Opposition Brief — Delaware, Lackawanna & Western Railroad v. Division of Tax Appeals

SUPREME COURT OF THE UNITED STATES

OCTOBER TERM, 1949

No. 502

THE DELAWARE, LACKAWANNA AND WESTERN

RAILROAD COMPANY,

Appellant,

vs.

DIVISION OF TAX APPEALS, NEW JERSEY STATE

DEPARTMENT OF TAXATION AND FINANCE, anv

THE STATE OF NEW JERSEY,

Appellees

APPEAL FROM THE SUPREME COURT OF NEW JERSEY

STATEMENT OPPOSING JURISDICTION AND

MOTION TO DISMISS OR AFFIRM

Tueopore D. Parsons,

Attorney General of New Jersey,

Counsel for Appellee,

State of New Jersey,

State House,

V Trenton, New Jersey.

Bensamin.C. Van Tine,

Of Counsel.

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INDEX

Susseot Inpex

Page

Statement Opposing Jurisdiction.......__.... 1

Matters and Grounds Making Against Jurisdiction . 2

A. There are no Federal Questions........—... $

B. No Substantial Federal ee is Raised. 11

Motion to Dismiss or Affirm. ......... 15

Tasie or Cases Crrep

Aero Mayflower Transit Co, v. Board of R. R. Com.,

332 U. S. 495, 499 (1947)............. 11

Charleston Fed. Sav. & L. Asso. v. Alderson, 324 U.S.

OE Se Se tela kha ae aed ba’ i)

Ferry v. County of King, 141 U. 8. 668 (1891). 10

French v. Taylor, 199 U.S. 274 (1905).......... 11

Jersey City v. State Board of Tax Appeals, 133

eee fF | re rrr 3

Jersey City v. Kelly, 134 N.J.L. 239 (E&A 1946) . 3

Lehigh Valley R.R. Co. v. Martin, 100 F. 2nd 239

ot , Se See rer rer cee 11

New York, Susquehanna & Western R. Co., In re As-

sessments, 21 N. J. Mise. 400 (1943)............ 4

Norton, Trustee v. State Board of Tax Appeals, 132

ee ee I IG xd iad: bs ek ado ee vaesien 4

Norton, Trustee v. State Board of Tax Appeals, 134

eon Oe, Ge CR, BOOOD oecccccthincidvccvses 5

Postal Telegraph Cable Co. v. Adams, 155 U. 8. 688

ARRESS EE eS TSR Deiat a halt fee eae 12, 13

Wall v. Chesapeake & Ohio R. Co., 256 U. 8. 125

RG TRIE Bie NAAT 9

Whitfield v. Ohio, 297 U. S. 431 (1936)............. 9

Wilentz v. Hendrickson, 135 N. J. Eq. 244 (E.&A.

ist oe ea ace er bers vhenes a+ 9

Wilson v. Cook, 327 U. 8. 474 (1946)............... 9

Zucht v. King, 260 U. S. 174 (1922)................ 15

—6078

ii INDEX

Statutes Cirep

en RS Tavs 5.3 v4 9.4 918 1

. 1941, ch. 291, sect. 12..... aaa,

. 1941, ch. 291, sect. 13

1941, ch. 291, sect. 14

54:29A-13 et seq. ~

ae errr

. 1888, ch. 208... .

SS FF PETIT

Po rO TO BY TO ho OS

Aah oh] of oh

Rugs

Ruie 1:3-2 (c) of the New Jersey Supreme Court

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SUPREME COURT OF THE UNITED STATES

OCTOBER TERM, 1949

No. 502

THE DELAWARE, LACKAWANNA AND WESTERN

RAILROAD COMPANY,

Appellant,

vs.

