In re the Appraisal under the Acts in Relation to Taxable Transfer of Property of Cooley

Ingraham, J. (dissenting) :

The deceased being a non-resident, it was only the transfer of his property in this State at the time of his death that was taxable. (See Tax Law [Laws 'of 1896, chap. 908], § 220, subd. 2, as amd. by Laws of 1897, chap. 2§4; Id. § 221, as ajnd. by Laws of 1903, chap. 41.) _IIe was the owner of capital stock of the Boston and Albany Bail-road Company. That corporation was formed by the consolidation of two railroad corporations, one in the State of Hew York and the " other in the State of Massachusetts, authorized by an act of the Legislature of the State of Hew York (Laws of 1869, chap. 917) and an act of the State of Massachusetts (Mass. Acts & Besolves of 1869, chap. 461). The act of 1869 authorized a railroad corporation organized under the laws of this State to .consolidate with railroad corporations organized under the laws of other States for the purpose of operating railroads Or bridges, either wholly within or partly within and partly without the State, and enacted that upon the consummation of said consolidation, all the rights, privileges, exemptions and franchises of each of the said corporations shall be deemed to have been transferred to and vested in the new corporation. A similar act was passed by the State of Massa*394chusetts; and under the authority. conferred by these two acts, several ‘railroads consolidated and became the Boston and Albany Kailroad potnpany, and they have operated a- railroad from the city of Boston, Mass., to the city of Albany, E. Y. - The deceased-was a resident of the .State of Connecticut, and the only ground upon which he can be said to have any property within this State is the fact that this corporation was by this act created a domestic corporation, and that by the transfer of the stock upon the death of the testator there was a transfer of property within this State. While the new corporation that was created by the consolidation became a domestic corporation so far/as it owned and operated a line of railroads in this State, it was also a foreign corporation so far ~ as it owned and operated a railroad in the State of Massachusetts. Its right to exist and operate its railroad in. Massachusetts depended not upon the law of this State, but upon the law of the State of Massachusetts, and its property that it owned in that State, it seems to me, it owned as a foreign and not a domestic corporation. " It is undoubtedly true that the transfer óf the shares of stock was taxable in this State; but I think that where a corporation owns property in this State under, its domestic charter, and owns property in .the State of. Massachusetts under a Massachusetts charter, a transfer of its stock cannot be said to be a transfer of property in this State - so far as that property is represented by its road and real property in Massachusetts owned and operated under the law of that' State. Just how this property .shall be apportioned it is not necessary now to decide, but it .seems to me to be a gross injustice to require a stockholder in this Massachusetts corporation,.not a resident of this State, to pay taxes upon property held 'and operated under the authority of the Massachusetts charter, over which this State has -no control.' A stockholder of a domestic corporation'is,liable tó a tax upon the value .of his interest in the whole of the corporate property as evidenced by the number of shares of stock which lie holds (Matter of Palmer, 183 N. Y. 288) as, the stock being that of a domestic corporation, the transferee of the stock must come into this State to transfer the stock and secure 1ns rights in the corporation. But the stock of this corporation- is actually transferred in Massachusetts. The owner is. not dependent upon the law of this State to secure his rights in the corporation, except so far as it affects the property of *395the corporation within this State. The courts- of this State would have no authority or control over the property of this corporation in the State of Massachusetts, and I do not think that the. proportion of the property in the State of Massachusetts is subject to taxation in this State.

I dissent, therefore, from the affirmance of this- order.

Order affirmed, with costs. . Order filed.