
    The People of the State of New York ex rel. Twenty-third Street Railway Company, Respondent, v. Thomas L. Feitnrr and Others, Composing the Board of Taxes and Assessments of the City of New York, Appellants.
    
      Tam—scope of the statutory writ of certiorari to review an assessment—appointment of a referee to take testimony — it does not preclude a decision that upon the face of the return the tace was invalid—assessment of the capital stock and surplus of a corporation — the debts of the corporation should be deducted—meaning of “ capital stock” — the assessors home no power to determine the value of a special franchise—they cannot disregard an unimpeached verified statement filed by the corporation. ■
    
    The statutory writ of certiorari to review the action of a board of assessors in making an assessment for taxation possesses all the functions of the common-law and Code writs of certiorari, and in addition thereto authorizes a rehearing ,of the question at issue and the introduction of additional proofs bearing thereon. The enlarged scope of the writ does not change or alter its functions as a writ of review. .
    The fact that the court, when the case comes on for trial upon the petition, writ . and return, decides that testimony is necessary for the proper disposition of the matter, and appoints a referee to take testimony and report to the court his conclusions of law and findings of fact, does not preclude it, where the relator offers no testimony before the referee, but rests its case upon the return, from determining, upon a motion to confirm the referee’s report, that it appeared upon the face of the return that the tax was illegal and void.
    zWhen assessing the capital stock and surplus of a corporation, the corporation is entitled to have deducted from its personal property the amount of its debts; bonds issued by the corporation constitute an indebtedness.
    Capital stock, as that term is used in the Tax Law, does not. mean share stock, but is limited to the actual money or property paid in and possessed by the corporation as such.
    The assessors have no power to determine the assessable value of a special franchise possessed by the corporation.
    Where the corporation, delivers to the assessors a statement of its financial condition, verified by the secretary, upon the face of which it appears that the corporation has no personal property subject to tax, the assessors have power to examine the officers of the corporation under oath and to require a fuller statement of its property. If, however, they neglect to do this, they are not at liberty to disregard the verified statement.
    Van Brunt, P. J., dissented.
    Appeal by the defendants, Thomas L. Feitner and others, composing the board of taxes and assessments of the city of New York, from an order of the Supreme Court, made at the New York Special Term and entered in the office of the clerk of the county of New York on the. 11th day of November, 1903, confirming the report of a referee appointed to take testimony in a certiorari proceeding and vacating an assessment upon the relator’s stock and surplus.
    
      Demid Rvmsey, for the appellants. •
    
      Charles F. Brown, for the respondent.-
   Hatch, J.:

The relator claiming to be aggrieved by an assessment of its capital stock and surplus by taxation for the year 1900 sued out a writ of certiorari to review the action of the board of assessors. The proceeding came on for trial at a Special Term in Januarv, 1901, and upon the petition, the writ and the return thereto the court decided, as recited in the order, that it appearing to the court that testimony is necessary for the proper disposition of the matter,” a. referee should be appointed to take testimony and report to the court his findings of fact and conclusions of law. At the hearing before the referee in November, 1902, the relator produced no testimony, but rested its case upon the return of the assessors to the writ of certiorari. Thereupon the defendants moved to dismiss the proceeding upon the ground that it was incumbent upon the relator to prove that the amount of the assessment was erroneous, even though it appeared that there was an error in the method adopted by the assessors in arriving at the amount of the tax. The referee made no ruling upon this motion, but he subsequently made his report, in. which he found that the total gross assets of the relator did not' exceed $259,000 on the second Monday of January, 1900, and that the indebtedness of the relator-on that date was $400,000, arid as a conclusion of law he found that the assessment was illegal and should be stricken from the assessment roll. Upori motion the court confirmed the report of the referee and directed that the ■ tax be canceled by the comptroller or.other proper officer of the city. From the order entered thereon the defendants appealed.

It is contended on the part of the defendants that upon the conclusion by the court that testimony was necessary for the proper disposition of the matter, the law of the case thereby became established and governed the subsequent procedure, and that under the special statutory writ the court is required to take testimony upon the issues presented by the pleadings and that a trial must be had of such issue; that by adopting the course which obtained the writ herein was changed from one of review of the assessment into a trial upon' which judgment of the court is required to be rendered and that the assessment must stand, unless overthrown by proof. The special statutory writ does not cease to be a writ of review by reason of the enlarged scope in the proceedings which may be had thereunder. It was decided by this court in People ex rel. Citizens' L. Co. v. Feitner (81 App. Div. 118) that this writ embraces all that is contained in the common law and Code writs of certiorari. It possesses all of. the requisites of these two writs and in addition thereto authorizes a rehearing of the question at issue and the introduction of additional proofs bearing thereon. Such was the conclusion reached in People ex rel. Manhattan R. Co. v. Barker (152 N. Y. 417). The enlarged scope of the writ, therefore, does not change or alter its functions as a writ of review. The court by deciding in the first instance that testimony was necessary to be given to make proper disposition of the proceeding was not concluded on the motion to confirm the report from determining that .upon the face of the return it appeared that the tax Was illegal and i void. The former decision did not destroy the power to review the return; nor could any estoppel be worked upon the exercise of the judicial function by an erroneous determination that testimony was necessary to dispose of the questions presented by the return. There is, therefore, no error in procedure which calls for a reversal of this order, and the only question to be considered is whether the return itself shows that the tax was illegal.