DIVISION OF TAX APPEALS, NEW JERSEY STATE

DEPARTMENT OF TAXATION AND FINANCE, anv

THE STATE OF NEW JERSEY,

Appellees

STATEMENT OF APPELLEE, STATE OF NEW JER-

SEY, MAKING AGAINST THE JURISDICTION OF

THE SUPREME COURT OF THE UNITED STATES

TO REVIEW ON APPEAL THE JUDGMENT IN

QUESTION, INCLUDING APPELLEE'S MOTION TO

DISMISS THE APPEAL OR AFFIRM THE JUDG-

MENT

The appellee, State of New Jersey, believing that the

matters set forth below will demonstrate the lack of juris-

diction of the Supreme Court and the lack of substance in

the questions raised by this appeal, files this, its statement

in opposition to appellant’s statement as to jurisdiction.

Appellee includes herein its motion to dismiss the appeal for

lack of jurisdiction, or in the alternative to affirm the judg-

a

ment of the Supreme Court of New Jersey on the ground

that the questions raised by the appellant are so unsub.

stantial as not to need further argument.

The appellant seeks a review of a judgment of the Sy.

preme Court of New Jersey on direct appeal from that

Court. Appellee respectfully asserts that jurisdiction to

hear such appeal is lacking under the statute and, further-

more, the grounds stated by the appellant appear on the face

of the record to be so unsubstantial as to warrant the Court

in summarily disposing of the appeal at this) stage of the

proceeding.

The matters relied upart by appellee are more particularly

stated below: |

2

\

1. Matters and Grounds Making Against Jurisdiction

The appellant seeks to invalidate portions of its franchise

excise tax assessments for the tax years 1942 to 1946

inclusive, levied pursuant to the ‘‘ railroad tax law of 1941”

(P. L. 1941, ch. 291; R. S. 54:29A-13 et seq.) The ‘‘fran-

chise base’? upon which the said taxes were levied was

computed for each year upon a formula applied to ‘‘the

next preceding year’s net operating income’”’ (P. L. 1941,

ch. 291, sect. 14). The appellant complains because, in

computing the ‘‘next preceding year’s net operating

income,’’ the state tax commissioner refused to allow: 1)

items of back taxes which were not levied against the next

preceding year; 2) interest items never heretofore charged

to operating income accounts; and 3) a provisional pay-

ment of additional 1941 taxes made in 1945 but ultimately

determined not to be due and returned to the appellant.

The last item warrants attention. It arose out of litiga-

tion concerning the validity of the 1941 tax act. Because

the ‘‘railroad tax law of 1941’’, which was designed to pro-

vide some measure of tax relief to the railroads in poor earn-

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—

3

ing years, did result in lessened railroad taxes, the City of

Jersey City, in which the large Hudson River water front

railroad terminals are located, immediately challenged the

constitutionality of the new act. Certain of the major rail-

road companies, including the appellant, along with the

Attorney General of New Jersey, vigorously defended the

constitutionality of the new Act in its entirety. The old

Supreme Court held the new Act to be valid prospectively

but invalid as to 1941. Jersey City v. State Board of Tax

Appeals, 133 N. J. L. 202, decided August 29, 1945. The

Court based its conclusion as to 1941 on the fact that assess-

ments for the year 1941 had already been made in the amount

- of $18,322,161.33 and that new assessments for that year

which under the 1941 Act, totalled only $15,0442,931.07,

resulted in an unconstitutional gift to the railroads of an

amount in excess of $3,000,000 (p. 208). Immediately there-

after most of the railroads, including the appellant, paid the

additional amount of 1941 taxes which they considered due

by reason of the opinion, the appellant paying an additional

$530,902. This was done without any demand from the

State and notwithstanding appeals were to be taken. From

the said judgment, the City of Jersey City and the railroad

companies appealed, the railroad companies, including the

appellant, asserting the constitutionality of the new Act in

7 its entirety and the City its complete unconstitutionality.

