State ex rel. Rankin v. Harrington

MR. CHIEF JUSTICE CALLAWAY

delivered the opinion of the court.

In this action the attorney general as relator seeks a writ of mandate to compel Ed. J. Harrington, as assessor of Silver Bow county, to assess for the purpose of taxation certain shares of stock of the Inspiration Consolidated Copper Company and of the United Yerde Extension Mining Company, which the intervener, W. D. Thornton, owned on the first Monday of March, 1923. Upon the admitted facts gathered from the petition, answer of Harrington, and com-' plaint in intervention filed by Thornton, the latter was on the first Monday of March,. 1923, and for many years prior thereto had been, a legal resident of the city of Bntte. On that date he was the owner of the shares of stock named and these have never been listed for assessment in the state of Montana. The Inspiration Consolidated Copper Company is incorporated under the laws of the state of Maine, and the United Yerde Extension Mining Company under the laws of Delaware. The entire property of these corporations is within the state of Arizona. Neither corporation has ever owned or had any interest in any property within the state of Montana, nor has either ever transacted any business of any nature within this state. The stocks of these companies have been for many years, and are now, listed for sale upon the New York, Boston and other stock exchanges, and large numbers of the shares of these companies have been daily bought and sold for many years upon and through the medium of these stock exchanges.

In 1906 Thornton closed out his business affairs in this state which required his personal attention and went to the city of New York. There he engaged in the business of buy *15 ing and selling upon his own account shares of stock of corporations, both domestic and foreign to the state of New York, together with such other bonds, notes and securities as are usually dealt in in a business of that character. In order to carry on his business he has borrowed large sums of money from banks and trust companies located in that city and from citizens and residents of the state of New York, part of which has been secured by collateral owned by him and belonging to his business, none of which has ever been within the state of Montana, and all of which was owned and used by him as a part and in connection with his New York business. None of the capital or moneys invested by him in that business, or stocks, bonds, notes or securities connected therewith, has ever been within the state of Montana or secured or derived from his investments in Montana. The stocks in question were purchased by him with money and capital invested in his New York business, are a part of that business, and have never been actually within this state.

Ever since 1906 and up to and including the present time Thornton has been absent almost continuously from the city of Butte and from the state of Montana, and has been within the city of New York, returning to this state only at infrequent intervals, usually for a period of four or five weeks during each year. While he has been a legal resident of u this state, his business as distinguished from his legal residence has been in the city of New York.

Upon the foregoing statements, admitted to be true for the purposes of this case, the intervener alleges that the stocks in question are not property in the state of Montana, are not subject to assessment by the officers of this state, ,are not taxable here, 'but the same are localized and have their situs in the city of New York, being property exclusively within the territorial limits of the state of New York and subject to the jurisdiction of that state for the purposes of taxation, o The concrete question presented is whether the laws of [1] Montana command the assessment of the shares of stock *16 of a resident of this state even though they have a business situs in another state. The question is one of first impression in this state.

Section 1, Article XII, of the Constitution, declares: “The necessary revenue for the support and maintenance of the state shall be provided by the legislative assembly, which shall levy a uniform rate of assessment and taxation, and shall prescribe such regulations as shall secure a just valuation for taxation of all property, except that specially provided for in this article. * * * ” And section 1997, Revised Codes of 1921, provides: “All property in this state is subject to taxation, except as provided in the next section.” No question as to exemption from taxation is involved in this controversy.

The taxing power of the state does not extend beyond its [2] territorial limits. (Hayes v. Smith, 58 Mont. 306 , 192 Pac. 615 .) It is essential to the validity of a tax that the property subject to it shall be within the territorial jurisdiction of the taxing power. (Union Transit Co. v. Kentucky, 199 U. S. 194 , 4 Ann. Cas. 493, 50 L. Ed. 150 , 26 Sup. Ct. Rep. 36 [see, also, Rose’s U. S. Notes].) “Whatever may be said of its vast character and sweeping extent,' the power of taxation, of necessity, must be limited to subjects within the jurisdiction of the state, or, as otherwise characterized, to subjects which have acquired a situs within the state for the purpose of taxation.” (Hayes v. Smith, supra.)

