Abbildungen der Seite
PDF
EPUB

Your memorialists have deemed it expedient on behalf of those they represent, to make these remarks to the Legislature, because the law proposed is new in principle, and will be deemed a leading measure, both at home and abroad. It will not escape observation that the loose connexion between the debts which are taxed, and the real estate which collaterally secures them, is not sufficient to discriminate such debts from any others which are owing to foreigners. The real estate referred to by the bill, is doubtless within the State of New-York, and is subject to its jurisdiction, and liable to all its fiscal impositions. But the bill does not purport to tax the lands. They are already taxed under existing laws. The reference to lands would seem to be made, merely to show a connection, between debts which in general contemplation, are beyond the jurisdiction of the Legislature, and lands which are confessedly within their jurisdiction. And yet the connexion is substantially nothing more, than if the collateral security were a citizen of New-York, or his personal property situated therein, in both which cases the locality and the jurisdiction would be equally incontestible. It will be difficult, if this act shall pass into a law, to discriminate in principle, the cases embraced by it, from the case of promissory notes with a New-York endorser, or loans secured to non-residents by pledges of chattels, whether merchandize, shares in banks, insurance companies and other New-York corporations, or loans of the State itself. The act will announce to the world, that all debts owing to non-residents, are exposed to taxation within the State of New-York, by being deemed a fit subject for taxation in cases not to be satisfactorily distinguished from the rest; and if it is a benefit to the State and its citizens, to borrow money of nonresidents upon mortgage or pledge, or to have a credit from them, for either money lent, or goods or lands sold, it may be supposed, even if equalizing laws are not passed by other States, that the fact will not be without its influence upon the state of credit in this community.

[ocr errors]

Your memorialists most respectfully pray, that under the influence of these considerations and others of the like nature, the Legislature of New-York, will not enact the proposed bill into a law. If however, such general suggestions, shall be deemed to have less weight than your memorialists think them entitled to, they beg leave to offer for consideration, some remarks which more particularly spring from the terms of the proposed law, and from the position and circumstances of the parties they represent.

The evils of the proposed law in its operation upon these parties. are striking, and will be extremely oppressive.

It appears to be an essential part of the system, that there shall be a searching inquisition into all outstanding debts due to non-residents, which arise from the purchase of land or are secured by mortgage. It is no slight objection to a law, that it has a tendency to place those in a state of opposition, who, by their relation, ought to be united; and the objection is still stronger, when the tendency is to subject an agent to a public duty, his fidelity to ,which increases a charge upon his immediate principal. The objection is not diminished by the restriction of the enactment to agents who are inhabitants of this State. The two great interests represented by your memorialists, require the presence of agents within the State; but there are many interests within the description of the bill, which require no such agencies, and some which require no agency at all; and it aggravates the evil, that similar interests will not be similarly affected by the law. It is not unworthy of consideration, that an example set by this great State, of probing the consciences of agents, as well as others for the discovery of non-resident interests, is, from the extension of the capital and pecuniary means of the citizens of New-York, as likely to be followed by other States in regard to them, as to any others in the United States.

The bill in further prejudice of the parties represented by your memorialists, comprehends within the same provision, interests extremely dissimilar. "Debts owing for the purchase of real estate," and "debts secured by a mortgage on real estate," are, in the understanding and judgment of all who are practically acquainted with the subject, unlike in the very point in which they ought alone to be regarded by a tax law-their productiveness of money to the creditor. The mortgagee is either a lender who has the choice of security, or a seller who has received so large a part of the purchase money as to be willing to part with the title, and to take a security upon the land for the balance that remains due. The creditor upon a contract of sale, is one who has frequently received no part of the purchase money, and who is obliged even to pay the taxes, assessed upon the land, to prevent its sale, while the contract is outstanding. Debts owing for purchases of wild land, as contradistinguished from debts secured by mortgage, are, notoriously, and in the universal judgment of men, of far less value than

their nominal amount. The expenditures, the deductions, the expedients that are to be made and practised, before the contract is carried into effect, and with a view so assist the debtor in performing it, are nearly infinite. The purchasers, and first clearers of wild land, are men who rarely if ever, have any thing directly to do with money. Such as are unthrifty, leave the land to fall back to the seller, charged with taxes, injured by bad clearing, of less value in the end than it was in the beginning. This has happened to your memorialists, or rather to their principals, in many cases, and will continue to happen; and in all these, if the bill shall become a law, the creditors after paying the heavy taxes assessed upon the land, must also pay a tax upon the contract for the price of the land, and finally lose the price and the contract also, by taking back against their will, the injured and impoverished land, and letting the purchaser go free.

