Gloucester Ferry Company v. Pennsylvania - 114 U.S. 196 (1885)
U.S. Supreme Court
Gloucester Ferry Company v. Pennsylvania, 114 U.S. 196 (1885)
Gloucester Ferry Company v. Pennsylvania
Argued March 13, 1885
Decided April 13, 1885
114 U.S. 196
Commerce among the states consists of intercourse and traffic between their citizens, and includes the transportation of persons and property and the navigation of public waters for that purpose, as well as the purchase, sale and exchange of commodities.
The power to regulate commerce, interstate and foreign, vested in Congress, is the power to prescribe the rules by which it shall be governed -- that is, the conditions upon which it shall be conducted; to determine when it shall be free and when subject to duties or other exactions.
As to those subjects of commerce which are local or limited in their nature or sphere of operation, the state may prescribe regulations until Congress assumes control of them.
As to such as are national in their character and require uniformity of regulation, the power of Congress is exclusive, and until Congress acts, such commerce is entitled to be free from state exactions and burdens.
The commerce with foreign nations and between the states which consists in the transportation of persons and property between them is a subject of national character, and requires uniformity of regulation.
The business of receiving and landing of passengers and freight is incident to their transportation, and a tax upon such receiving and landing is a tax upon transportation and upon commerce, interstate or foreign, involved in such transportation.
The only interference by a state with the landing and receiving of passengers or freight arriving by vessels from another state or from a foreign country which is permissible is confined to measures to prevent confusion among the vessels and collisions between them, to insure their safety and convenience, and to facilitate the discharge or receipt of their passengers and freight.
Interstate commerce by corporations is entitled to the same protection against state exactions which is given to such commerce when carried on by individuals.
The transportation of passengers and freight for hire by a steam ferry across the Delaware River from New Jersey to Philadelphia by a corporation of New Jersey is interstate commerce which is not subject to exactions by the Pennsylvania.
Freedom of transportation between the states or between the United States and foreign countries implies exemption from charges other than such as are imposed by way of compensation for the use of the property employed, or for facilities afforded for its use, or as ordinary taxes upon the value of the property.
In March, 1865, the Gloucester Ferry Company, the plaintiff in error here, was incorporated by the Legislature of New Jersey to establish a steamboat ferry from the Town of Gloucester in that state to the City of Philadelphia, in Pennsylvania, with a capital stock of $50,000, divided into shares of $50 each. During that year, it established and has ever since maintained a ferry between those places across the River Delaware, leasing or owning steam ferry boats for that purpose. At each place, it has a slip or dock on which passengers and freight are received and landed -- the one in Gloucester it owns, the one in Philadelphia it leases. Its entire business consists in ferrying passengers and freight across the river between those places. It has never transacted any other business. It does not own, and has never owned, any property, real or personal, in the City of Philadelphia other than the lease of the slip or dock mentioned. All its other property consists of certain real estate in the County of Camden, New Jersey, needed for its business, and steamboats engaged in ferriage. These boats are registered at the port of Camden, New Jersey. It has never owned any boats registered at a port of Pennsylvania, and its boats are never allowed to remain in that state except so long as may be necessary to discharge and receive passengers and freight.
In July, 1880, the Auditor General and the Treasurer of the State of Pennsylvania stated an account against the company of taxes on its capital stock, based upon its appraised value, for the years 1865 to 1879, both inclusive, finding the amount of $2,593.96 to be due the commonwealth. From this finding, an appeal was taken to the Court of Common Pleas of Philadelphia, and was there heard upon a case stated, in which it was stipulated that if the court were of opinion that the company was liable for the tax, judgment against it in favor of the commonwealth should be entered for the above amount, but if the court were of opinion that the company was not liable, judgment should be entered in its favor.
A statute of Pennsylvania, passed June 7, 1879, "to provide revenue by taxation," in its fourth section enacted as follows:
"That every company or association whatever, now or hereafter
incorporated by or under any law of this commonwealth or now or hereafter incorporated by any other state or territory of the United States or foreign government and doing business in this commonwealth or having capital employed in this commonwealth in the name of any other company or corporation, association, or associations, person, or persons, or in any other manner, except foreign insurance companies, banks and savings institutions, shall be subject to and pay into the treasury of the commonwealth annually a tax to be computed as follows -- namely, if the dividend or dividends made or declared by such company or association as aforesaid, during any year ending with the first Monday of November amount to six or more than six percent upon the par value of its capital stock, then the tax to be at the rate of one-half mill upon the capital stock for each one percent of dividend so made or declared; if no dividend be made or declared or if the dividend or dividends made or declared do not amount to six percent upon the par value of said capital stock, then the tax to be at the rate of three mills upon each dollar of a valuation of the said capital stock,"
made in accordance with the provisions of another section of the act.
It was under the authority of this act that the taxes in question were stated against the company by the auditor general and the state treasurer.
The court of common pleas held that the taxes could not be lawfully levied, for there was no other business carried on by the company in Pennsylvania except the landing and receiving of passengers and freight, which is a part of the commerce of the country, and protected by the Constitution from the imposition of burdens by state legislation. It therefore gave judgment in favor of the company. The case being carried on a writ of error to the supreme court of the state, the judgment was reversed and judgment ordered in favor of the commonwealth for the amount mentioned. To review this latter judgment, the case is brought here.