City of Utica v. . Churchill

33 N.Y. 161

• Court: New York Court of Appeals
• Decided: September 5, 1865
• Status: Published

Opinion

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[EDITORS' NOTE: THIS PAGE CONTAINS HEADNOTES. HEADNOTES ARE NOT AN OFFICIAL PRODUCT OF THE COURT, THEREFORE THEY ARE NOT DISPLAYED.] The appeals in these three cases were heard together, and the general question in each is, whether the shares of the stockholders in the banking associations created under the acts of congress, which provide for the creation of national banks, can be subjected to taxation by State authority.

In the first case, the institution whose stockholders were taxed, was established on the 4th day of January, 1864, with a capital of $200,000, the whole of which was invested in the securities of the public debt of the United States. The plaintiffs and other shareholders were taxed by the common council of the city of Utica, in September, 1864, as for so much personal property as their respective shares in the stock of the bank represented.

In the second case, the institution is the First National Bank of Albany, which was established in February, 1864, with a capital of $300,000, the whole of which, and a considerably larger sum, is invested in similar national securities. Its shareholders, of whom the plaintiff is one, were assessed upon the respective amount of their shares between the months of April and September in the present year.

In the remaining case, the bank is the National Albany Exchange Bank, and it was established in January, 1865, with a capital of $300,000, all of which is invested in federal securities. The plaintiff is a shareholder, and, with the other shareholders, has been taxed during the present year, in the same manner as in the other cases. The defendants in these two actions are the individuals who constitute the board of assessors of the city of Albany.

Each of the three actions came before the Supreme Court, upon cases agreed upon, pursuant to the 372d section of the Code of Procedure, for the purpose of determining whether the parties who had been assessed and taxed, were legally liable to such taxation. The plaintiffs proceeded in behalf of themselves and all other stockholders of their respective banks.

In the first case, the decision of the Supreme Court was, that the plaintiff Churchill was liable to the tax, his residence being in the first ward of the city of Utica, in which ward the bank was located; and that the other plaintiffs were not liable on account of their residences being without that ward. Judgment was given accordingly, and costs were awarded to the prevailing parties.

In the two other cases, the taxes were adjudged to be illegal, and judgment was given in favor of the respective plaintiffs; and it directed that the names of the several stockholders be stricken from the assessment rolls.

Appeals have been taken to this court by all the parties against whom the judgments were rendered.

The taxes in all the cases are challenged as illegal on two principal grounds: first, that the banking institutions are creations of the federal government, and are instrumentalities provided by the national legislature to execute the powers granted to it by the Constitution, and secondly, that the capital of these banks having been invested in securities of the public debt of the United States, which securities have been determined not to be liable to State taxation, the taxation of the shares is an act hostile to that immunity, and destructive of it, and that such taxation is consequently illegal and void.

