Western Union Telegraph Co. v. State Board of Equalization

The assessment in question and the judgment of the court based thereon result in taxation of a separate and distinct unit of property located beyond and outside the territorial limits of Montana and not physically connected with, or in operation, or use, connected with or operated in physical or manual connection with any property within the state of Montana, — a tax upon property over which neither this state nor this nation (except as to war and its treaty obligations of which Montana is neither a party to or connected with under the federal Constitution) has any jurisdiction and cannot furnish any sovereign protection or aquid pro quo.

It should be remembered that the theory of taxation when Montana's Constitution was adopted was and yet is the value of the physical property within the territorial limits of the state. "The taxing power of the state does not extend beyond its territorial limits. (Hayes v. Smith, 58 Mont. 306,192 P. 615.) It is essential to the validity of a tax that the property subject to it shall be within the territorial jurisdiction of the taxing power. (Union Refrigerator Transit Co. v. Kentucky,199 U.S. 194, 4 Ann. Cas. 493, 50 L. Ed. 150, 26 Sup. Ct. Rep., see, also, Rose's U.S. Notes.) "Whatever may be said of its vast character and sweeping extent, the power of taxation, of necessity, must be limited to subjects within the jurisdiction of the State, or, as otherwise characterized, to subjects which have acquired a situs within the State for the purpose of taxation. (Hayes v. Smith, supra.)" (State exrel. Rankin v. Harrington, 68 Mont. 1, 217 P. 681.) As to the question of attempted taxation of power properties beyond the territorial limits of the state, see Nevada-California PowerCo. v. Hamilton, 235 Fed. 317; Franklin v.Nevada-California Power Co., 264 Fed. 643.

If the taxing laws of Montana (Chap. 3, Laws 1923, and sec. 2138, Rev. Codes 1921) are to be construed as giving the power to the Montana board of equalization to tax ocean cables of the telegraph company they do violence to section 11, Article XII, of the state Constitution. The principles of uniformity of taxation declared in 26 R.C.L. 241-243, have been repeatedly adhered to by this court in its considerations of this section. (Clark v.Maher, 34 Mont. 391, 87 P. 272; Hauser v. Miller,37 Mont. 22, 94 P. 197; Hayes v. Smith, 58 Mont. 306,192 P. 615; State v. Mady, 83 Mont. 418-427, 272 P. 691.) The classification here made under this Montana law by the defendant board is a classification of property as "beyond the United States but a facility to property within the state" and no such classification should be permitted. It creates a classification which in effect penalizes this plaintiff over others. No other person or corporation is assessed for property beyond the territorial limits of the United States nor can they be.

To construe these Montana taxation statutes as the lower court has done is to deny this appellant that equal protection of the law it affords other taxpayers. These ocean cables are a different physical property of different physical construction and of vastly different construction costs operated separately — they add nothing to the Montana property — at least no more than other extraterritorially located facilities of hundreds of other corporations that own property within the state. This classification is not of telegraph companies, nor can it be because other corporations add to their business and facilities and to the value of their Montana owned property by the facilities furnished to their Montana customers by extraterritorially located and owned property. They are not taxed as this appellant has been — discrimination has been laid against the telegraph company.

Taxes, or rather the power of a government to enforce the same, must have a limit. This limit naturally has been the territorial limit of the sovereign power seeking to enforce the tax. This for the very natural and logical reason that the power of the sovereign to protect the property which it seeks to tax is limited by its territorial boundaries. (Union RefrigeratorTransit Co. v. Kentucky, 199 U.S. 194, 4 Ann. Cas. 493,50 L. Ed. 150, 26 Sup. Ct. Rep. 36; Wallace v. Hines,253 U.S. 66, 64 L. Ed. 782, 40 Sup. Ct. Rep. 435; Southern R. Co. v.Kentucky, 274 U.S. 76, 71 L. Ed. 934, 47 Sup. Ct. Rep. 542.)

From the argument made in the district court, we assume that the theory of the state is organic unity and enhanced value of Montana property by reason of the fact that plaintiff accepts messages "at any of its stations within the state of Montana to be ultimately transmitted to a foreign country over said ocean cables." In answer we cite Fargo v. Hart, 193 U.S. 490,48 L. Ed. 761, 24 Sup. Ct. Rep. 498.

