author: LAMM, J.

text:
    THE STATE ex rel. M. C. CONNORS et al. v. NAT M. SHELTON, Judge, and JOHN C. MILLS, Receiver.
    In Banc,
    December 16, 1911.
    1. PROHIBITION: Return: No Motion for Judgment: Reply: Practice. Where the preliminary rule in prohibition to show cause was ordered and served, and respondent made return, specifically denying certain vital allegations of the petition and stating facts which make a case different from that stated in the petition, to which relator -files a reply stating he is without knowledge or information of certain allegations in the return and averring that such matters are immaterial, and there is no motion for judgment on the pleadings and no request for a commissioner to take evidence, the reply will be treated ex gratia as a demurrer to the return, and all allegations of facts well pleaded in the return will be taken as true, and those allegations of the petition specifically denied by the return will be taken as false. •
    2. -: Existence of Lien. An absolute writ of prohibition cannot be predicated on the existence of a lien in favor of the relators in the railroad properties ordered by the circuit court to be sold by respondent receiver, where respondents in their returns deny the existence of the lien and make allegations of fact which if true entirely defeat a lien, and in view of the state of the pleadings these allegations must be taken as true.
    3. -: Delay: Inadequacy of Remedy. Mere delay, or mere inadequacy of remedy by appeal arising from mere delay, cannot be made the sole basis of a writ of prohibition. Delay and inadequacy of remedy fill- a subsidiary office in prohibition; but they furnish no ground for the writ. Prohibition is issued to a court to compel it to desist from the exercise of a jurisdiction it does not have, or to cease to exercise a jurisdiction in excess of what belongs to it.
    4. -: Receivership: Creditors and Lienors as Parties. In • a proceeding to appoint a receiver for a railroad company creditors are not necessary parties. They have a right to intervene to be made parties, and lienors may be made parties if they were such at the time the receiver was appointed.
    5. -: -: Attack by Creditors: Waiver. Creditors of a railroad company, who sue both the receiver and the company to establish their debt and lien, thereby recognize the validity of the prior decree, appointing a receiver, and are in no position to attack that decree.

      6. -: -: Power of Equity Court. A court of equity has power to appoint a receiver for an insolvent company on the petition, of stockholders where grave corporate questions exist, such as directors false to their trust and guilty of misappropriating the funds, and creditors crying for relief.
    7. -: -: Collateral Attack. The appointment of a receiver cannot be collaterally attacked. Unrevoked by a motion to vacate in the court below or by appeal, the appointment must stand in the face of a collateral attack, such as by a writ of prohibition against the court making the appointment.
    8. -: -: Power to Order Sale of Property. A court of equity does not exceed its jurisdiction in ordering all the properties of an insolvent railroad company to be sold by its receiver previously appointed, where the corporate project has been abandoned or broken down, its property is perishable and deteriorating, there are no corporate means at hand for conserving it, and the interests of creditors and stockholders are best served by the sale.
    9. -:-: Order of Sale: Notice: Appearance. It is not necessary to decide whether the court exceeded its jurisdiction in ordering a sale of the properties in the receiver’s hands without notice to creditors, where the order itself shows that the complaining creditors appeared. A voluntary appearance makes notice immaterial.
    10. -: -: -: Collateral Attack. Where relators, creditors of an insolvent railroad company for which a receiver had been appointed, appeared at the hearing of the application for an order for the sale of the company’s properties, ^nd an ■ order was made that directly affects their interests, they had a remedy to dispute the court’s power to make the order,, by a motion to modify, and that failing, by an appeal,- and if they availed themselves of neither, they cannot-assail the order by a writ of prohibition.
    11. -: -: -: Appeal. From an order of sale of the properties of an insolvent railroad company in the hands of a receiver, which directly affects the interests of creditors who have under contract constructed the roadbed, such creditors (under Sec. 2038, R. S. 1909) have an appeal. They are a “party to a suit aggrieved” by a “special order after final judgment in the cause.”
    Prohibition.
    Whit denied.

      Vroman, Munroe <$> Vroman and John T. Barlter for relators.
    (1) Persons performing labor and doing work upon railroads have a lien thereon on the roadbed, station houses, depots, bridges, rolling stock, real estate, and improvements of such railroad. Sec. 8249, R. S. 1909. (2) Where the remedy by appeal is inadequate or not sufficiently speedy, the writ of prohibition is the proper remedy. State ex rel. v. Denton, 128 Mo. App. 314; State ex rel. v.'Allen, 45 Mo. App. 557; State ex rel. v. Eby, 170 Mo. 497; State ex rel. v. Cline, 85 Mo. App. 628'; State ex rel. v. Port, 107 Mo. App. 328; State ex rel. v. Guinotte, 156 Mo. 527 ; 23 Am. & Eng. Ency. Law, p. 21. (3) The court exceeded its jurisdiction when it ordered the receiver to sell this property. The directors of the road were the proper parties to take charge of and manage or dispose of same. State ex rel. v. Foster, 225 Mo. 171; Ashton v. Penfield, 233 Mo. 391. (4) The court exceeded its jurisdiction when it ordered the railroad sold free and clear of all liens and incumbrances. High on Receiver (4 Ed.), sec. 199a; Beech on Receiver (4 Ed.), sec. 199b; Alderson on Receiver (4 Ed.), sec. 602; Blair v. Walker, 26 Fed. 75; Kneeland v. Loan Co., 136 IT. S. 89; Railway v. Steel Co., 176 H. S. 257. (5) The court exceeded its jurisdiction when it ordered the road sold without notice to plaintiffs or other creditors. Roden v. Helm, 192 Mo. 95; and cases cited under point 4.

      Humphrey <& Gose, Edward Higbee, Walter Higbee and Paul D. Higbee for respondents.
    (1) The Hannibal & Northern Missouri Railroad Company is an insolvent domestic corporation. Its failure, to comply with the law, to keep its office and records in the State of Missouri, its insolvency, the pendency of suits, interruption and cessation of work, the dissensions in the directory, the voluntary donation of over 2,000 shares of its capital stock, the condition of the few miles of road bed, bridges and culverts partially constructed, the grading machinery and other property, and their liability and exposure to waste and loss, together with other conditions alleged in the petition for the appointment of a receiver, as found by the court, unquestionably warranted the appointment of a receiver. The mere fact that the railroad company at all times maintained its office and kept its records in a foreign State, in contempt of the laws of this State, subjected it to ouster proceedings; this alone would have justified the appointment of a receiver. Secs. 3035 and 3036, R. S. 1909; 24 Am. & Eng. Eney. Law (2 Ed.), 5; Ralph v. Circuit Judge, 58 N. W. 837; 1 Elliott on Railroads, sec. 547. The appointment of the receiver is conclusive. Thompson v. Greeley, 107 Mo.'589; State v. Poster, 225 Mo. 205. The jurisdiction and power of the court to appoint the receiver is not questioned by relators. The action to enforce the lien against the receiver and the railroad company expressly recognizes the regularity of the appointment. And the court properly ordered the sale of all the property of-the railroad company within this State, including its projected line and right of way, as an entirety, at the county seat of Shelby county. Bethune v. Railroad, 149 Mo. 603. (2) The petition for the appoinment of a receiver prayed for an order to sell. The court might well have made the order of sale upon this petition without any formal application by the receiver for an order to sell. 34 Cyc. 313 (3); 17 Ency. PL & Pr. 832, note 2. The rule is that notice to parties interested in an application for an order to sell is not essential. 34 Cyc. 313, b, note 60. Order of sale without notice would, at most, be irregular, and not a usurpation of judicial power, and would not authorize a preliminary rule of prohibition. State ex rel. v. Tracy, 237 Mo. 100. (3) Even if relators’ lien has been established, the court had power in its discretion tb order a sale free of all liens, “for the proceeds take the place of the property, and whatever rights relators may eventually establish in the latter were transferred to the former.” The court’s discretion will not be disturbed even on appeal in the absence of a clear showing of abuse. The purpose of the appointment of a receiver is that the assets may be speedily sold and the receivership wound up. Relators ’ "rights are abundantly protected by the order of sale. Mellen v. Moline, etc. Works, 131 U. S., 352; 23 Am. & Eng. Ency. Raw (2 Ed.), 1080, (15), 108 g. n. 4. (4) But relators have no lien; that is res ad judicata. (5) The relators were present in court, asked for and procured a postponement of the consideration of the petition for an order to sell until after a trial of their action to enforce their lien, and were present in court, and appeared at the time the order of sale was made. The only purpose of notice is to bring parties into court; hence, the fact that formal notice was not served upon relators is immaterial, even if notice were required. Holman v. Farrar, 112 Mo. 54. (6) If the order of sale could be reviewed in this proceeding, it is plain that the intentional inclusion of false and fictitious items and of non-lienable items in relators’ lien account vitiated the lien. Daugherty v. Rothbaum, 137 S. W. 83; Carthage, etc. Co. v. Church, 137 S. W. 1028.
   LAMM, J.

