1. A certification by the Court of Claims under § 3(a) of the
Act of February 13, 1925, cannot be entertained if the question
certified embraces the whole case, because to accept it and proceed
to a determination thereof would be an exercise of original
jurisdiction by this Court contrary to the Constitution, and
because the statute permits a certification only of definite and
distinct questions of law. P. 281 U. S.
2. That a certification from a court of first instance,
restricted to definite and distinct questions of law, invokes
appellate action is settled by early and long continued usage
amounting to a practical construction of the constitutional
provision defining the jurisdiction of this Court. Id.
3. The certification of a definite question of law is not
rendered objectionable merely because the answer may be decisive of
the ease. P. 281 U. S.
4. The importance or controlling character of the question
certified, if it be a question of law and suitably specific,
affords no ground for declining to accept the certification.
5. Under the Revenue Acts of 1917 and 1918, which imposed a tax
on transportation of freight payable by the person paying for the
service, the exemption [§ 502, Act of 1917; § 500(h), Act of 1918,]
allowed in case of transportation rendered to a state is to be
construed a extending to her counties. P. 281 U. S.
6. Where a vendor, who had engaged to sell and deliver lumber
needed for public bridges to a county at a designated point in the
county f.o.b. at a stated price, shipped the lumber by rail to that
point preparatory to there effecting the required delivery and
forwarded the bills of lading to the county, and the latter,
conformably to the vendor's intention, surrendered the bills of
lading to the carrier, paid its transportation charges, received
the lumber from it, deducted from the f.o.b. price at destination
the transportation charges paid to the carrier, and remitted the
balance to the vendor,the transportation of the lumber to the place
of delivery was not a service rendered to the county (state) within
the meaning of the exempting provisions of § 502 of the
Page 281 U. S. 573
Revenue Act of 1917 and § 500(h) of the Revenue Act of 1918. P.
281 U. S.
7. Although the transportation in this case was with a view to
definite sale to the county, the transportation was not in fact a
part of the sale, but preliminary to it and wholly the vendor's
affair; therefore, the tax on the transportation cannot be regarded
as a tax or burden on the sale, and Panhandle Oil Co. v.
Mississippi, 277 U. S. 218
inapplicable. P. 281 U. S.
Answer to a question certified by the Court of Claims in a suit
by the Lumber Company to recover the amount of a tax on rail
transportation service, which it paid under protest.
MR. JUSTICE VAN DEVANTER delivered the opinion of the Court.
The Court of Claims has certified to us a question concerning
which it desires instruction for the proper disposition of the
above-entitled cause now pending before it. Late in the last term,
we dismissed the certificate in the belief that the question
propounded embraces the whole case, and so could not be answered
consistently with the applicable statute or with the constitutional
limitations on our jurisdiction. But, before the term closed, we
vacated the order of dismissal (279 U.S. 826) and held the matter
for further consideration.
The facts shown in the certificate are as follows: in the years
1918, 1919, 1920, and 1921, the plaintiff, a corporate dealer in
bridge materials, engaged to sell and
Page 281 U. S. 574
deliver to each of several counties in the states of Iowa and
Nebraska a quantity of lumber which in each instance was needed and
used by the purchasing county in the construction or repair of
bridges along public highways within the county. The plaintiff was
to ship the lumber from places outside the state to designated
points within the purchasing county, and there deliver the same to
the county f.o.b. at stated prices. The plaintiff fulfilled its
engagement as made. The shipping was done by railroad under bills
of lading calling for delivery by the carrier to the plaintiff, or
on its order at destination. The plaintiff forwarded the bills of
lading to the county clerk, and when the shipments reached their
destination the county clerk, acting for the county and conforming
to the plaintiff's intention, presented the bills of lading to the
carrier, paid the transportation charges, accepted the lumber,
deducted the transportation charges from the stipulated f.o.b.
price, and remitted the balance to the plaintiff.
The federal revenue laws in force at the time imposed on the
transportation of freight by rail or water a tax of three percent
of the amount paid for that service, required that the tax be paid
"by the person paying for the service," and authorized the carrier
to collect the tax on behalf of the government, but declared that
transportation service rendered to a state should be exempt from
the tax. Revenue Act 1917, c. 63, §§ 500, 501, 502, 503, 40 Stat.