■ Section 17 of Article XII of the Constitution declares: “The word property as used in this article is hereby declared to include, moneys, credits, bonds, stocks, franchises and all matters and things (real, personal and mixed) capable of private ownership, but this shall not be construed so as to authorize the taxation of the stocks of any company or corporation when the property of such company or corporation represented by such stocks is within the state and has been taxed.” Respecting section 17 this court has said: “This lat'ter section, in its definition of that which may be made sub *17 ject to taxation, is sufficiently comprehensive to include all matters and things, visible and invisible, tangible and intangible, corporeal and incorporeal, capable of private ownership.” (Northwestern Mut. Life Ins. Co. v. Lewis & Clark County, 28 Mont. 484 , 98 Am. St. Rep. 572 , 72 Pac. 982 .) Subdivision 1 of section 1996, Revised Codes of 1921, is prac [3] tically a reiteration of the language of section 17 foregoing. That the section gives affirmative recognition to the policy that shares of stock may have an independent status for the purpose of taxation is too clear to admit of discussion; and that such shares, if within this state, whether belonging to residents or nonresidents, are proper subjects of taxation is beyond -question.

By the provisions of section 2002, Revised Codes of 1921, the assessor is required to ascertain the names of all taxable inhabitants, and all property in his county subject to taxation, except such as is required to be assessed by the state board of equalization, and to assess such property to the persons by whom it was owned or claimed or in whose possession or control it was at 12 o’clock noon of the first Monday of March next preceding.

Section 2003 directs the assessor to require from each person 'a statement under oath setting forth specifically all the real and personal property owned by such person, or in his possession or under his control at 12 o’clock noon on the first Monday of March. Then follow sections relating to the property of absent or unknown owners (2008, 2009), to property situate in another county (2010), and section 2012 provides: “When a person is assessed as agent, trustee, bailee, guardian, executor, or administrator, his representative designation must be added to his name, and the assessment entered on a separate line from his individual assessment.” By section 2013 it is provided that “The property of every firm and corporation must be assessed in the county where the property is situate, and must be assessed in the name of the firm or corporation.” Section 2015 provides that “The capi *18 tal stock and franchises of corporations and persons, except as otherwise provided, must be listed and taxed in the county, town, or district where the principal office or place of business of such corporation or person is located; if there be no principal office or place of business in the state, then at the place in the state where any such corporation or person transacts business.” By the provisions of section 2016, “the personal property belonging to the business of a merchant or of a manufacturer must be listed in the town or district where his business is carried on,” and by section 2017 the personal property of express, transportation and stage companies, steamboats, vessels and other water craft must be listed and assessed in the county, town or district where such property is usually kept. And after providing for the assessment of railroads, telegraph, telephone and electric light lines (2021, 2022), the first sentence of section 2023 declares: “All other taxable property must be assessed in the county, city, or district in which it is situated.”

The foregoing statutes demonstrate the emphasis laid upon the actual situs of property for purposes of taxation by the law-making power, and also indicate a clear intention to include the property of nonresidents which has a situs here.

While the Attorney General admits that the stocks are and always have been in New York, he urges that, as Thornton is a resident of this state, the situs of the stocks in question is here under the doctrine of moiilia sequuntur personam— movables .follow the person. In order to arrive at a proper understanding of the problem presented it will be of advantage to consider briefly two theories of taxation bearing upon the subject, one of which may be called the Massachusetts, the other the New York, doctrine, tracing then the course of legislative action in the territory and state of Montana with respect thereto.

The statutes of Massachusetts provided that all property, real and personal, situated within the commonwealth, and all personal property of the inhabitants of the commonwealth *19 wherever situated, unless expressly exempted by law, should be subject to taxation. Under, these statutes Massachusetts for over three-quarters of a century has taxed her inhabitants upon shares of stock in foreign corporations owned by them, upon the theory that movables follow the person. (Inhabitants v. County Commrs., 16 Pick. (Mass.) 572; Dwight v. Boston, 12 Allen (Mass.), 316, 90 Am. Dec. 149 ; Hawley v. Malden, 204 Mass. 138 , 90 N. E. 415 .) Many states follow the Massachusetts rule, even under different statutes.