Prohibition. Relators are M. O. Connors and William Nuttall, doing business in railroad contracting under the firm name and style of M. C. Connors & Company. Respondents are the Hon. Nat M. Shelton, Judge of the Second Judicial Circuit of Missouri, and John C. Mills, receiver of the Hannibal and Northern Missouri Railroad Company, hereinafter called the Company.

This cause is submitted on the bare pleadings. There is no evidence, no formal demurrer to the returns and no motion for judgment. The situation is this: On the filing of the petition we passed, and had served, a peliminary rule to show cause. Presently respondents made separate returns, admitting some but denying specifically certain other vital allegations of the petition. Ffirther, these returns stated facts putting a case to us quite different from that stated in the petition. Thereupon relators filed a reply to the effect that they were without information or knowledge on certain allegation of facts in the returns, but averring that “said matters are immaterial in this case.” It then restates, in effect, some averments of the petition and renews the prayer for an absolute writ of prohibition. Neither side asked for a commissioner to take proofs and report. Such situation springs a question of practice to be disposed of at the outset. We rule thereon as follows:

Present issues of fact, absent evidence upon which those issues cán be determined, and present a reply of the kind indicated (followed by a submission of the case on the pleadings) we may, ex gratia, treat the reply as a demurrer to the returns. In that view of it we must take all well-pleaded allegations of the returns (not impossible) as true for the purposes of the case. [State ex rel. v. Broaddus, 234 Mo. l. c. 332.] Or, if by way of extreme grace, we take the reply at bottom and meaning as a motion for judgment on the pleadings, the same result would follow, to-wit, the well-pleaded averments in the returns would be taken as true, and those averments of the petition specifically denied by the returns would be taken, as false. [State ex rel. v. Shields, 237 Mo. 329.] In no other way can the issues of fact raised by the pleadings be laid out of view, and vitality and sense be given to the submission.

We are to gather, then, the facts from the forty printed pages of pleadings, excluding relators’ petition, except in so far forth as the returns admit its allegations. So gleaning, the facts in small compass follow, viz.:

In 1909 the company was incorporated to build a railroad from Hannibal to Kirksville passing through Marion, Shelby, Macon and part of Adair counties. Its route lay through a region without railroad facilities, and the people of that region were anxious for a road. Its authorized capital was $2,000,000, divided into 20,000 shares of the face value of $100 each. In 1910 about nine miles of the proposed road were graded in Marion county, and four in Shelby, but in disconnected portions;.some culverts and bridges were partly built on those grades; there were some cross-ties and grading machinery belonging to the company, and the right of way was nearly secured through Marion and Shelby. The people along the line had subscribed and paid various sums of money to aid the enterprise and were expected to subscribe more. In December, 1910, the company quit being a going1 concern, laid off all work on the line and work was never resumed. It was then found that large blocks of its capital stock were wrongfully issued and donated to its directors and officers, that its treasury was looted, that it had continuously violated the law in not keeping a general office for the transaction of its business within this State as provided by section 3035', Revised Statutes 1909, that it had wrongfully kept its office, books, etc., in Chicago, Illinois. Other usurpations and fraudulent acts upon the part of its officers were found to exist, among them the wrongful -dissipation of funds and wrongful appropriation of large sums by the company’s president to his own use. In consequence of all these things dissentions sprang up in the board of directors and made out of question any co-operation and concert of action. So accentuated was this intestinal war that some of its officers denounced others of them by publications, precisely as in a former age a man “posted” his enemy. The confidence of the people on whom the company relied for subscriptions was lost, debts accrued amounting to $37,000, with no means to pay. The company became insolvent. Suits were begun against it on over-due notes for $15,000. A lien had been filed by one Simmons (Note: relators’ lien was .not yet filed) and a suit was pending to enforce Simmons’ lien. To add to the corporate chaos and distress, rights of way had been wrongfully taken in the name of some of the. promoters which they refused to transfer or put of record, and contracts for construction were let (without advertising for bids) for grossly excessive prices. - In short, it was impossible for the company to go on with the construction of the road, and all the work already done faced waste, depreciation and destruction. In that fix on April 5, 1911, some of the bona fide resident stockholders brought suit against the company in the Shelby Circuit Court for a receiver, to conserve the property, pay debts, cancel the shares of stock wrongfully donated, wind up the company’s affairs, etc. Summons issued and was served, an answer was filed, and on a certain day in April of that year that cause was tried. The chancellor found the issues for plaintiffs and appointed respondent John C. Mills receiver, who gave bond, qualified and took upon himself the burden of the receivership as the arm of the court.

(Nota bene: There is no pretense that any motion was filed to revoke the order appointing him receiver, or that the judgment in that case does not stand unappealed from and in plenary vigor.)

Thereafter relators, as contractors aud material-men, filed in the proper office what they claimed was a just and true lien account against the company for the purpose of a lien under section 8249, Revised Statutes 1909, and post. Thereafter in July, 1911, the present relators as plaintiffs brought suit in the Shelby Circuit Court against both the company and John C. Mills, receiver, upon said alleged lien accounts to enforce a lien for $16,000. To the petition in that lien case the company and Mills answered separately. Mills’s answer alleged that sundry items in the lien accounts were non-lienable, and that two of the items (said to have accrued in March, 1911) were false and fictitious and known to be such by relators when they filed their lien accounts. On the day the receiver filed that answer in the lien case, he also filed a petition in the receivership case for a sale of the company’s assets, reciting, inter alia, that work had been abandoned, that the property of the company did not exceed $10,000 in value, that the debts due by the company were over $37,000, that its property was perishable and was deteriorating, etc., and he asked an order to sell, free and clear of all liens that might be established, the sale money however to be ordered held subject to any such liens thereafter established. On the day that petition to sell was filed the present relators, Connors and Nuttall, appeared in that matter in court, by their attorneys, and objected to the order of sale being made at that time. At their request the hearing of the petition for an order to sell was by the court postponed until said lien case could be tried. On July 25, 1911, the lien case was tried to the court without the aid of a jury. Taking time to consider till August 3, 1911, on that day being fully advised, the court made a finding in the lien case to the effect that two of the lien items were false and fictitious and known to be so by the present relators when they filed their lien accounts, and that several of the items of the account were nonlienable. The upshot was that the court reduced relators’ claim from $16,000, to $11,448.50, denied any lien, and rendered judgment against the company in favor of the present relators for the latter sum.

From that judgment relators appealed, to this court. On the same day, but later, the court took up the petition to sell in the receivership case and heard and determined that application in favor of the receiver. The returns made by respondents in the instant case state the substance of the order of sale, hut the order itself is brought here by relators and, as it is brief, we may as well let it speak for itself, viz.:

ORDER OP SALE.
Now on this 3d day of August, 1911, comes again John C. Mills, Receiver, and presents to the court his petition, filed on July 17, 1911, praying for an order to sell the property of said railroad company; also comes J. L. Simmons, by his attorney, and M. C. Connors and William Nuttall, co-partners as M. C. Connors & Company, by their attorneys Vroman, Munro & Vroman, who have each filed liens for material furnished and work done on the construction of the road-bed of said railroad and at whose instance the hearing on the petition was adjourned to this date, and the court having heard all the evidence upon the petition of said John C. Mills, and the arguments of counsel for and against the prayer of said petition, and the court being now duly advised, it is considered, ordered and adjudged that said John C. Mills, Receiver of said Railroad Company, after giving twenty days’ notice of the'time, terms and place of sale, ind of the property to be sold, in one newspaper of general circulation, published in each of the counties of Shelby and Marion as he may select, do sell at public auction, to the highest bidder for cash, at the south door of the court house in the city of Shelbyville in Shelby county, Missouri, between the hours of ten A. M. and five P. M: on the 2d day of September, 1911, all the right of way of said Hannibal & Northern Missouri Railroad Company, beginning at and in the city of Hannibal, in Marion County, Missouri, through said county and the counties Shelby, and Macon, through and into the city of Kirksville, in Adair county, Missouri, together with all road-bed, bridges, culverts and all other property, real and personal, of and belonging to said Railroad Company, including its franchise to construct, own and operate a railroad, and including its right and franchise acquired from the city of Palmyra, to enter and construct its railroad, depot, side track, switches and sidings in the city of Palmyra, and all grants of land for that purpose.
And it is further ordered that said sale of said property of said railroad company be made as an entirety and free and clear of all liens and encumbrances of every nature, and that the money realized upon such sale be held by the said John C. Mills, Receiver as aforesaid, subject to all liens that have or may be established upon the road-bed or property of said railroad company, and he paid out and disbursed only as this court may direct.
Railroad ties, scrapers, tools, machines and all other personal property of said railroad company may he sold separately for cash at such time and place and on»such notice as the said Receiver may think best.

