This appeal involves the same question as that presented in its companion case, Matter of Sears, Roebuck Co. v. McGoldrick (279 N.Y. 184). Should the principles there stated lead to a different result on the facts in this case?
The Standard Oil Company, having numerous oil tanks in New Jersey, by New York contract sold and delivered oil to the respondent's steamships at its piers in New York city. A tax upon these sales for the period from December 10, 1934, to December 31, 1935, has been set aside below, as an illegal burden upon interstate commerce. The only distinction upon the facts in this case and those in the Sears, Roebuck Co. case rests in the nature of the respondent's business. The respondent buys two classes of oil for steamships — fuel oil, and Diesel fuel oil. In the briefs these are referred to as "Standard Bunker Fuel Oil" and "Standard Diesel Fuel Oil." The storage tanks containing large quantities of these oils are at Bayonne, New Jersey.
The contract for the period in question for fuel oil is contained in a letter accepting an offer to extend a previous fuel oil contract until December 31, 1936. It states that the Standard Oil Company of New Jersey is to supply the total fuel oil requirements at New York of all the oil-burning vessels of the Compagnie Generale Transatlantique during the period of the contract up to a maximum of four million barrels per year. The maximum price is fixed at $1.10 per barrel, with provision for increases. The contract for the Diesel fuel was also made at New York for a period up to December 31, 1935, *Page 197 not to exceed fifteen thousand barrels in any one month, and up to, but not exceeding, one hundred thousand barrels during the term of one year. Delivery shall be made by barge provided by the seller to the buyer's vessel at dock within the harbor limits at New York, or to the buyer's vessel alongside dock of seller at New York. The price varies according to the place of delivery.
These two companies have been doing business for many years, and it was well understood that the oil of the Standard Oil Company of New Jersey was stored in thousands of tanks in Bayonne, New Jersey. So far as this record shows, it had no storage facilities in New York city. As the Normandie or theParis or the Champlain or the Lafayette approached the harbor in New York, messages were sent to the Standard Oil Company's office in New York city indicating the amount of fuel that would be necessary, and with the docking of the steamer at the steamship company's pier, barges of the oil company would soon be alongside prepared to pump the oil into the steamer's tanks. The oil was brought from New Jersey by the oil company's barges. Both the Standard Oil Company of New Jersey and the Compagnie Generale Transatlantique were doing business in the city of New York. The latter had its piers and office at the foot of Fiftieth street, and places of business at 19 State street and 610 Fifth avenue, Manhattan. The offices of the Standard Oil Company of New Jersey were at 26 Broadway, New York city.
Unless there be some material difference between the sales in this case and those in the Sears, Roebuck case, we shall be obliged to sustain the tax. What difference do we find? In the first place, the Standard Oil Company of New Jersey maintains a large number of oil tanks in Bayonne, New Jersey, and the vicinity. The steamship company knew that the nature of the business required oil to be stored in large quantities, and that the oil company had such a plant, and delivered its oil *Page 198 by drawing it off from these tanks into ships at Bayonne, or else into barges, to be carried to vessels at the port of New York and elsewhere. While the purchase or the contract of sale was made in New York, it was with a view of getting this specific oil, the product of the Standard Oil Company of New Jersey, from its plant and tanks in New Jersey. The product in New Jersey, kept there in tanks, was the thing bargained for. So far as the record in this case goes, the contract centers around the purchase of the New Jersey oil of the kind and quantity specified. The delivery at the Port of New York was made necessary because of the draft of the steamers. The cost of transportation from Bayonne to the port of New York increased the price.
In the Sears, Roebuck case the purchaser bought an article in New York according to sample. As long as he got what he ordered, it was indifferent to him where it came from. The merchandise was very largely stock goods and kept for the convenience of the seller at various depots throughout the State. The ease with which the tax could be evaded by such class of merchandise being stored without the State and sold in New York city by sample, was a matter worthy of consideration, as bearing upon competition with New York goods.
Here, on the other hand, there is a special product of the Standard Oil Company of New Jersey which has to be kept in great receptacles built for the purpose which we can treat by analogy as a manufacturing plant. It is the articles of this plant in New Jersey which the purchaser seeks. At the office of the seller in New York it bargains for this oil to be put in its ships. We think, under the principles stated in the Sears, Roebuck case and the authorities there cited, that this is a contract for interstate shipments, and that the tax upon such a sale is a direct tax upon interstate commerce.
The order should be affirmed, with costs. *Page 199