As to the first position, it is incontestable that property wholly devoted to public uses by the general government, cannot be subjected to the taxing power residing in the governments of the States of the Union. Independently of the cases which have been adjudged in the federal courts, it is perfectly plain upon principle, and it results inevitably from the system of the Constitution, that the national institutions and establishments of every kind, which have been brought into existence by laws constitutionally enacted by the national legislature, exist independently of the State governments, and cannot be made tributary by means of State laws for taxation, or in any other manner to the needs or exigencies of the State governments. This results necessarily from the preëminence which must always belong to an imperial government, over the subordinate and local governments which are embraced within it, though these may be sovereign in respect to all subjects not committed to the common sovereignty, which, within its assigned sphere, rightfully dominates over them all. This preëminence is moreover cautiously defined and guaranteed by the provision of the Constitution, which declares that itself and all the laws of the United States which shall be made in pursuance of it, shall be the supreme law of the land, and above and superior to all State constitutions and laws. Hence, no man would, for a moment, claim that the taxing power of the State could be exerted against the public money in the treasury, the precious metals in the mint, or the lots, structures, ships, material of war, or other property devoted to public purposes by the general government. It was, no doubt, carrying this conservative principle to its extreme limits, to class the late Bank of the United States among the instrumentalities for carrying on the government of the United States. That institution, although for most purposes, it was concerned in the private business of the citizens of the United States, was yet charged with public duties of great importance. The government owned seven millions of its thirty-five millions of capitol, and appointed five of its twenty-five directors; and it contributed a million and a half of its funds to the public resources. It was made subject to the visitation of the secretary of the treasury, and was bound to obey his orders for transferring the public funds, without charge for exchange, to all parts of the United States and the federal territories. (3 Story's Laws, p. 1547.) These features of its charter enabled the Supreme Court of the United States to pronounce that it was an instrument necessary and proper for carrying into effect the power vested in the government of the United States, and that it was of the same character, so far as the power of congress to create it was concerned, as the other public institutions, such as the mint, the post-office and the like. (McCullough v. TheState of Maryland, 4 Wheat., 316; Osborn v. The United StatesBank, 9 id., 738.) It followed inevitably from this determination, that the United States Bank was no more subject to State taxations than any other of the great departments of the public administration. That this was the view taken by Chief Justice MARSHALL is apparent from the whole scope of his reasoning, in the masterly opinions prepared by him in the two cases to which I have referred; and it is pointedly manifested in the part which I will now quote from the opinion in the last of these cases. Speaking of the argument of the counsel opposed to the bank, that the corporation was established for the management of an individual concern, and was founded upon contract between individuals, and having private trade and private profit for its great end and principal object, he said: "If these premises were true, the conclusion drawn from them would be inevitable. This mere private corporation, engaged in its own business with its own views, would certainly be subject to the taxing power of the States as an individual would be; and the casual circumstance of its being employed by the government in the transaction of its fiscal affairs, would no more exempt its private business from the operation of that power, than it would exempt the private business of any individual employed in the same manner. But the premises are not true. The bank is not considered as a private corporation, whose principal object is individual trade and individual profit, but as a public corporation created for public and national purposes. That the mere business of banking is in its nature a private business, and may be carried on by individuals or companies having no political connection with the government, is admitted; but the bank is not such an individual or company. It was not created for its own sake or for private purposes. It has never been supposed that congress could create such a corporation."

But the Bank of the United States, equally with the banks involved in these cases, besides its public aspect as an instrument of the federal government, was a trading corporation. The citizens were not only permitted, but invited to invest their moneys in its stock, for the purposes of their individual profit, and the community at large was expected to transact a large portion of its own pecuniary business by means of its agency. The faculty to transact that business, and the contribution to its funds by its private stockholders, was necessary in order to render it a useful instrument to the government in the transaction of its business. Without this connection with the general business of the country it would be a mere inanimate body, useful, no doubt, to a certain extent, as a depository of the public moneys, but incapable of subserving the great public purpose for which it was created. Its connection with the general trade of the country constituted, in the language of the chief justice, its vital spirit, which alone gave it a useful existence. But these individual means, invested in the stock by the private stockholders, were, before such investment, the proper and legitimate subject of State taxation. There was certainly no reason why they should cease to be subject to that liability after they were thus invested, unless such immunity was essentially necessary to the existence and preservation of the corporate body with which they were connected. It is argued that they were and are so necessary; that if the liability to taxation on the means so invested be sustained, it will be in the power of the State governments to tax them so inordinately as to wholly destroy them. The argument drawn from the possible abuse of a power clearly legitimate, except on account of such liability to abuse, is carried quite too far, and is not justified by the circumstances of the case, or the common experience of mankind. The State taxes all the private property of its citizens invested, as they frequently are, in partnerships and associations, and in other business arrangements in connection with other individuals and corporations; and yet it has never been considered that the power so to tax was antagonistic to any of those other arrangements of business which are tolerated and sometimes encouraged by the laws. There is, in truth, no practical repugnancy between the exercise of this power of taxation and the integrity of the institutions and business arrangements in which the property so taxed is invested and mixed. A malicious exercise of the taxing power, in such cases, might no doubt produce mischief or inconvenience, as might the gross abuse of any other of the powers reserved to the States; but so long as the property thus invested is only taxed in common and equally with other individual property, as is done in the taxing laws of this State, the apprehension of danger is purely fanciful.

