Argument for Plaintiff in Error.

allowing the States so to do, thereby indicates its will that such commerce shall be free and untrammelled." Leisy v. Hardin, 135 U. S. 100; Mobile v. Kimball, 102 U. S. 691; Ball v. United States, 10 Wall. 557; Brown v. Maryland, 12 Wheat. 419.

IV. The statutes in question regulate interstate commerce in so far as they tax plaintiff in error for its business done in the State of New York during the years 1881 and 1882, and therefore are invalid to sustain the taxes for which judgment has been recovered. Hall v. De Cuir, 95 U. S. 485; Pembina Mining Co. v. Pennsylvania, 125 U. S. 181; Norfolk & Western Railroad v. Pennsylvania, 136 U. S. 114; Cooper Manufacturing Co. v. Ferguson, 113 U. S. 727; Moran v. New Orleans, 112 U. S. 69; Brown v. Maryland, 12 Wheat. 419; Philadelphia & Southern Steamship Co. v. Pennsylvania, 122 U. S. 326; Corson v. Maryland, 120 U. S. 502; Fargo v. Michigan, 121 U. S. 230; Lyng v. Michigan, 135 U. S. 161.

V. If the taxes in question are not laid upon the business of plaintiff in error in New York they are laid upon all its business or upon all its capital, and therefore either regulate commerce among the States or effect extra territorial taxation and are invalid pro tanto. A tax on capital stock at its actual value is a general tax on the property of the corporation. Bank of Commerce v. New York City, 2 Black, 620; Bank Tax Case, 2 Wall. 200, 208.

As a valuation of the entire capital stock of plaintiff in error is the just and natural measure of either all the business of the company, or of all its property, it follows that the taxes in question fall either upon all its business or upon all its property.

The plaintiff in error is not endeavoring to escape its fair share of the burden of taxation. For ten years it has been trying to pay the State of New York its taxes upon its business transacted within that State, measured by the capital actually employed within the State, or to state the effect of the statute more accurately, upon its property situated within the State of New York. The question now presented in this case is whether New York, and, therefore, every State in the

Opinion of the Court.

Union, can, under guise of taxing business that has been transacted within its border, (not of imposing a license tax,) tax all the property of a foreign corporation wheresoever situated. This tax is a property tax, and nothing else, in its operation upon foreign corporations. The recent decisions of this court establish that proposition beyond question in dealing with statutes with identical provisions. Western Union Telegraph Co. v. Massachusetts, 125 U. S. 530; Pullman's Car Co. v. Pennsylvania, 141 U. S. 18; Massachusetts v. Western Union Telegraph Co., 141 U. S. 40.

VI. The statutes in question should be confined in their effect to the property of plaintiff within the jurisdiction of the State of New York.

If these statutes be declared effective only to tax the capital of the plaintiff in error within the State of New York, they will be confined in their operation to a subject within the taxing power of this State, and restrained from operating upon subjects beyond the exercise of this power. Telegraph Co. v.. Texas, 105 U. S. 460; Western Union Telegraph Co. v. Massachusetts, 125 U. S. 530; Ratterman v. Western Union Telegraph Co., 127 U. S. 411; Massachusetts v. Western Union Telegraph Co., 141 U. S. 40.

VII. The affirmance of the judgment against plaintiff in error would be a deprivation by the State of New York of the property of the plaintiff in error without due process of law, and a denial of the equal protection of the laws, contrary to the Fourteenth Amendment of the Constitution of the United States.

Mr. Charles F. Tabor, Attorney General of the State of New York, submitted on his brief.

MR. JUSTICE FIELD delivered the opinion of the court.

A corporation being the mere creature of the legislature, its rights, privileges and powers are dependent solely upon the terms of its charter. Its creation (except where the corporation is sole) is the investing of two or more persons with the

Opinion of the Court.

capacity to act as a single individual, with a common name, and the privilege of succession in its members without dissolution, and with a limited individual liability. The right and privilege, or the franchise, as it may be termed, of being a corporation, is of great value to its members, and is considered as property separate and distinct from the property which the corporation itself may acquire. According to the law of most States this franchise or privilege of being a corporation is deemed personal property, and is subject to separate taxation. The right of the States to thus tax it has been recognized by this court and the state courts in instances without number. It was said in Delaware Railroad Tax, 18 Wall. 206, 231, that "the State may impose taxes upon the corporation as an entity existing under its laws, as well as upon the capital stock of the corporation or its separate corporate property. And the manner in which its value shall be assessed, and the rate of taxation, however arbitrary or capricious, are mere matters of legislative discretion;" except, we may add, as that discretion is controlled by the organic law of the State. And, as we there said also, "it is not for us to suggest in any case that a more equitable mode of assessment or rate of taxation might be adopted than the one prescribed by the legislature of the State; our only concern is with the validity of the tax; all else lies beyond the domain of our jurisdiction."

