stock or its separate corporate property." (See also Maine ". Grand Trunk Ry. Co., 142 U. S. 217.)

In Horn Silver Mining Co. t'. New York, 143 U. S. 305, a statute of New York imposed a tax upon the corporate franchise or business of every corporation, etc., incorporated or organized by the law of that State or of any other State, hut doing business in New York, the tax to be computed by a percentage upon its whole capital stock. The corporation in question was incorporated in Utah, but di a small part of its business in New York. The tax was upheld. The Court said, that "the right and privilege, or the franchise, as it may be termed, of being a corporation is of great value to its members, and is considered as property, separate and distinct from the property the corporation itself may acquire." Continuing, the Court declared that the tax being valid in other ways did not operate as a hurden upon or interference with interstate commerce, as it was neither directed against any of the subjects of that commerce

descriminated against the citizens of other States.

It is upon this latter case that the New Jersey Court appears to have principally based its decision, although the Court makes the following distinction as to the use of

the word "franchise' in the two instances, saying "The franchise that is taxed as property is the privilege enjoyed by a corporation of exercising certain powers derived from the State, whereas the franchise with which we have to do, is the right to exist in corporate form without reference to the powers that, male that form, the company may exercise. In this State (New Jersey) we tax each of these so called franchises. The latter tax is, in short, a poll tax levied upon a domestic corporation for the right to be. Such a tax is not upon property or assets, and does not in any way concern the nature of the business the company may be authorized to carry on."

The doctrine of this case may be said to be this: That a State tax levied upon a corporation engaged in a business of an exclusively interstate character, although based upon the whole amount of the capital stock, whether it be held within the State or not, does not conflict with the federal power over interstate commerce, provided that the corporation is incorporated within the State, and falls within the operation of a law in other respects valid. The fact that the corporation was also chartered in the neighboring State, does not alter the question.

W. T. ELLIS.

ance; one, that insurance is a personal contract and does not run with the land; the other, that the controlling feature of fire insurance is that it is a contract of indemnity. If this course had been adopted, it is conceived that the case before the court would have been seen to bear an interesting relation to the leading English cases of Rayner "'. Preston (L. R. 18 Ch. D. 1, 1881) and Castellain . Preston (L. R. 11 Q. B. D. 380, 1883), as well as to certain earlier cases decided by the Supreme Court of Pennsylvania, especially Reed v. Lukens, 44 Pa. 202 (1863).

The case of the Peoples' Street Railway Co. . Spencer was an action brought by the corporation against Spencer to determine the rights of the parties to certain money deposited by a fire insurance company in payment of a loss by fire. It appeared that the company had been the owners of the property in question, and that in con sideration of a payment of $20,000 by Spencer a conveyance of the property was executed to him and a lease back to the company at a nominal rent with no change of possession, which remained all the while in the company. This arrangement included the giving by Spencer to the company of an absolute and exclusive option to re-purchase at the end of the year for the same sum with interest. At the end of the year the company paid up the interest, and the arrangement was renewed for another year. During the continuance of the agreement the company effected an insurance upon the premises and paid the premium. In the policy the company were described as the assured, and there was inserted therein the fol

lowing clause: "The interest of the assured in the above described building is the right to purchase from A. D. Spencer, owner; and, in case of loss, the insurance is payable to him, as his interest may appear under said contract." The property was destroyed by fire, and pending this action (which was instituted as the result of an agreement between the company and Spencer) the company exercised the option to purchase and took a conveyance upon payment of the purchase money.

After stating the facts the opinion of Mr. Justice MITCHELL proceeds, as follows:

"It is unimportant what name we apply to the relation of the parties during the year. Whether technically vendor and vendee, mortgagor and mortgagee, or les sor and lessee, is immaterial. The nature of the relation is incontestable. Appellant was the holder of the legal title, subject to an equity in the company. It is strongly argued for appellant that his interest at the time of the fire was an absolute fce-simple title. But this is an error. It was not absolute. It was the legal title in fee, but subject to the equitable' interest of the company, an interest in the land, capable of being specifically enforced, and good, not only against the appellant, but all others, creditors, purchasers or strangers, to whom the recorded deeds and the company's possession gave notice.

