283 U.S. 376 75 L. Ed. 1126 51 S. Ct. 515 1931 U.S. LEXIS 153 SCDB 1930-060

GRANITEVILLE MANUFACTURING CO. v. QUERY et al.

No. 596.

Argued April 27, 1931.

Decided May 18, 1931.

*377 Mr. P. F. Henderson for appellant.

Messrs. John M. Daniel, Attorney General of South Carolina, and J. Fraser Lyon were on the brief for appellees.

Mr. Chief Justice Hughes

delivered the opinion of the Court.

The Graniteville Manufacturing Company, a corporation of South Carolina, brought this suit in the District Court of the United States to restrain the collection of certain stamp taxes imposed upon its promissory notes under Act 574, p. 1089, of the Acts of 1928 of that State.1 *378A motion for an interlocutory injunction was heard by three judges, as required by § 266 of the Judicial Code (U. S. C., Title 28, § 380). Holding that the plaintiff had no adequate remedy at law, the court granted an injunction with respect to notes made outside the State but denied relief as to notes which were signed within the State. 44 F. (2d) 64.

There is no controversy as to the facts, which were stipulated and found by the court substantially as follows:

These notes were executed at various times from July 24, 1923, to March 12, 1930. The notes were all payable to banks, at their banking houses, respectively, outside of South Carolina, none of them being located or doing any business within that State. The custom and practice between the plaintiff and each of the banks was that in each instance, at the office of the bank, a line of credit was first established; that is, an agreement was made that the plaintiff’s borrowing from the bank should never exceed a certain amount, each specific loan to be made thereafter being subject to acceptance by the bank. When a loan was desired, the bank having been notified that a loan would be desired at a certain date and an inquiry having been made of it as to the then existing discount rate, the note would be signed by the president or other executive officer of the plaintiff, and forwarded to the bank by mail. The note was subject to withdrawal and revocation by the plaintiff until it was actually received and accepted by the bank and the proceeds actually placed to the credit of the plaintiff in the bank. . . . Payment of the note *379was made to the bank at its banking house by the plaintiff sending checks from its office at Graniteville upon other banks; and when the note was paid, it was marked paid, or canceled, and returned to the plaintiff at Granite-ville, S. C., and there kept.

“ The foregoing facts apply to all of the notes; but with reference to the place where the notes were signed, they may be divided into two classes. Prior to December 1, 1924, the plaintiff’s executive officers resided in Augusta, Ga., and all of its notes, up to that time, were signed by its executive officers in Augusta, Ga., and mailed from there to banks outside of South Carolina, and those notes were never in the State of South Carolina until after they were paid and returned to the plaintiff at its office at Graniteville, S. C. But after December 1, 1924, plaintiff’s executive officers resided at Graniteville, S. C., and the notes executed subsequent to that time were signed by those officers at Graniteville, S. C., placed in the mail there for delivery to the bank outside of South Carolina, and upon payment, were later returned to the plaintiff at Graniteville, S. C ”

It is only as to the latter class of notes which were signed in South Carolina that the District Court upheld the tax. The tax as thus sustained is an excise tax, of a familiar sort, levied with respect to the creation of instruments within the State. So laid, the tax was not imposed upon property, or upon the transfer of property, situated beyond the jurisdiction of the State as was found to be the case in Union Refrigerator Transit Co. v. Kentucky, 199 U. S. 194; Frick v. Pennsylvania, 268 U. S. 473; Farmers Loan & Trust Co. v. Minnesota, 280 U. S. 204; Baldwin v. Missouri, 281 U. S. 586; Beidler v. South Carolina Tax Commission, 282 U. S. 1. It is simply a tax levied in relation to an act done within the State in making an instrument. New York ex rel. Hatch v. Reardon, 204 *380U. S. 152; Brodnax v. Missouri, 219 U. S. 285. See, also, Nicol v. Ames, 173 U. S. 509, 519. We see no reason to doubt the validity of the tax as thus enforced.

Order affirmed.

Graniteville Manufacturing Co. v. Query
283 U.S. 376 75 L. Ed. 1126 51 S. Ct. 515 1931 U.S. LEXIS 153 SCDB 1930-060

Case Details

Name
Graniteville Manufacturing Co. v. Query
Decision Date
May 18, 1931
Citations

283 U.S. 376

75 L. Ed. 1126

51 S. Ct. 515

1931 U.S. LEXIS 153

SCDB 1930-060

Jurisdiction
United States

References

Referencing

Nothing yet... Still searching!

Referenced By

Nothing yet... Still searching!