It was the consideration of the mixed character of the purposes for which the Bank of the United States was incorporated, and the twofold character of its operations, and of the interests it was intended to promote, which led the Supreme Court of the United States, in determining the question of the liability of that institution to taxation, carefully to discriminate between the interests of the individual shareholders, which represented their private investments in the stock, and the corporate body itself. From the nature of the case, and the consideration that the judgment was to operate in every State in the Union in which the bank and its branches were located, or in which any of its stock might be held, it was eminently proper, and indeed essential, that the court should define the precise subject which should be exempt from the taxing power of the States, and that which should remain liable to contribute to the burthen of sustaining the State institutions. We accordingly find, at the close of the opinion of the chief justice, which was adopted as the opinion of the court, the following cautious qualification: "This opinion does not deprive the States of any resources which they originally possessed. It does not extend to a tax paid by the real property of the bank, in common with the other real property within the State, nor to a tax imposed upon the interest which the citizensof Maryland may hold in this institution in common with otherproperty of the same description throughout the State. But this is a tax on the operations of the bank, a tax on the operations of an instrument employed by the government of the Union to carry its powers into execution. Such a tax must be unconstitutional." (4 Wheat., 436.) If this qualification was proper to be made in respect to the Bank of the United States, in which comparatively few of the citizens of the country were interested as stockholders, a fortiori, it is applicable to the national banks established by the recent legislation of congress, which are designed to and practically will supersede the State banks, and absorb the whole of the funds and property of all the people of the Union which shall be invested in the business of corporate banking. The idea of withdrawing all these immense pecuniary means, constituting a very large proportion of all the personal property of the nation, from the duty of contributing to sustain the State governments, whose sphere it is to enact and administer all the laws and institutions which regulate the acquisition, enjoyment and transmission of property, and the administration of justice and the conduct of State and local government, would be frightful to contemplate. We cannot yield to the argument that the qualification which the court annexed to its opinion was a mere dictum of the chief justice, which we are at liberty to disregard. In the first place, it is in consonance with our own convictions of what is the necessary result of the principles upon which the court proceeded. But principally, we think we ought to adhere to it as a part of the judgment which the court was called upon to pronounce. The powers of the national and of the State governments were examined and investigated to their very foundations, with a thoroughness which few other questions have ever undergone. A rule was to be adopted, with its necessary limits and qualifications, which was ever to be the guide of all the courts, State and national, and of all the people of the Union for all time to come. That rule was adhered to during the whole period of the existence of the bank, and it is believed that it has been recognized as settled constitutional law, from the time the judgment was pronounced to the present day, a period of nearly half a century. We do not feel at liberty to depart from it in the judgments to be given in these cases.

A provision in the act of congress under which these banks were established, appears to us directly to lead to the same result. The clause in that act subjecting the shareholders in these banks to State taxation, has a close reference to the qualification contained in the opinion of the chief justice, and was no doubt suggested by it; but as it is to be immediately examined in connection with the questions next to be considered, we merely refer to it here. We close our observations on this topic by a reference to two cases in which the power to tax the shareholders in the Bank of the United States, under State authority, has been affirmed. (Bulow v. The City of Charleston, 1 Nott McCord, 527; State v. Collectors, 2 Bailey, 654.) And we conclude, with entire confidence, that there is no impediment to the taxation of these shareholders, arising out of the consideration that the banking corporations are not themselves taxable.

It remains to consider whether the circumstance that the national banks, whose stockholders are before us, had invested their capitals in federal stocks, exonerates them from State taxation. It is an essential prerequisite in the constitution of these banks, that before the commencement of their banking business, they shall own, and shall deposit with the treasurer of the United States, an amount of the registered bonds of the public debt to at least one-third of their respective capitals, and in no case less than the amount of thirty thousand dollars. (Laws 38th Cong., 1st Sess., ch. 106, § 16.) It must, therefore, be steadily kept in mind, in examining the other provisions of the act, that the congress was creating and dealing with moneyed institutions, which must, according to the very law of their existence, possess at all times a large amount of these national securities, and which institutions might own them in much larger proportions. The act of congress to which reference has already been made, contains provisions in the following words: "Provided that nothing in this act shall be construed to prevent all the shares of any of the said associations, held by any person, or body corporate, from being included in the valuation of personal property of such person or corporation, in the assessment of taxes imposed by or under State authority, at the place where such bank is located and not elsewhere, nor at a greater rate than is assessed upon other moneyed capital in the hands of individual citizens of this State. Provided further, that the tax so imposed under the laws of any State upon the shares of the associations, authorized by this act, shall not exceed the rate imposed upon the shares of any of the banks organized under authority of the State where such association is located. Provided also, that nothing in this act shall exempt the real estate of associations from either State, county or municipal taxes to the same extent, according to its value, as other real estate is taxed." (§ 41.)

