The Cornell Steamboat Company is a domestic corporation duly incorporated and engaged in the business of towing vessels, boats and barges upon the waters of the Hudson river and adjacent navigable waters, and having its office in the city of Kingston, N. Y. The city of Kingston is a municipal corporation and Addison E. Dederick is the assessor of said city. During the month of July, 1898, said assessor made an assessment against said company for real estate and personal property and inserted the same in 'the assessment roll. The personal assessment was and is $250,000. The said assessor duly gave notice that he would attend on the third Tuesday of August to hear and examine all complaints in relation to the assessments appearing on said roll. Written objections to said personal assessment were duly filed with the assessor by said company, and said company therein stated that it had no personal property other than that mentioned and set forth in a report filed with said assessor, and that the indebtedness of .the company as therein stated exceeded the value of its personal *541property, and asked that the assessment for personal property he stricken from the assessment roll. The report referred to in snch objections is dated June 15, 1898, and said company in such statement sets forth in detail its real estate and the value thereof. The statement in regard to its capital stock and its personal property is aa follows: “ The capital stock of the company amounting to the sum of $750,000 was issued in payment for real and personal property, and the good will and franchises of the business. The personal property of the above-named corporation at the present time consists of steam towing vessels, machinery, materials and supplies, accounts receivable and such other personal property as is necessary in the operation of the company’s business, and the market value of the entire property is less than $700,000. The bonded indebtedness and other indebtedness of the above corporation is $730,000.” On the 12th day of September, 1898, the president of the company was examined at length by the assessor. The condition of the company as thus shown is as follows:
Value of steamboats.......................... $550,000 00
Real estate................................. 149,200 00
Amount due from other parties. ........... 131,721 44
Cash on hand............■.................. 18,193 87
Materials and supplies......................... 11,637 83
Machinery and tools......................... 30,000 00
$890,753 14
Deduct amount due other parties. $96,301 37
Mortgage indebtedness ......... 700,000 00
Real estate.................... 149,200 00
945,501 37
Leaving a deficiency of................... $54,748 23
It appears by the testimony of the president of the company that the mortgage indebtedness of $700,000 bears interest at the rate of five per cent, per annum, and that the company also has a capital stock of $750,000 and pays an annual dividend thereon of six per cent. The president of the company in his testimony asserts that the personal property, franchises and good will of the business are sufficient to meet the obligations of the company, and that he re*542gaxds the corporation as solvent. He states that the franchises and business are worth more than the boats. He says the company has bought out the competing lines on the river and that they have paid high prices for the good will of such competing lines. He says further in substance that the ability of the company to pay interest and dividends rests in the good will of the business concerns owned by the company and in the personnel of the management. There was nothing to limit the inquiry on the part of the assessor, but the evidence was closed with the testimony of the president of the company. The return expressly states that the assessor had no other evidence, documents, records and papers before him concerning the valuation for assessment and taxation of the company’s personal property. The only documents, statements or evidence before the assessor were the statements and documents, furnished by the company, and the oral testimony of the president of the company. The assessor in his return states: “ I proceeded and acted upon the best information I could obtain.” And he further states that “ This determination was reached after a full and careful consideration of all the statements and arguments submitted to him, and was based upon the information so acquired and upon his own knowledge of the property and business of the company, and such information as he could acquire by diligent inquiry.” If the assessor made inquiries other than as expressly stated in the return, and upon which he acted, he should in compliance with the terms of the writ give the court some information as to the nature, extent and direction of such inquiries, and he should state what the information was which he obtained and upon which he based his decision. People ex rel. Edison Electric Illum. Co. v. Barker, 139 N. Y. 55.
While the assessing officers are not bound by the sworn statements when they have fair reason or ground for disbelieving them, they must return the information inducing such disbelief so that the court may understand what it was upon which they acted. People ex rel. Edison Gen. Elec. Co. v. Barker, 74 Hun, 418.
If the assessors rely upon facts not otherwise appearing in the proceedings, they must return them. It is not sufficient to state that he had other information which he preferred to accept, nor • can he rest upon such belief. This is purely arbitrary. People ex rel. Ind. Pub. Co. v. Barker, 16 Misc. Rep. 255.
Where the. capital stock' of a company is all paid in and the company is enabled from its business to pay interest on its bonded *543indebtedness and to declare from its earnings a dividend on its capital stock, there is a presumption that its capital remains unimpaired, and the assessors have a right to rely upon such presumption unless there is .evidence to the contrary sufficient to overcome such presumption. In this case it is not claimed that any of the real or personal property of the company has been omitted from the statement of the company. The testimony taken by the assessor shows the actual value of all of the real and personal property of the company in detail. Such testimony is full and complete and is not contradicted in any manner whatever. The assessor claims to rely upon the presumption that the capital is unimpaired. If the assessor really did rely upon such presumption he should have assessed the company for a much larger amount. The amount of the assessment was not the result of any mathematical calculation, but was an arbitrary sum fixed without computation and without any definite theory. Counsel for the defendant refers to two cases in the Court of Appeals, namely, People ex rel. Equitable Gas Light Company v. Barker, 144 N. Y. 94, and People ex rel. Manhattan Railway Co. v. Barker, 146 id. 304. In each of these case the presumption arising by virtue of the payment of dividends is recognized and stated. The sworn statement of the relator in each case is doubted by reason of the fact that the relator does not in either case specify the actual market value of its real estate. In each instance the relator refers to the assessed value of its real estate, and not its actual value, and the court expressed the belief that the real estate was of an actual value much greater than the assessed value as stated. An examination of the evidence shown by the return in this case necessarily results in the conclusion that the ability of the company to pay interest on its indebtedness and dividends on its stock rests in good will and management rather than in actual tangible assets. The good will of a business of a corporation is not taxable. People ex rel. Malcom Brewing Company v. Neff, 19 App. Div. 596. The presumption in this case arising by virtue of the payment of such interest and dividends is clearly overcome by the undisputed testimony returned by the assessor.
As the relator has no personal property (exclusive of franchises and good will) over and above its indebtedness, the assessment is illegal. An order may issue directing that such assessment of $250,000 for personal property be stricken from the assessment roll of the city of Kingston for the year 1898.
Ordered accordingly.