300, 314, 315; Revenue Act 1918, c. 18, §§ 500(a) and (h), 501(a),
502, 40 Stat. 1057, 1101, 1102, 1103. In the administrative
regulations issued under those laws, the exemption of
transportation service to a state was construed as including such
service to her "political subdivisions, such as counties, cities,
towns, and other municipalities."
No tax on the transportation service was demanded or paid when
the transportation charges were paid. But
Page 281 U. S. 575
thereafter the Collector of Internal Revenue assessed such a tax
against the plaintiff, and the plaintiff paid it under protest.
Application was then made by the plaintiff to have the amount
refunded, but the application was denied by the Commissioner of
The suit in the Court of Claims was brought by the plaintiff
against the United States to recover the amount collected on the
tax, that exaction being assailed on two grounds: one, that the
transportation service was rendered to the purchasing counties, and
therefore was exempt from the tax, and the other that, as the
counties paid the carrier its transportation charges, the
liability, if any, for the tax did not attach to the plaintiff.
The certificate further shows that the court referred the case
to a commissioner who, in accord with the reference, reported
special findings of fact, and that both parties conceded the
correctness and accuracy of the report. In making the certificate,
the court accepted and summarized the facts reported by its
The question certified, somewhat shortened in words but not
altered in substance, is --
Where a vendor, who has engaged to sell and deliver lumber
needed for public bridges to a county at a designated point in the
county f.o.b. at a stated price, ships the lumber by rail to that
point preparatory to there effecting the required delivery, and
forwards the bills of lading to the county, and the latter,
conformably to the vendor's intention, surrenders the bills of
lading to the carrier, pays its transportation charges, receives
the lumber from it, deducts from the f.o.b. price at destination
the transportation charges paid to the carrier, and remits the
balance to the vendor -- is the transportation of the lumber to the
place of delivery a service rendered to the county (state) within
the meaning of the exempting provisions of § 502 of the Revenue Act
of 1917 and § 500(h) of the Revenue Act of 1918, and within the
Page 281 U. S. 576
recognized and applied in Panhandle Oil Co. v.
Mississippi, 277 U. S. 218
The statute providing for certification of questions by the
Court of Claims is § 3(a) of the Act of February 13, 1925, c. 229,
43 Stat. 936, 939, which reads:
"That in any case in the Court of Claims, including those begun
under § 180 of the Judicial Code, that court at any time may
certify to the Supreme Court any definite and distinct questions of
law concerning which instructions are desired for the proper
disposition of the cause, and thereupon the Supreme Court may give
appropriate instructions on the questions certified and transmit
the same to the Court of Claims for its guidance in the further
progress of the cause."
This is a new provision. Similar provisions have permitted
particular federal courts to certify questions to this Court, but
this provision is the first giving such authority to the Court of
There are two reasons why a certification by that court which
embraces the whole case cannot be entertained by this Court. One is
that to accept such a certification and proceed to a determination
thereon, in advance of a decision by that Court, would be an
exercise of original jurisdiction by this Court contrary to the
constitutional provision which prescribes that its jurisdiction
shall be appellate in all cases other than those affecting
ambassadors, other public ministers and consuls, and those in which
a state shall be a party. Article III, § 2, cl. 2. The other is
that the statute permits a certification only of "definite and
distinct questions of law."
Even the restricted certification permitted by the statute
invokes action which is rather exceptional in the appellate field.
But that such action is appellate is now settled. Early and long
continued usage amounting to a practical construction of the
constitutional provision requires that it be so regarded.
Page 281 U. S. 577
In § 6 of the Act of April 29, 1802, c. 31, 2 Stat. 156,
Congress made provision for restricted certifications from the
circuit courts to this Court in advance of a decision by the
former. That provision remained in force and was given effect for
seventy years. Many certifications in both civil and criminal cases
were entertained and dealt with under it. Indeed, it was the only
mode in which questions of law in cases of several classes could be
brought to this Court during that period.
