Bank v. McIntire.

sion of the defendants, and sought to give effect to a lien upon them; but it prayed for a judgment against the Hurd estate, and the evidence showed that no Norton assets came to the defendants. The defendants are not liable in this action as, in any sense, the representatives of the Norton estate. Their only power and duty touching that estate was to file an account showing Hurd's transactions while executor, and to deliver to his successor, when appointed, the remaining moneys and assets, if any, of that estate.

Treating the action as one against the Hurd estate, upon his individual liability, when, if ever, did the statute of limitations begin to run? So long as he retained assets of Norton, sufficient to pay the decrees in full, his mere delay to make the promised payment created no personal liability. So long as the settlement of the Norton estate remained open; so long as Hurd delayed to file his accounts in the Probate Court, all unpaid claims that he, as executor, had admitted to be valid, remained in full force and effect against that estate. Holding the moneys and assets of the estate in a trust capacity, he held them subject to the right of the bank to priority in payment, and the moment he, by otherwise applying them, made it impossible for him to pay the bank out of the Norton estate, he became individually liable to the bank. But as such payment by him under the case shown was a fraud upon the bank, the statute would not begin to run in his favor, if at all, until the bank had knowledge that he had so acted as to incur this liability.

The petition does not show when the bank first acquired such knowledge. As it set out a valid claim to the proceeds of the sale of the mortgaged premises and averred that part of said proceeds were in defendant's hands, the Common Pleas did not err in overruling the demurrer to the petition as amended.

The defendants sought to avail themselves of the six years' bar. This imposed upon them the burden of proving that Hurd individually ought to have been sued more than six years before this action was begun. The exhibit from the Probate Court showed that Hurd had during his life-time disposed of all of the Norton as sets, and so made it impossible to pay the bank out of that estate. But there was no evidence even tending to show when Hurd so

Miller v. First National Bank.

disabled himself, or when the bank first had notice of it. Hence, the Common Pleas did not err in finding that the plaintiff's action against the Hurd estate was not barred, or in overruling the motion for a new trial.

But that court did err, as we think, in holding the claim a preferred debt against the Hurd estate. If the record disclosed any specific assets of the Norton estate in the hands if the Hurd administrators, the plaintiff would be entitled to an order applying them upon the judgment; but no such fact is shown.

Judgments of the District Court and Common Pleas reversed and decree for plaintiffs for the amount found by the trial court, with interest and costs. Execution to run against the Hurd es

tate.

MILLER V. FIRST NATIONAL BANK.

SAME V. THIRD NATIONAL BANK.

SAME V. MERCHANTS' NATIONAL BANK.

(Ohio Sup. Ct., May 21, 1889.)

Taxation. Shares-in what name.

There is no authority in the statutes of the State, nor of the United States, for listing and valuing the shares in a National bank in the aggregate, and placing such aggregate on the tax-list in the name of the bank Such shares when listed and valued for taxation are required to be placed on the proper tax-list in the names of the respective owners.

The listing of the shares for taxation is provided for and secured by section 2765, R. S., and the correction of returns made by the cashier of the bank to the county auditor is provided for by section 2769 and not by section 2782, Id.

RROR to District Court, Hamilton county. The action below

ERRO

was by the treasurer of Hamilton county against the First National Bank of Cincinnati. The questions arise upon a demurrer to the petition on the grounds (1) that there is a want of proper parties; and (2) that the petition does not state facts sufficient to constitute a cause of action. The petition is as follows:

Miller v. First National Bank.

"Plaintiff says that he is the duly elected and qualified treasurer of Hamilton county, Ohio, now holding and exercising said office, and that the defendant is a National bank incorporated under the laws of the United States, having now, and during all the time hereinafter referred to, its place of, and transacting its business in, Cincinnati, Hamilton county, Ohio. Plaintiff says that in each of the years 1877, 1878, 1879, 1880 and 1881, the said defendant, by its cashier, for the purposes of taxation, made a return to the auditor of Hamilton county, Ohio, purporting to be a true return of the resources and liabilities of said bank at the close of business on the Wednesday next preceding the second Monday of May of each of said years, but did not return any statement of the names and residences of the stockholders thereon, with the number of shares held by each, but, instead thereof, a written statement that said bank would pay the taxes for and on behalf of the stockholders; and said bank did pay the taxes levied, in accordance with said returns so made out; but plaintiff says that the auditor of said county of Hamilton in the year 1881 discovered that said returns were false. Thereupon, said auditor proceeded to correct said returns, and having fully inquired, in accordance with the requirements of the statute in such cases made and provided, into the amount of the personal property, money, credits and investments that said bank should have returned for each of said years, and having first notified the cashier of said bank, and permitted full opportunity for the same to be heard by its counsel and officers, to show that its said returns were, correct, he, the said auditor, thereupon found that each of said returns were false, and that there had been omitted from the same, personal property which should have been included therein, and listed for taxation, of the value, for the year 1877, of $82,837, for the year 1878 of $475,522, for the year 1879 of $349,246, for the year 1880 of $481,159, and for the year 1881 of $377,827, which said sums the said auditor, on April 8, 1882, placed on the tax-list against the defendant, as and for the years 1877, 1878, 1879 and 1881, respectively, when the same should have been returned, and opposite to the same the taxes on said sums for the said years, amounting, for the year 1877, to the sum of $2,410.56; for the year 1878, to the sum of $13,571.40; for the year 1879, to the sum of $10,121.14; for the year 1880, to the sum of $14,915.50, and for the year 1881, to the sum of $8,837.76, which taxes now stand charged on the duplicate of said Hamilton county; that the same are due and unpaid, and the stockholders of said bank are indebted to the plaintiff, as treasurer of said county, in the said sum of $2,410.56, with interest thereon from December 20, 1877, and in the sum of $13,571.40, with interest thereon from December 20, 1878, and in the sum of $10,121.14, with interest thereon from December 20, 1879, and in the sum of $14,915.50, with interest thereon from December 20, 1880, and in the sum of $8,837.76, with interest thereon from December 20, 1881, which, though payment has often been demanded, the defendant has failed and refused, and still fails and refuses to pay. Plaintiff further says that the defendant, at all times during the years above mentioned, had in its possession, and now has, money and property belonging to its stockholders more than sufficient to pay all the sums of taxes so, as aforesaid, due from the said stockholders; but, instead of applying the same or any