Two days later, without any other steps in the circuit court in the order of sale matter, relators lodged here their petition for prohibition to prohibit the court and receiver from executing that order of sale, relying on the following propositions:

(1) They have a lien for their labor and material.

(2) Their remedy by appeal in the lien case is inadequate or not sufficiently speedy.

(3) The court exceeded its jurisdiction when it ordered the receiver to sell the property, the directors being the proper parties to manage or dispose of the same.

(4) Exceeded its jurisdiction in ordering it sold free and clear of all liens.

(5) And exceeded its jurisdiction in ordering it sold with no notice to plaintiffs or other creditors.

As said, because of the form of the submission, we have taken the facts from the returns of respondents. If, however, in the determination of any question it is necessary to notice the presence or absence of any material allegation in relators ’ petition we shall do so while passing on the point.

I think it clear the preliminary rule should be quashed and an absolute writ denied. This, because:

(a) As to the lien of relators as contractors and materialmen, relators allege such lien exists, whilst respondents in their returns deny its existence and make allegations of facts which if true entirely defeat a lien. With that issue of fact open, with no evidence here on which it can be determined, and with the submission in such form that we must take the averments of the returns as true, manifestly we cannot predieate a right to an absolute writ of prohibition on the existence of a lien. Yet this is precisely what relators ask us to do. They alleged in their petition for a writ that a lien exists. ‘The first proposition in their brief is that one exists and they assert the right to a writ to protect that lien. Now, in order to have a lien, their lien accounts filed with the circuit clerk within ninety days next after the completion of the work or after materials are furnished, must be “just and true.” [R. S. 1909, sec. 8251.] An unjust and untrue account, made so intentionally, is in contravention of the statute and cannnot be the basis of a lien. [Dougherty, etc. Co. v. Rothbaum, 156 Mo. App. 215; Carthage, etc., Stone Co. v. Methodist Church, Ibid, 671.] Evidently a writ cannot go unless there is something else in the case.

(b) The next proposition advanced in the brief of relators and in their petition is that their remedy by appeal in the lien case is inadequate and not sufficiently speedy; ergo, they say, as we grasp it, they are entitled to prohibition. That proposition opens a wide door to comment and speculation. There are legal precepts to the effect that justice delayed is justice denied; that fresh justice is ever the sweetest; that he gives twice who gives quickly. So, in our Bill of Rights it is ordained that courts of justice shall be open to every person, that certain remedy shall be afforded, etc., “and that right and justice shall be administered without sale, denial or delay.” [Art. 2, sec. 10, Const.] But none of those generalities are sufficient legal grounds for the extraordinary writ of prohibition. If mere delay, or mere inadequacy of remedy arising from mere delay, could be made the sole basis for writs of prohibition, then a new and anxious situation would spring; for thereby a litigant would be invited to leave the beaten way, to discard relief by appeal, certiorari o.r error, and seek prohibition as an end-all and cure-all. We could not very well announce a doctrine of that sort. Certainly the doctrine of the books does not rnn that way; nor has this court ever so held. In jurisprudence the maxim is: We must have recourse to the extraordinary, when what is ordinary fails. (Recurrendum est ad, etc.) Delay, inadequacy of remedy and hardships springing from the use of other remedies, when present, fill a subsidiary office in prohibition. But mark, their office is not to furnish a ground for the writ. It, is merely to persuade' the court to exercise its discretion to issue one in a case where grounds exist, but where peradventure our' discretion might incline us to decline the writ because of the existence of some ordinary remedy. [State v. Elkin, 130 Mo. l. c. 109.] Speaking through our Brother Kennish, in State ex rel. Terminal Railroad Association v. Tracy, Judge, in Banc, 237 Mo. 109, we have been so lately and fully over this precise question tliat a restatement of the law or further exposition of it is out of place. Excess of exposition of the law (like excess of light to the eye) may be confusing. Briefly, as injunction against proceedings at law reaches the parties litigant, so prohibition is directed to a court itself to compel it to desist from the exercise of a jurisdiction which it has not, or to cease to exercise a jurisdiction in excess of what belongs to it.

Relators rely, among other cases, on State ex rel. v. Eby, 170 Mo. 497. There is language in the Eby Case which, taken by itself, lends color, to the view that prohibition may go when the remedy by appeal is inadequate, cumbersome or oppressive. But read with its context and rightly understood, as pointedly put by Kennish, J., in the Terminal Railroad Association Case, it furnishes no countenance or aid to the proposition that mere delay or inadequacy of remedy by appeal affords sufficient ground for the extraordinary writ of prohibition.

(c) We come next to the question of jurisdiction in the circuit court to make the order of sale. Under Ibis bead may be grouped the three remaining propositions of relators’ counsel, which, for one or another reason, strike at lack of jurisdiction.

(1) Some preliminary questions lie at the door of the discussion inviting determination to clear the way for the main question. At our bar an attack was delivered against the original decree appointing a receiver. . So, in relators’ brief it is insisted that the directors of the company a*re the only ones entitled to the charge and management of the property. The petition in the instant case charges that relators were not made parties to the receivership' case. Their petition is susceptible to the construction that they filed their lien as contractors before the receivership suit began. But it sufficiently appears from the returns that the contrary is true, and that the receivership case was not only begun hut that a decree was entered therein before such lien was filed. We do not see that relators put their relief on the theory they were not made parties to the receivership suit. We are referred to no authority (and know of none) for the proposition that all creditors must he made parties to the suit. Why make them parties when they have the right to intervene if they see fit? We see no reason why lienors might not be made parties. But relators were not in that class at that time, nor are they in position to attack the decree in'the receivership case. This, because:

In the first place they sued both the receiver and the company in the lien case, thereby recognizing the validity of the decree appointing one. They should not face two ways on that proposition.

In the second place a court of equity has power to appoint a receiver on the petition of stockholders where grave corporate conditions exist of the character disclosed by respondents’ returns. We so held in a very late case on full consideration. [Ashton v. Penfield, 233 Mo. 391.] It would be unprofitable to reopen and rediscnss a question there set at rest. On a review of our own cases and the general doctrines of equity, the remedy of a receivership, whereby a court of equity lifts the hands of incompetent officers and directors false to their trust and guilty of grave corporate misconduct to the detriment of stockholders or creditors, was allowed in the Ashton Case. It is a strong remedy not to be lightly applied, but where conditions are crying, as here, it is a remedy allowed in equity. The question whether existing creditors are delayed by such appointment, or have or have not left open to them all their legal remedies to collect their debts is not here for determination. We can pass on that question when a case is here presenting it.

In the third place the appointment of a receiver may not be assailed collaterally. Unrevoked by motion below or by appeal, as here, that appointment must stand as against a collateral attack. [Thompson v. Greely, 107 Mo. 577; State ex rel. v. Foster, 225 Mo. l. c. 205.]

(2) Did the court exceed its jurisdiction in making any order whatever to sell the property? We answer, no. If a court of equity may take over the management of corporate property through its receiver, as we have just held, it may be allowed to act sensibly with it. I hold this truth to be self-evident, viz.: One of the inherent powers of a court of equity is the right to act with good sense. If the corporate project has been abandoned, or has broken down, or the property is perishable and is deteriorating, if there are no corporate means at hand for conserving it and the interests of creditors and stockholders are best served by a sale, what good reason can be given why the chancellor, who holds the property of an insolvent corporation through his receiver, may not sell it? Why hold it till it bécomes worthless? Why return it to the wasteful, inefficient or corrupt hands from which equity rescued it? An order of sale under such circumstances is not an unusual incident of a receivership. [High on Receivers (4 Ed.), sec. 192, et seq.} Such power of sale was guardedly upheld, under exceptional circumstances, in Thompson v. Greely, supra, p. 586 et seq. The cases cited by relators do not hold to the contrary. We rule, then, that unless there is something else in the case, the court had power to order a sale.