New York’s statute provided, in effect, that all lands and all personal estate within the state should be liable to taxation, subject to certain exemptions. Under this statute the supreme court, in the leading case of People v. Commissioners of Taxes, 23 N. Y. 224 , denied the fiction of law that personal estate has. no situs away from the person or residence of the owner, and held the actual situs of the property to be controlling. These conflicting doctrines were well understood when the territory came into existence.

Our first legislative assembly adopted “an Act providing for the collection of the revenue.” (Bannack Laws, p. 411.) Section 3 thereof provided that all property of every kind and nature whatsoever, within this territory, with certain exceptions, should be subject to taxation. Section 4, a lengthy one, provided in part: “All other property, real and personal, within the territory, is subject to taxation, in the manner herein directed, and this is intended to embrace [after enumerating certain kinds of real and personal property] stock or shares in any bank or company incorporated or otherwise, and whether incorporated by this or any other territory or state, and whether situated in this territory or not. * =:;= * ” This was supplemented by section 6, which declared that “Every inhabitant of this territory, of full age and sound mind, shall list all property, subject to taxation in this territory, of which he is the owner, or has the control or management, in the manner hereinafter directed. * * * ” Thus the legislature practically adopted the Massachusetts doctrine.

*20 The legislature of 1871 re-enacted the Bannaek statute with slight amendments (Codified Statutes, p. 600), as did that of 1879 (Rev. Stats., p. 615). A radically different Revenue Act was passed by the first session of the legislature of 1887. (Comp. Stats., p. 1104;) Section 3 (1667) provided: “All property, both real and personal, within the territory, not expressly exempt by law, shall be subject to taxation.” The new Act did not contain section 4 of the previous Acts; while parts of it were included in section 2 (1666) of the new Act, the language of that section above quoted and analogous phraseology was wholly omitted.

The 1887 Act had a brief existence. It was enacted in March, and in August an extraordinary session was called— reputed generally for the purpose of repealing the Prairie Dog and Ground Squirrel Bounty Act, also passed-in March, 18'87. The extraordinary session repealed the Revenue Act enacted at its first session, and enacted another which embraces portions of all former Acts. (Laws Ex. Sess. 1887, p. 82.) As section 4 of the new Act it re-enacted substantially section 4 of the Bannaek Laws, but with some alterations and additions, notably the following: In place of the above-quoted excerpt from section 4 this appears: “Stocks or shares in any bank or company, incorporated or otherwise, and whether incorporated by this or any other territory or state, or whether situated in this territory or not, except that where the entire capital stock of any- incorporated company shall be invested in assessable property in the territory of Montana, such capital stock shall not be taxed. * * * ”

When the legislature met in 1889 it again amended the Revenue Act and did so in contemplation of impending statehood. (Laws 1889, p. 219.) While the 1889 Act did not in terms repeal section 4, the first section of the new Act, amending section 3 of the Act of the extraordinary session, declared that “All real and personal property in the territory (or state) of Montana * * * shall be listed and assessed *21 with reference to its value and location, on the first day of April preceding the assessment: Provided, that the provisions of this section shall be construed to apply to all taxable personal property within the exterior limits of the territory (or state), including all property situated upon Indian and military reseiwations. * * * ” Section 3 of the 1889 Act was the forerunner of many important sections of the 1891 Act and of sections 2013, 2015, 2016, 2017, 2018, 2019 and 2020 and others of the Revised Codes of 1921.

"Whether section 4 of the Act passed by the extraordinary session was repealed by the 1889 Act is not necessary to be .decided now; but it is perfectly clear that the last expression of the territorial legislature was a departure from the Massachusetts and a recognition of the New York doctrine.

At the next session of the legislature — the first following the adoption of the Constitution and the attainment of statehood— a revenue measure was passed and approved (Laws 1891, p. 73), and this, with minor amendments and modifications, is still in force. (Hayes v. Smith, supra.) The 1891 Act followed the policy of the 1889 Act closely. As above adverted to, it adopted many of its important provisions, some literally, many substantially.

