I concur in the result reached by the majority for the sole reason that the agreed statement of facts shows that all the stock of plaintiff, a Montana corporation, is owned by Commercial Credit Company, a Delaware corporation, and that the former functions only for the business convenience and benefit of the latter.
This court said in United States Gypsum Co. v. Mackey W.P.Co., 60 Mont. 132, 199 P. 249, 251: "It has been held by this court that where the stock of a corporation is owned by one person, whereby the corporation functions only for the benefit of such individual owner, the corporation and the individual should be deemed to be the same. (Edwards v. Plains Light WaterCo., 49 Mont. 535, 143 P. 962; Barnes v. Smith, 48 Mont. 309, *Page 220
137 P. 541; Hanson Sheep Co. v. Farmers' Traders' StateBank, 53 Mont. 324, 163 P. 1151.)"
In Barnes v. Smith, supra, this court speaking through Mr. Chief Justice Brantly said that section 3833, Revised Codes of 1907 (now sec. 5933, Rev. Codes), requiring directors of a corporation for profit to be holders of its stock, required them to be bona fide owners thereof and said: "The result of the requirement is that, when the capital stock passes into the hands of a single person, the entity of the corporation, except so far as it is necessary to protect the rights of strangers, who deal with it through its ostensible officers and agents, is entirely in abeyance, and its functions for the time being cease. So it is held by the current of authority."
It is immaterial whether the sole owner of the corporate stock is an individual or another corporation. In either event the result is a practical merger of the corporation with its owner. (Gallatin Natural Gas Co. v. Public Service Commission,79 Mont. 269, 256 P. 373; Fulmer v. Board of RailroadCommissioners, 96 Mont. 22, 28 P.2d 849.) There being in legal effect no separate contracting parties, the "contract" and other transactions relied upon to show plaintiff's transfer of the taxable property to its parent company are of no force, and plaintiff has failed to prove its case.
It seems fair to the learned district judge to state that the above determinative point was not raised by defendants either on trial or on appeal. Reference to the relationship was made in plaintiff's brief on appeal, but only upon the ground that "under such a state of facts, closer scrutiny of the dealings between these two companies becomes necessary to determine their real nature."
This is not a criticism of able counsel for appellants, whose attention was centered upon the question of the ownership of the taxed property as between the two assumedly separate, though related, corporations, nor do I consider counsel derelict as implied in the majority decision for not having recounted the complete life history of the two corporations at length in the *Page 221 agreed statement of facts. The majority decision suggests also that by agreeing to the stipulation that "the Delaware Company has no offices and does no business in the State of Montana," counsel for defendants were attempting to waive a public right. The suggestion is not tenable. By an agreed statement of facts the parties stipulate facts and not law. As a matter of fact the Montana Company and not the Delaware Company maintained the offices and transacted the business in Montana; but as a matter of legal effect, under the circumstances shown the offices and the business were those of the Delaware Company. The agreed statement tried to effect no change in that respect, and effected none, as the result of this appeal amply demonstrates.