Crocker v. Marine National Bank of New York. J. G. Abbott and H. C. Hutchins, for plaintiffs. E. D. Sohier and C. A. Welch, for defendant. GRAY, J. These actions are brought, the one by citizens of New York and the other by citizens of Massachusetts, against a banking association established in the city of New York, under the act of Congress of 1864, chap. 106, entitled "An act to provide a National currency secured by a pledge of United States bonds, and to provide for the circulation and redemption thereof." The first question to be decided is that of jurisdiction; for, if the court has no jurisdiction. it has no authority to consider the merits of the actions. The general principle is well settled, that civil cases arising under the Constitution and laws of the United States may be tried and determined in the State courts, unless the National Constitution and laws have vested exclusive jurisdiction of them in the Federal tribunals; but that Congress may prohibit the State courts from entertaining jurisdiction of such cases. 1 Kent's Com. (6th ed.) 396 et seq.; Bank of United States v. Deveaux, 5 Cranch, 85, 86; Osborn v. United States Bank, 9 Wheat. 738; Teall v. Felton, 1 Comst. 537; S. C., 12 How. 284; Ward v. Jenkins, 10 Metc. 591. The question in this case, therefore, depends upon the intention of Congress, as manifested in the act of 1864. The 8th section of that act declares that every banking association, formed and organized pursuant to its provisions, shall be a body corporate, with the usual powers of a corporation, and among others, to have a corporate name and seal, and "by such name it may make contracts, sue and be sued, complain and defend, in any court of law and equity, as fully as natural persons." If the act contained no further provision upon this subject, the corporations thus established might doubtless be sued, as well as sue, in the State courts of appropriate jurisdiction, and could be sued in only such courts of the United States as the citizenship of the parties would warrant. Bank of United States v. Deveaux; Teall v. Felton and Ward v. Jenkins, above cited. But by the 5th section it is enacted that suits, actions and proceedings against any association under this act may be had in any circuit, district or territorial court of the United States, held within the district in which such association may be established; or in any State, county or municipal court in the county or city in which said association is located, having jurisdiction in similar cases;" provided, however, that all proceedings to enjoin the Comptroller Crocker v. Marine National Bank of New York. of the Currency under this act shall be had in a court of the United States. The plaintiffs contend that this section, except the final proviso, is merely permissive, and does not exclude the bringing of such suits in any court, National or State, having jurisdiction in similar cases. But, according to their construction, so much of it as relates to courts of the United States would seem to have no effect, except in the case of a plaintiff residing in the district in which the association is established; and so much as relates to the State courts would seem to be wholly useless and superfluous. And the effect would be, that, while a citizen of New York could not sue this association in any Federal court held beyond the limits of that State, he might bring a suit against it in the courts of any State of the Union, by the laws of which a corporation established in another State might be sued, and in which it might be effectually served with process. Folger v. Columbian Insurance Co., 99 Mass. 272. Upon full consideration, we are unanimously of opinion that the construction of the act of Congress for which the plaintiffs contend cannot be supported, and that the opposite construction must prevail. The whole purpose of the 8th section appears to have been to clothe the association with the attributes of a corporation, including that of suing and being sued. Unaccompanied by further legislation, that would have left the jurisdiction over suits against it to be regulated, according to the subject-matter involved or the parties interested, by the existing laws of the United States, and the several States respectively. But the 57th section designates not only the judicial district of the courts of the United States, but the locality of the State courts, within which suits may be brought against such associations; and, by thus regulating the whole subject of suits against such corporations, so far supersedes all other rules, or to speak more accurately, prevents them from ever applying to such suits. This section manifests the intention of Congress that each of these associations should be sued, either in the Federal or in the State courts, only in the judicial district in which it is established, and in which its officers may be summoned and its books brought into court with the least interruption and inconvenience of its business; and that the election of plaintiffs to sue in any court whatever should be confined within these limits in all cases. Action dismissed for want of jurisdiction. Providence Institution for Savings and Jewell v. City of Boston. PROVIDENCE INSTITUTION FOR SAVINGS AND JEWELL V. CITY OF BOSTON. (101 Massachusetts, 575.) Constitutional law-Construction of statute - Taxation of National bank shares. By the statute of June, 1868, chapter 349, of Massachusetts, entitled "An act concerning the taxing of bank shares," it was provided that the shares in National banks owned by non-residents of the Commonwealth shall be assessed to the owners thereof in the cities or towns where the banks are located; that the rate of taxation shall be the same as on other moneyed capital; that the value of such shares shall be omitted from the valuation upon which the rate is to be based, and that the act shall "apply to taxes assessed and collected for the present year in the same manner and to the same effect as if it had been in force on the first day of May." Held, that the act was not unconstitutional, either as being in violation of the act of Congress of 1864, chapter 106, section 47, and 1868, chapter 7, or as levy. ing a tax in a disproportional manner, or as being retrospective in its opera tion. A CTION to recover the amount of taxes paid under protest. The taxes were assessed by the assessors of Boston, under the stat ute of 1868, chap. 349, on shares owned by the plaintiffs, in the National Revere Bank, which was established at Boston under United States statute of 1864, chap. 106. One of the plaintiffs was a corporation of Rhode Island, the other was a citizen of Connecticut. Several of the provisions of the statute of 1868, chap. 349, are referred to in the opinion. It was also provided by the act, that it should "apply to taxes assessed and collected for the present year in the same manner and to the same effect as if it had been in force on the first day of May." B. F. Thomas, for plaintiffs. 