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Show IfiE ME GIVES DECISION ! IN CASE OF UTAH NATIONAL BANK AGAINST WEBER COUNTY A Judge Alfred Ac after giving the t.l'tah National bank versus Wetter county suit careful in .-.-n-.incn fa. Rhe following decision tor. Memorandum of Decision. I "This is an action brought bv 'hf Hllintlff bank ro recover back from thecountv a retain which if paid is taxs on it? eapiia) stock, it being tl&imed by the hank that the propr-i deduction as not made as provided fc Section 2509 of the Compiled Laws of 1907 No evid nee was offered by atbe plaintiff that ne valuation placed Jj upon the shares of capital sto.-k was J excessive, the entire contention being I that tbe proper de luetion was not Bpade on account of ihe real estate Kvhlch was assessed as such to the bsnk itself ' "When 'he rase of Pingrce National iBank vf. Weber coun'v was r;eil, h nestion of the constitu'ionality of this section war- not raised In thai i case, In assessing the shares of capital tltock of the bank, the ass.-?or had d t"rm!ned the actual value of all the lhares and from that value had de t ducted the assessed value of the real ptate, Ignoring the provisions of the ectloD mentioned. That section pro : Tides that in making deduct ions r,n ac count of real estate, such sum shall be deducted as bears the same proportion I to the entire aluc of h. . -pnai s( cK lu th assessed value oi tlv teal i sate lars to the capital s'ock. Mirplus and Undivided prom- A- Mi- question .,: Itt aJIdity of this section was not Weed In that case, I held that Ihe rliilure of ihe as,. : ur to comply with provisions resulted in an over val - jation of th. , apital stock h v. hi h tllc bank and its -tocknold. rs were I Impelled to pd nmri than I e Mould hae been required to pay 1 be MBpremc court affirmed ny constnii I linn nl 1. . . ...... vi mis section. I On a petition tor a rehearing, fh HHestlon of the constltutlonahi of action was argued, but the su Jremr" rourt r. fi.is. d i.. . on.-i.l. i n mi ground that the quev.ion had no' IS,? ruaiSRl ,n "lls ,r'u-. bllt stated I at ,he constitutionality of this c I 'on was a serious question. So tar as 1 ln,m ,awarp- therefore, the supreme wtirt hag never parsed ,.n ,hls . ?'nce the trial of the Plngree Na-j Na-j gwar bank case, I nave rarefullv ex Bf? lJe Prov'on of the section visin 111 conntlon with the pro- th. c.'k?' th" constitution bearing on subject and have bet n forced to conclusion that the section of the FJ B mentioned :8 in conflict with Br.? provi81nfi of our constitution ma therefore void. 1h,,'!h?'" 'I'""' ih- :e,e. r '-'itution wnirh b, ar on the 8Ub-Wuiri 8Ub-Wuiri !k MJ,nr"';i; say that tbej ! JW h na' a,h ?Prsnn : n(1 corpora th Pay lnx"s in Pportlon to 0Der v Tn"y V3iUe Jf his or "B E.V .An' statutory provision l nch r,,quir,s nn. n, p;jy , hi, ,al,v? 'h" mon I one fVnJr prP"":'. or exenlpU .in onev x"iPa,nK Uxs on ,n(' ac,ual i fllct wi k S f hlS P'0per,y iH ,n , ,n Ulutlnn . Prov'-'ons ot the ,-,i C n; ; -nu.res all persons ' co poratlons (not expresslj ex the act. 1.1 Pay 1ax"s ,n Proportion to N whiri U of his or ;t Property, itortn h requirea taxation to be unl VoaLUK T1Ulres'r31 be-iW-n d bankHlt; 'rinoratlon to be I -wed aa eu:h l0 (ne bpnk j quires th capital -lock to be assessed to the Individual stockholders as personal per-sonal property according 'o the num ber of shares held by each. Thz-re (fore, since the real estate constitutes ;a part of the value oi the capital stock, to assess the real estate at its value and also the capital stock at its full value would amount vo double taxa tion to the extent of the value of the J real estate The plain and sirap'e way of avoiding this result Is for the assessor asses-sor to determine the foir market value jof the real estate and assess it to the i bank at that value Then determine the actual fair value of the shares of capital stock owned by all the share holders, and from that value deduct ! the assessed value of the real estate and the remainder wiil represent the value of the stock exclusive of the real estate which has been separately as-d. as-d. Each indhliual stockholder should then be assssr-d with such proportion of the entire value of the stock, after deducting the assessed value of the real estate, as the number num-ber of shares owned by nim bears to the entire number of shares. In do termining the entire value of he shares, the same rules shouid be applied ap-plied as In the ass -ssment of an oth er property. If this Is done, and the method I have pointed oul is adopted, fair and just results will be obtained. But if the rule of deduction provided in the section I have quoted is followed, fol-lowed, the agreed facts in this case show that the bank or its stockhrld 1 ers would escape paying taxes on over (18,000 of the actual value of their property, that is ihe capital stock of the- bank, for it is agreed that the real estate was assessed at $5", 750; tbat the total value of the capital stock as found by the assessor was $2f2,50f; that the capital stock ,'par value), sur-;plus sur-;plus and undivided profits amounted to 5 1 - I M Now applying 'lie rule of! deduction provided in thic sect-on in 'question, instead jt deducting $E0,750, the sum at which reai estate was ap sessed, the deduction vould b-5 in dollars dol-lars $09,443, or $18,693 more than the assessed value of 'he real estate ( Is '.clear therefore, ihat. if che rule provided pro-vided in this section is followed, 'he, i plaintiff would escape the payment of j taxes on this $18,693. I "It follows t hat this sec .on is there fore In conflict vith the constitution jand void. "It appears that it has been custom-arj custom-arj to plnce a value on all the cap tal stock of banks, then o deduct the as j sessed value of 'he real estate, and from the remainder make a further arbitrarj deduction of a certain per ceiA There is no trarran' of law for bucT procedure. The value placed on the capital stock shouid do only its ac jtual value In money, or what it would I sell for on the open market, and should be determined in tre same va that the value of other kinds of prop I'erty is determined, and without an discrimination. No excessive value j should be placed on the stock In !he) j first instance, makinc it necessarv to resort to arbitrary deductions "Ah I have said, u fair and Just valu-J iation should be placed on the entire capital stock, care being used to see that such capital Stock Is assessed on the same basis as all other property is assessed, so 'hat the valuation is 'neither too high nor too low in com-iparlson com-iparlson with the assessed value of o'h er property, and from th!3 total value I should be deducted the assessed vaue of the real estate anj the remainder I will constitute the portion of the ttal j value not assessed as reat estate and jwhich should be issessed o the stot h (holders as personal property each i stockholder being assessed tor the ' number of shares held by him This I will insure exact justice, of which no one can rightfully complain "Since no evidence was offered to show that the value o' $262,501' placed 'on the capital stock was excessive, land since it appears that the amount I at which the real estatt i -as as6estd was deducted from the total value of the shares of capital Mock, and only the remaining value assessed to he stockholders as personal property, it follows that the plaintiff was not re-'quired re-'quired to pay an excessive an un' in taxes and is not entitled to recover back any portion of the taxes paid by it, and that the findings and Judgm ut j must be for the defendant, Weber count "Let findings und judgment be pre pared accordingly ' |