(3) But relators say there is something else in the case. Their last two propositions are: First, that the court exceeded its jurisdiction in ordering a sale free and clear of liens; second, in ordering a sale without notice to relators or other creditors. These two propositions may be taken together.

We shall assume it as a proposition to be accepted without discussion that relators are not entitled to a writ of prohibition in order to assert the rights, or protect the property interests of non-complaining creditors who are not parties to the application for the writ. That branch of the contention is laid out of view.

The petition charges that relators had no notice of and did not appear to the proceedings looking' to a sale. But unfortunately for them the case made tells another story. The very copy of the order of sale produced here by relators shows they not only had notice, but appeared to the proceeding. A voluntary appearance makes notice immaterial. [Coleman v. Farrar, 112 Mo. l. c. 72.] We do not.say they were entitled to notice or were not entitled to notice. That particular question is reserved to be ruled in'some case breaking on the point. In this case we take the fact as we find it. Under the form of submission we are dealing with, the allegation in the petition of no notice and no appearence is drowned in the contrary allegation of the returns and in the narration of the order itself.

In that view of it, relators had an ordinary remedy, amply meeting any mischiefs complained of and attaining the full justice of the case. They had a remedy by a motion to modify tbe order. They threw that remedy away and may not now assail the order collaterally. “When a court of equity,” says Mr. High (High on Receivers (4 Ed.), sec. 196), “properly acquires jurisdiction of the parties and of the subject-matter in a cause, and appoints a receiver therein and orders him to sell the property in controversy, such order, although irregular and improvident, cannot be assailed or questioned in a collateral action, and such action will not lie to set aside the order of sale and proceedings thereunder. The appropriate method of correcting, such irregularities is by motion to the court making the order, and an independent action for that purpose will not be entertained.”

Moreover, the order of sale in the terms in which it was couched directly affected the interests of re]ators. That fact entitled them to an appeal under the provisions of our statute (R. S. 1909, sec. 2038), as that statute has been liberally construed by this court. They were a “party to a suit aggrieved” by a “special order after final judgment in the cause.” The former statute in saying who can appeal used the phrase “every person' aggrieved.” In commenting on that change in the statute this court in Thomas v. Elliott, 215 Mo. l. c. 603-4, said: “We do not construe that act [the present act] as taking away from any one the right of appeal under section 2246, Revised Statutes 1889 [R. S. 1899, sec. 806], although the one says ‘every person aggrieved’ and the other says ‘any party to a suit aggrieved.’ ” It will thus be seen that to meet the ends of justice we have given to the present act the same wide range of meaning imported by the language of the former act.' Hence decisions construing the former act are in point. We shall not prolong this opinion by reviewing them. Samples of them are: In re Switzer, 201 Mo. 66; Nolan v. Johns, 108 Mo. 431; State ex rel. v. Talty, 139 Mo. 379; Wauchope v. McCormick, 158 Mo. 660. The Wauchope Case was in part overruled in the Thomas Case supra, hut not in its interpretation of the statute.

In my opinion the rationale of those cases, applied to this case, allowed an appeal from the order of sale.

But if at fault in that conclusion, clearly an appeal would lie by relators from the order confirming the sale.

The premises considered, we should not at this time pass on the question whether the order of sale was improvidently or irregularly broad in ordering the sale free and clear of liens. Under conditions present the writ cannot go to test that question, since the court had jurisdiction of the subject matter and parties.

The preliminary rule is quashed and an absolute writ is denied.

Graves, Ferriss, Brown, and Kennish, JJ., concur; Valliant, G. J., concurs in result; Wood-son, J., dissents.


source: Caselaw Access Project

author: VALLIANT, C. J.

license: Public Domain

text:
    THE STATE ex rel. EDWARD T. CAMPBELL and AMERICAN INSURANCE COMPANY v. CHRISTIAN BRINKOP, President of the Board of Assessors, and EDMOND KOELN, Collector, of the City of St. Louis.
    In Banc,
    December 16, 1911.
    1. TAXATION: Stock and Property of Corporation: Double Taxation. The stockholders cannot -he taxed on their stock and the corporation taxed on its property. That would be double taxation, whether the tax' is paid by the company or by the stockholders severally. When once the actual property of a corporation is reached and taxed, whether through the corporation directly or the stockholders indirectly, the law is satisfied. The statutes provide that certain corporations (manufacturing, mercantile, etc.) shall themselves" be assessed for and pay the taxes on their actual properties, and that the taxes on the actual properties of certain others (banks, insurance companies) shall be assessed against and paid by their stockholders; but they do not provide that both the corporation and its stockholders shall pay taxes on the same actual properties owned by the corporation.
    2. -: -: -: Bank Stock Held by Insurance Company. Shares of stock in banks and trust companies located in this State, owned and duly assessed and taxed against the insurance company as owner, the taxes on which are paid by the banks and trust companies, which are reimbursed by the insurance company, as the law requires, are not subject to further taxation against the insurance company — nor against the stockholders of the insurance company.
    3. -: -: Taxation of Banks and Insurance Companies. Banks and insurance companies are not assessed for taxation on the personal property owned by them, but the tax is levied against the shares of stock held by the stockholders. This method of bank taxation was adopted for the purpose of putting State banks on a footing with national banks, because by national law, while much of the personal property of a national bank, such as bonds, is not taxable, its shares of stock are. The real estate of a bank is taxed against the bank, and the personal property against the stockholders, and thereby its entire property is taxed once, but only once.
    4. -: -: Double Taxation: Not Authorized by Statute. The State has no authority to levy a tax against a bank based on the value of its taxable personal property, and also a tax on the shares of stock held by its stockholders based on a valuation of the same property. That would be double taxation. The Legislature did not intend to tax the bank’s personal property twice, once directly against the bank, and again indirectly against the stockholder; nor has it done so. Nor has the Legislature, by express terms or necessary implication, provided for double taxation in any case.
    5. -: -: -: Uniformity. To collect a double tax on property owned by a bank or an insurance company, and a single tax on the same kind of property held by an individual or a manufacturing company, would not be uniformity in taxation.
    6. -: -: -: In Proportion to Value. It would not be taxation in proportion to its value, to value property twice under different forms for the same purpose — for instance, to tax the personal property of a bank directly against the bank, and indirectly against the stock of the stockholder at the same valuation.

      7. -: -: -: Government Bonds. In estimating the value of hank stocks or insurance company stocks for the purpose of taxation, Government bonds owned by the bank or company are to be -taken into account and the stock appraised as if the money invested in them were invested in other personal property, although such bonds are not themselves taxable; but that is far from holding that the actual properties of the bank or company can be doubly taxed; it is simply holding that the stock only can be taxed.
    8. --: Stock of Manufacturing Company: Held by Insurance Company: Double Taxation. An insurance company cannot be assessed or taxed upon shares of stock of a manufacturing or business corporation organized under the laws of this State, owned and held by it, where the properties of said corporations were all duly assessed for the taxes and the taxes were paid by the corporations. Since the industrial corporations paid taxes on all their properties, to permit their stockholders to be taxed for the amount of stock held by them would be to twice tax the properties of said companies.
    9. -: Personalty Follows the Person. MoMlia■ sequuntur personam is a maxim of international law, applied chiefly, if not exclusively, to the distribution of an intestate’s estate. It has never been applied in this State to require a resident to list for taxation personal -property owned by him located in another State — not because the property is liable to taxation in another State, but because it is not liable to taxation, in this State.
    10. -: -: Double Taxation. An attempt to tax in this State property located outside of the State would not be invalid as double taxation, because this State is not chargeable with the consequences of taxes levied in another State.
    11. -: On Stock of Corporation: Property Outside'of State. Property located in another State is not directly taxable in this State, or at least is not included in the property rendered liable t.o taxation by the statutes; nor has the Legislature intended to levy a tax on such outside property in the guise of taxing the shares of stock of the corporation which owns it. Neither corporations nor individuals are required to pay taxes in this State on their property located outside of this State — ■ • neither the corporation directly, nor its stockholders indirectly, are required to pay taxes on such property.
    12. --: -: -: Insurance Premiums Due from Non-residents. Premiums due June the 1st, to a fire insurance company organized under the laws of this State and doing business here, on policies issued by it outside of this State, on property situated outside of this State, the premiums being payable outside of the State by non-residents, are not taxable in this State against the company.
    13. -: Insurance Company: Money Outside of This State. A domestic insurance company is not required to pay taxes in this State on money deposited in a bank located outside of this State, on June 1, kept by it in such bank in good faith, subject to check, with no intent to avoid taxation thereof in this State.
    14. -: Unlawful Assessment: Remedy: Certiorari. Relator, claiming that certain of its properties had been unlawfully assessed for taxation by the assessors, after an unavailing appeal to the local board of equalization, filed its petition in the Supreme Court for a writ of certiorari, and the writ being issued, the court holds that the assessment was illegal, and quashes the record thereof.
    Certiorari.
    Record quashed.

