It was provided by an act of the legislature, passed July 21, 1853 (ch. 654), that any incorporated company named in an assessment-roll upon proof mode to the board of supervisors, as therein required, that it had "not been during the preceding year in the receipt of net annual profits or clear income, equal to five per cent" on the capital stock paid in or secured to be paid in after deducting therefrom the assessed value of its real estate, should be "entitled to commute for their taxes on such capital stock by paying directly to the treasurer of the county in which the business of such company is transacted, a sum equal to five per cent on such net annual profits or clear income, and also such further sum as shall have been assessed on such roll as the taxes on their real estate."
The Park Bank claimed the right of commutation under that act, and in the proof made to the Board of Supervisors of the City and County of New York at their annual meeting in July, 1856, it appeared that it was a banking association duly organized under the general banking law on the 12th of March in that year, but did not proceed to carry on any banking *Page 95 business, except to call in its capital and take other steps preparatory thereto, till the 31st day of March thereafter; that its capital stock paid in or secured to be paid in was two millions of dollars, and that its clear income from the period of its organization till the time such exemption was claimed in July amounted to and did not exceed the sum of forty-eight thousand and five dollars and seventy-nine cents, being less than five per cent on its capital after the deduction of the assessed value of the real estate, which was one hundred and twenty-five thousand dollars. Upon these facts, the question is presented whether this bank was entitled to the privileges claimed by it under the provision of the act above referred to. As a general rule the whole of the capital stock of banks, except such as is held by the State or incorporated literary and charitable associations, is liable to taxation, and no regard is had to the time during which they have carried on business. It is the duty of the assessors to include all in the assessment-roll, and they are to be charged by the board of supervisors with their proportional share of the public burdens on such capital. The provision of law above referred to was an innovation upon a long established system and continued in force only till 1857, when it was repealed. (Laws of 1857, ch. 456, § 1.) It was a special privilege granted, and the corporations claiming it were bound to furnish the board of supervisors with the requisite proof to entitle them to it, within two days from the commencement of their annual meeting. It was, therefore, an exception to a general rule, and it should appear that a corporation was clearly within the exception before it should be permitted to discharge itself from its just proportion of the public burden, to the prejudice of other taxpayers. One of the requirements to entitle a bank to its benefit, in my opinion, is, that it should have been in existence for a year previous to the annual meeting of the board of supervisors. The law requires that it should be shown that the company has not been "during the preceding year in the receipt of net annual profits or clear income equal to five per cent on its capital stock," c., and the commutation is to be based on such net annual profits *Page 96 or clear income. It contemplates that the corporation shall have been in business during a whole year. It is in such cases only that annual profits or income can accrue. It was no doubt the object of the law to relieve all incorporated companies from taxation on their capital when their business was not sufficiently profitable to justify the imposition of the ordinary burden to which property is subject for the support of government. A year preceding the usual time designated for imposing taxes was fixed as the period for determining that fact, and therefore the annual profits were the test of success, and formed the basis of taxation. Such, indeed, is claimed to be the construction of the law by the bank. It says that "the effect of the words is, and the intent was, that corporate capital should not be fully taxed in its corporate form until it had been one year successfully operating; and that whenever corporate operations were unsuccessful, like indulgence should be allowed." It is claimed, in other words, that if it should appear that corporations which have been in existence for less than a year, have been prosperous and have during the time they have carried on their business, realized more than five per cent on their capital, that they nevertheless could not be taxed on the whole capital, and consequently that their corporate existence for a year and the receipt of profits to the amount specified, were both "prerequisite to liability," on the part of a corporate company, to be taxed in the usual way.
Assuming, therefore, that the law in question has application only to such incorporated companies as have been in existence for a whole year preceding the annual meeting of the board of supervisors, it, in my opinion, follows as a necessary consequence that the claim of the Park Bank was properly refused. The fact of such existence during that time is a prerequisite to the right of commutation, and not to the ordinary mode of taxation. The law does not prescribe a new rule of taxing corporations, but merely gives them the privilege of relieving themselves from the operation of that rule upon showing certain facts to the satisfaction of the board of supervisors. In the present case the material fact necessary to be *Page 97 shown, the corporate existence of the bank for a whole year, was wanting. There was, moreover, no basis on which the commutation could be made. There were no "net annual profits or clear income" on which it could be estimated. It was impossible, therefore, to include it within the privileged class of corporations, and it has no ground of complaint when it is subjected to the same rule of taxation which is applicable to the community generally. A different construction would lead to results which could not have been intended by the legislature. The rule contended for by the appellant would relieve all capital that had been invested in an incorporated company at any time within the year, from its ordinary burden of taxation, although profits far exceeding five per cent had accrued thereon both before and after its investment.
The law should not be so construed as to produce such a result if any other meaning can reasonably and fairly be given to it, and the views above expressed show that such a construction is not only unnecessary but unwarranted.
The judgment of the Supreme Court should therefore be affirmed, with costs.
All the judges concurred, except