It is not shown that any of the bonds held by these banks, were actually issued by the government prior to the passage of the act above mentioned. The bonds contained, it is true, provisions on their face exempting them from State taxation, but this, I presume, did not add anything to the immunity in that respect which they enjoyed under the Constitution, as settled by the federal judiciary. But if it should be considered otherwise, and that the taxing of the shareholders is in any proper sense a taxing of the bonds, then as to all those which were issued subsequently to June 3, 1864, the lenders who received them must be considered as entering into the transaction with a knowledge of, and subject to all the provisions of the public law by which the exemption expressed on their face was qualified, including the aforesaid provision of the act passed on that day, which has just been mentioned, and thus considered, the terms of the exemption will be that they shall not be taxable under State authority, except that if they become parcel of the capital of a banking association, the shareholders shall nevertheless be taxable on their shares, in common with other personal property of the citizen, with a limitation of the rate of taxation, as mentioned in the proviso.

I need not spend time to show that the fact that the exemption is expressed by way of proviso, does not impair the face of the enactment. It is in substance a declaration of the supreme legislative authority of the Union, that the bonds may be taxed against the shareholders (if taxation of the shares is a taxing of the bonds) when they are made parcel of the capital of a national bank.

But we are of opinion that the assessment and taxation of the shares of a banking corporation is not a taxing of the property in which the capital of the bank has been invested. The shares of these banks are personal property. The stock is a species of chose in action, or an equitable interest which the shareholder possesses, and which he can enforce against the corporation. The shareholder is not the owner of the public stock possessed by the corporation, any more than he is the owner of the discounted notes, or other securities held by the bank. He is not the owner of either. He is only entitled to participate in the net profits earned by the bank, and upon its dissolution to have his proper proportion of what may remain after payment of its debts. A little reflection will show this to be so. Suppose the capital to be invested, partly in stocks, and, in part, of other moneyed securities. If he has a proprietary interest in the public stocks, he has, as I have said, an equal property in the other securities. As to the latter, there is no possible objection to the taxation. Now the assets of a bank are constantly fluctuating. A national bank must own the amount of the stocks required to be deposited with the treasurer. As to any further amount, the bank may own it one day and part with it the next. If the shareholder is taxed on the footing of a part owner of the assets, a problem must be solved on each occasion on which the assessment is made, to ascertain what aliquot proportion of the whole assets, deducting the debts, consists in this exempt stock, and the tax must be a fractional part of each share, which would generally be a perfectly impracticable operation. A shareholder has, no doubt, a certain interest in all the property of the corporation. What I contend for, is, that it is not the interest of an owner of the property which the bank possesses. If any party, except the corporate body, has the interest of an owner, the creditors have such an interest. Neither they or the stockholders can touch an item of the property. They cannot transfer or incumber it. They have none of the powers of disposition which are incident to the ownership of property. If there is anything which assimilates the interest of the creditors and shareholders to that of owners, the creditors certainly approach nearest to that character, for they are first entitled to be paid; and in case of insolvency, the proceeds arising from the conversion of the assets are to be first applied to the payment of their demands. Now, when the constitutional inhibition, as construed by the courts, or the express provision contained in the laws providing for loans, speak of the bonds as not liable to State taxation, the meaning is, that the owners of these bonds are thus exempt, not that all persons having a collateral interest in them are exempt. The expression is elliptical, for the idea of taxing a note or bond, distinct from its ownership by some person, natural or artificial, is of course an absurdity. The owner is taxed in respect to the bond or on account of its ownership by him. If I am right in considering the banks as the owners of the bonds, and the shareholders as having a collateral interest respecting them, on account of their title to share in the profits, then it is the banking corporation, and not the shareholders or creditors, which are entitled to claim the exemption.

The Court of King's Bench has, in a recent case, taken the same view respecting the ownership of the shareholders in the property of a corporation. The British acts of parliament forbid the registry of a ship as a British vessel unless it iswholly owned by British subjects. If a part owner is not a subject, it cannot be registered. A mandamus was sued out to compel the registry of a vessel owned by a British corporation, some of the shares in which were owned by foreigners. The judgment was for the plaintiff, sustaining its right to a registry. Lord Chief Justice DENMAN said: "It appears to us that the British corporation is as such the sole owner of the ship. * * * The individual members of the corporation are no doubt interested, in one sense, in the property of the corporation, as they may derive individual benefit from its increase, or loss from its destruction; but in no legal sense are the individual members the owners." (The Queen v. Arnaud, 9 Adolph. Ellis, N.S., 806.)