These ocean cables are personal property. As to the question of nontaxability of such property extraterritorially, seeDelaware, L. W.R. Co. v. Pennsylvania, 198 U.S. 341,49 L. Ed. 1077, 25 Sup. Ct. Rep. 669; Frick v. Pennsylvania,268 U.S. 473, 42 A.L.R. 316, 69 L. Ed. 1058, 45 Sup. Ct. Rep. 603; 26 R.C.L. 278. "A state statute which undertakes to tax things wholly beyond the jurisdiction and control of the state conflicts with the 14th Amendment." (Safety Deposit Trust Co. ofBaltimore, Maryland, v. Virginia, 280 U.S. 83, 74 L. Ed. 180,50 Sup. Ct. Rep. 59.)

The cost of an ocean cable is about eight times that of land lines. We asked counsel for the state board of equalization to stipulate this fact into this record. This they declined to do, so the fact is not before the court in the stipulated record and necessitates this citation of authorities upon the question of this court taking judicial notice of these material facts involved in this particular discussion. "It may be stated generally with regard to the question as to what matters are properly of judicial cognizance that, while the power of judicial notice is to be exercised with caution, courts should take notice of whatever is or ought to be generally known, within the limits of their jurisdiction, for justice does not require that courts profess to be more ignorant than the rest of mankind." (15 R.C.L., pp. 1057, 1058.)

Questions of difference in costs have most frequently been presented to the courts in recent years in the questions of difference of costs of construction work and living expenses as between the times before the World War and the time subsequent, and it has been repeatedly held that the courts will take judicial notice of these differences of costs. "It is notorious that any work constructed during the war period, involving the employment of labor and the use of materials, was very much more expensive than if done before and very materially depreciated in value after the war." (United States v. Corona Coal Co.,23 F.2d 673, a taxation case.) "It is well known, and the court will take judicial notice of the fact, that the purchasing power of money has been much less since 1917 than it was in 1912, when the order was made; and that the cost of labor, materials, and supplies necessary for the proper operation and maintenance of street railways has greatly increased." (Banton v. Belt LineRy. Corp., 268 U.S. 413, 69 L. Ed. 1020 at 1026,45 Sup. Ct. Rep. 534; Galveston Elec. Co. v. Galveston, 258 U.S. 388,66 L. Ed. 678, 42 Sup. Ct. Rep. 351; Waiwila v. Illinois Cent. Ry. Co.,220 Ill. App. 113; Mandelbaum v. Goodyear Tire R. Co.,6 F.2d 818.) Changes in living expenses. (In re Wilmer,137 Md. 29, 111 A. 118.) We also find numerous references to judicial notice of differences of prices of real estate before and after periods of deflations, etc. (MacFarland v. Hanes, 286 Fed. 937; Strauns v. Victor Talking Machine Co., 297 Fed. 791; Jefferson v. Souter, 150 Ark. 55, 233 S.W. 804; R.E.L. McKaskill Co. v. Dekle, 88 Fla. 285, 102 So. 262; Larson v. Larson, (Iowa) 196 N.W. 41; Terrell v. Cheatham, 200 Ky. 667,255 S.W. 262; Hitchcock v. Tackett, 208 Ky. 803,272 S.W. 52; Arnold v. Arnold, (Mo.) 222 S.W. 996; Martin v.Palmer, 115 S.C. 17, 104 S.E. 308.)

We respectfully submit that this court should take judicial notice of the fact that the property here sought to be taxed is not located within the state of Montana, nor can it ever be, nor is any part thereof connected physically with the system of which the Montana properties are a part. That the only possible theory upon which the state can tax the cable lines is upon the theory of organic unity. That this court should take judicial notice of the fact that the costs of construction are not comparable and the theory of organic unity does not apply in this case and as to this property under the rules laid down in the United States in the case of Fargo v. Hart, and Wallace v. Hines, supra. In arriving at the value of property within the state such as telegraph lines, railroads, etc., there may be taken into consideration any value which that property has that is attributable to the fact that it is used in connection with and as a part of an entire plant or system operated both within and without the state, and that in arriving at the value of the property situated within the state, the assessing officer may take into consideration the value of the entire plant or system, and fix the value of that portion of the property which is situated in the state at that part of the total value of the entire plant or system that the mileage or trackage in the state bears to the whole mileage or trackage, both within and without the state. (Western Union Tel. Co. v. Massachusetts,125 U.S. 530, 31 L. Ed. 790, 8 Sup. Ct. Rep. 961; Western Union Tel. Co. v. Taggart, 163 U.S. 1, 41 L. Ed. 49, 16 Sup. Ct. Rep. 1054; Inre Assessment of Western Union Tel. Co., 35 Okla. 626, 130 P. 565; Western Union Tel. