NOTES OF RECENT CASES tion of the prisoner's rights under the i4th Amend ment of the Federal Constitution.
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not duly lay a property tax, strictly so-called, on all these cars; but as the corporation was a Kentucky corporation the common law was familiar with a practice by which it should be taxed by Kentucky in proportion to all its personal property every where. This is the first decision in which it is even hinted that a state may not so tax its own corporations. A legal process which is familiar to common lawyers is due process of law. J. H. B.
CONSTITUTIONAL LAW. (Due Process — Taxation — Situs.) U. S. S. C. — A decision of some moment as to the power of the State to tax property not actually within its jurisdiction, is contained in Union Refrigerator Transit Company v. Commonwealth of Kentucky, 26 Supreme Court Reporter, 36. A statute of Kentucky provides that all real and personal estate within the State, and all personal estate of corporations residing in the State, and of all corporations organized under the laws of the state, whether the property be in or out of the State shall be subject to taxation unless the same be exempt from taxation by the Constitution, etc. The Union Refrigerator Trans it Company was the owner of 2,000 cars which were employed by the company by renting them to shippers who took possession of them from time to time at Milwaukee, Wis.t and used them for the carriage of freight in the United States, Canada, and Mexico, the company being paid by the railroads in proportion to the mileage made over their lines. The company insisted that the correct method of ascertaining the num ber of cars to be assessed for taxation in Ken tucky, was to ascertain and list such a proportion of its cars as under a system of averages upon their gross earnings, were shown to be used in- the State of Kentucky during the fiscal year. The lower court approved of this method of assessment, but the Kentucky Court of Appeals held that the entire 2,000 cars were assessable in Kentucky. The Federal Supreme Court holds that it is essen tial to the validity of a tax that the property shall be within the territorial jurisdiction of the taxing power, and that by the taxation in Ken tucky of the cars used in other states, the corpo ration was denied due process of law. The cases are analyzed, and it is pointed out that the cases which hold that personal property is taxable at the domicile of its owner nearly all relate to in tangible property such as stocks, bonds, interest, and other choses of action, and that as real prop erty is visible, easily found, and difficult to con ceal and the tax readily collectible, it should be taxed at its situs.
This case, affirming D. L. & W. R. Co. v. Penn sylvania, 198 U. S. 341 (1905), seems definitely to commit the United States Supreme Court to the doctrine that a state cannot constitutionally tax tangible personal property owned by a resident, but situated out of the taxing state — certainly a wholesome rule. Most of the judicial statements to the contrary, are, as the court points out, dicta. To the solitary decision it finds opposed to its view should probably be added Bemis v. Board of Alder men, 14 All. 366 (1867), which, under the Massa chusetts statutes then in force, seems to be a case of a tax on chattels outside the state and not merely one on a partner's intangible interest in a partnership. The state cases cited in favor of the court's opinion nearly all turn upon the interpre tation of tax laws and involve no constitutional question; but the decision is a logical and desirable step in the direction the court has so long traveled, of construing the Fourteenth Amendment to for bid substantially all arbitrary and oppressive inter ference with personal and property rights. It should be noticed, however, that the statutes the Federal courts have so far dealt with have been construed as intended to impose taxes on property as such. A stronger argument could be made in favor of a tax imposed on the person of a resident, measured by the value of his personal property wherever located. Such a tax would bear some resemblance in principle to an income tax. State v. Bentley, 23 N. J. L. 532, 542 (1852). Of course, any state granting a franchise to a corporation can virtually escape the effect of the principal case by measuring the tax on the fran chise by the value of the corporate property whereever located. James P. Hall.
In this case, as Judge Holmes hinted in his dis senting opinion, the court appears to have allowed its economic theories to get the better of its legal principle that the result reached is good economi cally may be granted. But as the same court has often pointed out the common law is familiar with three kinds of taxation : on property, on persons, and on business. It is clear that Kentucky could
CONSTITUTIONAL LAW. (Sales in Bulk — Statute.) N. Y. C. of A. — In Wright v. Hart, 75 Northeastern Reporter, 404, the Court of Ap peals decides that New York Laws, 1902, p. 1249, c. 528, providing that a sale of any portion of a stock of merchandise other than in the ordinary course of trade in the regular and usual prosecu tion of the seller's business, or the sale of an entire
