to the claim of personal liability, or else be forever barred from setting it up. He does claim that as a nonresident he did not have such notice, and the state or city did not obtain such jurisdiction over him, with regard to the original assessment, as would authorize the establishment of any personal liability on his part to pay such assessment. The contractor nevertheless has obtained a judgment, not alone for a foreclosure of his lien, but also for the personal liability of the lotowner, and unless he can in this proceeding have the provision in the judgment, for a personal liability, stricken out, the lotowner cannot thereafter resist it, even when the lots fail (if they should fail) to bring enough on their sale to satisfy the judgment. The case of Davidson v. New Orleans, 96 U. S. 97 [24: 616], has been cited as authority for the proposition that the rendering of a personal judgment for the amount of an assessment for a local improvement is a matter in which the state authorities cannot be controlled by the Federal Constitution. It [205]does not appear in that case that the com plaining party, in regard to the state statute was a nonresident of the state, but, on the contrary, it would seem that she was a resident thereof. That fact is a most mate 3. 4. 5. which in effect requires the deduction of the debts of the banks, and that unincorporated banks and bankers shall be assessed upon the moneyed capital belonging to the bank or banker and employed in the business, after deducting the debts existing in the business, makes no discrimination between unincorporated banks and bankers on the one hand and shareholders in national banks on the other. The increase of the value of national bank shares by reason of the franchises of the bank itself, while there is no such added value in the case of unincorporated banks, does not make the taxation of such shares at their true value a discrimination against the shareholders and in favor of the unincorporated banks. This court will not take judicial notice of the report of the auditor of the state, nor refer to any statement or alleged fact stated therein, unless that fact is found by the trial court. The term "credits" in the Ohio statute includes claims for labor or services, but these claims are not moneyed capital within the meaning of U. S. Rev. Stat. § 5219, respect ing discrimination against national banks. [No. 137.] rial one, and renders the case so unlike the Argued January 13, 16, 1899. Decided Februone at bar as to make it unnecessary to further refer to it. The statute upon which the right to enter this personal judgment depends being as to the nonresident Iotowner an illegal enactment, it follows that the judgment should and must be amended by striking out the provision for such personal liability. For that purpose the judgment is reversed, and the cause remanded to the supreme court of Iowa, for further proceedings therein not inConsistent with this opinion. So ordered. FIRST NATIONAL BANK OF WELLINGTON, OHIO, Piff. in Err., v. H. P. CHAPMAN, as Treasurer of Lorain County, Ohio. (See S. C. Reporter's ed. 205–220.) Meaning of the term "moneyed capital"discrimination in taxation-value of national bank shares-judicial notice-meaning of the term "credit." 1. 2. The term "moneyed capital" as used in U. S. Rev. Stat. § 5219, forbidding greater taxation of shareholders of national banks than is imposed on other moneyed capital, does not include capital which does not come into competition with the business of national banks, such as deposits in savings banks or moneys of charitable institutions, the exemption of which from taxation is not forbidden by the Federal statute. The law of Ohio that the shares of national ary 27, 1899. IN ERROR hit to review a judgment of that court reversing the judgment of the Circuit Court of Lorain County, Ohio, and affirming the judgment of the Court of Common Pleas of Lorain County dismissing an action brought by the First National Bank of Wellington, Ohio, against H. P. Chapman, Treasurer of Lorain County, to restrain the collection of taxes, through or by means of the bank, by the defendant, levied under a statute of Ohio upon individual shareholders in the bank. Affirmed. N ERROR to the Supreme Court of the See same case below, 56 Ohio St. 310. Statement by Mr. Justice Peckham: This action was brought to restrain the collection of taxes, through or by means of the bank, by the defendant in error, levied under a statute of Ohio upon certain individual shareholders in the bank, on the ground, as alleged, that the assessments upon such specified shareholders were illegal as having been made without regard to the debts of such individual owners, contrary to the case[206] of other moneyed capital in the hands of individual citizens, whose debts were permitted to be deducted from the value of such capital before the assessment of taxes there on. The petition contained allegations intended to show a case for the interposition of a court of equity, and a tender was therein made of the amount of the taxes which the plaintiff admitted to be due on such shares after deducting the debts. The answer, while not taking any objecbanks shall be assessed at their true value, tion that a case for equitable relief by in junction was not made, provided the conten- | tion of the petition as to the assessments being illegal was well founded, claimed, substantially, that by the laws of the United States and of Ohio the assessments were legal, and the petition should therefore be dismissed. Upon trial in the court of common pleas of Lorain county the court found the following facts: stock of said bank set opposite their respective names, to wit: S. S. Warner.. S. K. Laundon. ..150 shares. 