 835, 29 Sup. Ct. Rep. 527; Bingham v. Birmingham, 103 Mo. 345, 15 S. W. 533; 36 Cye. 1127; Continental Oil Co. v. Santa Fe, 25 N. M. 94, 3 A.L.R. 404, 177 Pac. 742; 25 R. C. L. 222, pp. 967, 969; 37 Cyc. 768; Cooley, Taxn. 3d ed. pp. 460-465; Black, Interpretation of Statutes, 2d ed. § 145, p. 515; Endlich, Interpretation of Statutes, 346, P. 480; 2 Lewis's Sutherland, Stat. Constr. 2d ed. pp. 993, 994; United States v. Goldenberg, 168 U. S. 95, 98, 42 L. ed. 394, 395, 18 Sup. Ct. Rep. 3; United States v. Stowell, 133 U. S. 1, 12, 33 L. ed. 555, 558, 10 Sup. Ct. Rep. 244; Penn Mut. L. Ins. Co. v. Lederer, 247 Fed. 561; Scottish Union & Nat. Ins. Co. v. Bowland, 196 U. S. 611, 629, 49 L. ed. 619, 627, 25 Sup. Ct. Rep. 345; Johnson v. Southern P. Co. 196 Ú. S. 1, 17, 49 L. ed. 363, 369, 25 Sup. Ct. Rep. 158, 17 Am. Neg. Rep. 412; United States v. Lacher, 134 U. S. 624, 628, 33 L. ed. 1080, 1083, 10 Sup. Ct. Rep. 625; Hartranft v. Oliver, 125 U. S. 525, 31 L. ed. 813, 8 Sup. Ct. Rep. 958; United States v. Thompson, 189 Fed. 841; United States v. Raisch, 144 Fed. 486; Travis v. American Cities Co. 192 App. Div. 16, 182 N. Y. Supp. 394; Re Clark, 270 Mo. 362, 194 S. W. 54; State ex rel. American Mfg. Co. v. Koeln, 278 Mo. 37, 211 S. W. 31.

The act provides that if taxes are not paid, suits shall be brought to collect, in the name of the state, in a court of competent jurisdiction, and this is the only means by which payment may be enforced. This clearly affords the taxpayer such opportunity for a hearing as the law requires.

Hagar v. Reclamation Dist. 111 U. S. 701, 711, 28 L. ed. 569, 573, 4 Sup. Ct. Rep. 663; Davidson v. New Orleans, 96 U. S. 97, 104, 24 L. ed. 616, 619; Kentucky R. Tax Cases, 115 U. S. 321, 335, 29 L. ed. 414, 418, 6 Sup. Ct. Rep. 57; Winona & St. P. Land Co. v. Minnesota, 159 U. S. 526, 534, 40 L. ed. 247, 250, 16 Sup. Ct. Rep. 83; Gallup v. Schmidt,