Now, in order to arrive at a proper construction of our constitutional provisions quoted above, let us consider the subject “in the light of our history, the surrounding circumstances, the subject matter under consideration, and the object to be attained.” (Northern Pac. Ry. Co. v. Mjelde, 48 Mont. 287 , 137 Pac. 386 ; State ex rel. Hillis v. Sullivan, 48 Mont. 320 , 137 Pac. 392 .) Not only do we find the territorial policy at the time the Constitution was framed and adopted to have been inclined strongly against the Massachusetts and in favor of the New York rule, but also that the first state legislature followed the policy then indicated — a contemporaneous construction, undisturbed now for a generation.

The inquiry naturally follows: "What has been the attitude of this court respecting the maxim mobilia sequuntur personam *22 in respect to taxation? In Gallatin County v. Beattie, 3 Mont. 173 , it had under consideration a question relating to the assessment of mortgages. The taxpayer, a resident of Lewis and Clark county, held mortgages upon real estate in Gallatin county. The assessor of Gallatin county sought to tax these mortgages. The court said there was nothing in the proof tending to show that at the time of the assessment of taxes on the property the mortgages were in Gallatin county. “A mortgage being a mere chattel like any other personal property, is subject to taxation in the county where it is found. The record of a mortgage is not the mortgage itself, any more than any other copy would be. The mortgages in this case not having been found in the county of Gallatin during the fiscal year that they were listed and assessed there, the assessor had no right to list and assess them, for they were not subject to taxation in that county.”. The Attorney General argues that the court thus recognized the maxim, but we think it deemed the actual situs of the mortgages to be the determining factor in the case.

In Holland v. Commissioners, 15 Mont. 460 , 27 L. R. A. 797, 39 Pac. 579 , the court recognized the principle of the maxim. The case had to do with the assessment of mortgages belonging to nonresidents. It-said: “Regarding a. mortgage, therefore, for the purposes of taxation, as nothing more than a collateral security, depending upon some outside obligation to secure which it is given, it is established by the great weight of authority that the mortgage belongs to the owner of the debt, and passes with the debt to any lawful holder thereof. * * * The debt, therefore, if owned and controlled by one not a resident of the state, is not ‘property in the state subject to taxation,’ as provided by the Revenue Act of 1891, but can be assessed only at the domicile or place of residence of the creditor, without regard to the domicile of the debtor.” But further on it is said: “It may be that if, as a fact, notes and mortgages owned by nonresidents are actually within the state, and are controlled by the agents therein, who retain them and make the *23 investments for the owners, snch securities, under the present revenue laws, are subject to taxation in the hands of such agents as property in the state.”

In Flowerree Cattle Co. v. Lewis & Clark County, 33 Mont. 32 , 8 Ann. Cas. 674, 81 Pac. 398 , this court affirmed the annulment of an assessment upon cattle only temporarily within Lewis and Clark county, which was the residence of their owner, the situs of the cattle being not in the residence of their owner but in the county of their accustomed and permanent range. This was a distinct denial of the maxim respecting personal property within the state, actual situs being held controlling in that instance. ■

In Monidah Trust v. Sheehan, 45 Mont. 424 , 123 Pac. 692 , the facts were that Monidah Trust, a corporation under the laws of Delaware, and transacting business in Montana and elsewhere, had loaned money upon property situated in this state and had taken notes as evidence of the loan, the notes being secured by mortgage. The assessor assessed the company on solvent credits for the full face value of the notes secured by the mortgages, whereupon the company obtained an injunction restraining the county treasurer from collecting the tax assessed thereon. The notes and mortgages were held by the plaintiff corporation at its domicile in Delaware. The court said: “Assuming that the domicile of this plaintiff is in the state of Delaware, these credits presumptively have their situs in that state. There is not any evidence in the record that the mortgages were in this state at any time during the year 1911; while the testimony, though not very direct or certain, tends to show that they were not. The presumption is in favor of their situs in the state of Delaware, and this presumption was not overcome.” In the process of the opinion the court said: “Counsel for appellants contend that any foreign corporation doing business in this state is liable to taxation upon its solvent credits, so far as the same arise out of business transacted in this state. ‘ Mobilia personam sequuntur’ is a maxim of law as old as the law itself, and, while it cannot be invoked merely *24 to shield one from the payment of taxes, the presumption nevertheless attaches that personal property, and particularly intangible personal property, such as credits, has its situs, for the purposes,of taxation, only at the domicile of the owner.”