10 shares. 50 shares. .120 shares. 10 shares. 10 shares. 20 shares. .120 shares. "That said shares were valued by said "First. Plaintiff is a national banking association incorporated under and by virtue of an act of Congress entitled 'An Act to Pro-state board of equalization for the year 1893 vide for the National Currency, Secured by at $36,607.90, and certified by said board a Pledge of United States Bonds, and to to the auditor of Lorain county as the taxProvide for the Circulation and Redemption able value of the same; that the rate of taxThereof,' approved June 3, 1864, and the ation for all tax *assessed and collected for[208] amendments thereof, and is established and the year 1893 within said county and village doing business in the village of Wellington, was $0.0255 on a dollar's valuation, and county of Lorain, and state of Ohio. amounted on said value of said shares to $933.50. "Second. The defendant is the duly elected and qualified treasurer of the county of Lorain and state of Ohio. "Third. The plaintiff has a capital stock of $100,000, divided into 1,000 shares of $100 each, all of which are fully paid up, and certificates for the shares are outstanding and owned by a large number of persons. "Fourth. That in accordance with section 2765 of the Revised Statutes of Ohio, then and now in force, the cashier of plaintiff duly reported in duplicate to the auditor of said county the resources and liabilities of said banking association, at the close of business on the Wednesday next preceding the second Monday of May, 1893, together with a full statement of the names and residences of the shareholders therein, with the number of shares held by each, and the par value thereof, as required by said section; that MOV]included in said return so made by said cashier was the real estate owned by the plaintiff, valued at $3,420, separately assessed and charged on the tax duplicate of said county; that thereupon said auditor proceeded, as required by section 2766 of the Revised Statutes of Ohio, to fix the total value of said shares according to their true value in money, and fixed the same at $74,710, exclusive of the assessed value of plaintiff's real estate, and made out and transmitted to the annual board of equalization of incorporated banks a copy of the report so made by said cashier, together with the valuation of such shares as was fixed by said auditor; that said state board of equalization, acting under sections 2808 and 2809 of the Revised Statutes of Ohio, did examine the return aforesaid, made by said cashier to said county auditor, and the value of such shares as fixed by said county auditor, and did equalize said shares to their true value in money, and fixed the valuation thereof at $74,710, exclusive of the assessed value of plaintiff's real estate, and the auditor of said state did certify said valuation to the auditor of said county of Lorain, which said auditor of said county did enter upon the tax duplicate of said county for the year 1893. "Fifth. That the following named stockholders of said bank were on the said day next preceding the second Monday of April, 1893, the owners of the number of shares of "Sixth. That on said day next preceding said second Monday of April, 1893, and at the time the cashier of said banking association made return to the auditor of said county of the names and residences of the share holders of said association, with the numbers and par value of the shares of capital stock of said banking association for the year 1893,-to wit, between the first and second Mondays of May of said year,—each of said above named shareholders was indebted and owing to others of legal bona fide debts a sum in excess of the credits, from which, under the laws of Ohio, he was entitled to deduct said debts to an amount equal to the value of said shares. That proof of said indebtedness was duly made to said auditor by the shareholders aforesaid at the time that the valuation of said shares of stock was so fixed by him, and that said auditor refused to allow the deduction of any indebtedness of said shareholders from the value of said shares, as so fixed by said board of equalization, and the auditor of said county carried upon the duplicate delivered to the