The only substantial question in the case is the date at which the company's equity became complete. The fire took place during the running of the term. The option to redeem was exercised after the fire had occurred. Did the company's interest begin to run only from the

exercise of its option, or did it, upon that event, relate back for all purposes to the transaction? We are of opinion that both principle and authority sustain the latter view. As already said, the transaction was in substance a loan of money, and appellant's right was to have his money back with interest at a specified time, or, in default of that, to have his title become absolute. The insurance was for his protection, not to increase his profit; to keep up the sufficiency of his security while the loan lasted, or make good the value of his purchase, if it became absolute. For that reason it was to be kept up by the appellee. If the latter had exercised its option before the fire, there could have been no question that the insurance money would have belonged to it. But the date of the fire makes no substantial difference when, as was the case, the appellee elected to repay the loan, and resumed its title. On the happening of that contingency, the appellant got his money, with interest, which was all he was entitled to; while the appellee got back its land, lessened in value by the fire, but the loss compensated by the insurance money. The insurance was, in contemplation of law, for the benefit of whomever should be entitled when the option was exercised or expired by default, and, in fact, it was contracted for "as interest may appear." It stood in place of so much of the property as was destroyed by the fire, and followed the title when the equitable and legal interests united. The authorities, so far as we have any analogous case, lead to the same conclusion. It was held in Kerr . Day, 14 Pa. 112, that an option to purchase is a sub

stantial interest in land, which may be conveyed to a vendee; and the English chancery cases were reviewed by BELL, J., with the result that, "when the lessee made his option to purchase, he was to to be considered as the owner ab initio. Indeed, the determination can only be supported by attributing to the lessee an equivalent estate in the land, under his covenant for an optional purchase, which passed to his alienec, vesting him with the right to call for a specific execution on declaring his election." ~And in Frick's Appeal, 101 Pa. 485, where the land was sold upon a prior judgment before payment or conveyance, it was held that the surplus was the property of the optional vendee. It is true that the option in that case had been exercised before the levy and sale, but that circumstance was not of controlling weight, as the decision was put on the ground that "in equity the vendee became the owner, suhject to the payment of the price stipulated. His right of property therein flows from the contract, and exists before any purchase money may have been paid:" Citing Siter's Appeal, 26 Pa. 178. We are of opinion that, upon the exercise of its option to redeem, the appellee's equitable title reverted back to the date of the original agreement, and appellce be came the owner of the owner of the land as it was at such date, or of the insurance money, which stood pro tanto in its place.

Before discussing the case further it will be well to summarize the other decisions to which reference has been made.

In Rayner v. Preston, it appeared that the plaintiffs had purchased

from the defendants a messuage and workshops. Between the date of the contract and the time fixed for settlement, the buildings purchased were injured by fire. The vendors had before the contract insured the buildings against fire, but there was not in the contract any mention of this fact or of the policy. The vendors collected the policy money from the insurance office, and the vendees brought an action to establish their right to the money thus received or to have it applied in or towards reinstating the buildings injured. Against the dissent of JAMES, L. J., it was decided by the Court (affirıning the judgment of Sir GEORGE JESSEL) that the action was not maintainable. The following extract from the opinion of Lord Justice BRETT exhibits the grounds of the decision more clearly than any statement that the writer could make :-

"It seems to me that the question raised between the plaintiffs and the defendants calls upon us to consider, first of all, the nature of a policy of fire insurance; and, secondly, what was the relation with regard to the policy and to the property between the plaintiffs and the defendants in this case. Now, in my judgment, the subjectmatter of the contract of insurance is money, and money only. Thic subject-matter of insurance is a different thing from the subjectmatter of the contract of insurance. The subject-matter of insurance may be a house or other premises in a fire policy, or may be a ship or goods in a marine policy. These are the subject-matter of insurance, but the subject-matter of the contract is money, and money only. The only result of the policy if an

accident which is within the insurance happens, is a payment of money. It is true that, under certain circumstances, in a fire policy there may be an option to spend the money in re-building the premises, but that does not alter the fact that the only liabiliity of the insurance company is to pay money. The contract, therefore, is a contract with regard to the payment of money, and it is a contract made between two persons and two persons only, as a contract.

In this case there was a contract of insurance made between the defendants and the insurance company. That contract was made by the defendants, not on behalf of any undisclosed principal, not on behalf of any one interested other than themselves. The contract was made by the defendants solely and entirely on their own behalf, and at a time when they had no relation of any kind with the plaintiffs. It was a personal contract between the defendants and the insurance office, to which they were the sole parties. It is true that under certain circumstances a policy of insurance may, in equity, be assigned so as to give another person a right to sue upon it; but in this case the policy of insurance, as a contract, never was assigned by the defendants to the plaintiffs. It would have been assigned by the defendants to the plaintiffs if it had been included in the contract of purchase, but it was not. Any valuation of the policy, any consideration of increase of the price of the premises in consequence of there being a policy, was wholly omitted. There was nothing given by the plaintiffs to the defendants for the contract. The contract, therefore, neither expressly nor