Newark Fire Ins. Co. v. State Board of Tax Appeals, 307 U.S. 313 (1939)

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Newark Fire Insurance Co. v. State Board of Tax Appeals

No. 449

Argued April 18, 19, 1939
Decided May 29, 1939 *
307 U.S. 313

APPEAL FROM THE COURT OF ERRORS

AND APPEALS OF NEW JERSEY

Syllabus

A tax assessed under a statute of New Jersey against an insurance company incorporated under the laws of that State, upon the full amount of its capital stock paid in and accumulated surplus, less certain deductions for liabilities and statutory exemptions -- resisted as violative of the due process clause of the Fourteenth Amendment on the ground that the business situs of its intangibles and the tax domicile of the corporation were in New York -- sustained.

By REED, J., with whom the CHIEF JUSTICE and BUTLER and ROBERTS, JJ., concurred.

1. Insofar as the conclusion as to the existence of a business situs for the purpose of taxation, distinct from the domiciliary situs, is the basis for a claim of federal right, the duty of inquiring into the evidence which establishes such business situs rests upon this Court. P. 319.

2. The facts presented by this record are insufficient to establish that the corporation’s intangibles had a business situs in New York and to overcome the presumption of a taxable situs solely in New Jersey. P. 321.

By FRANKFURTER, J., with whom STONE, BLACK, and DOUGLAS, JJ., concurred.

The tax as applied is a clearly constitutional exertion of the taxing power of a State over a corporation of its own creation, and Cream of Wheat Co. v. Grand Forks, 253 U.S. 325, and the cases which have followed it, afford a wholly adequate basis for sustaining it. Questions affecting the fictional "situs" of intangibles are irrelevant here. P. 324.

120 N.J.L. 185; id., 224; 198 A. 836, 837, affirmed.

Appeals from affirmances of judgments sustaining the validity of a state tax, 118 N.J.L. 525, 538, 193 A. 912.