treasurer the entire valuation of said shares so made, without allowing any deductions therefrom, by reason of any bona fide indebtedness of said shareholders to others, from the valuation so fixed by said board of equalization. “Seventh. That the plaintiff tendered to said treasurer of Lorain county on the 28th day of December, 1893, and offered to pay to said treasurer, the sum of $485.80, if he would receive the same in full for the tax assessed upon the valuation of the shares of stock owned by the shareholders named in the petition for the entire year of 1893; and said treasurer refused to accept the same; and said treasurer intends, if not enjoined by this court, to use all lawful means for the collection of said tax so assessed upon the valuation of said shares of stock." The court also found as a conclusion of law from the above facts that the injunction should be denied and the petition dismissed. The plaintiff appealed to the circuit court *of[209] Lorain county, where, after argument, the judgment for defendant was reversed and judgment ordered for plaintiff enjoining the collection of the tax. The defendant, the treasurer of Lorain county, brought the case to the supreme court of the state, where, after hearing, the court reversed the circuit court and affirmed the judgment of the common pleas dismissing the petition. Chapman v. First National Bank of Wellington, 56 Ohio St. 310. The state law on the subject of taxation, so far as it may be claimed to in any way affect the question, is contained in the various sections of the Revised Statutes of Ohio, which are set out in the margin.t †Section 2730 gives definitions of the terms used in the article relating to taxation. This section is not set out in so many words, but as therein used the following terms are thus defined: a. "Real property" and "lands" mean not only land itself, but everything connected therewith in the way of buildings, structures, and improvements, and all rights and privileges appertaining thereto. b. "Investment in bonds" includes moneys in bonds or certificates of indebtedness of whatever kind, issued by incorporated or unincorporated companies, towns, cities, villages, townships, counties, states, or other incorporations, or by the United States. c. "Investment in stocks" includes all moneys Invested in the capital stock of any association, corporation, joint-stock company, or other company, where the capital or stock is divided into shares transferable by each owner without the consent of the other shareholders, for the taxation of which no special provision is made by law. d. "Personal property" includes (1) every tangible thing the subject of ownership, whether animate or inanimate, other than money, and not forming part or any parcel of real property; (2) the capital stock, undivided profits, and all other means not forming part of the capital stock of a company, whether incorporated or unincorporated, and all interest in such stock, profits, or means, including shares in a vessel as therein stated; (3) money loaned on pledge or mortgage of real estate, although a deed may have been given, provided the parties consider It as security merely. e. The term "moneys" includes surplus or undivided profits held by societies for savings or banks having no capital stock, gold and silver coin, bank notes of solvent banks in actual possession and every deposit which the person owning, holding in trust, or having the beneficial Interest therein is entitled to withdraw in money on demand. f. The term "credits" means the excess of the sum of all legal claims and demands, whether for money or other valuable thing, or for labor or service due or to become due to the person liable to pay the tax thereon, including deposits in banks, or with persons in or out of the state, other than such as are held to be money as defined in this section, when added together (estimating every such claim or demand at its true value in money) over and above the sum of legal bona fide debts owing by such person; but in making up the sum of such debts owing, no obligation can be taken into account (1) to any mutual insurance company; (2) for any unpaid subscription to the capital stock of any jointstock company; (3) for any subscription for any religious, scientific, or charitable purpose; (4) for any indebtedness acknowledged unless founded upon some consideration actually received and believed at the time of making the acknowledgment to be a full consideration therefor; (5) for any acknowledgment made for the purpose of diminishing the amount of credits Messrs. F. S. Monnett, Attorney General of Ohio, and S. W. Bennett for defendant in error. *Mr. Justice Peckham, after stating the[211] facts, delivered the opinion of the court: Complaint is made in behalf of the shareholders of the national bank in question that they are, by means of the system of taxa-[212) to be listed for taxation; (6) for any greater amount or portion of any liability as surety than the person required