1. State taxing officials seeking through judicial proceedings
to assess a succession tax on intangible property in pursuance of
laws of their State, which impose the tax only if the deceased was
domiciled therein at death, cannot constitutionally be interpleaded
in a federal court with tax officials of another State likewise
claiming the domicile and the right to tax, in order that the
federal court may determine which State is in fact domiciliary and
enjoin taxation in the other State, for the purpose of avoiding
double taxation. P.
302 U. S.
296.
Such a suit is in effect against the State, forbidden by the
Eleventh Amendment.
A bill of interpleader, brought by an executor against tax
officials of California and of Massachusetts, alleged that the
California officials had determined and were asserting that the
decedent at death, was domiciled in that State, and were
threatening to assess and collect under California laws, applicable
in case of local domicile, a death tax upon all his intangibles,
which would be in excess of any tax that would be due if the
domicile was Massachusetts, and that the Massachusetts official, in
behalf of his State, was asserting that the domicile was in
Massachusetts and the estate taxable there upon all the
intangibles; that it was impossible in law and in fact for decedent
to have been domiciled in both States at the time of his death, or
for his estate to be subject to death taxes in both States as
asserted, and that attempted collection was a threatened
deprivation of property without due process of law and denial of
equal protection of the laws. The bill prayed that the court order
the respondent officials of the two States to interplead their
respective claims for the tax; that the court determine the
domicile of decedent, the amount of the tax, and the person or
persons to whom it was payable, and that respondents be enjoined
from any other proceedings to collect it.
Held that, on
objection of the California respondents, the suit was properly
dismissed as, in substance, a suit against the State.
Page 302 U. S. 293
2. Under California statutes, inheritance taxes are assessed by
judicial proceedings resulting, after full opportunity for
presentation of evidence and a hearing, in a judgment which is
reviewable on appeal by the state courts, and by this Court if it
involves any denial of federal right. P.
302 U. S.
298.
3. Conflicting decisions of the same issue of fact do not
necessarily imply judicial error. P.
302 U. S.
299.
4. Neither the Fourteenth Amendment nor the full faith and
credit clause requires uniformity in the decisions of the courts of
different States as to the place of domicile where the exertion of
state power is dependent upon domicile. P.
302 U. S.
299.
5.
City Bank Former Trust Co. v. Schnader, 291 U. S.
24, distinguished. P.
302 U. S. 300.
89 F.2d 59 affirmed.
Certiorari, 301 U.S. 678, to review the reversal of a decree
granting a temporary injunction in an interpleader suit,
14 F. Supp.
754.
Page 302 U. S. 294
MR. JUSTICE STONE delivered the opinion of the Court.
The question for decision is whether the Federal Interpleader
Act, § 24(26) of the Judicial Code as amended January 20, 1936, c.
13, § 1, 49 Stat. 1096, may be availed of for the litigation and
final disposition of the rival claims of two states, each asserting
through its officers the right to recover death taxes on the ground
that decedent was last domiciled within its boundaries.
Petitioner is the duly qualified executor named in the last will
of decedent, which has been probated in Massachusetts. Ancillary
administration of the estate has been granted in California.
Petitioner brought the present suit in the District Court for
Massachusetts, joining as defendants Commissioner of Corporations
and Taxation of the Commonwealth of Massachusetts, and respondents,
officers of the State of California, all charged with the duty of
administering death tax statutes of their respective states. The
bill of complaint is founded upon the Interpleader Act, and seeks
the remedy which it affords.
Page 302 U. S. 295
Section 24(26) confers jurisdiction on the District Courts in
suits of interpleader or in the nature of interpleader, by
plaintiffs who are under an obligation to the amount of $500 or
more, the benefits of which are demanded by two or more adverse
claimants who are citizens of different states. By subsection
26(a),
"Such a suit in equity may be entertained although the titles or
claims of the conflicting claimants do not have a common origin, or
are not identical, but are adverse to and independent of one
another."
And, by subsection 26(a)(ii) and (d), complainant, upon
satisfying jurisdictional requirements of the act and depositing
the money or property in the registry of the court, or upon giving
a prescribed bond, is entitled to a decree discharging him from
further liability and enjoining the claimants from further
proceedings in other courts to recover the sum claimed.
