Bacon v. Illinois
227 U.S. 504 (1913)

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U.S. Supreme Court

Bacon v. Illinois, 227 U.S. 504 (1913)

Bacon v. Illinois

No. 76

Argued December 6, 1912

Decided February 24, 1913

227 U.S. 504

Syllabus

The denial to the states of the power to tax articles actually moving in interstate commerce rests upon the supremacy of the federal power to regulate that commerce, and its postulate is necessary freedom of that commerce from the burden of local taxation.

The state cannot impose a tax upon articles moving in interstate commerce on the ground that such articles belong to its own citizens.

Page 227 U. S. 505

They, a well a others, are under the protection of the commerce clause of the Constitution.

The test of exemption from state taxation is not citizenship of the owner, but whether or not the articles attempted to be taxed are actually moving in interstate commerce.

Property brought from another state and withdrawn from the carrier and held by the owner with full power of disposition become subject to the local taxing power notwithstanding the owner may intend to ultimately forward it to a destination beyond the state.

Goods within the state may be made the subject of a nondiscriminatory tax though bought from another state and held by the consignee in the original package. Woodruff v. Parham, 8 Wall. 123.

243 Ill. 313 affirmed.

This is a writ of error to review a judgment of the Supreme Court of the State of Illinois which affirmed a judgment for the amount of a tax assessed against the plaintiff in error for personal property in the year 1907. The contention that the assessment was in violation of article I, § 8, clause 3, of the federal Constitution, in that it was laid upon a subject of interstate commerce, was overruled by the state court. 243 Ill. 313.

The facts were agreed to, as follows:

"That the defendant, E. R. Bacon, had, on the first day of April, 1907, and for many years prior to said date, his residence and domicil in the Town of Lake View, in the County of Cook, and State of Illinois; that the defendant, E. R. Bacon, on the first day of April, 1907, and prior thereto, occupied and controlled a certain private grain elevator known as Wabash Elevator, and that the said grain elevator was located at 33d and Waterville Streets in the Town of South Town, in the City of Chicago, County of Cook, and State of Illinois; that the only personal property in the Town of South Town owned by the defendant on the first day of April, 1907, was certain grain stored in the said elevator above mentioned, and certain personal property used by him in his business office located at 234 La Salle Street, in the City of Chicago,

Page 227 U. S. 506

Illinois, and that the said business office and the said personal property used by said defendant therein was not then a part of or in any way connected with said grain elevator; that the said defendant, E. R. Bacon, has paid the tax assessed on April 1st, 1907, on all the personal property used by him in his said business office located at 234 La Salle Street, in the City of Chicago, Illinois; that the said defendant, E. R. Bacon, has paid the tax assessed on April 1st, 1907, on all his personal property located in the Town of South Town except the tax assessed on the grain which was stored in the said Wabash Elevator on the 1st day of April, 1907; that all of said grain stored in the said Wabash Elevator on the 1st of April, 1907, was sold to the defendant, E. R. Bacon, by various persons domiciled in and residents of various states in the southern and western portions of the United States, and that the said persons who sold the said grain to the said defendant, E. R. Bacon, did, prior to the said sale and the shipment of said grain, as hereinafter mentioned, enter into certain contracts with certain railroad companies for the transportation of said grain to the Cities of New York and Philadelphia and various other cities in the eastern portions of the United States, all of said cities being outside of the State of Illinois, in and by which said contracts the said persons reserved the right to the owners of the said grain to remove said grain from the cars of the said railroad companies at the City of Chicago, Illinois, for the mere temporary purposes of inspecting, weighing, cleaning, clipping, drying, sacking, grading, or mixing, or changing the ownership, consignee, or destination of said grain; that, after the making of the said contracts by the original vendors of the said grain and the said railroad companies, the said original vendors delivered to the said railroad companies, under and in accordance with the said contracts, the said grain for transportation to said Cities of New York, Philadelphia and the said divers other cities specified in the said contracts of shipment."

"That the said E. R. Bacon was, prior to and on April 1st, 1907, represented in the Cities of New York, Philadelphia, and the said

Page 227 U. S. 507

divers other cities in the said eastern portions of the United States by various agents, by and through whom he disposed of grain and other commodities on the eastern markets, and that all of the said grain above mentioned was purchased by him as aforesaid for the sole and only purpose of being sold and disposed of by and through his said agents in the aforesaid eastern cities, and that the said grain or any portion thereof was not at any time intended, by said original owners nor by said E. R. Bacon, for use, sale, or disposition in the State of Illinois."

"That, at the time the said grain was sold to the said defendant, E. R. Bacon, by the said original vendors thereof, domiciled in and residents of said southern and western portions of the United States, his sole and only intention regarding the said grain was that all of the said grain should be transported and carried from the place of its said original consignment to said railroad companies to the said points of destination named in the said contracts of shipment entered into between the said original vendors of said grain and the said railroad companies, as hereinbefore mentioned."

"That the said grain was sold to the defendant, E. R. Bacon, by the original vendors of said grain, along with the existing contracts of shipment between the said original vendors and the said railroad companies, and along with the said privilege of removing said grain from the said cars of the said railroad companies, which said privilege was reserved to the owner of the said grain in the manner and for the purposes hereinbefore mentioned; that, in pursuance of the privilege which the defendant, E. R. Bacon, was entitled to under said contracts of shipment

Page 227 U. S. 508

as the owner of said grain, he removed said grain from the said railroad cars and placed the same in his said private Wabash Elevator for the sole purposes of inspecting, weighing, cleaning, clipping, drying, sacking, grading, and mixing, as specified in said contracts of shipment, and not for the purposes of changing the ownership, consignee, or destination of said grain, and that said grain remained in said elevator for only such time as was reasonably necessary for the purposes of inspecting, weighing, cleaning, clipping, drying, sacking, grading, and mixing, and that, immediately after said grain had been inspected, weighed, cleaned, clipped, dried, sacked, graded, and mixed, it was turned over again to the said railroad companies for shipment to the said eastern cities in accordance with the said provisions of the said original contracts of shipment entered into between the said original vendors of said grain and the said railroad companies, and that the said grain was thereupon forwarded by said railroad companies to its said original points of destination."

"That the said grain so placed and contained in the said elevator was not, nor was any part thereof at any time on, before, or after the 1st day of April, 1907, sold or disposed of or consumed in the State of Illinois, but that said grain and each and every part thereof was transported out of said state to the points of destination, and in the manner and form aforesaid;"

"That, on the 1st day of April, 1907, the Board of Assessors of Cook County, Illinois, assessed a tax against the said E. R. Bacon on the said grain contained in the said Wabash Elevator on the said 1st day of April, 1907, on a valuation of $5,000, which was established by the board of review, and which was equalized by the State Board of Equalization, and that the tax levied thereon against the defendant, E. R. Bacon, for the year 1907, amounts to $360, which is the tax to recover which the suit is brought; that the defendant owns certain personal

Page 227 U. S. 509

property in the Town of Lake View, County of Cook and State of Illinois, and that said personal property is contained in his said domicil and residence, and that the said defendant has heretofore paid all the taxes assessed on the said personal property on the said 1st day of April, 1907, and that the said defendant, E. R. Bacon, owned, on the 1st day of April, 1907, no other personal property taxable by the taxing bodies of the State of Illinois other than that above mentioned. "

Page 227 U. S. 510

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