      A. é J. F. Lee and Charles M. Polk for relators.
    (1) It was unlawful to include in the assessment of the shareholders .of the insurance company the shares of stock owned by the insurance company on June 1, 1909, in national banks, in a State bank and in a trust company, the latter two organized under the laws of Missouri and all located in St. Louis, as such shares had already been taxed to the insurance company as the owner thereof and the taxes paid thereon, on behalf of the insurance company, and to include the same in the assessment of the shareholders of the insurance company was in violation of the constitutional provisions of this State that taxes should be uniform and that all property should be taxed in proportion to its value, in that the same property of the insurance company was thus taxed twice, such double taxation not being authorized or permitted by any statute of this State, and being contrary .to the decisions of the courts of this State. Constitution, art.. 10, secs. 3-4; secs. 7098 and 31357, R. S. 1909; Ham nibal, etc. Railroad v. Schacklett, 30 Mo. 550; State v. Railroad, 37 Mo. 265; Life Ins. Co. v. Charles, 47 Mo. 462; Scotland County v. Railroad, 65 Mo. 123; State v. Railroad, 77 Mo. 202; Valle v. Ziegler, 84 Mo. 214; State v. Railroad, 196 Mo.'523; East Livermore v.. Banking Co., 69 Atl. (Maine) 30’6; State v. Union Depot Co., 42 M'inn. 142; School Directors v. Bank, 8 Watts, 2891; Commonwealth v. Life & Trust Co., 9 Pa. Dist. 479; Commonwealth v. Coal & Navigation Co., 162 Pa. 603; Commonwealth v. Coal Co., 156 Pa. 488; Burke v. Badlam, 57 Cal. 594; State v. Simmons, 70 Miss. 485; Mail Co. v. Barbour, 88 Ky. 73; Gillespie v. Gaston, 67 Tex. 599; Security Co. v. Hartford, 61 Conn. 89; Bank v. Mumford, 4 R. I. 478; In re Newport Reading Room, 21 R. T. 440; Frederick Co. v. Bank, 48 Md. 117; Gordon v. Baltimore, 5 Gill (Md.), 231; Tax cases, 12 Gill & J. (Md.) 117. (2) It was unlawful to include in the assessment of the shareholders of the insurance company the shares of stock owned by the insurance company on June 1, 1909', in manufacturing and business corporations, organized under the laws of Missouri, and all located in St. Louis, as the property of such corporations had already been assessed and taxed as the property of such corporations for all general taxes assessable and taxable thereon on June 1, 1909, and such taxes had been paid by such corporations, and to include the same in the assessment of the shareholders of the insurance company was in violation of the constitutional provisions . of this State that taxes should be uniform and that all property should be taxed in proportion to its value, in that it was double taxation to assess both the property of such corporations and the shares therein owned by the insurance company, such double taxation not being authorized or permitted by any statute of this State and being contrary to the decisions of the courts of this State. Authorities under point one. (3) Neither the State nor any of its officers had jurisdiction to assess and tax the shareholders of the insurance company upon the insurance premiums due from nonresidents of Missouri, payable to the insurance company outside of Missouri, for insurance policies executed by the insurance company outside of Missouri, upon property outside thereof, due on policies subject to cancellation at any time at the instance of either insurer or insured, such cancellation requiring proportionate abatement of the premium unearned at the time of cancellation, and on which premiums the insurance company was assessed and paid taxes to the states in which such non-residents lived, because: 1st, Such premiums, were hot property within the State of Missouri; 2d, They were not such property as the laws of Missouri seek to tax. R. S. 1909, sec. 11337; State ex rel. v. Howard County, 69 Mo. 454; Yalle v. Ziegler, 84 Mo. 214; State v. Taylor, 47 Mo. 594; Wilcox v. Ellis, 14 Kas. 588; Fisher v. Commissioners, 19 Has. 414; Poppleton v. Yamhill County, 18 Ore. 377; People v.- Smith, 88 N. Y. 576. (4) Neither the State nor any of its officers had jurisdiction to assess and tax the shareholders of the insurance company upon a bank deposit of the insurance company subject to its check, kept by it in good faith outside of this State with no intent to avoid the taxation thereof in Missouri and taxable in the State were kept, because: 1st, Such premiums were not property within the State of Missouri. 2d, They were not such property as said laws seek to tax. Authorities under point three.

      Lambert E. Walther and William E. Baird for respondents.
    (1) The tax in question, like the tax in the case of banks and trust companies, is a tax upon the shares in the company and not a tax upon the property of the company. Bldg. & Savings Assn. v. Lightner, 42 Mo. 421; Lionberger v. Rowse, 43 Mo. 67; Ins. Co. v. Charles, 47 Mo. 373; State ex rel. v. Board of Assessors, 56 Mo. 503; Springfield v. Bank, 87 Mo. 441; State ex rel. v. Catron, 118 Mo. 280; State ex rel. v. Bank, 160 Mo. 640; State ex rel. v. Shryack, 179 Mo. 424; State ex rel. v. Bank, 180 Mo. 717; State ex rel. v. Bank, 196 Mo. 516. (2) In determining the value of the shares there must be considered all the property of the corporation except its real estate, legal reserve and unpaid policy claims. R. S. 1909, secs. 7098 and 11357; Savings Assn. v. Lightner, 47 Mo. 393 ; St. Louis Ins. Co. v. Charles, 47 Mo. 373; State ex rel. v. Catron, 118 Mo. 280; State ex rel. v. Bank, 160 Mo. 640; State ex rel. v. Shryack, 179 Mo. 424., (3) The tax being a tax on the shares of stock in the hands of the shareholders and not a tax on the property of the company, it is proper and legal, in fixing the value of the shares, to include property of the company which has already been taxed to the company or which is exempt from taxation. R. S. 1909, secs. 7098 and 11357; Savings Assn. v. Lightner, 47 Mo. 393; State ex rel. v. Shryack, 179 Mo. 424. (4) Although the property included in fixing the value of the shares has been taxed to the company or is exempt from taxation in this or any other State, it is not double taxation to consider such property in determining the value of-the shares for the purpose of taxing the shareholders; because the- shares of stock are an independent and: distinct species of property. Cases cited under points 1, 2 and 3; Cooley on Taxation (2 Ed.), pp. 225, 231 and 232; Van Allen v. Assessors, 3 Wall. 573; Lionberger v. Bowse, 43 Mo. 67; Savings Assn. v. Lightner, 47 Mo. 393; Lionberger v. Bowse, 9 Wall. 468; Bank v. Britton, 105 IJ. S. 325; Bank v. Tennessee, 161 U. S. 134; Trust Co. v. Lander, 184 U. S. Ill; Bank v. Des Moines, 205 U. S, 503; Hepburn v. School District, 23 Wall. 48Ó; People v. Coleman, 126 N. T. 433; Bank v. Kinsella, 201 111. 31; Bank v. Chambers, 182 IJ. S. 556; Coal Co. v. Commrs., 59 Md. 185; State v. Ins. Co., 70 Conn. 590; Bank v. Biclimond, 94 Ya. 316; People v. Commrs., 64 N. Y. 541; Light & Power Co. v. State, 79 Md. 63; Cook v. Burlington, 59 Iowa, 251; Commrs. v. Tile Co., 13 Allen 391.
   VALLIANT, C. J.

On the petition of relators a writ of certiorari issued to respondents,, requiring them to send up the records held by them showing the assessments for taxes, made by the assessors, of the shares of stock of the American Central Insurance Company, and relators’ appeal therefrom to the board of equalization, and the action of the board on that appeal, to the end that this court may pass judgment on the legality of the assessment which relators claim to be unlawful. In obedience to the writ the records have been sent up. There is no dispute as to the facts.