The appeal was argued orally on March 5, 1946, the rail-

road companies, including the appellant, together with the

Attorney General, urging the constitutionality of the ‘‘rail-

road tax law of 1941”’ in its entirety. It should be empha-

sized that on March 5, 1946, the appellant urged the com-

plete constitutionality of the act. That date as will be shown

is significant. On May 3, 1946, the New Jersey Court of

Errors and Appeals modified the judgment of the old

Supreme Court. Jersey City v. Kelly, 134 N. J. L. 239, hold-

ing the new act to be constitutional in its entirety. Immedi-

“a

4

ately thereafter the appellant was repaid the said sum of

$530,902, provisionally paid as additional 1941 taxes.

In the meantime, while the above litigation was in

progress, the New Jersey Courts were considering the ques-

tion presented by the instant case. For the years 1942 and

1943, the State Tax Commissioner had permitted the appel-

lant to include certain items of back taxes in its current

operating income accounts, solely because the Interstate

Commerce Commission had permitted the inclusion of such

items. The New York, Susquehanna and Western Railroad

Company had also defaulted in payment of taxes for some

of the same years as appellant. The record in this case dis-

closes that the latter railroad company was first advised by

the Interstate Commerce Commission to place such items of

back ‘axes in a non-operating income account and thereafter

permitted to charge the soap te ada sheet account.

(Exhibit S-7, schedules A, B, € and D,) At no time was it

even suggested that such. . properly belonged in the

operating income Wécounts. ‘For this reason the Tax Com-

missioner refused to permit the New York, Susquehanna &

Western Railroad Company to include such items of back

taxes in the operating income accounts for the year 1942.

Susquehanna appealed to the State Board of Tay Appeals,

which, in affirming the assessment, said that, in determining

the next preceding year’s net operating income, only cur-

rent items could be allowed. In re assessment of New York,

Susquehanna & Western Railroad Co., 21 N. J. M' .. 400

(1943). Susquehanna was granted certiorari by the old

Supreme Court. This appellant, believing itself aggrieved

by the determination of the State Board of Tax Appeals,

sought leave to and was permitted to intervene in the Sus-

quehanna case (Ex. 8-6). The old Supreme Court reversed

the State Board, holding in Norton, Trustee v. State Board

of Tax Appeals, 132 N. J. L. 40, that the deduction should

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5

have been allowed notwithstanding the amount had not been

included in the Interstate Commerce Commission reports as

an operating income item. Appeal was taken to the New

Jersey Court of Errors and Appeals, which unanimously

reversed the judgment of the old Supreme Court, holding

in Norton, Trustee v. State Board of Tax Appeals, 134

N. J. L. 57, 62 that:

‘We hold that ‘tax accruals’ mean the current taxes

for the particular year which have been assessed in con-

formity with law, e. g. the amount certified by the tax

assessor.”

This case was decided on Jan. 31, 1946, nearly five weeks

before March 3, 1946, the significant date pointed out above,

on which the appellant argued and helped to sustain the

constitutionality of the railroad tax law of 1941 in its

entirety. Thus the argument of appellant, urging the con-

stitutionality of the act in its entirety, was made with the

full knowledge of the construction placed upon the pertinent

provisions of the Act by New Jersey’s court of last resort.

The appellant has not changed its position. Nowhere

in the record below can be found a forthright assertion that

any portion of the 1941 railroad tax law is invalid. The

said appeliant simply has sought to have certain portions of

the assessments invalidated as not conforming to its own

idea of what should constitute ‘‘the next preceding year’s

net operating income’’.

Rule 1:3-2 (c) of the New Jersey Supreme Court requires

a statement of questions involved to be printed on a page by

itself in an appellant’s brief. The rule provides that such

requirement is to be considered in the highest degree manda-

tory, admitting of no exception and that ordinarily no point

will be considered which is not set forth in or necessarily

suggested by the statement of questions involved. In com-

7

pliance with this rule, the appellant included the following

in its brief below:

‘*Questions Invo.vep’’

I

‘*Does not the action of the State Tax Assessor in

arbitrarily increasing the net railway operating income

of an interstate railroad as reported to the Interstate

Commerce Commission, with the effect of greatly in-

creasing its State taxes, operate as a burden on inter-

state commerce in violation of the Commerce Clause

and involve a denial of due process under the Four-

teenth Amendment?"’ —

a

‘*In view of the disputes as to the construction of

the Franchise Tax Act of 1941 is it not proper for the

Court to refer to the report of the Joint Legislative

Committee which prepared and reported the bill to the

Legislature, and the Joint Legislative Committee

report of the following year which reported upon the

operation of the Act and submitted amendments

thereto?’’