The granting of the rights and privileges which constitute the franchises of a corporation being a matter resting entirely within the control of the legislature, to be exercised in its good pleasure, it may be accompanied with any such conditions as the legislature may deem most suitable to the public interests and policy. It may impose as a condition of the grant, as well as, also, of its continued exercise, the payment of a specific sum to the State each year, or a portion of the profits or gross receipts of the corporation, and may prescribe such mode in which the sum shall be ascertained as may be deemed convenient and just. There is no constitutional inhibition against the legislature adopting any mode to arrive at the sum which it will exact as a condition of the creation of the corporation or of its continued existence. There can be, therefore, no pos

Opinion of the Court.

sible objection to the validity of the tax prescribed by the statute of New York, so far as it relates to its own corporations. Nor can there be any greater objection to a similar tax upon a foreign corporation doing business by its permission. within the State. As to a foreign corporation-and all corporations in States other than the State of its creation are deemed to be foreign corporations-it can claim a right to do business in another State, to any extent, only subject to the conditions imposed by its laws.

As said in Paul v. Virginia, 8 Wall. 168, 181, "the recognition of its existence even by other States, and the enforcement of its contracts made therein, depend purely upon the comity of those States-a comity which is never extended where the existence of the corporation or the exercise of its powers is prejudicial to their interests or repugnant to their policy. Having no absolute right of recognition in other States, but depending for such recognition and the enforcement of its contracts upon their assent, it follows, as a matter of course, that such assent may be granted upon such terms and conditions as those States may think proper to impose. They may exclude the foreign corporation entirely; they may restrict its business to particular localities, or they may exact such security for the performance of its contracts with their citizens as in their judgment will best promote the public interest. The whole matter rests in their discretion."

This doctrine has been so frequently declared by this court that it must be deemed no longer a matter of discussion, if any question can ever be considered at rest.

Only two exceptions or qualifications have been attached to it in all the numerous adjudications in which the subject has been considered, since the judgment of this court was announced more than half a century ago in Bank of Augusta v. Earle, 13 Pet. 519. One of these qualifications is that the State cannot exclude from its limits a corporation engaged in interstate or foreign commerce, established by the decision in Pensacola Telegraph Co. v. Western Union Telegraph Co., 96 U. S. 1, 12. The other limitation on the power of the State is, where the corporation is in the employ of the general gov

Opinion of the Court.

ernment, an obvious exception, first stated, we think, by the late Mr. Justice Bradley in Stockton v. Baltimore & New York Railroad, 32 Fed. Rep. 9, 14. As that learned justice said: "If Congress should employ a corporation of ship-builders to construct a man-of-war, they would have the right to purchase the necessary timber and iron in any State of the Union." And this court, in citing this passage, added, “without the permission and against the prohibition of the State." Pembina Mining Co. v. Pennsylvania, 125 U. S. 181, 186.

Having the absolute power of excluding the foreign corporation the State may, of course, impose such conditions upon permitting the corporation to do business within its limits as it may judge expedient; and it may make the grant or privilege dependent upon the payment of a specific license tax, or a sum proportioned to the amount of its capital. No individual member of the corporation, or the corporation itself, can call in question the validity of any exaction which the State may require for the grant of its privileges. It does not lie in any foreign corporation to complain that it is subjected to the same law with the domestic corporation. The counsel for the appellant objects that the statute of New York is to be treated as a tax law, and not as a license to the corporation for permission to do business in the State. Conceding such to be the case we do not perceive how it in any respect affects the validity of the tax. However it may be regarded, it is the condition upon which a foreign corporation can do business in the State, and in doing such business it puts itself under the law of the State, however that may be characterized.

The only question therefore open to serious consideration in this case is one of fact: Did the Horn Silver Mining Company do business as a corporation within the State? The referee found such to be the fact, as a conclusion from many probative circumstances in the case. That finding was never set aside, but stands approved by the courts of New York. If the correctness of the conclusion could be questioned, and held not justified by the facts in evidence — and they should be considered as showing only transactions of interstate commerce, and not business in the State independently of such commerce-it