The American Central Insurance Company is a Missouri corporation, a fire insurance company. In the assessment made of the value of the stock of the corporation for taxation the relators say that items were included that should not have been taken into account. The petition states that the insurance company, by one of its chief officers, made its return to the-assessor of all the property taxable, as the property of the corporation, against its shareholders, which amounted to $734,848.55, which, according to the uniform rule of equalization adopted by the board of equalization, should have been assessed at fifty-five per cent of its actual value, that is, $404,166.69, but the assessor added to the list of property returned by the corporation certain other items, which increased the amount of actual values to $2,938',074, of which fifty-five per cent was $1,615, 950. It appears from the petition that, after the return above mentioned, an assistant secretary of the company, in the absence of the president and without authority, sent a statement to the assessor of the assets of the corporation containing the items which it is now claimed were improperly listed for taxation, and it was upon that information that the assessor acted in adding those items to the return previously made by the company; that as soon as it was discovered, the company applied to the assessor for its correction, and on his refusal appealed to the board of equalization, which also refused to strike those items from the list. It is stipulated, however, that that act of the assistant secretary in no way estops the relators from questioning the legality of the assessment.

The items in the assessment of which the relators complain are:

1. Shares of stock owned by the insurance company in national banks, a State bank and a trust company, the latter two Missouri corporations and all located in the city of St. Louis, which stocks were of the aggregate value of $1,092,510. These stock were duly assessed and taxed against the insurance company as owner, and the taxes paid thereon were paid by the national banks and the State bank and the trust company, and the insurance company reimbursed the banks and trust company therefor as the law requires.

2. Shares of stock owned by the insurance company of the value of $97,795, in manufacturing and business corporations organized under the laws of this State, the properties of which corporations were all duly assessed against them and paid by the corporations.

3. Premiums due June 1, 1909, to the amount of $328,696.38, on policies issued by the insurance company outside of Missouri, on property outside of the State, the premiums payable outside the State by nonresidents, on which sums the insurance company was assessed and paid taxes in the states in which such nonresidents lived.

4. A bank deposit of the insurance company, subject to its check, kept by it in good faith, on June 1, 1909, in a bank outside of this State, with no intent to avoid the taxation thereof in Missouri, and taxable in the State where kept.

The question is whether either or all of those four items is or are to be taken into account in estimating the value of the shares of stock held by the shareholders in the insurance company.

The position of the relators on this question is that having already paid their taxes on the shares of stock held by them in the national banks and the Missouri corporations, it would be double taxation to take those items into account in determining the value of their shares of stock in the insurance company; and that as to the premiums due outside the State and money in a bank outside the State, which are taxable in the States where located, the statutes of this State do not authorize their assessment here..

The position of the respondents is that taxation of the property of a corporation is one thing, and taxation of shares of stock in the corporation is another thing; that to tax the corporation on the value of its property and tax the shareholders on the value of their shares is not double taxation, and that as to the intangible personal property outside the State the taking of it into account in estimating the value of the stock for taxation is not taxing the property.

I. Generally speaking the title to corporate property is in the corporation, while the beneficial interest is in those who own the stock. The profits derived from the successful operation of the business of the corporation is distributed among the shareholders, its losses fall indirectly on the shareholders, and upon its dissolution the property is reduced to money and likewise distributed. Thus, although the shareholders do not own the property, yet they alone are interested in the profits or losses arising from its use, and they alone are affected financially by the increased or diminution of its value. Therefore, notwithstanding the artificial legal distinction between the ownership of the property and the ownership of the stock, it is true as a matter of fact that whatever affects the property affects the financial value of the stock, and whatever burden the property has to bear is borne by the shareholders, whatever tax it pays is paid at the expense of the shareholders; and when the tax on the property is paid at the expense of the shareholders, and then a tax is levied on the stock owned by the shareholders, taking into account in estimating its value the value of the property on which the tax has already been paid, it is in fact double taxation in spite of the legal fiction. Under our statute, stock in a bank, Federal or State, is assessed against the shareholder, but the tax is paid in the first instance by the bank, and the bank is reimbursed by the shareholder. That is merely a mode of convenience in collecting the tax, the effect is the same as if the shareholder paid it in the first instance. In the case now before us the insurance company was a shareholder of stock in these banks, the banks paid the tax that was assessed against the insurance company stock and the insurance company reimbursed the banks as the law required.- The insurance company in this act took money out of its treasury to pay those taxes. Whose money was that? The legal title was in the corporation, but the beneficial interest was in the shareholders of that corporation, the act affected financially no one but those shareholders ; in point of fact it was the same in effect as if each shareholder had been assessed by the corporation and paid his share of the tax into the treasury of the company, and if the shareholders are now to pay a tax on those bank stocks in the form of a valuation of their stock in the insurance company, it is in fact double taxation, whatever aspect the legal fiction may-give it.

Respondents contend that since property in the corporation is one thing and stock of the corporation is another, it is not double taxation to tax both, but they say, that even if it were double taxation to do so, the State has authority to make the double taxation, and authorities are cited which are claimed to sustain that proposition. On that point we understand the position of the relators to be that, if it should be conceded that the State had such authority, it has not by its statutes authorized such double taxation. That we deem to be the crucial point in this case.

Shares of stock in an insurance company are taxed in the same manner as shares of stock in a bank. [Sec. 11357, R. S. 1909.] Banks and insurance companies are not assessed for taxations on the personal property owned by them, they are assessed only on their real estate; the only tax on the personal property belonging to those corporations is levied in the form of a tax on the shares of stock held by the stockholders. That method of taxation was adopted for the purpose of putting State banks on a footing with national banks in relation to taxation, because whilst much of the personal property of a national bank (United States bonds, etc.) is not subject to taxation, the shares of stock in a national bank are, by an Act of Congress, section 5219, Revised Statutes of United States, 1878, made taxable. Under respondents’ theory the State would have authority to levy a tax against a bank based on the value of its taxable personal property and a tax on the shares of stock based on a valuation of the same property, which as we have already said would be double taxation, both taxes being paid by the shareholder in proportion to his shares, the one paid indirectly, the other directly. But the State has not done that; it recognizes that the tax on the shares of stock is in fact a tax on the personal property, and therefore it does not otherwise tax the personal property of the bank. And the intention of the lawmaker is further shown by the fact that in estimating the value of the stock for taxation it does not take into account the real estate belonging to the bank, because that is assessed to and paid by the bank, and the State is content to levy only one tax on the real estate, and one tax on the personal property belonging to the bank, which is assessed against the stockholder in the guise of assessing his stock. Real estate belonging to a bank affects the value of the stock as much as personal property, and if the purpose of the Legislature was double taxation, it would have included the real estate in estimating the value of the stock; and unless we say that a tax on the shares of stock based on a valuation of the personal property of the bank is a tax on the personal property itself, we must say that the General Assembly has violated the Constitution in exempting that personal property from taxation. The Legislature intended to levy one tax on all the property of the corporation, its real estate and its personal property, and provided that the tax on the real estate should be paid by the corporation, and that on the personal property by the shareholders in the form of a tax on the shares. Thus all the property is taxed, but not taxed twice. Cases are cited by respondents to show that, although Government bonds owned by a bank are not taxable, yet in estimating the value of the shares of stock the bonds may be taken into account. But conceding that proposition, it does not answer the question before us; the question we are considering is not whether property not subject to taxation shall be taken into account, but whether property on which the shareholder has already paid the tax shall be again listed for taxation against him.

If double taxation has crept into our law in any form it is not in the form of express terms or necessary implication, and can only be discovered by strained inference. Uniformity in taxation is required by our Constitution, and it requires all property to be taxed in proportion to its value. [Art. 10, secs. 3 and 4.] It would not be uniform to collect a double tax on property owned by a bank or. insurance company, and a single tax on tbe same kind of property held by an individual or a manufacturing corporation; and it would not be taxation in proportion to the value of the property if it is valued twice under different forms for the same purpose.