The maxim, as the foregoing authorities show, is not one of [4] universal application. Of this ancient maxim that eminent jurist, Mr. Justice Sawyer, speaking for the supreme court of California in People v. Home Ins. Co., 29 Cal. 534 , said: “It is true, as a general principle, that personal -property follows the owner, having no situs apart from the owner, and is subject to the law of his domicile; but this is a fiction of law, adopted for the purposes and incidents of contracts and descents. It may still, for the purposes of taxation and judicial proceedings, be affected by the law of the place where it is in fact situate. This general principle applies to all personal property, whether corporeal or incorporeal.”

In Catlin v. Hull, 21 Vt. 152 , it is said: “This rule is merely a legal fiction, adopted from considerations of general convenience and policy, for the benefit of commerce and to enable persons to dispose of their property, at their decease, agreeably to their wishes, without being embarrassed by their want of knowledge in relation to the laws of the country, where the same is situated.”

The supreme court of the United States, in Pullman Palace Car Co. v. Pennsylvania, 141 U. S. 18 , 35 L. Ed. 613 , 11 Sup. Ct. Rep. 876, said: “The old rule, expressed in the maxim mobilia sequuntur personam, by which personal property was regarded as subject to the law of the owner’s domicile, grew up in the middle ages, when movable property consisted chiefly of gold and jewels, which could be easily carried by the owner from place to place, or secreted in spots known only to himself. In modern times, since the great increase in amount and variety of personal property, not immediately connected with the person of the owner, that rule has yielded more and more to the lex situs.”

*25 In 23 R. C. L., at page 276, we find the following: “This principle was sufficiently satisfactory under the primitive conditions of the middle ages when the resident of one country rarely kept personal property in another country, and if he traveled generally carried his wealth with him. It is, however, well recognized that the rule mobilia sequuntivr personam is a mere fiction of law, not resting of itself on any constitutional foundation. It was intended for convenience, and is not controlling when it -is inconsistent with expressed provisions of statute or when justice does not demand that it should be. As between different towns and taxing districts in the same state the rule was abrogated in many cases even prior to the Revolution, and such personal property as machinery employed in manufacturing and fixtures of goods, wares and merchandise employed in trade, were taxed in the place where the manufacturing or trade was carried on, rather than in the town in which the owner lived.”

The “fiction of law” that “all intangible property is presumed to have its situs at the domicile of the owner * # * must give way, # * * in the face of contrary facts.” (In re Thourot’s Estate, 52 Utah, 106 , 172 Pac. 697 .) And see Marshall Hardware Co. v. Multnomah County, 58 Or. 469 , 115 Pac. 150 ; Mayor etc. of Mobile v. Baldwin, 57 Ala. 61 , 29 Am. Rep. 712 ; Adams Express Co. v. Ohio, 166 U. S. 185 , 41 L. Ed. 965 , 17 Sup. Ct. Rep. 604 [see, also, Rose’s U. S. Notes]; Blackstone v. Miller, 188 U. S. 189 , 47 L. Ed. 439 , 23 Sup. Ct. Rep. 277; State Board of Assessors v. Comptoir National, 191 U. S. 388 , 48 L. Ed. 232 , 24 Sup. Ct. Rep. 109; Liverpool etc. Ins. Co. v. Assessors, 221 U. S. 346 , 55 L. Ed. 762 , L. R. A. 1915C, 903, 31 Sup. Ct. Rep. 550.

That it is the policy of this state to tax tangible property without its territorial limits is not asserted. As illustrative, if the intervener’s business in New York consisted of maintaining a store on Fifth Avenue in which he dealt only in wearing apparel, it is clear that this state would not attempt to tax that merchandise. To cite other well-known instances, it will not *26 be contended by anyone that a resident of Montana may be taxed upon the cattle which he owns in Arizona or the sheep which he owns in Idaho. The cattle are taxed in Arizona, the sheep in Idaho.