I do not consider the case called "The Bank Tax Case" (reported in 2 Wallace, 200), as at all hostile to the conclusion above expressed. This court had held that the Bank of the Commonwealth was taxable, without regard to the amount it had invested in federal stocks, under an act of the legislature of this State, passed in the year 1863, which declared that all banks, banking associations, and other moneyed corporations and associations should be liable to taxation on a valuation equal to the amount of their capital stock paid in or secured to be paid in," c., "in the manner provided by law." We considered the tax thus provided for, to be imposed upon the corporation as a legal being, wholly irrespective of the securities in which its capital might be invested. We found that under a former system of tax laws, contained in the Revised Statutes, such had been repeatedly adjudged to be the rule; and that if the bank had lost a part of its capital, or had added to its assets by an accumulation of profits, it did not in any manner affect the amount for which it was taxable. (The Bank of Utica v. The City of Utica, 4 Paige, 399; The People v. The Board of Supervisors of NiagaraCounty, 4 Hill, 203; The Farmers' Loan and Trust Co. v. TheMayor, c., 7 Hill, 261; The Oswego Starch Factory v.Dolloway, 21 N.Y., 449.) This was a point, as will be seen by these cases, well settled in this State. The law, thus adjudged, we understood to be concurred in by the Supreme Court of the United States, or, at least, by the eminent judge who prepared the opinion of the court in the case reported in Wallace, in a part of his opinion in the former case of The Bankof Commerce v. New York City, reported in 2 Black., 620. He there said that, according to the former system of taxation, meaning that which was contained in the Revised Statutes, banks were taxed on their nominal capital, without regard to loss or depreciation. "According to that system of taxation," he said, "it was immaterial as to the character or description of property which constituted the capital, as the tax imposed was wholly irrespective of it. The tax," he added, "was like one annexed to the franchise as a royalty for the grant." We were of opinion that the intention of the act of 1863 was to return to that system, and if we had been correct in that assumption, it certainly would have followed that it was immaterial whether the capital was invested in United States bonds or any other securities. The determination in the Bank Tax Case, by which our judgment was reversed, proceeded upon the ground that we had misconstrued the act of 1863, and that it was not a tax on the banks, nominally, which was intended, but was a tax upon their property and assets, valued by an artificial standard. If our act of 1863 had declared the tax to be imposed upon the amount of the nominal capital, irrespective of the mode of its investment when the tax came to be assessed, we suppose our judgment would have been affirmed, instead of being reversed.

It is argued that the congress had not the constitutional power to enact the provisions contained in the bank act of 1864. The argument is, that as the Constitution had exempted public stocks from taxation by the States, it was not in the power of congress to subject them to such taxation. It is material to remember that there is no language of the Constitution to that effect. But the Supreme Court has considered that the exertion of the taxing power of the States upon these securities would, or might, impair the ability of the government to raise money by loan for public purposes, and hence would be hostile to the congressional power to borrow money; and it is easy to see that the faculty of borrowing upon securities which should enjoy that immunity, might in some degree promote the negotiation of loans. But, is this an advantage which may not be waived by the national legislature? There are, frequently, other public objects connected with a loan beyond the mere purpose of realizing the amount required to be borrowed. One purpose of the government, organized by the Constitution, is declared to be to promote the general welfare of the people of the United States. No doubt the maintenance of the State governments, to which the possession of pecuniary means to be acquired by taxation is essential, is intimately connected with the general well-being of the people. Suppose, then, congress should come to the conclusion that the placing of the general government, in respect to a loan, upon the same footing with other borrowers, would not essentially affect the ability to negotiate such loan, while it would greatly conduce to sustain and promote the interests of the State governments in their pecuniary arrangements, and would moreover more effectually secure domestic tranquillity, which is another object aimed at by the Constitution, is the supreme legislature powerless in the premises? I cannot believe that such is the case. The inhibition of the States to tax the money of their citizens invested in national loans, is predicated of the power to borrow money on the credit of the United States. It is a power conferred in the same general terms as the power to regulate commerce, and it has frequently been decided in the Supreme Court of the United States, and in this court, that an act of a State legislature, having the effect of a commercial regulation, is not a violation of the Constitution, if congress has not exercised their undoubted authority over the subject in the particular case. (Wilson v. The Black Bird Creek Swamp Company, 2 Peters, 250;Sturges v. Crowningshield, 4 Wheat., 193; Moore v.Housten, 5 id., 1; Cooley v. The Board of Wardens ofPhiladelphia, 12 How., 299; Lemmon v. The People,20 N.Y., 562, 613.) If by omitting to legislate on the subject, the States are left free to act, a fortiori, an express permission to the States to act, would not be objectionable. In the Pilot case, above referred to from 12 Howard's reports, the State of Pennsylvania had passed an act for the regulation of pilots. It was shown in the opinion in the case, that this State law was in substance a regulation of commerce. But congress had never assumed to enact a pilot system; but the several maritime States had generally done so, and congress had, at an early day, passed an act declaring that pilots should continue to be regulated "by such State laws may respectively hereafter enact for that purpose." The pilot act of Pennsylvania was declared to be valid, on the ground that congress could waive, in favor of the States, the right which the Constitution had conferred upon it by the power to regulate commerce. I consider this a strong precedent for holding that the national legislature is competent to waive the right, which under the decisions of the federal court it possesses, to provide for the negotiation of loans, which shall not clothe the securities with an exemption from State taxation. If, therefore, it could be held, that the taxation of these shares was the taxing of the bonds which the corporations hold, I should yet think that the taxation was lawful under the permission contained in the banking law of the United States.