The mode of reaching the value of stock for taxation is thus prescribed in our statute, section 11357, Revised Statutes 1909: “Persons owning shares of' stock in banks, or any joint-stock institution or association doing a banking business, or any insurance company, whether of fire, marine, life, health, accident or other insurance, incorporated under or by any law of the United States or of this State, shall not be required to deliver to the assessor a list thereof, but the president or other chief officer of such corporation, institution or association, shall, under path, deliver to the assessor a list of all shares of stock held therein, and the face value thereof, the value of all real estate, if any, represented by such shares of stock, together with all reserved funds, undivided profits, premiums or earnings, and all other values belonging to such corporation, company, institution or association ; and such shares, reserved funds, undivided profits, premiums or earnings, and all other values so listed to the assessor, shall be valued and assessed as other property at their true value in money, less the value of real estate, if any, represented by such shares of stock.”

The statute there speaks of real estate represented by the shares of stock, “together with all reserved funds,” etc., showing that it intended to say that the stock represented the property. But the real estate was to be deducted from the assessment against the shares of stock, because the tax on that was to be paid by the bank. The intention of the Legislature to-tax all the taxable property of the bank, real and personal, is clearly shown by the statute and the intention to tax it but once is just as clearly shown.

By the charter of the Hannibal & St. Joseph Railroad Company the capital stock of the company was exempt from all State and county taxes. [Laws 1847, p. 156; and Laws 1837, p. 247, l. c. 252, sec. 24.] In the General Revenue Act of 1855, Revised Statutes 1855, p. 1322, it was provided that “all property owned by incorporated companies, over and above their capital stock” was made subject to taxation. Under that statute the collector of Marion county in 1858 assessed for taxation the property of the corporation consisting of road bed, depot, shops, rolling stock, etc. The question before this court was whether that property was exempt from taxation under the terms of the charter exempting the stock. The court experienced difficulty in determining what property was to be considered as representing the capital stock, as distinguished from other property owned by the railroad company. The court said: “It is clear that there was no intention of taxing both the capital stock and the property which was over and above the capital stock. It is only the last which is taxed and the former is expressly exempted.....Capital stock in its strictest signification, exists only nominally; the money or property which it represents is the tangible reality. The one is the representative of the other; and if the stock and the property which it represents are both taxed, the taxation is double. ’ ’ Further on in the same opinion the court said: “A double taxation on the same property is manifestly not intended, either by this enactment or by the provisions of the general revenue law. A double taxation is an absurdity, at least, where the proceeds of the tax go in one direction, since it is in effect an increased rate of taxation merely, and could be more plainly and simply expressed by making it so in terms.” [Hannibal, etc., Railroad v. Shackett, 30 Mo. 550.] In a later case construing the same statute in connection with the same charter provision, exempting the stock of the railroad company from taxation, it was held that the stock represented all the property of the corporation, and to tax it taxed the property, and to exempt it from taxation exempted the property. The court said: “If property of a corporation is taxed in the hands of the stockholders it cannot he taxed in the hands of the corporation also. A corporation is taxable like a natural person, but is not to be taxed twice.....It might be said that the natural persons, who held the stock, could be taxed as such persons in respect to the shares of stock owned by them, and that the corporation, as an artificial person, might be taxed in respect of the real and personal estate owned by the company, without necessarily involving a double taxation of the same person; but the taxation would still be double in respect of the same actual property, the stock Certificate merely representing the several interest of the shareholder in the property of the corporation.” And further the court said: “It is-not easy to see how, in any legal sense, a corporation could own other property than that which would be represented by the stock in the hands of the' shareholders. The shares of stock might be above or below par.value, according to the amount and value of the property owned by the corporation, and it is to be presumed that shares of stock would be taxed, if subject to taxation, in proportion to their value, like other kinds of property. [Redf., Railw., 531.] In this, way the whole property would be once taxed against the natural persons, who are, at last, the only real owners of the property held by the corporation in which they are the stockholders.” Those cases show that at that early date the spirit of onr law wasxagainst double taxation, and that whilst recognizing the propriety of reaching the property for taxation either through the stockholders or the corporation, yet when once-reached and taxed the State was satisfied. That is a principle of law so right and just that it pervades all our revenue statutes from that time to the present. Section 11357, above cited, provides for the taxation of property through the medium of the stock and of other property in the hands of the corporation, but the property that is reached through the stockholders is not touched in the hands of the bank, and that which is reached in the hands of the bank is not touched in the hands of the stockholder.

Respondents in their brief say that the decisions from which the above quotations are made were based on the fact that the charter of the Hannibal & St. Joseph Railroad Company vested all the property of the corporation in the stockholders, but in that they are mistaken, as reference to the charter of that' railroad company will show. [Laws 1847, p. 156, and Laws 1837, p. 247, l. c. 252, sec. 24.] The charter exempted tire stock from taxation, and the court held that wás in law equivalent to exempting the property. Other •cases referred to in the brief of relators show that the doctrine of the cases above cited has been the doctrine of this court ever since. [St. Louis M. Life Ins. Co. v. Charles, 47 Mo. 462; Scotland County v. Railroad, 65 Mo. 123; State v. Railroad, 77 Mo. 202; Valle v. Ziegler, 84 Mo. 214.] In Scotland County v. Railroad, the stock of the company was exempt from taxation. The court held that a tax on the property which the stock represented was a tax on the stock, and said: “If the exemption of the stock did not extend to the property which the stock represented, the section (exempting the stock) was purely illusory.” In State v. Railroad, the court said: “It may be conceded only for the purpose of the argument, what has never been held by any court, that it (the State) could have subjected to taxation the shares of individual stockholders, tiie capital stock and the property, but the question is, had the Legislature up to 1871 seen proper to do so?” The court then goes on to say that taxation of the shares of stock is taxation of the property of the corporation, and that to tax the shares against the shareholders and the property against the corporation is double taxation, and that therefore when the tax is levied on the stock it exempts the property. In that case, as is pointed out by respondents, by the charter of the company its capital stock and its property is vested in the stockholders, “and shall be exempt from any public charge or tax whatsoever for the period of five years from and after the passage of this act.” The language is peculiar; it shows that the Legislature in 1853 was not as familiar with the art of framing charters for railroad companies as it is now. But it goes to show that the Legislature then appreciated the fact that the words “capital stock” and “property” of the corporation really referred to the same interest, and the object was to make it clear that in. exempting the capital stock from taxation the property represented by the stock should also be exempted. But what was said by the court in that case on the subject of double taxation was not based on that peculiarity of the charter, but on the broad proposition that the stock and the property were really one interest, and to tax one was to tax the other, and to tax both was double taxation. In Valle v. Ziegler it was held that when the tax was levied against the property of a manufacturing corporation the shares of stock were not subject to taxation, because the property represented the capital stock, and to tax both would be duplicate taxation. The court said: “An intent to tax both the capital stock and the property of the corporation must be clearly declared, or it will not be imputed to the Legislature.” Decisions from the courts of other States to the same effect are cited in the brief of relators, but as our own decisions are explicit on the point we will not consume space in discussing the cases from other jurisdictions.

In none of the cases referred to by relators, nor. in any case to which our attention has been called, has this court been called on to say whether under the clauses of our Constitution hereinbefore mentioned a valid statute could be enacted taxing both the property of the corporation and the shares of stock, and it is not necessary to decide that question in this case, because no such statute has been passed by our General Assembly. Therefore the authorities from other jurisdictions cited in respondents’ brief to sustain the proposition that a State may tax both the stock and the property need not be discussed.

We do not understand respondents as contending that there is any express provision of our statute authorizing double taxation in the form of a tax on the property and a tax on the shares of stock representing the property, but they draw that inference from the fact that the statute requiring a list of all the personal property of the bank to be given to the assessor to enable him to estimate the value of the shares of stock and there being no express exceptions of personal property on which the taxes have already been paid, or as to,which a different mode of collecting- the tax has been prescribed, such property is to be included and double taxes are to be paid. Such an inference is not only not the necessary inference, but it is contrary to the spirit of the statute which, by separating the real from the personal, assessing one against the bank and the other against the stockholder, shows an intent to avoid double taxation. If the purpose of the lawmaker had been double taxhtion, taxing the bank on all its property and the shareholder on the value of his stock, it could have been expressed very much more clearly and in very much fewer words. Reference to respondents’ brief will show a number of cases decided by this court interpreting our statute which prescribes the method of taxing banks and insurance companies, which is, that the corporation pays taxes on the real estate only, while the tax on personalty is levied in the form of a tax on the shares of stock held by the shareholders. In State ex rel. v. Shryack, 179 Mo. 424, the history and development of onr statute law on that subject are fully set out in the opinion of the court by Judge Marshall and the conclusion is as above stated. In that opinion it is shown that the reason for the plan adopted, that is, assessing the real estate to the corporation and covering the personalty in the form of assessment on the shares of stock, was to put the State banks for taxation on a level with national banks. That case was followed by the case of State ex rel. v. Bank, 180 Mo. 717, in which the same conclusion was reached in opinion by Judge Robinson.