to make the statement of such credits believes that such surety is in equity bound to pay, etc. Other sections read as follows: Sec. 2736. Each person required to list property shall, annually, upon receiving a blank for that purpose from the assessor, or within five days thereafter, make out and deliver to the assessor a statement verified by his oath, as required by law, of all the personal property, moneys, credits, investments in bonds, stocks, joint-stock companies, annuities, or otherwise, in his possession or under his control on the day preceding the second Monday of April of that year, which he is required by law to list for taxation, either as owner or holder thereof, or as parent, husband, guardian, trustee, executor, administrator, receiver, accounting officer, partner, agent, factor, or otherwise; and also of all moneys, credits, investments in bonds, stocks, joint-stock companies, or otherwise, held on said day by another, residing in or out of this state, for and belonging to the person so listing, or anyone residing in this state, for whom he is required by law to list, and not listed by such holder thereof, for taxation in this state. Sec. 2737. Such statement shall truly and distinctly set forth, first, the number of horses and the value thereof; second, the number of neat cattle, and the value thereof; third, the number of mules and asses, and the value thereof; fourth, the number of sheep, and the value thereof; fifth, the number of hogs, and the value thereof; sixth, the number of pleasure carriages (of whatever kind) and the value thereof; seventh, the total value of all articles of personal property, not included in the preceding or succeeding classes; eighth, the number of watches, and the value thereof; ninth, the number of piano fortes and organs, and the value thereof; tenth, the average value of the goods and merchandise which such person is required to list as a merchant: eleventh, the value of the property which such person is required to list as a banker, broker. or stock jobber; twelfth, the average value of the materials and manufactured articies which such person is required to list as a manufacturer; thirteenth, moneys on hand or on deposit subject to order; fourteenth, the amount of credits as herein before defined; fifteenth, the amount of all moneys invested in bonds, stocks, joint-stock companies, annuities or otherwise: sixteenth, the monthly average amount or value, for the time he held or controlled the same, within the preceding year, of all moneys, credits, or other effects, within that time invested in or converted into bonds or other securities of the United States or of this state, not taxed, to the extent he may hold or control such bonds or securities on said day preceding the second Monday of April; and any indebtedness created in the purchase of such bonds or securities shall not be deducted from the credits under the fourteenth item of this section; but the person making such statements may exhibit to the assessor the property tion adopted and enforced in the state of Ohio, subjected to taxation at a greater rate than is imposed upon other moneyed capital [213]in the hands of individual citizens, *contrary to section 5219 of the Revised Statutes of the United States. duct their debts from the valuation of that property. It is also claimed that there is an unfavorable discrimination against the national bank shareholder and in favor of an unincorporated bank or banker. The complaint is founded upon the allega- At the outset it is plain that the system tion that the owners of what is termed cred- of taxation adopted in Ohio was not intendits in the law of Ohio (Rev. Stat. § 2730)|ed to be unfriendly to or to discriminate are permitted to deduct certain kinds of their against the owners of shares in national debts from the total amount of their credits, banks, for, as observed by the state supreme and such owners are assessed upon the bal- court, that system was adopted long prior ance only, while no such right is given to to the passage of the law by Congress proowners of shares in national banks. The viding for the incorporation of national claim is that shares in national banks banks. Under this system the owner of should be treated the same as credits, and shares in national banks is taxed precisely their owners permitted to deduct their debts like the owner of shares in incorporated from the valuation. The owners of property state banks. Rev. Stat. Ohio, § 2762. other than credits are not permitted to decovered by the first nine items of this section, | and allow the assessor to affix the value thereof; and in such case the oath of the person making the statement shall be in that regard only that he has fully exhibited the property covered by said nine items. Sec. 2746. Personal property of every description, moneys and credits, investments in bonds, stocks, joint-stock companies, or otherwise, shall be listed in the name of the person who was the owner thereof on