But, in exercising that jurisdiction, this Court uniformly ruled
that it could not entertain the certifications unless they were of
distinct questions of law, and not of the whole case, for otherwise
it would be assuming original jurisdiction withheld from it by the
Constitution. White v. Turk,
12 Pet. 238, 37 U. S. 239
United States v.
14 Pet. 524, 39 U. S. 525
6 How. 41, 47 U. S. 43
10 How. 54, 51 U. S. 55
Wall. 571, 74 U. S. 573
United States v. Perrin, 131 U. S. 55
131 U. S. 58
Baltimore & Ohio R. Co. v. Interstate Commerce
Commission, 215 U. S. 216
215 U. S.
And, in applying the provision of 1802 and other later
provisions permitting certifications, this Court, while holding, on
the one hand, that it cannot be required through certifications
thereunder to pass upon questions of fact or mixed questions of law
and fact, or to accept a transfer of the whole case, or to answer
questions of objectionable generality -- which, instead of
presenting distinct propositions of law, cover unstated matters
lurking in the record -- or questions that are hypothetical and
speculative, has distinctly held, on the other hand, that the
certification of a definite question of law is not rendered
objectionable merely because the answer may be decisive of the
case, and also that the importance or controlling character of the
question certified, if it be a question of law and suitably
specific, affords no ground for declining
Page 281 U. S. 578
to accept the certification. United States v. Mayer,
235 U. S. 55
235 U. S. 66
and cases cited.
The practice and rulings just described are equally applicable
to certifications under the provision relating to the Court of
Upon further consideration of the present certificate in the
light of that practice and those rulings, we are of opinion that
the certificate is not open to any valid objection, and should be
entertained. The question certified is a distinct and definite
question of law, and its materiality is adequately shown. Neither
in form nor in effect does it embrace the whole case. It does not
include any question of fact, but, on the contrary, treats the
facts as fully ascertained and definitely states those out of which
it arises. No doubt, with these facts ascertained, an affirmative
answer to the question would be decisive of the case. But, if the
answer were in the negative, the case would be left where another
question of law raised by the plaintiff's petition and mooted in
the Court of Claims, but not certified, would need to be resolved
by that Court before a judgment could be given.
We thus are brought to the solution of the certified question.
Counsel for the government concede, and rightly so, that the
exemption accorded to a state by § 502 of the Revenue Act of 1917
and § 500(h) of the Revenue Act of 1918 should be construed as
extending to her counties, as is done in the administrative
regulations. The Court of Claims, evidently entertaining this view
of the exemption, inquires whether the transportation described in
the question is a service rendered to the county within the meaning
of those sections. The transportation is had at the vendor's
instance, and is his means of getting his lumber to the place of
sale and delivery. He engages to deliver f.o.b. not at the place of
shipment, but at the place of destination, which is
Page 281 U. S. 579
the place of sale and delivery. There is no delivery, and
therefore no sale, until after the transportation is completed.
Upon these facts, recited in the question, we are of opinion that
the transportation is not a service rendered to the county in the
sense of the sections cited, but is a service rendered to the
vendor. Conceding that the sections are parts of a taxing scheme,
and assuming that they are intended to recognize and fully respect
the constitutional immunity of a state agency, such as a county,
from federal taxation, we think they neither require such
transportation to be regarded as a service to the county nor
operate to exempt such transportation from the tax.
The tax is not laid on the sale, nor because of the sale. It is
laid on the transportation, and is measured by the transportation
charges. True, it appears that here, the transportation was had
with a view to a definite sale; but the fact remains that
transportation was not part of the sale, but preliminary to it, and
wholly the vendor's affair. United States v. Normile,
239 U. S. 344
239 U. S. 348
It follows that the tax on the transportation cannot be regarded as
a tax or burden on the sale. Cornell v. Coyne,
192 U. S. 418
As the tax is not laid on the sale or in any wise measured by
it, the case of Panhandle Oil Co. v. Mississippi,
277 U. S. 218
referred to in the question and relied on by the plaintiff, is not
Question Answered "No."