Without authority from the United States it was thought that a State could not tax shares in a national bank, and therefore an act of Congress was passed June 3, 1864 (13 Stat. at Large, 111), conferring on States power to tax shares of stock in national banks within their respective borders. Since the national banks all owned Government bonds, which were not subject to taxation, the question arose, under the act of Congress, whether in assessing the value of the shares of stock, the Government bonds belonging to the bank should be taken into account, because, it was said, to do so would be an indirect tax on the bonds. But the Supreme Court of the United States, in Van Allen v. The Assessors, 3 Wall. 573, and in other cases following, decided that the shares of stock in a national bank could be taxed although its entire capital was invested in bonds of the United States; that decision was based on the express terms of the act of Congress conferring that right on the States. And in that ease the court drew a distinction between a tax on the bonds and a tax on the shares of stock whose value was based on the bonds. The theory of that case, and the cases following, is that whilst the bonds cannot be taxed because tbe law forbids it, tbe shares of stock may be taxed because the act of Congress expressly permits it. The court was not dealing with common law principles or discussing the question of double taxation. There was no question of double taxation in that case — the bonds were not taxed, the only tax was against the shares of stock.

Respondents refer to Bank v. Tennessee, 161 U. S. 134, from which they quote this sentence: “The capital stock of a corporation, and the shares into which such stock may be divided and held by individual shareholders are two distinct pieces of property. The capital stock and the shares of stock in the hands of the shareholders may both be taxed, and it is not double taxation.” And Van Allen v. Assessors, above referred to, is cited as announcing that doctrine. As we have already said there was ho question of double taxation in the Van Allen. Case, nor was there in the case from which the above quotation is taken. In that case the charter of the bank (date 1856) required the corporation to pay to the State annually one-half of one per cent of each share of its capital stock “which shall be in lieu- of all other taxes. ’ ’ Under its general revenue statute of 1891, the State undertook to levy a tax on the stock, but the court held that the charter provision was a contract which the State could not violate, and that the exemption applied as well to the increased stock as to the original. But the Tennessee statute also provided “that the surplus and undivided profits in such bank, banking association or other corporation shall be assessable to said bank or other corporation and the same shall not be considered in the assessment of the stock therein.” The court held that that surplus could be taxed. The court said that the charter exemption in terms mentioned only the capital stock of the bank and that as the surplus of the bank was not expressly mentioned in the exemption clause it was not to be included. Mr. Justice White dissented from that part of the opinion which held that the surplus could he taxed. Neither of those cases is authority for double taxation as it is presented in this case.

There are a number of other cases from the same court cited by respondents, but we do not feel justified in occupying time and space to discuss them, because in so far as they are thought to bear on the question before us, as we understand them, they are only to the effect that a tax on the shares of stock in a national bank is not a tax on the Government bonds held by the bank, and they are all based on the construction given the act of Congress in the Yan Allen Case, and they are all leveled against the argument that taxing the stock in a national bank is taxing the Government securities. Chief Justice Chase filed a dissenting opinion in that case, and Justices Wayne and Swain concurred therein.

But relators are not complaining against this assessment on the ground that it includes property not taxable, but on the ground that it includes property on which they have already paid the tax. That distinguishes this case from all the above named cases cited by respondents. Relators concede that in estimating the value of the stock held by the insurance company in the banks, the Government bonds are to be taken into account, and that is all that the Yan Allen Case and the cases following it decide.

We hold that to levy a tax on the shares of stock in the State and national banks and trust company, and then to take those shares into account in estimating the tax to be levied on relators’ shares of stock, in the insurance company, would be double taxation, which our statutes do not authorize.

II. The same principle applies to the shares of stock owned by the insurance company in the domestic manufacturing corporations, the only difference in fact being in tbe mode of assessing and collecting the tax, that Is, instead of reaching the property through the shares of stock the tax is levied directly on the property.

III. As to policy accruing premiums and money of the insurance company outside of this State which are subject to. taxation in the State where located, a different principle applies. Mobilia sequuntur personam is a maxim of international- law, and is applied chiefly, if not exclusively, to the distribution of an intestate’s estate; it has never been applied in this State to the requiring of a resident to list for taxation personal property owned by him located in another State, not because the property is liable to taxation in, the other State, but because it is not liable to taxation in this State. If the property were liable to taxation here and if the State should see fit to tax it, the taxation here would not be double taxation in the sense that we have above used that term, because this State is not chargeable with the consequences of taxes levied in another State. Since, therefore, the property located in another State is not directly taxable here, or at least is not included in the property rendered liable to taxation by our statutes, the question arises was it the intention of our Legislature to levy indirectly a tax on it in the guise of taxing the shares of stock in the corporation which owns the property?

Section 11357, Revised Statutes 1909', requires the president or other chief officers of the company to deliver to the assessor, under oath, a list of the shares of stock ‘ and the' face value thereof and the value of the real estate, if any, represented by such shares of stock, together with all reserved funds, undivided profits, premiums or earnings and all other values belonging to such corporation, company, institution or association; and such shares, reserved funds, undivided profits, premiums or earnings, and all other values so listed to the assessor, shall be valued and assessed as other property at their true value in money, less the value of real estate, if any, represented by such shares of stock.”' After the assessment, the bank or insurance company pays the tax on the land, but not on the personal property; the personal property being taxed only by taxing the shares of stock which represent the property. That means that the shares of stock take the place of the property which they represent, and which but for the tax on the shares would be subject to a direct tax. If that system of taxation had not been adopted in reference to banks and insurance companies, the system that applies to other corporations would apply to them,- and they would make return to the assessor of all their “real estate and personal property subject by law to taxation in this State,” in the language of section 11415'. But would they, in such case, be required to include in their return property not in this State? If so, then an individual would be required to do the same, for the language above quoted from section 11415 is not limited to corporations, but applies to individuals as well, and besides section 7098, Revised Statutes 1909, in reference to insurance companies, requires that their property “shall be assessed and taxed as the property of individuals.”

It is true property outside of the State influences the value of the shares in a commercial sense, and if the shareholder were selling his stock it would be taken into account in fixing the price, but so it would if, instead of taxing the shares, the State had taxed the property directly in the hands of the corporation, and so it would also if the property outside the State consisted of real estate. In taxing the shares of stock in lieu of the personal property which they represent, the General Assembly intended the same revenue re-suit that would follow the taxing of the property, that is, the taxing of property “made subject by law to taxation in this State. ’ ’

We have just had occasion in another case decided at this term, State ex rel. v. Liesser, 237 Mo. 310, to review our revenue statutes from 1845' to this date, and we there reached the conclusion that it had never' been the policy of this State to tax both the shares of stock and the property which they represent. The older statutes subjected to taxation shares of stock in all corporations and the property of the corporation “over and above that represented by the shares of stock.” Where the shares of stock are taxed the property they represent is not -taxed, and where the property of the corporation is taxed the shares of stock are not taxed. Double taxation has never been the policy of this State, as would be the case if the stock and the property were both taxed. The policy of our General Assembly has always been to encourage the building up in the State of corporations engaged in business of pub-lie utility and promoting the financial advantage of its citizens. Double taxation in the form of a tax on the stock and on the property represented by the stock, would be not only unjust, but impolitic. And it would also be unwise and unjust discrimination to make corporations pay taxes, either directly or indirectly, on their property outside the State, when individuals are not so required. Missouri has within its own borders vast wealth in property on which the tax collector can lay his hands, and it has no occasion to reach out and gather taxes on property which is not under its protection. To take into account, in assessing the value of the shares of stock in this insurance company, property owned by the corporation outside of this State, would be equivalent in. effect to requiring the shareholders to pay taxes on such property; our statutes do not authorize such taxation.. We hold that the bank deposits and accruing premiums outside this State, mentioned in relators’ petition, are not to be taken into account in assessing the value of the shares' of stock.

What we have said in this connection is intended to apply to the facts of this case, wherein it is admitted that the corporation has acted in good faith and has not put any of its property outside this State to avoid taxation.

We hold that the assessment complained of in relators ’ petition is illegal, and the record thereof should he quashed. It is so ordered.

All concur.