The bill of complaint alleges that decedent left bank deposits
and other intangibles in California and Massachusetts, a
substantial part of which has come into the possession or custody
of petitioner; that respondents, the California taxing officials,
have determined and assert that decedent, at death, was domiciled
in California, and that, under the law of that state, his estate is
subject to death taxes upon all his intangibles; that respondents
threaten to assess and collect there a tax in excess of any which
would be due if decedent were domiciled in Massachusetts; that the
Massachusetts Commissioner, in behalf of the state, asserts a
similar claim that decedent, at death, was domiciled in
Massachusetts, and that his estate is subject to taxes there upon
all his intangibles; that it is impossible in law and in fact for
decedent to have been domiciled in both states at the time of his
death, or for his estate to be subject to death taxes in both
states as asserted, and that the attempted collection of the tax is
a threatened deprivation of property without due process
Page 302 U. S. 296
of law and a denial of equal protection of the laws. Petitioner
prays that the Court order respondent officials of the two states
to interplead their respective claims for the tax; that the Court
determine the domicil of decedent, the amount of the tax, and the
person or persons to whom it is payable, and that respondents be
enjoined from any other proceedings to collect it.
Respondents, the California officers, appeared specially and
moved to dismiss the complaint upon the ground, among others, that
the suit was brought against respondents in their official
capacity, and was in substance a suit against the state forbidden
by the Eleventh Amendment. The District Court overruled this
contention and granted a temporary injunction restraining
defendants, until further order of the court, from taking any
action to assess the tax. The Court of Appeals for the First
Circuit reversed, 89 F.2d 59, holding that the maintenance of the
suit is an infringement of the Eleventh Amendment, which provides
that:
"The Judicial power . . . shall not be construed to extend to
any suit in law or equity, commenced or prosecuted against one of
the United States by Citizens of another State."
We granted certiorari, 299 U.S. 567, the decision below being of
an important question of federal law which has not been but should
be settled by this Court. Supreme Court Rules, rule 38(5)(b).
Petitioner does not deny that a suit nominally against
individuals, but restraining or otherwise affecting their action as
state officers, may be in substance a suit against the state, which
the Constitution forbids,
Louisiana v. Junel, 107 U.
S. 711;
Hagood v. Southern, 117 U. S.
52;
In re Ayers, 123 U.
S. 443;
North Carolina v. Temple, 134 U. S.
22,
134 U. S. 30;
Smith v. Reeves, 178 U. S. 436;
Lankford v. Platte Iron Works, 235 U.
S. 461;
Ex parte New York, No. 1, 256 U.
S. 490,
256 U. S. 500;
Missouri v. Fiske, 290 U. S. 18,
290 U. S. 28;
See Cunningham v. Macon &
Brunswick R. Co., 109
Page 302 U. S. 297
U.S. 446;
cf. Wells v. Roper, 246 U.
S. 335, or that generally suits to restrain action of
state officials can, consistently with the constitutional
prohibition, be prosecuted only when the action sought to be
restrained is without the authority of state law or contravenes the
statutes or Constitution of the United States.
Cf. Ex parte
Young, 209 U. S. 123;
Scully v. Bird, 209 U. S. 481;
Old Colony Trust Co. v. Seattle, 271 U.
S. 426,
with Louisiana v. Junel, supra; Hagood v.
Southern, supra; In re Ayers, supra; Lankford v. Platte Iron Works,
supra. The Eleventh Amendment, which denies to the citizen the
right to resort to a federal court to compel or restrain state
action, does not preclude suit against a wrongdoer merely because
he asserts that his acts are within an official authority which the
state does not confer.
Petitioner's contention is that here, the prospective official
action of respondents involves a threatened violation of the
Constitution for which state law can afford no sanction. It is said
that, as the officers of each state assert the right to collect the
tax out of decedent's property within the state, they may succeed
in establishing that right by a judicial determination in each that
decedent was last domiciled there,
cf. Dorrance's Estate,
309 Pa. 151, 163 A. 303;
In re Estate of Dorrance, 115
N.J.Eq. 268, 170 A. 601; 116 N.J.Eq. 204, 172 A. 503,
with New
Jersey v. Pennsylvania, 287 U.S. 580;
Dorrance v.
Pennsylvania, 287 U.S. 660;
Hill v. Martin,
296 U. S. 393,
although he could not be domiciled in both; that neither state
could constitutionally authorize its officials to impose the tax if
decedent was last domiciled elsewhere, and petitioner is thus
exposed to the danger of double taxation, which the Constitution
forbids.
See First National Bank v. Maine, 284 U.
S. 312;
Farmers' Loan & Trust Co. v.
Minnesota, 280 U. S. 204. As
those officials threaten acts whose consequence may be taxation
which is unauthorized by any valid state enactment, petitioner
insists
Page 302 U. S. 298
that the suit brought to restrain such action does not run
against the state.
