Bressler v. Wayne County

Letton, J.

The facts In this case are stated in the former opinion, 82 Neb. 758. The principal question decided in that case was that the Nebraska Land Company is an investment *775company, and- that its property should he assessed under the provisions of section 56 of the revenue law (Ann. St. 1907, sec. 10955). Upon reargument and further consideration, while we adhere to the principle laid down in the second paragraph of the syllabus that the owner of shares of stock of a domestic investment company is not required to list them for taxation, we are convinced that the Nebraska Land Company, the corporation the taxation of whose shares to the individual shareholder was in question, ,is not embraced within the class of “investment companies,” to be assessed under section 56. In the consideration of the case, we are confined to an examination of the pleadings, since there is no bill of exceptions properly before us. While the petition alleges that the corporation is an investment company, this is a mere conclusion, and the further facts alleged that it was formed for the purpose of purchasing a large tract of land, that all of its capital is invested in the land, and that the real estate constitutes all its assets, in nowise tend to bring the corporation within the class, but rather remove it from that category. The fact that its capital stock is invested in land does not make this an investment company. We are not aware of anything in the revenue law that distinguishes a corporation which purchases land from one which invests its capital in cattle, or horses, or in dry goods, or groceries, or in any other commercial channel. There is no particular virtue, in real estate which makes a trading venture in it an investment and a similar venture in other property not an investment.

In one sense all corporations formed for the purpose of profit are investment companies. Their' main object and purpose is that the stockholder may obtain a profit from the investment of .his money in the business of the company,. but this .is not the sense in which the words are used, in the statute. The meaning of the words is made clear by a consideration of the context. The language of the statute, so far as pertinent, is as follows: “The president, cashier, or other accounting officer of every, bank *776or banking association, loan and trust, or investment company, shall on the first day of April of each year make out a statement,” etc. Ann. St. 1907, sec. 10955. The “investment company” mentioned in the section evidently belongs to a class of financial institutions dealing in bonds, stocks, notes, mortgages, and other instruments, or evidences of value representing invested capital. It properly belongs and is classed with banks, banking associations, and loan and trust companies having a “cashier” or “accounting officer.” Its purpose is not to deal with actual and tangible property itself so much as with the representatives of property or mediums of exchange such as money, notes, obligations and securities. It may be difficult to draw the line between a concern which is an investment company and one which is a mere broker, but this we are not concerned with in this case. There is a clear distinction between a company formed to buy or to deal in real estate and an “investment company” under the statute. So far then as the result at the former hearing is based upon the proposition that the company in question is an investment company, the opinion must be vacated.

Section 28 of the revenue law (Ann. St. 1907, sec. 10907), requires every resident of the state to list all “his moneys, credits, bonds, or stocks, shares of stock of joint-stock or other companies, when the capital stock of such company is not assessed in this state.” Under the law it is the duty of every owner of capital stock of corporations not assessed in this state to list the same for taxation. If he omits to do so, and the shares of stock owned by him are sought to be placed upon the assessment roll by the assessor or by the board of equalization, he may raise the issue of their exemption from taxation by presenting facts to show that the capital stock of such company is assessed in this state, or any other matter which entitles him to be exempt from assessment on such shares. A hearing can then be had and a record made before that board, from wl:' h, and on the particular question there *777decided, an appeal may be had to,the district court. From the judgment of that court on an appeal to this court the proceedings of the district court will be examined in the same manner and to the same extent as other appeals, and the same presumptions will be applied with respect to the validity of the findings and judgments of that court as in other cases. Woods v. Lincoln Gas & Electric Light Co., 74 Neb. 526. In the present case both parties seem to have presumed that the question in the case was whether or not the Nebraska Land Company was an investment company, and whether its lands lay in this state or in North Dakota. This, it seems to us, was not the real issue in the case. Our view is that the real matter to determine was whether the capital stock had been “assessed in this state.” If not, it was taxable to the owner of the shares. So far as the question of the right to deduct the value of the real estate from the assessment of the capital stock of the corporation is concerned, this was not properly before the court, since it was a matter which directly concerned the corporation, to which it was the proper party, and not the stockholder. The petition alleges that the capital stock of the Nebraska Land Company was assessed, not to the company itself, but to the individual stockholder, and this is admitted by the answer. If not assessed to the corporation, it should have been assessed to the individual. On the facts pleaded the shares were properly assesséd to the plaintiff, and the judgment was erroneous.

The former opinion is vacated in so far as it holds that the Nebraska Land Company is an investment company, and the judgment of the district court is reversed.

Judgment accordingly.