Ill

‘*‘Where a State statute imposes on an interstate

railroad a franchise tax based upon an apportionment

to the State of a part of the entire ‘‘Net Railway

Operating Income”’ of the interstate railroad system,

may the State Tax Assessor legally and constitutionally

increase such ‘‘Net Railway Operating Income’’ as

reported to and determined by the Interstate Com-

merce Commission pursuant to the provisions of the

Interstate Commerce Act, so as to increase the amount

of the State taxes?’’

There is no mention in this statement of the 1941 Act being

unconstitutional. The appellant does not even suggest that,

if the judgment of the Appellate Division under review

should be sustained, the Act would be in any wise uncon-

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_—<

7

stitutional. On «he contrary the appellant stated in its

prief at page 27:

“The effect of the action of the Director that is com-

plained of in each of the tax years under review is to

place an unconstitutional burden on the interstate com-

merce in which appellant is engaged.

“The New Jersey franchise excise tax can only be

justified as a tax on the New Jersey earnings of appel-

lant. The only attempt of the statute to determine the

earnings of appellant in the State is by taking the Net

Railway Operating Income of the System, whether

made in two or more States, and taking as a base for

taxation by New Jersey that proportion thereof which

the mileage of the railroad in New Jersey bears to the

total mileage of the railroad in all states. The Supreme

Court has held that such a method of determining the

earnings of a railroad system in a State is not unrea-

sonable. Pittsburgh, C. C. & St. L. R. Co. v. Backus,

154 U. S. 421, 430, 431; 38 L. Ed. 1031, 1038 (1894) ;

State R. Tax Cases, 92 U. 8. 575, 608, 611; 23 L. Ed.

663, 671, 672 (1876); Postal Tel. Co. v. Adams, 155

U. S. 688; 39 L. Ed. 311 (1895); Atiantic Coast Line

R. Co. v. Daughton, 262 U. 8. 413; 67 L. Ed. 1051; 43

S. Ct. 620 (1923) ; Norfolk & W. R. Co. v. North Caro-

lina, 297 U. S. 682, 684; 80 L. Ed. 977, 980 (1936) ;

Western Live Stock v. Bureau of Revenue, 303 U. S-

250 (Stone, J.) ; 82 L. Ed. 823 (1938).

‘We do not questioa the constitutionality of the New

Jersey Statute as it is written. When, however, the

Director, Division of Taxation, so construes the statute

as to permit him arbitarily to increase the system Net

Railway Operating Income of an interstate railroad

carrier to the end that the portion subject to taxation in

this State is much greater than the ‘franchise base’

as specified in the statute, it necessarily follows that

New Jersey is assessing a franchise tax not only on the

earnings fairly attributable to New Jersey; but actually

upon the earnings of the railroad earned in the other

States in which the system operates, in this case Penn-

7 a

sylvania and New York (See Statement of Miles of

Track operated in each state, Ex. P-4, Ap. 344a).”’

In addition to the above, the Supreme Court of New Jer-

sey had before it the opinion of the Superior Court, Appel-

late Division, which makes no mention of any claim of uncon-

stitutionality in the event that the construction, followed

ever since the authoritative opinion in Norton Trustee vy,

State Board, supra, should be reaffirmed. The New Jersey

Supreme Court had every reason to believe, as has this

Court from the moving papers in the instant appeal, that

the appellant is complaining because the State Tax Com-

missioner had improperly applied the statute and because

the said Commissioner had, in the opinion of the appellant,

arbitrarily and capriciously increased the assessments

(see assignment of errors). The absence from the opinion

of any reference to a federai question concerning the con-

stitutionality of the statute itself was not an oversight.