Miller v. First National Bank.

part thereof to the payment of said taxes, has paid over large portions of the same as dividends to the said stockholders, although the defendant has been repeatedly notified, by the treasurer of said county, of the non-payment of said taxes; and, notwithstanding the premises, the defendant has, during all said years, been transferring, and permitting to be transferred, from one person to another, the stock thereof, as the stockholders therein have from time to time requested; and said defendant will, unless restrained by the order of this court, continue to refuse to pay said taxes, and will, at the same time, continue to pay dividends to stockholders of said bank, and to transfer the stock thereof to the great and irreparable damage of plaintiff. Wherefore, plaintiff prays that defendant, its officers and agents, be enjoined from paying to its stockholders, or any of them, any dividends, and from transferring on its book or otherwise any shares or share of its capital stock, until said taxes and interest shall have been paid in full; and that the court cause an account to be taken of the moneys and property in defendant's possession belonging to the several stockholders, and cause the taxes and interest, as aforesaid, due from them and each of them, to be paid in full out of said money and property in defendant's possession; and for such other and further relief as may be just." "CHAS. EVANS,

County Solicitor."

"[Duly verified.] The demurrer was sustained, and judgment rendered thereon for the defendant, which, on error, was affirmed by the District Court; and this proceeding is prosecuted to reverse both judg ments on the ground that the Court of Common Pleas erred in sustaining the demurrer to the petition. The cases of Miller, Treasurer, v. Merchants' National Bank of Cincinnati, and Same v. Third National Bank were argued and submitted with the case here reported.

W. S. Little, Goss & Cohen, Foraker & Black, and Rufus B. - Smith, County Solicitor, for plaintiff in error.

Lincoln & Stephens, for defendants in error.

MINSHALL, C. J. It is evident that the relief prayed for against the stockholders in this case cannot be granted, as they are not parties to the action; and unless the plaintiff is entitled to some relief upon the facts stated against the bank, the demurrer to the petition was properly sustained. And as regards the bank, there is but one question in the case that needs to be determinedfor the determination of it will dispose of all the others that have been raised and that is, whether the shares of stock in a Na

VOL. III-90.

Miller v. First National Bank.

tional bank are to be listed for taxation in the names of the shareholders or in the name of the bank. The power of the State to impose any tax upon such shares is conferred by the statutes of the United States. R. S., § 5219. This is not controverted. It is also true that the property of a National bank, other than its realty, cannot be subjected to taxation by a State or any of its subdivisions. The power conferred by the section just referred to is to include the "shares" in the valuation of the personal property of the "owner" or "holder" of such shares. A bank does not own the shares of its capital. It owns the capital, and the shares are owned by its stockholders. The capital is corporate property; the shares in it are the individual property of its shareholders. It is the latter that may be taxed, and not the former. No authority is conferred to assess them for taxation against the bank itself; and to so assess them would be but another form of taxing the capital of the bank itself, which no one contends could be done without the authority of Congress. A share in a bank is but a fractional part of its capital, owned by one who contributed an equivalent part of the capital, or his transferee; and the aggregate of all the shares held by individuals in a bank is equal to the aggregate of its capital; so that, if all the shares in a bank were assessed for taxation in its name, and payment of the tax required of it, the effect would be precisely the same as a tax upon the aggregate capital of the bank. Again, as the shares are to be assessed for taxation according to their true value in money, a tax so levied would extend to and include all the property of the bank its personalty, in the valuation placed on the shares in its capital stock, and its realty, under the exception contained in section 5219, U. S. R. S. It seems then to follow, as a necessary result, that shares in a National bank must be assessed for taxation in the names of the owners of them, and not in the name of the bank itself. The language of the statute under which the power is conferred on a State to tax such shares is such; and the power conferred must be confined to the language; or the exemption of the bank itself from taxation may be reduced to an empty expression. Nor do the statutes of the State on the subject of taxation contemplate or intend that such stock should be listed in the name of the bank. They con