But this argument confuses the possibility of conflict of
decisions of the courts of the two states, which the Constitution
does not forestall, with other types of action by state officers
which, because it passes beyond the limits of a lawful authority,
is within the reach of the federal judicial power, notwithstanding
the Eleventh Amendment. This Court has held that state statutes,
construed to impose death taxes upon the intangibles of decedents
domiciled elsewhere, infringe the Fourteenth Amendment, and it has
accordingly reversed judgments of state courts enforcing such
liability.
First National Bank v. Maine, supra; Farmers' Loan
& Trust Co. v. Minnesota, supra. But petitioner does not
assert that there are such statutes in California or Massachusetts,
or that the courts in those states have ever held or threaten to
hold that their laws taxing inheritances apply to intangibles of
those domiciled in other states.
Although the bill of complaint states that respondents
California officials "have determined" that decedent was domiciled
in California, it is not contended that they have or are assuming
authority to assess the tax, independently of the judgment of a
court. Under California statutes, inheritance taxes are assessed by
judicial proceedings resulting, after full opportunity for
presentation of evidence and a hearing, in a judgment which is
reviewable on appeal by the state courts, and by this Court if it
involves any denial of federal right. §§ 14, 15, 17 and 18,
Cal.Inheritance Tax Act of June 3, 1921, Stats.1921, pp. 1500,
1514, 1515, 1517-1520, and § 16, as amended by St.1929 P. 1848;
see Stebbins v. Riley, 268 U. S. 137;
Estate of Haskins, 170 Cal. 267, 149 P. 576;
Estate of
Brown, 196 Cal. 114, 236 P. 144.
Petitioner does not contend that respondents, the California
officers, propose to do more than invoke the action
Page 302 U. S. 299
of its courts to assess a lawful tax and to seek there a
judicial determination that decedent was domiciled in California as
the basis of its power to impose the tax. Nor is it denied that, in
so doing, they are acting in the performance of official duty
imposed upon them by state statutes, which conform to all
constitutional requirements. Petitioner's real concern is that the
judgment of the California court, if it should decide that decedent
was domiciled there, may be erroneous, or may conflict with that of
the Massachusetts courts. But conflicting decisions upon the same
issue of fact do not necessarily connote erroneous judicial action.
Differences in proof and the latitude necessarily allowed to the
trier of fact in each case to weigh and draw inferences from
evidence and to pass upon the credibility of witnesses might lead
an appellate court to conclude that in none is the judgment
erroneous. In any case, the Constitution of the United States does
not guarantee that the decision of state courts shall be free from
error,
Central Land Co. v. Laidley, 159 U.
S. 103;
Tracy v. Ginzberg, 205 U.
S. 170; or require that pronouncements shall be
consistent.
Milwaukee Electric Ry. & L. Co. v.
Wisconsin, 252 U. S. 100,
252 U. S. 106.
Neither the Fourteenth Amendment nor the full faith and credit
clause requires uniformity in the decisions of the courts of
different states as to the place of domicil where the exertion of
state power is dependent upon domicil within its boundaries.
Thormann v. Frame, 176 U. S. 350;
Overby v. Gordon, 177 U. S. 214;
Burbank v. Ernst, 232 U. S. 162;
Baker v. Baker, Eccles & Co., 242 U.
S. 394;
Iowa v. Slimmer, 248 U.
S. 115,
248 U. S.
120-121;
cf. Tilt v. Kelsey, 207 U. S.
43. Hence, it cannot be said that the threatened action
of respondents involves any breach of state law or of the laws or
Constitution of the United States. Since the proposed action is the
performance of a duty imposed by the statute of the state upon
state officials through whom alone
Page 302 U. S. 300
the state can act, restraint of their action, which the bill of
complaint prays, is restraint of state action, and the suit is in
substance one against the state which the Eleventh Amendment
forbids. We do not pass on the construction of the Interpleader Act
or its applicability in other respects.
Unlike that in
Ex parte Young, supra, and in the many
cases which have followed it, the present suit is not founded on
the asserted unconstitutionality of any state statute and the
consequent want of lawful authority for official action taken under
it. In
City Bank Farmers' Trust Co. v. Schnader,
291 U. S. 24, on
which petitioner relies, it was held that the bill of complaint
stated a cause of action in equity to enjoin a state official from
proceeding to assess and collect an inheritance tax upon chattels
alleged to have no tax situs within the state. The objection that
the suit was one against the state within the meaning of the
Eleventh Amendment was not urged or considered on the appeal to
this Court.
Affirmed.