Pullman's Palace-Car Company v. Pennsylvania

A trial by jury was waived, and the case submitted to the decision of the court, which found the following facts: 'The defendant is a corporation of the state of Illinois, having its principal office in Chicago. Is business was, during all the time for which tax is charged, to furnish sleeping-coaches and parlor and dining-room cars to the various railroad companies, with which it contracted on the following terms: The defendant furnished the coaches and cars, and the railroad companies attached and made them part of their trains, no charge being made by either party against the other. The railroad companies collected the usual fare from passengers who traveled in their coaches and cars, and the defendant collected a separate charge for the use of the seats, sleeping-berths, and other conveniences. Business has been carried on continuously by the defendant in this way in Pennsylvania since February 17, 1870, and it has had about 100 coaches and cars engaged in this way in the state during that time. The cars used in this state have, during all the time for which tax is charged, been running into, through, and out of this state.' Upon these facts the court held 'that the proportion of the capital stock of the defendant invested and used in Pennsylvania is taxable under these acts; and that the amount of the tax may be properly ascertained by taking as a basis the proportion which the number of miles operated by the defendant in this state bears to the whole number of miles operated by it, without regard to the question whether any particular car or cars were used;' and therefore gave judgment for the state. That judgment was affirmed upon writ of error by the supreme court of the state, for reasons stated in its opinion as follows: 'We think it very clear that the plaintiff in error is engaged in carrying on such a business within this commonwealth as to subject it to the statutes imposing taxation. While at tax on the capital stock of a company is a tax on its property and assets, yet the capital stock of a company and its property and assets are not identical. The coaches of the company are its property. They are operated within this state. They are daily passing from one end of the state to the other. They are used in performing the functions for which the corporation was created. The fact that they also are operated in other states cannot wholly exempt them from taxation here. It reduces the value of the property in this state, justly subject to taxation here. This was recognized in the court below, and we think the proportion was fixed according to a just and equitable rule.' 107 Pa. St. 156, 160.Pul lman's Palace-car Company sued out a writ of error from this court, and filed six assignments of error, the substance of which was summed up in the brief of its counsel as follows: 'The court erred in holding that any part of the capital stock of the Pullman Company was subject to taxation by the state of Pennsylvania by reason of its running any of its cars into, out of, or through the state of Pennsylvania in the course of their employment in the interstate transportation of railway passengers.' ''Edward Isham, John S. Runnells, Wm. Burry, and M. E. Olmsted'', for plaintiff in error.

W. S. Kirkpatrick and J. F. Sanderson, for the Commonwealth.

Mr. Justice GRAY, after stating the facts as above, delivered the opinion of the court.