It appeared from the return that the assessors required and the relator delivered a statement showing its financial condition, which statement was verified by the oath of Charles E. Warren, the secretary of the relator, and was presented to the assessors before the assessment was made. None of the facts appearing in this statement are contradicted by the return, and upon the face of the statement it appears that relator’s liabilities and the assessed value of its real estate of $81,000 amounted to $222,000 more than the value of all its property, thus showing that there was no personal property owned by the relator which could properly be made the subject of a tax. It was entitled to have deducted from its personal property the amount of its debts (People ex rel. Cornell S. Co. v. Dederick, 161 N. Y. 195), and the debts were conceded to amount to $400,000.

The method of making up the assessment was clearly erroneous. The defendants first took the capital stock at par, added thereto the premium at which the share stock was selling in the market, also. added libe par' \ nine of the bonds, $400,000, which was a debt. The sum total produced by this method was $2,692,000. They then deducted the assessed value of the special franchise, assessed valuation of the real estate, debts and ten per centum of surplus capital, which aggregated $2,489,276, which deducted from the assets left the sum of $202,724, which was the amount of the tax. The par value of the capital was $600,000. The premium upon the share stock, which the assessors added thereto, was $1,692,000. The method, therefore, by which the value of the capital stock was arrived at was clearly erroneous. Capital stock, as that term is used in the Tax Law (Laws of 1896, chap. 908, § 12), does not mean share stock; it is limited to the actual money or property paid in and possessed by the corporation as such. (People ex rel. Union Trust Co. v. Coleman, 126 N. Y. 433; People ex rel. Manhattan R. Co. v. Barker, 146 id. 304.) The assessors also assumed to determine the assessable value of the franchise of the corporation. This was also" erroneous. (People ex rel. Brooklyn R. R. Co. v. Neff, 19 App. Div. 590 ; affd. on opinion below, 154 N. Y. 763.) The share stock is represented by the franchise, and it was not assessable for local purposes until the passage of the Special Franchise Tax Law (See Laws of 1899, chap. 712), and under that law the assessors have no jurisdiction to determine its assessable value. While the commissioners had power and authority to examine the officers of the relator under oath, -and to require a fuller statement of all its property, and by oral examination under oath could compel a complete disclosure of all matters concerning the property owned by the relator, it could not dispense with such examination and disregard the statement which had been furnished upon the commissioners’ requirement. Having received this statement and made no further inquiries concerning the same, and requiring neither an examination nor a fuller statement, it was not at liberty to disregard the facts contained therein, which have been verified by the oath of one of relator’s officers. (People ex rel. Edison G. E. Co. v. Barker, 141 N. Y. 251; People ex rel. Consolidated Gas Co. v. Feitner, 78 App. Div. 313.) It is said, however, that even though the commissioners adopted an erroneous method of assessment, yet that such fact, standing alone, is not sufficient to call for the cancellation of this tax, for the reason that the relator does not show that it is aggrieved thereby. So far as the statement itself is concerned, it shows upon its face that the relator has no personal property which is the subject of a tax, and if it has no property, then it cannot be called upon to pay any tax and it is necessarily aggrieved thereby.

The cases relied upon in support of defendants’ contention (People ex rel. United Verde Copper Co. v. Feitner, 54 App. Div. 217; affd. on opinion below, 165 N. Y. 645; People ex rel. Equitable G. L. Co. v. Barker, 66 Hun, 21; affd., 137 N. Y. 544) and others do not meet the case. In all of them the statement which was made the basis for the tax by the relator showed taxable property equal in amount to the assessment. ' The statement in the present case shows the reverse; in consequence of which it is made to appear that there was no personal property subject to taxation.

It follows from these views that the order appealed from should be affirmed, with costs.

Patterson, Ingraham and Laughlin, JJ., concurred; Van Brunt, P. J., dissented.

Van Brunt, P. J.

(dissenting):

I dissent. This court has held, as I understand it, that the writ of certiorari in a tax case is not a writ of review, but the relator is entitled as matter of right to a reassessment by the- Supreme Court.

Order affirmed, with costs.  