(3) The terms "par value of the outstanding capital stock" and "surplus" are to be taken as used in their ordinary and customary meaning, nothing appearing in the act to evidence a legislative intent to the contrary. State ex rel. v. Gorden, 66 Mo. 394; Kirby Castle's Digest of the Statutes of Arkansas of 1916, sec. 8480; People ex rel. v. Roberts, 168 N.Y. 14; People ex rel. v. Roberts, 72 N.Y.S. 950. As friends of the court, Ball Ryland and James E. Goodrich also filed briefs for relator; Judson, Green Henry, filed briefs for St. Louis Chamber of Commerce; Barker, Botts, Parker Garwood, W.R. Thurmond and Jesse Andrews filed briefs for Long-Bell Telephone Company; Samuel Mitchell filed briefs for Mercantile Trust Company of St. Louis: Fordyce, Holliday White and Bennett Clark filed briefs for Liberty Bank of St. Louis: Jeffries Corum filed briefs for Baden Bank, Chippewa Bank, Grand Avenue Bank and Union Station Trust Company, of St. Louis.
" (p. 57.) Beyond all this, we are concluded by a previous decision which was made at a time when section 190, which has been several times amended, was in substantially the same form as it stands to-day. In the case of People ex rel. New York East River Ferry Co. v. Roberts ( 168 N.Y. 14) we had occasion to construe section 182 as affecting corporations paying dividends of less than six per centum. Under the section as it then stood the attorney-general contended that the tax was to be assessed upon the par value of the capital stock, while the relator in that case claimed that it should be assessed upon the basis of the actual or appraised value of its capital stock.
VANN, J. (dissenting). In 1901, when the act of 1896 first came before us for construction, we held that the provision of section 182 directing that when a dividend of less than six per centum has been declared during the tax year, the tax should be at the rate of one and one-half mills upon the employed capital stock at par, should be read with section 190 providing for its assessment at its actual cash value and that in such case an assessment upon its par value would be erroneous. (L. 1896, ch. 908; People ex rel. N.Y. East River Ferry Co. v. Roberts, 168 N.Y. 14.) Our decision was expressly limited to the language of the statute as it then stood and our main argument was ab inconvenienti, founded on the unreasonable result of any other construction, as corporations paying a dividend of less than six per centum would be taxed the same as those paying six per centum even if the dividend was but one per centum and the market value not more than twenty-five. Other absurd and unequal results were pointed out by way of illustration and an amendment was suggested to remedy "inconsistencies and apparent unfairness."
The language of section 182 of the Tax Law would seem to support the relator's contention, but this court has recently held that this section must be read with section 190, and when so read the basis for the tax is the actual and not the par value of the stock. ( People ex rel. N.Y. E.R. Ferry Co. v. Roberts, 168 N.Y. 14.) In the present case it would, doubtless, be to the advantage of the relator to have the tax based upon the par value of the stock, since that value is much less than the actual value and the dividends are only five per cent, but in case of a corporation that had paid even a smaller dividend and whose stock was much below par it would be decidedly to its disadvantage.
Before the amendment in 1906 of section 182 of the Tax Law, the franchise tax against such a corporation was based upon the appraised value of its capital stock and not upon the par value thereof. ( People ex rel. N.Y. E.R.F. Co. v. Roberts, 168 N.Y. 14.) In that case, decided in 1901, the Court of Appeals determined that section 182 standing alone was ambiguous, and perhaps justified the contention that the par value of the stock was the correct basis for the tax, but that section 190, providing for the appraisal in all cases where a dividend of six per cent was not declared, made it clear that the tax of such corporations could only be based upon the appraised value.
The principal contention of the relator is that under section 182 of the Tax Law (Laws of 1896, chap. 908) in cases where dividends amounting to less than six per centum have been declared upon the capital stock of the corporation and the cash value of the capital stock exceeds its par value, the tax should be at the rate of one and one-half mills upon the par value of that portion of the capital stock employed within this State and not upon its cash value. We understand that the Court of Appeals in People ex rel. New York East River F. Co. v. Roberts ( 168 N.Y. 14) has held against the relator's contention. The court in that case say: "The direction that the tax shall be `upon such portion of the capital stock at par as the amount of capital employed within this State bears to the entire capital of the corporation,' was not intended to establish or fix the rate at which such capital stock was to be asessed, but a rule for the computation of the amount of capital stock on which assessment was to be made."
This certiorari is for the purpose of reviewing such determination of the Comptroller. A recent decision of the Court of Appeals ( People ex rel. New York East River Ferry Company v. Roberts, 168 N.Y. 14) has settled the construction to be given to sections 182 and 190 of the Tax Law, (Laws of 1896, chap. 908) and the determination of the Comptroller herein cannot be justified upon the theory that the entire capital stock of the relator must be valued at par. The dividends declared by the relator during the year being less than six per cent on the par value of the capital stock, the tax against the relator must be paid "upon such portion of the capital stock at par as the amount of capital employed within this state bears to the entire capital of the corporation."