Such question was never argued. The sole question argued

was the proper construction of the franchise provision of the

act. When the New Jersey Supreme Court answered that

question and reaffirmed the rule of Norton, Trustee v. State

Board, supra, it had completed its assignment.

Since the appellant never brought in question the con-

stitutionality of a state statute, and had that question

decided adversely to its contention, there is no matter

properly before the Supreme Court on appeal. Also since

the Supreme Court is bound by the construction placed by

the New Jersey Supreme Court upon a state tax statute, the

matter sought to be raised by the designation of errors pre-

sents frivolous or fictitious issues, which are not the sub-

ject of appeal or are of such unsubstantial nature as to war-

rant summary disposal thereof upon this motion. Also,

even if the necessary constitutional question had been

properly raised below, the issue would have been so unsub-

a

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_ — } -

stantial as to warrant summary disposal because the **rail-

road tax law of 1941” is in substitution of a higher straight

property tax, which time after time had been held wholly

constitutional. (History of litigation set out in Wilente v.

Hendrickson, 135 N. J. Eq. 244, 258 (E. & A. 1944).) To

support these various contentions, the following is respect-

fully submitted :

A. Tuere Are No Feperat Questions

The Supreme Court is without jurisdiction of an appeal

under 28 U. S. C. A. 1257 (2) unless there was ‘‘drawn in

question’? before the Supreme Court of New Jersey the

validity of the state statute under review. In Wilson v.

Cook, 327 U. S. 474, 480 (1946), the Court said that the pur-

pose of this requirement is to make certain that no judg-

ment of a state court will be reviewed on appeal by the

Supreme Court unless the highest Court of the State has

first been apprised that a state statute is being assailed as

invalid on federal grounds, citing-Charleston Fed. Sav. & L.

Asso. ¥. Alderson, 324 U. S. 182 (1945). The jurisdictional

requirement is only satisfied if the record shows that the

validity of the statute has been either presented for decision

to the highest court of the state, Wall v. Chesapeake & Ohio

R. Co., 256 U. S. 126 (1920) or has been decided by that

Court. Whitfield v. Ohio, 297 U. 8. 431 (1936).

The record in the instant case does not disclose that

appellant did at any time assert that the construction placed

by the New Jersey Courts on the franchise provisions of the

1941 tax law caused such provision to violate the Constitu-

tion of the United States. On the contrary since the begin-

ning of this litigation, the appellant has complained only

of the ‘‘arbitrary and capricious’’ action of the state tax-

ing authorities and has alleged that the said action or con-

duct violated the constitutional rights of the appellant.

10

Furthermore, even in the present assignment of errors,

the appellant does not explicitly assert that if the legislature

intended to permit only the inclusion of current items for the

purpose of calculating the next preceding year’s net operat-

ing income, this would make the 1941 franchise tax pro-

vision unconstitutional. This in itself would make the ap-

peai defective for, as it was held in Charleston Fed. Sav.

é L. Asso. vy. Alderson, supra, even where the federal ques-

tions have been properly raised below, an appeal may be

dismissed where the appellant fails to attack a statute

explicitly in its assignment of errors.

It is obvious, from the course charted by the appellant

below and from the moving papers in this case, that the

appellant is attacking specific assessments and has no wish

that any portion of the 1941 tax law should be declared to

be unconstitutional. In Wilson v. Cook, supra (p. 482), the

Court restated the well established rule that in order to

support an appeal, it is necessary that the validity of the

statute itself and not an assessment under the act be pre-

sented, citing many cases to support the rule.