the day preceding the second Monday of April, in each year; but no person shall be required to list for taxation any share or shares of the capital stock of any company, the capital stock of which is taxed in the name of such company. UNINCORPORATED BANKS AND BANKERS. Sec. 2758. Every company, association, or person not incorporated under any law of this state or of the United States for banking purposes, who shall keep an office or other place of business, and engage in the business of lending money, receiving money on deposit, buying and selling bullion, bills of exchange, notes, bonds, stocks or other evidence of indebtedness, with a view to profit, shall be deemed a bank, banker, or bankers, within the meaning of this chap ter. Sec. 2759. All unincorporated banks and bankers shall annually, between the first and second Mondays of May, make out and return to the auditor of the proper county, under oath of the owner or principal officer or manager thereof, a statement setting forth: First. The average amount of notes and bills receivable, discounted or purchased in the course of business, by such unincorporated bank, banker, or bankers, and considered good and collectible. Second. The average amount of accounts receivable. The main purpose of Congress in fixing limture and other property not otherwise herein enumerated. From the aggregate sum of the first five items above enumerated the said auditor shall deduct the aggregate sum of the fifth, sixth, seventh, and such portions of the eighth items as are by law exempt from taxation, and the remainder thus obtained added to the amount of item nine, shall be entered on the duplicate of the county in the name of such bank, banker, or bankers, and taxes thereon shall be assessed and paid the same as provided for other personal property assessed and taxed in the same city, ward, or township. Sec. 2759a. The said bank, banker, or bankers shall, at the same time, make statement under oath of the amount of capital paid in or employed in such banking business, together with the number of shares or proportional interest each shareholder or partner has in such association or partnership. INCORPORATED BANKS. Sec. 2762. All the shares of the stockholders in any incorporated bank or banking association located in this state, whether now or hereafter incorporated or organized under the laws of this state or of the United States, shall be listed at their true value in money, and taxed in the city, ward, or village where such bank is located, and not elsewhere. Sec. 2763. The real estate of any such bank or banking association shall be taxed in the place where the same may be located, the same as the real estate of individuals. Sec. 2765. The cashier of each incorporated bank shall make out and return to the auditor of the county in which it is located, between the first and the second Monday of May, annually, a report in duplicate under oath, exhibiting in detail and under appropriate heads the resources and liabilities of such bank at the close of business on the Wednesday next preceding Third. The average amount of cash and cash said second Monday, together with a full stateItems in possession or in transit. Fourth. The average amount of all kinds of stocks, bonds, including United States government bonds, or evidences of indebtedness, held as an investment or in any way representing assets. Fifth. The amount of real estate at its assessed value. Sixth. The average amount of all deposits. Seventh. The average amount of accounts payable, exclusive of current deposit accounts. Eighth. The average amount of United States government and other securities that are exempt from taxation. ment of the names and residences of the stockholders therein, with the number of shares held by each, and the par value of each share. Sec. 2766. Upon receiving such report the county auditor shall fix the total value of the shares of such banks according to their true value in money, and deduct from the aggregate sum so found the value of the real estate inIcluded in the statement of resources as the same stands on the duplicate, and thereupon he shall make out and transmit to the annual state board of equalization for Incorporated banks copy of the report so made by the cashier, together with the valuation of such shares as so Ninth. The true value in money of all furni- fixed by the auditor. its to state taxation on investments in na- | utes therefore makes provision, in order to tional banks was to render it impossible for determine the amount to be assessed for taxthe state in levying such a tax to create and ation, for deducting the debts existing in the [214]*fix an unequal and unfriendly competition business itself from the amount of moneyed by favoring institutions or individuals carry- capital belonging to the bank or banker and ing on a similar business and operations and employed in the business, and the remainder investments of a like character. The lan- is entered on the tax book in the name of