Hope Natural Gas Co. v. Hall, 274 U.S. 284 (1927)

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Hope Natural Gas Company v. Hall

No. 815

Argued April 21, 1927
Decided May 16, 1927
274 U.S. 284

ERROR TO THE SUPREME COURT OF APPEALS

OF THE STATE OF WEST VIRGINIA

Syllabus

1. A state court’s construction of a state statute is to be gathered from the application made of it as shown by the final decree in connection with the opinion, rather than by excerpts selected from the opinion. P. 288.

2. West Virginia "annual privilege tax" on the business of producing natural gas in the state, computed on the value of the gas produced "as shown by the gross proceeds derived from the sale thereof by the producer" -- the measure of the tax being otherwise stated as "the value of the entire production in this state, regardless of the place of sale, or the fact that deliveries may be made to points outside the state" -- is not unconstitutional as respects gas transported to and sold in other states, since it is construed as requiring the tax to be computed on the value of the gas at the well, before it enters interstate commerce, which is valid. P. 288.

3. The contention that the tax violates due process by taxing gross receipts from interstate commerce beyond the jurisdiction of the state therefore is without basis. P. 288.

4. The exemption from gross proceeds of $10,000, allowed by the statute in all cases, does not violate the Equal Protection Clause. P. 289.

102 W.Va. 272 affirmed.

Error to a decree of the Supreme Court of Appeal of West Virginia, which reversed a decree enjoining Hall, Tax Commissioner, and Lee, Attorney General, from enforcing against the plaintiff, Hope Natural Gas Company, the taxing act discussed in the opinion.