Again, not only is the operation of state laws limited to persons and property within the boundaries of the state, but property which is wholly and exclusively within the jurisdiction of another state receives none of the protection for which the tax is supposed to be compensation. In Catlin v. Hull, supra, it is said: “We think it entirely just and equitable that, if persons residing abroad bring their property and invest it in this state, for the purpose of deriving profit from its use and employment here, and thus avail themselves of the benefit and advantages of our laws for the protection of their property, their property should yield its due proportion towards the support of the government, which thus protects it.” (See Armour Packing Co. v. City Council of Augusta, 118 Ga. 552 , 98 Am. St. Rep. 128 , 45 S. E. 424 ; Wilkey v. City of Pekin, 19 Ill. 160 ; State Board of Assessors v. Comptoir National, supra; Redmond v. Commissioners, 87 N. C. 122 ; State v. Falkinburge, 15 N. J. L. 320; People v. Gardner, 51 Barb. (N. Y.) 352; Poppleton v. Yamhill County, 18 Or. 377 , 7 L. R. A. 449, 23 Pac. 253 .) In State v. Falkinburge, supra, it is said: “A man’s personal property, his choses in action, his trade and business, need and receive the protection of the laws of that country where they are situate, accruing, or carried on. They have all the benefit resulting from the society in whose midst they are, without regard to the owner’s residence. They should therefore pay .their part of the expense of maintaining and administering those laws, and supporting that society.”

Counsel have argued at great length as to whether shares of [5] stock employed as are the Thornton stocks are to be deemed tangible or intangible property. Shares of stock in corporations have a large place in every-day transactions in the business. world. They are daily bought and sold upon the world’s exchanges, are the subject of larceny, and, indeed, are *27 property in the highest sense of the term. In view of these facts many courts consider them tangible property, others as quasi tangible, and others, no doubt the majority, as intangible. But, deeming them, and correctly, we think, to be intangible property, yet, held and used in business as they have been and are, we reach the same result in this case as if they be considered tangible property. Judge Taft, in Walker v. Jack, 88 Fed. 576 , 31 C. C. A. 462 , after stating, the general rule that intangible property is taxable at the residence of its owner, said: “Certain exceptions to this rule are recognized. One is where the chose in action is represented by a negotiable bond, property in which passes by delivery. In such a ease the evidence of title is in such form, and is so important an element of the value of what it represents, as to make it closely. analogous to tangible property, and to give it a situs for taxation where the negotiable evidence of its existence actually is, even though the owner may live elsewhere.” As will be mentioned soon, this exception is very generally applied to shares of stock as well as to bonds.

Our Constitution and statutes, in so far as the principles of taxation are concerned, do not make any distinction between tangible and intangible property whatever. Both are taxable. That shares of stock are recognized directly as objects of tax-ability we have already adverted to. If they are owned by one who has his domicile in this state the presumption is that they have their situs here. (Monidah Trust v. Sheehan, supra; Holland v. Commissioners, supra.) That this state may tax a [6] resident upon his stocks in foreign corporations which have no situs other than the domicile of their owner is beyond any question whatever. (Const., Art. XII, sec. 17; secs. 1996, 1997, Rev. Codes 1921; San Francisco v. Fry, 63 Cal. 470 ; Greenleaf v. Board, 184 Ill. 226 , 75 Am. St. Rep. 168 , 56 N. E. 295 ; Seward v. City of Rising Sun, 79 Ind. 351 ; Cook v. Board of Commrs. of Marion County, 175 Ind. 218 , 92 N. E. 876 ; Judy v. Beckwith, 137 Iowa, 24 , 15 Ann. Cas. 890, 15 L. R. A. (n. s.) 142, 114 N. W. 565 ; Ogden v. City of St. Joseph, 90 *28 Mo. 522 , 3 S. W. 25 ; Bacon v. Board of State Tax Commrs., 126 Mich. 22 , 86 Am. St. Rep. 524 , 60 L. R. A. 321, 85 N. W. 307 ; State v. Nelson, 107 Minn. 319 , 119 N. W. 1058 ; State v. Bentley, 23 N. J. L. 532; Worth v. Commissioners, 82 N. C. 420 , 33 Am. Rep. 692 ; Bradley v. Bander, 36 Ohio St. 28 , 38 Am. Rep. 547 ; McKeen v. County of Northampton, 49 Pa. 519 , 88 Am. Dec. 515 ; Dyer v. Osborne, 11 R. I. 321, 23 Am. Rep. 460 ; Sturges v. Carter, 114 U. S. 511 , 29 L. Ed. 240 , 5 Sup. Ct. Rep. 1014 [see, also, Rose’s U. S. Notes]; Wright v. Louisville & N. R. Co., 195 U. S. 219 , 49 L. Ed. 167 , 25 Sup. Ct. Rep. 16; Kidd v. Alabama, 188 U. S. 730 , 47 L. Ed. 669 , 23 Sup. Ct. Rep. 401; Central of Georgia Ry. Co. v. Wright, 207 U. S. 127 , 12 Ann. Cas. 463, 52 L. Ed. 134 , 28 Sup. Ct. Rep. 47; Darnell v. Indiana, 226 U. S. 390 , 57 L. Ed. 267 , 33 Sup. Ct. Rep. 120; Hawley v. Malden, 232 U. S. 1 , Ann. Cas. 1916C, 842, 58 L. Ed. 477 , 34 Sup. Ct. Rep. 201.) Such stocks are relieved of taxation only in case “the property of such company or corporation represented by such stocks is within the state and has been taxed.” This applies to residents as well as nonresidents.

