
    The People of the State of New York ex rel. The Zulia Steam Navigation Co., App’lt, v. The Commissioners of Taxes and Assessments of the City of New York, Resp’ts.
    
      (Supreme Court, General Term, First Department,
    
    
      Filed January 28, 1889.)
    
    1. Taxes and assessments — Stock oe resident corporation where PROPERTY IS WITHOUT THE STATE.
    The capital stock of an incorporated company, which is legally a resident of this state, may be taxed here, notwithstanding that the property which that stock represents is situated in a foreign state.
    3. Same—Property oe individual without the state.
    • In regard to individual owners, who are assessed for tangible personal property, the sitm of the property is material, and if without the state, is not subject to assessment here.
    Appeal from order confirming the proceedings of the respondents in assessing the relator upon its capital stock.
    
      JDe Lancey Nicoll, for app’lt; George 8. Coleman, for resp’ts.
   Bartlett, J.

This is a proceeding by writ of certiorari under chapter 269 of the Laws of 1880 to review an assessment made by the commissioners of taxes and assessments :of the city of New York against the Zulia Steam Navigation Company for taxation on its capital stock for the year 1881. -

It appears that the company was incorporated in 1880 under the laws of this state to build and own, charter and navigate vessels on lakes and rivers within this state, but, also, and chiefly in Venezuela, and the United States of Colombia. Its principal office was in the first ward of the city of New York. This made it a resident of the city for the purposes of taxation. The capital stock of the company was $70,000, of which $35,000 had been paid in prior to the second Monday of January, 1881, but no shares of stock had actually been issued. Of this $35,000, about $17,000 had been expended in building a steamboat which-had been sent to the Zulia river in Venezuela, but had not yet been tried. The balance of $18,000 had most of it been expended on account of the transportation of the vessel to South America, and other incidental charges outside the actual cost of construction. The commissioners assessed the company the full amount of $35,000 as the actual value ■of its capital, and the court at special term has refused to reduce or set aside such assessment.

In behalf of the relator it is contended that inasmuch as the permanent location of the personal property of the Zulia Steam Navigation Company was shown to be outside the territorial limits of the state of New York, the company was entitled to. exemption from taxation in this state; and it is further urged that even if liable to be taxed on its capital, without deduction on account of property permanently located in a foreign country, the assessment was nevertheless erroneous because the capital stock was overvalued, instead of being assessed at its actual value as required by law.

The provisions of the Revised Statutes in reference to the "taxation of the capital stock of corporations, as amended by ■chapter 456 of the Laws of 1857, have very frequently come before the courts for consideration; and although no express adjudication is to be found by the court of last resort, to the effect that the capital stock of an incorporated company, which is legally a resident of this state, may be taxed .here, notwithstanding that property which that stock represents is situated in a foreign state, I think such is the implication fairly to be derived from the principal cases which have been decided by the court of appeals bearing on this question.

With respect to the individual owners, who are assessed for tangible personal property, the situs of such property is most material; and if it be without the state, that fact will defeat the assessment. People ex rel., Hoyt v. Commissioners, 23 N. Y., 224. But with respect to corporations, the mode of taxation is different. The assessment under the act of 1857, is the estimate of the actual value, not of the personal property of the corporation as such, but of its ■capital stock after making the statutory deductions, and although the personal property which the corporation owns may, and usually does, form a very important element in making up the aggregate value of the capital stock, other •elements often come in, as for example, the value of the corporate franchise. And the intent of the legislature seems to have been, that this assessment on the capital stock should be made without regard to the actual location of the personal property. In the case of The People ex rel Pacific Mail S. S. Co. v. Com’s of Taxes (64 N. Y., 541), the relator claimed that the assessment upon its capital stock •should be reduced by deducting therefrom certain sums paid on account of steamships, which were in process of construction outside the state This, claim for exemption was denied, on the ground that it did not appear that the absence of these vessels from the state was anything more than temporary; but the court of appeals was careful to say that it did not intend to intimate that under the statutes in this state, there was any other mode of taxing a corporation than by asessessing the capital stock at its actual value, without regard to the situs of its property.

And in the much later case of the People ex rel. Panama R. R. Co. v. Commissioners (104 N. Y., 240, 249; 5 N. Y. State Rep., 647), the language of Andrews, "J., clearly implies that the capital stock of a New York corporation is taxable here, although most of the property which really gives that stock its value may be situated in a foreign country. Thus he speaks of the possibility of corporations being subject to double taxation, “ where some portion of their personal estate may be in another state or country, and is taxable under the laws of the foreign jurisdiction; ” and. he points out that all which the state in justice should exact-from a corporation having nearly its whole property in a foreign jurisdiction would be to impose on it “ a franchise-tax and a tax on its real estate, and its taxable personal property having its actual situs within our jurisdiction, and: its credits.” But he says the remedy against the general: rule prescribed by the act of 1857, is with the legislature and not with the courts,

These observations and others in the same opinion necessarily involve the assumption that the Panama Railroad Company was liable to taxation in this state upon capital representing personal property situate in South America; and if that be so, the relator in this case is similarly taxable.

We do not think that the capital stock of the appellant was assessed at an excessive valuation. The fact that the actual cost of constructing the vessel sent to Venezuela was. only about $17,000, did not necessarily require a reduction of the assessment to that amount. The expenditure of an ■equal sum in getting the steamer into South American waters, could- not properly be -regarded as a loss. It might fairly be assumed by the assessing officers that such expenditure was advantageous to the company, and in the absence •of evidence to the contrary, would yield an adequate return-If it were thus, in fact, a profitable investment, we can see-no reason why the actual value of the capital stock was not. equal to the amount which had been paid in.

We find no error in the proceedings of the respondents, and the order confirming these proceedings should, therefore, be affirmed.

Brady and Daniels, JJ., concur.  