the guage of the act of Congress is to be read in bank or banker, and taxes assessed thereon. the light of this policy. "Moneyed capital" This does not give the unincorporated bank does not mean all capital the value of which or banker the right to deduct his general is measured in terms of money; neither does debts disconnected from the business of it necessarily include all forms of invest- banking, and ont incurred therein, from the ments in which the interest of the owner is remainder above mentioned. It cannot be expressed in money. Shares of stock in rail- doubted that under this section those debts road companies, mining companies, manu- which are disconnected from the banking facturing companies, and other corporations business cannot be deducted from the aggre are represented by certificates showing that gate amount of the capital employed therethe owner is entitled to an interest expressed in. The debts that are incurred in the acin money value in the entire capital and prop- tual conduct of the business are deducted, so erty of the corporation; but the property of that the real value of the capital that is emthe corporation which constitutes this in-ployed may be determined and the taxes asvested capital may consist mainly of real and sessed thereon. personal property, which, in the hands of individuals, none would think of calling moneyed capital; and its business may not consist in any kind of dealing in money or commercial representatives of money. This statement is taken from Mercantile Bank v. New York, 121 U. S. 138, 155 [30: 895, 901]. That case has been cited with approval many times, especially in First National Bank of Garnett v. Ayres, 160 U. S. 660 [40: 573], and in Aberdeen Bank v. Chehalis County, 166 U. S. 440 [41: 1069]. The result seems to be that the term "moneyed capital" as used in the Federal statute does not include capital which does not come into competition with the business of national banks, and that exemptions from taxation, however large, such as deposits in savings banks or of moneys belonging to charitable institutions, which are exempted for reasons of public policy, and not as an unfriendly discrimination as against investments in national bank shares, cannot be regarded as forbidden by the Federal statute. The case last cited contains a full and careful reference to most of the prior cases With no purpose to discriminate against the holders of shares in national banks, and with the taxation of the shareholders in the two classes of banks, state and national, pre[215]cisely the same, the question is whether this system of taxation in Ohio, in its practical operation, does materially discriminate against the national-bank shareholder in the assessment upon his bank shares. Under the Ohio law the shares in national 43 This system is, as nearly as may be, equiv alent in its results to that employed in the case of incorporated state banks and of national banks. Under the sections of the Revised Statutes which relate to the taxation of these latter classes of banks (§ 2762, etc.) the shares are to be listed by the auditor at their true value in money, which necessarily demands the deduction of the debts of the bank, because the true value of the shares in money is necessarily reduced by an amount corresponding to the amount of such debts. In order to arrive at their true value in money the bank returns to the auditor the *amount of the liabilities as well as its re-[216] sources. Thus in both incorporated and unincorporated banks the same thing is desired, and the same result of assessing the value of the capital employed in the business, after the deduction of the debts incurred in its conduct, is arrived at in cach case as nearly as is possible considering the difference in manner in which the moneyed capital is represented in unincorporated banks as compared with incorporated banks which have a capital stock divided into shares. That mathematical equality is not arrived at in the process is immaterial. It cannot be reached in any system of taxation, and it is useless and idle to attempt it. Equality, so far as the differing facts will permit, and as near as they will permit, is all that can be aimed at or reached. That measure of equality we think is reached under this system. So far as this point is concerned, it is entirely plain there is no discrimination between unincorporated banks and bankers on the one hand and holders of shares in national banks on the other. If the value of national bank shares is increased by reason of the franchises of the bank itself, as claimed by the plaintiff in error, while no such added value obtains in the case of unincorporated banks, there is no discrimination against bank shareholders on that account. This is simply a case where added elements of value exist in the national bank shares, which are absent in the case of unincorporated banks; but in both cases all the debts of the business itself are deducted from the capital employed before 673 |