Even where the settler is reasonably thrifty, abatements of interest, extensions or renewals of credit, contributions in money to schools, bridges, churches, roads, and other objects of interest to the country, are constantly required by the debtor, and granted by the creditor, in diminution of the nominal debt. A single fact is sufficient to show the difference between the nominal and real value of these contracts, that more than fifteen thousand five hundred of them were renewed by the Holland Land Company before the year 1832, at a reduction in nominal value, of more than 730,000 dollars, and upon the renewed contracts reductions to a great amount still remain to be made, from the continued operation of the same causes. In fine, it cannot be denied, that these debts are, in a great degree, unlike any other debts, that are known to our country. The purchasers of land under these contracts are often destitute of all property, except the scanty outfit of domestic utensils and apparel, and the tools and narrow stock which are necessary to begin a clearing. When they have sealed and delivered their contract, what is the security for its performance? The land, and nothing but the land. This is the only item of property that is represented by the contract. The debtor has nothing but the land, and the creditor has the same. The debtor may make something out of the land wherewith to pay his debt, or part of it, and when he does, then for the first time, there is something besides the land in the hands of the parties. But in the mean time, the land is the whole property on either side, or rather it is held in stake by the seller, with an engagement that it shall change hands,

upon receiving an agreed price per acre.

Until then, the party

who is to receive the money stands as he was before the contract, the certain proprietor of the land, with nothing more than a contingent right to money when the purchaser shall make it, and be willing to pay it; and the public should, in justice and in equity, stand in the same position, relative to the taxing power. If taxed at all, the contracts should be no further taxed than, as from time to time, they become productive of something in addition to the land.

What has thus been truly remarked of contracts for the sale of wild land to settlers, is not true of any other sale of property whatever. No man sells merchandize to another, who has nothing but the merchandize so sold to pay his note or debt with. Such a state of things would effectually prevent the sale altogether. The purchaser must have something besides the article sold. He must have credit, which implies the possession of something else. His note, therefore, is the representative of other property, besides that for the price of which it was given; and hence, if debts are taxed, it is reasonable to tax this as a debt due for the purchase of merchandize. But in the case of these land sales it is not so. The land is all that there is to show for the contract, and the contract is another name for the land. To tax both the land and the contract is therefore literally to tax the same subject twice.

The effect of the proposed bill upon other interests besides those of the creditors or sellers of the land, cannot be unworthy of no tice. The country which is growing up under contracts with the parties whom your memorialists represent, has felt the advantage of sales of land upon long credits, and also of renewed and extended credits. It must be the consequence of a tax upon the debt, either to prevent or diminish these credits, or to throw the expense of the tax upon those whom the law does not profess to charge. In cases where the debt is adequately secured, it may be supposed that an extension of credit, and even a forbearance to press the payment, if it take place at all, will be so arranged as to prevent the creditor from losing by his indulgence. In cases of a different description, it may also be supposed that the creditor will bring the contract to an immediate conclusion, if its continuance only serves to charge him with a tax upon a bad debt. This remark is not intended to communicate what will certainly occur in any given case, but only to indicate the probable tendency of the act in

question in those cases in which the parties will be at liberty to relieve themselves from the pressure of the enactment. The probability of such consequences, and their injurious effect upon interests which the Legislature has always been disposed to promote. seems to constitute a fair argument against the policy of the law. In the case of a debt well secured, when the debtor wishes further credit, the tendency of the act will be to throw a double tax upon the purchaser of the land. In those cases in which the debt is not well secured, and the credit has expired, its tendency is to lead to immediate pressure on the debtor, and upon his interest in the land; and where the debt is not well secured and the crèdit is not expired, its tendency will be to throw a double tax upon the seller. There are probably few cases, and the number will be constantly diminishing, in which the tax will fall upon the seller's interest in the debt, without at the same time falling upon his interest in the land, and thus compelling him to pay a double tax on the same in

terest.

Your memorialists are satisfied, from their long and intimate acquaintance with the lands and other interests under their care, that the proprietors have at no time done any thing to forfeit the just regard of the Legislature or of the country. They have purchased these lands under the guaranty of the public faith of the State. They have expended an immense capital not only in the purchase, but in the improvement of the country. The returns from it hitherto have been comparatively inconsiderable. The debts owing to them have been greatly augmented by a spirit of liberal consideration for the debtor, not always indulged with a view to their own ultimate payment. Their desire has been, not to sell their lands for the best price, but to make the settlements prosperous, and the people contented. With this view, they have habitually assisted the purchasers in their payments, by receiving their produce and stock, at prices much beyond the current rate of the market, and to the utmost extent of their power, have co-operated in every measure that promised a benefit to the community around them. For the truth of these remarks they can appeal with confidence to all who have witnessed their transactions. This conduct may not be, and it is not stated for the purpose of being, considered as a title to legislative favor; but they consider and state it as a ground for an impartial estimate of the remarks they have submitted to the Legislature in regard to the bearing of the pro.

2

« ZurückWeiter »