In Ferry v. County of King, 141 U. 8. 668 (Wash. 1891),

it was heid that the Supreme Court will not consider a case

where a state law is admitted to be valid and the only ques-

tion is whether it has been correctly construed. The quota-

tion from the appellant’s brief below (p. 28) shows clearly

that the instant case is squarely within rule of the Ferry

case.

The present appeal must fall not only because the validity

of the statute was not properly drawn in question, but

because the matters sought to be raised on this appeal are

frivolous or fictitious. The moving papers disclose that

appellant still urges that the New Jersey tax statute was

improperly construed. The appellant seeks by this appeal

to establish a construction more favorable to itself. But

there is no jurisdiction in the Supreme Court to undertake

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11

such an inquiry for as was said in Aero Mayflower Transit

Co. v. Board of R. R. Com., 332 U. 8. 495, 499 (1947) :

‘*We put aside at the start appellant’s suggestion

that the Supreme Court of Montana has misconstrued

the state statutes and therefore that we should consider

them, for purposes of our limited function, according

to appellant’s view of their literal import. The rule

is too well settled to permit of question that this Court

not only accepts but is bound by the construction given

to state statutes by state courts.’’

Since the question of the constitutionality of the ‘‘rail-

road tax law of 1941’’ was never submitted to the New Jer-

sey Courts but, on the contrary, the constitutionality of

such law as written was repeatedly urged below and, since

any other questions sought to be raised by the instant appeal

are frivolous or fictitious, there is no jurisdiction in the

Supreme Court to hear such appeal. French v. Taylor, 199

U.S. 274 (1905).

But even if the appellant had explicity drawn in question

the validity of the statutes, the question would have been

so unsubstantial as to require the Supreme Court to dispose

of the matter summarily by dismissing the appeal or affirm-

ing the judgment, because

B. No SusstanTiaL Feperat Question Is Raisep

Prior to 1941, New Jersey levied a straight property tax

(P. L. 1888, ch. 208, as amended; R. S. 54:19-1 et seq.) The

1888 law had been the source of much litigation. The said

law was repeatedly held to be constitutional. One complaint

had been that earnings were not taken into consideration in

determining valuation. The Circuit Court of Appeals com-

mented upon this lack in Lehigh Valley R. R. Co., et al. v.

Martin, 100 Fed. 2nd 139 (C. C. A. 3rd 1938), (all the rail-

roads). The New Jersey Legislature sought to remedy

——

this lack by the ‘‘railroad tax law of 1941’’. As was said by

the Court in Norton, Trustee v. State Board, supra,

12

‘“‘The new system was devised to provide some

measure of relief in poor earning years, while pro-

viding for a greater return to the state in times of high

earnings.’’

That the new railroad tax law was in substitution of the

old law is shown by P. L. 1941, ch. 291, sect. 74 which after

providing for abatement of taxes levied under the old law

said:

‘*This act shall be construed as a revision of chapters

nineteen through twenty-nine inclusive of Title 54 of

the Revised Statutes * * *’’.

Also by sect. 12 it is provided:

‘*Taxes assessed pursuant to this act shall be in lieu

of all other State or local taxation of or measured by

property taxable hereunder, other than assessments for

benefits. ’’

The total tax levied under the new act is less than that

levied under the old tax act. For the year 1941, the reduc-

tion for the appellant alone was $530,902. For the period

1941 to 1947 inclusive, the amount required to be paid by

appellant under the 1941 Act was substantially lower, even

on the basis of the present construction of the 1941 act, than

under the 1888 act. Although such period included the war

years when earnings were very high, the State for the whole

period collected $2,915,000 less. For the years 1946 and

1947 the reductions amounted to approximately $1,210,600

and $1,615,200 respectively. (Application of local and aver-

age rate to valuation shown on Ex. 8-14.)