It is further urged that these shareholders are taxed at a rate beyond the limits prescribed in the proviso in the act of congress. We do not perceive this to be so. The stock is assessed at the amount represented by the shares respectively. It is not shown that they are not of that value. Then the tax is at the same rate per cent as other moneyed capital in the hands of individual citizens. Our laws do not authorize the taxation of shares in banks organized under the authority of this state. We tax our domestic banks on their capital pursuant to the act of 1863, and it is presumed that the taxing officers conform to the judgment in the Bank Tax Case, reported in 2 Wallace, by deducting the part invested in United States bonds. This exemption is made because the banks which are taxed are the owners of these bonds. But we have shown that these shareholders are not the owners of the bonds held by the banks.

There are some questions which are not common to all these banks. In the first case the bank was established, and the taxes which are challenged were imposed prior to the enabling statute of this state, which was passed and became a law on the 9th day of March, 1865. Only one of the plaintiffs resided in the ward of the city of Utica in which the bank is situated. The principles which have thus far been stated, show that he was legally taxed. Of the other parties taxed, one resided in another ward of the city, one in the same county, another in another county of this State, and the remaining one in the District of Columbia. Our laws, prior to the enabling act, required that the taxation of personal property shall be in the town or ward in which the tax payer resides. I was at first inclined to the opinion that the provision of the national banking law, so often referred to, might be considered as a change of our own law, and might be sustained on account of its relation to the national banks which are within the sphere of federal legislation. On further reflection, I have concluded that it would be more correct to hold that the effect of the proviso is to permit the States so to shape their laws of taxation as to tax all the shareholders at the place where the bank is situated, as has been done by the enabling act.

It follows that the judgment of the Supreme Court, in favor of the plaintiff against Mr. Churchill, should be affirmed, and that the judgment in favor of the other defendants in that case should likewise be affirmed.

In the second case, the bank was established prior to the passage of the enabling act just mentioned, and, also, prior to banking act of congress, approved June 3, 1864. The enabling act, which authorizes the taxation of shareholders otherwise than in the place of their residence, declares that "all the shares of any of the banking associations organized under this act, or the act of congress mentioned in section one of this act," shall be assessed and taxed in the town or ward in which the bank is located (Laws 1865, ch. 97, § 10), and the act of congress mentioned in that first section is the act of congress of June 3, 1864. The First National Banking Act was passed February 25, 1863 (37th Cong., Sess. 3d, ch. 48), and it was consequently under that act that the First National Bank of Albany was organized. This would be conclusive in favor of such of the shareholders of that institution as reside out of the proper ward of the bank, were it not that a section of the act of 1864 (the 62d) provides that all the banking associations organized under that former banking act, which is in terms repealed by that section, should enjoy all the rights and privileges granted, and be subject to all the duties, liabilities and restrictions imposed by that act of 1864. I am of opinion that when the New York enabling act embraced within its scope all the associations organized under the act of 1864, it included, by a reasonable construction, these associations which, although first established under the earlier act, were continued and confirmed by the banking act of 1864, and which stood at the passage of the New York act, solely upon the last banking act of the United States.

Hence, the judgments in the second and third of the above entitled cases must be reversed; and it must be declared, as the judgment of this court, that the taxation of the shareholders, mentioned in the cases agreed on in these actions, were legal and valid.

The costs in each of the appeals are awarded in favor of the prevailing parties.

The form of the judgment is to be settled by one of the judges (unless agreed on by the parties), in order that a proper clause may be inserted, showing that a question arising under the Constitution of the United States was involved in this decision.

All the judges concurred in these conclusions, except that PORTER, J., did not sit in the last mentioned case, on account of interest in the bank concerned in it.