That the stocks of nonresidents which have a situs here should be taxed here is clearly within the intent of the language of section 17, Article XII, Constitution, and sections 1996 to 2012, Revised Codes of 1921. If we were to read into the statute the fiction mobilia sequuntur personam imposing an opposite principle, the state thus would not be able to tax such stocks because their situs would be presumed conclusively to be at the domicile of their owner. Acknowledging that we have the right to tax the stocks of nonresidents which have a situs here, we must by correct principles of comity allow a corelative right to every other taxing jurisdiction.

But, as indicated above, there is well-recognized exception to the general rule that intangibles have their situs at the domicile of their owner, as where there is such a combination of circumstances “as produce what is referred to in the books as a business situs as distinguished from the domicile of the owner.” *29 (Endicott, Johnson & Co. v. Multnomah County, 96 Or. 679 , 190 Pac. 1109 .) That this rule is sustained by the great weight of authority, see Stanford v. San Francisco, 131 Cal. 34 , 63 Pac. 145 ; Armour Packing Co. v. City Council of Augusta, 118 Ga. 552 , 98 Am. St. Rep. 128 , 45 S. E. 424 ; Armour Packing Co. v. Clark, 124 Ga. 369 , 52 S. E. 145 ; Matzenbaugh v. People, 194 Ill. 108 , 88 Am. St. Rep. 134 , 62 N. E. 546 ; Hathaway v. Edwards, 42 Ind. App. 22 , 85 N. E. 28 ; Buck v. Miller, 147 Ind. 586 , 62 Am. St. Rep. 436 , 37 L. R. A. 384, 47 N. E. 8 ; Hutchinson v. Board, 66 Iowa, 35 , 23 N. W. 249 ; Heinz v. Board, 121 Iowa, 445 , 96 N. W. 967 ; Commonwealth v. Avery, 163 Ky. 828 , 174 S. W. 518 ; Commonwealth v. West India Oil Ref. Co., 138 Ky. 828 , 36 L. R. A. (n. s.) 295, 129 S. W. 301 ; Monongahela, etc., v. Board, 115 La. 564 , 112 Am. St. Rep. 275 , 2 L. R. A. (n. s.) 637, 39 South. 601 ; National F. I. Co. v. Assessors, 121 La. 108 , 26 L. R. A. (n. s.) 1120; 46 South. 117 ; Travelers’ Ins. Co. v. Assessors, 122 La. 129 , 24 L. R. A. (n. s.) 388, 47 South. 439 ; Standard Marine Ins. Co. v. Assessors, 123 La. 717 , 29 L. R. A. (n. s.) 59, 49 South. 483 ; In re Jefferson, 35 Minn. 215 , 28 N. W. 256 ; State v. London etc. Co., 80 Minn. 277 , 83 N. W. 339 ; People ex rel. Bijur v. Barker, 155 N. Y. 330 , 49 N. E. 940 ; Finch v. York County, 19 Neb. 50 , 56 Am. Rep. 741 , 26 N. W. 589 ; Redmond v. Rutherford, 87 N. C. 122 ; Marshall Hardware Co. v. Multnomah County, 58 Or. 469 , 115 Pac. 150 ; Billinghurst v. Spink County, 5 S. D. 84, 58 N. W. 272 ; McKennon v. McFall, 127 Tenn. 393 , 155 S. W. 15 8; Hall v. Miller, 102 Tex. 289 , 115 S. W. 1168 ; Jesse French Piano etc. Co. v. Dallas (Tex. Civ. App.), 61 S. W. 942 (not officially reported); Walker v. Jack, 88 Fed. 576 , 31 C. C. A. 462 ; Western Assur. Co. v. Halliday, 126 Fed. 257 , 61 C. C. A. 271 ; Leavell v. Blades, 237 Mo. 695 , 141 S. W. 893 .

