
    PEOPLE ex rel. DAVIS-COLBY ORE-ROASTER CO. v. CAMPBELL, Comptroller.
    (Supreme Court, General Term, Third Department.
    November 22, 1892.)
    1. Taxation op Corporate Franchise—Oppice Out op State. The franchise of a domestic corporation, which removes its office from the state, and employs its capital wholly without the state, is not taxable.
    2. Same—Bank Deposit. Where the evidence disclosed no business done by a domestic corporation within the state, and showed its only property therein to be a bank deposit, a finding by the comptroller taxing its franchise and business on the basis of the capital stock will be set aside, the bank deposit being the only property taxable.
    Certiorari by the people of the state of New York ex rel. the Davis-Colby Ore-Roaster Company against Frank Campbell, comptroller of the state of New York, to review the determination of defendant in declining to set aside a tax assessed upon relator’s corporate franchise. Reversed.
    Argued before MAYHAM, P. J., and PUTNAM and HERRICK, JJ.
    R. Burnham Moffat, for relator.
    Simon W. Rosendale, Atty. Gen., for defendant.
   HERRICK, J.

The relator is a corporation duly incorporated under Laws N. Y. 1848, c. 40. Its certificate of incorporation stated that its principal place of business was to remain in the city and county of New Yprk, and that the operations of the company were to be carried on in the city and county of New York, and in such other places within and without the state of New York as the best interests of the company might thereafter determine. It was thus a domestic corporation, and was liable to pay a tax upon its franchise and business, to be measured by the amount of its capital stock found to be employed in this state. People v. Wemple, 129 N. Y. 558-562, 29 N. E. Rep. 808. During the year 1891 it moved its office for the transaction of business to the state of Pennsylvania. It made no sales within the state of New York during that year; it manufactured nothing within the state; it occupied no premises, paid no rent, employed no men within the state during the year. It did do business outside of the state of New York during that time; it manufactured ore roasters, kept a bank account, and employed servants, and paid them, outside of the state; and business done outside of the state in that way constitutes no part of the capital stock employed within the state. People v. Wemple, 183 N. Y. 323, 328, 31 N. E. Rep. 238. The same things, if done within the state by a corporation incorporated in some other state, would have constituted doing business within this state, and upon which such foreign corporation could have been taxed by this state. People v. Wemple, 131 N. Y. 64, 29 N. E. Rep. 1002; People v. Mining Co., 105 N. Y. 76, 11 N. E. Rep. 155.

If, then, a portion of the capital stock was employed without the state of New York, certainly all of it could not have been employed within the state of New York, and yet the defendant has assessed the relator upon the full amount of its capital stock. This, I think, was error. A portion of the capital stock being employed elsewhere, it could not be taxed as employed within this state. It seems to me that, in detertermining the amount of capital stock employed in this state, the same principle applies to a domestic as to a foreign corporation. If a corporation has no property and no business within the state, then there is no basis upon which to compute the tax. People v. Wemple, 133 N. Y. 323-329, 31 N. E. Rep. 238. There must be some property or business done within the state to justify a tax, and there must be some evidence to show how much capital is employed, and if there is such evidence the court will hesitate to disturb the finding of the comptroller; but that determination must be supported by some evidence,—it must not be a purely arbitrary determination. Having seen that the determination of the comptroller in taxing the entire capital stock of the relator was wrong, we must then see what evidence there is by which we can determine how much it should be taxed. The evidence discloses no business done within this state, and the only property disclosed is the sum of $1,391.68 in money deposited with a banking house in the city of New York. The amount in bank was held a proper basis for determining the tax in People v. Wemple, 129 N. Y. 558, 29 N. E. Rep. 812. How that money, or any portion of it, was paid out, or for what purpose, perhaps, is of no consequence. Whether any portion of it was used to pay past-due dividends I do not think can be considered here, as the case stands. The amount in the bank seems to be the only property that can be used as a basis to determine the amount of the tax, and the’ tax upon that would be the sum of $7.65. The determination of the comptroller should be reversed, the tax upon the relator fixed at the sum of $7.65, with $50 costs and printing and other disbursements to the relator.

MAYHAM, P. J., concurs.

PUTNAM, J.

I concur in conclusions reached in foregoing opinion generally, but am not clear that relator might not be taxed for the two months of the fiscal year that its office was in the city of New York. See People v. Wemple, (Sup.) 18 N. Y. Supp. 513.  