1. The shares in a bank are personal property, and follow the person of the owner. McCulloch v. Maryland, 4 Wheat. 316, 437; Utica v. Churchill, 33 N. Y. 233. 2. The tax is disproportional on account of the mode of valua tion. Oliver v. Washington Mills, 11 Allen, 268, 275; Commonwealth v. People's Savings Bank, 5 id. 428, 431; Portland Bank v. Apthorp, 12 Mass. 252, 255. 3. The statute of 1868, chap. 349, is retrospective in its operation. Providence Institution for Savings and Jewell v. City of Boston. Cases above; Commonwealth v. Provident Institution for Savings, 12 Allen, 313. 4. The statute is unconstitutional because it conflicts with the Constitution of the United States, which provides that "citizens of each State shall be entitled to all privileges and immunities of citizens of the several States." See also Corfield v. Coryell, 4 Wash. C. C. 380; Crandall v. State, 10 Conn. 343; Campbell v. Morris, 3 Har. & McHen. 534, 535. C. Allen, Attorney-General, and C. H. Hill, for defendants. 66 AMES, J. By the terms of the act of Congress of June 30, 1864 (U. S. Stat. 1864, ch. 106), under which the National banks have come into existence, all the shares in each of said banks are made taxable in the place in which the bank is located," without any regard whatever to the legal domicile of the shareholders respectively. This provision forms a part of the organic law under which every such bank has its being, and under which the stockholders contribute to its capital. This court has recently decided that the word "place,” as used in the statute, means the State within which the bank is located. Austin v. Aldermen of Boston, 14 Allen, 359. And the subsequent amendatory act of Congress of February 10, 1868 (U. S. Stat. 1868, ch. 7), uses the following language: The words "place where the bank is located and not elsewhere" shall be construed and held to mean the State within which the bank is located; and the Legislature of each State may determine and direct the manner and place of taxing all the shares of National banks located within said State, subject to the restriction that the taxation shall not be at a greater rate than is assessed upon any other moneyed capital in the hands of individual citizens of such State; and provided, always, that the shares of any National bank owned by a non-resident of any State shall be taxed in the city or town where said bank is located, and not elsewhere." The Legislature of this Commonwealth, by the statute of 1868, chap. 349, passed June 11th of that year, entitled "An act concerning the taxing of bank shares," has undertaken to determine and direct the manner in which all the shares of stock in banks, whether of issue or not, existing by authority of the United States, shall be taxed. The act provides, among other things, that such shares owned by non-residents of this Commonwealth shall be assessed to the owners thereof in the cities or towns where such banks are located, and Providence Institution for Savings and Jewell v. City of Boston. not elsewhere; that the tax shall be a lien on their shares; that the value of such shares shall be omitted from the valuation upon which the rate is to be based; and that the proceeds of the tax on such shares, when collected, shall be paid over by the treasurer of the town or city to the State treasurer. The plaintiffs insist that this statute, so far as it applies to non-resident stockholders, is one which the Legislature had no right to enact; that the tax assessed under it upon such stockholders is invalid; and that the lien it assumes to create upon the stock cannot be enforced. The counsel for the plaintiffs insists that three "landmarks" have been established in this broad field of inquiry, namely, that the shares of the stockholders of the National banks are distinct subjects of taxation; that they may be assessed and taxed without deducting from their valuation that portion of the corporate capital invested in the bonds of the United States; and last, and most important of all, for the purposes of this inquiry, that, the banks being agencies of the general government in the execution of its powers and functions, the States have no power to tax their capital except under the permission of Congress. It is also established by statute that the shares are taxable in the place (that is to say, the State) where the bank is located, and not elsewhere; that the Legislature of each State may determine and direct the manner and place within such State of taxing such shares (with a restriction against oppressive and hostile taxation); and that, in the case of shares belonging to persons not residing within the State, the place of taxation shall be the city or town in which the bank is located, and not elsewhere. A citizen of Connecticut or Rhode Island, therefore, owning shares in a National bank in Massachusetts, is not to be taxed for them in Connecticut or Rhode Island. They can only be taxed in Massachusetts, a provision which relieves him. of all danger of being twice taxed for the same property. Flint v. Aldermen of Boston, 99 Mass. 141(ante, p. 571). The acts of Congress in regard to such shares belonging to non-resident stockholders apparently are intended to annul, as to them, the general rule that personal property follows the person, and has no locality other than the domicile of the owner, and to attach to such shares, for some purposes, and to some extent, the local character and fixity of real estate. They are proper subjects of taxation in the town where the bank in question is located; and the Legislature of the Commonwealth (as the above-quoted act of Congress expressly provides 1 |