The general principle underlying this exception has been recognized by the supreme court of the United States in many eases (Tappan v. Blerchants’ National Bank, 19 Wall. 490 , 22 L. Ed. 189 [see, also, Rose’s U. S. Notes]; Pullman Car Co. v. Pennsylvania, 141 U. S. 18 , 35 L. Ed. 613 , 11 Sup. Ct. Rep. *30 876; State Board of Assessors v. Comptoir National, 191 U. S. 388 , 48 L. Ed. 232 , 24 Sup. Ct. Rep. 109; New Orleans v. Stemple, 175 U. S. 309 , 44 L. Ed. 174 , 20 Sup. Ct. Rep. 110; Bristol v. Washington County, 177 U. S. 133 , 44 L. Ed. 701 , 20 Sup. Ct. Rep. 585; Union Refrigerator Transit Co. v. Kentucky, 199 U. S. 194 , 4 Ann. Cas. 493, 50 L. Ed. 150 , 26 Sup. Ct. Rep. 36; Metropolitan Life Ins. Co. v. New Orleans, 205 U. S. 395 , 51 L. Ed. 853 , 27 Sup. Ct. Rep. 499; New York ex rel. Burke v. Wells, 208 U. S. 14 , 52 L. Ed. 370 , 28 Sup. Ct. Rep. 193; Wheeler v. New York, 233 U. S. 434 , 58 L. Ed. 1030 , 34 Sup. Ct. Rep. 607), and so far as we are aware has never been denied by that court. Certainly, Buck v. Beach, 206 U. S. 392 , 11 Ann. Cas. 732, 51 L. Ed. 1106 , 27 Sup. Ct. Rep. 712, Fidelity & Columbia Transit Co. v. Louisville, 245 U. S. 54 , L. R. A. 1918C, 124, 62 L. Ed. 145 , 38 Sup. Ct. Rep. 40, or Cream of Wheat Co. v. Grand Forks, 253 U. S. 325 , 64 L. Ed. 931 , 40 Sup. Ct. Rep. 558, do not deny it.

Of course, if the shares of stock in a given instance are kept [7] out of the state for the purpose of evading taxation, they are not within the rule as to business situs, but are controlled by the maxim mobilia sequ/antur personam, and will be taxed at the domicile of their owner. Or, if they are out of the state for a special and temporary purpose, as where they are simply pledged for the payment of a debt, their situs for the purpose of taxation will be controlled by that principle, as was the case in Stanford v. San Francisco, 131 Cal. 34 , 63 Pac. 145 .

In the instant case it is unquestioned that the Thornton shares have a business situs in the state of New York; they are actually there, and always have been. Under the admitted facts it must be held under the policy so long maintained in the territory and state of Montana, which we believe to be consonant with the true principles governing taxation — a policy which frowns upon double taxation in any form; and which simply demands of persons a just contribution to the support of the government under which they enjoy the protection which makes their business possible — the assessment of the Thornton *31 stocks is not commanded; and that the assessor of Silver Bow county was right in refusing to list them as taxable property within his jurisdiction.

(Decided July 16, 1923.)

We are under obligation to respective counsel for the very able and exhaustive briefs which they have presented.

The order to show cause is discharged and the proceeding dismissed.

Dismissed.

Associate Justices Cooper, Holloway, Galen and Stark concur.