Since the combined tax under the 1941 act was in substitu-

tion of and was less than the straight property tax would

have been, this case comes under the rule of Postal Tele-

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13

graph Cable Co. v. Adams, 155 U. S. 688 (1894), wherein the

Court said (p. 700) :

‘‘We are of opinion that it was within the power of

the state to levy a charge upon this company in the form

of a franchise tax, but arrived at with reference to the

value of its property within the state and in lieu of all

other taxes, and that the exercise of that power by this

statute, as expounded by the highest judicial tribunal

of the state in the language we have quoted, did not

amount to a regulation of interstate commerce or put an

unconstitutional restraint thereon.’’

As has been pointed out, appellant not only has admitted

the constitutionality of the 1941 act as written but, in

extended litigation, vigorously asserted the constitutionality

of the said act in its entirety. It is difficult to comprehend

how, if a franchise tax, based upon the next preceding

year’s net operating income, is admitted to be constitutional,

it may be claimed that such tax could become unconstitu-

tional because operating income charges are confined to

those of the year under consideration and charges never

heretofore placed in the operating income accounts are

excluded therefrom. We can find no case which supports a

finding of unconstitutionality based upon so flimsy a

premise. Also the record shows that the Pennsylvania

Railroad Co., the Central Railroad Company of N. J., and

the New York Central, all of whom were parties to the 1933

to 1940 tax litigation, charged the 1933 to 1940 taxes as they

were levied. Of this the opponent said id at page 15 of its

reply brief below:

‘*To begin with, the Attorney General refers to the

fact (p. 4) that appellant together with the New York,

Susquehanna & Western Railroad Company did not fol-

low the Pennsylvania Railroad Company, the Centra:

Railroad Company of New Jersey and the New York

Central Railroad Company in accruing the disputed

—

14

taxes in the years for which they were originally

assessed. The answer to this is that the Pennsylvania

Railroad having paid the taxes in full had no choice but

to accrue them currently, and that the Central Railroad

Company of New Jersey and the New York Central

Railroad did not follow the sound principles of accrual

accounting laid down in the authorities referred to in

the next preceding point in this brief. The fact that

those railroads thereby forfeited an advantage now

enjoyed by appellant does not in any way affect the

soundness of appellant’s position.’’

We respectfuliy submit that the constitutionality of state

tax laws cannot be made to rest upon the acceptance by a

State of the bookkeeping practices of a taxpayer.

The railroad tax law of 1941 as construed has substan-

tially benefited the railroads generally in New Jersey.

They are not here attacking the constitutionality of that law.

On the contrary in concert with this appellant, they were suc-

cessful in sustaining its validity. Nothing shown in the

moving papers on this appeal would even raise a suspicion

that this Court would at this time interfere with the opera-

tion of that act as construed.

We have shown above the frivolous nature of the appeal

as a reason for the Supreme Court not accepting jurisdic-

tion. We beg leave to repeat that argument including the

very appropriate observation of the Court in Aero v. May-

flower Transit v. Board of R. R. Com., supra, to the effect

that:

‘‘The rule is too well settled to permit of question

that this Court not only accepts but is bound by the

construction given a state statute by state courts.’’

It would appear therefore that, even if the appellant had

properly raised the invalidity of the 1941 railroad tax law

below, the questions presented by the appeal would be of

such an unsubstantial nature as to warrant the Supreme

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15

Court summarily dismissing the appeal or affirming the

judgment of the New Jersey Supreme Court. Zucht v. King,

260 U. S. 174, (1922).

2. Motion to Dismiss or Affirm

Appellee respectfully submits this statement showing

there is no Federal question involved and consequently a

lack of jurisdiction; and further that the questions upon

which the decision of this case depends are so unsubstantial

as not to need further argument.

Wuererore, appellee respectfully moves the Court to dis-

miss this appeal, or in the alternative to affirm the judg-

ment of the Supreme Court of New Jersey.

Respectfully submitted,

~ Tueopore D. Parsons,

Atterney General of New Jersey,

j Counsel for Appellee,

State of New Jersey,

State House,

Trenton, New Jersey.

Bengamin C. Van Tine,

Of Counsel.

(6078)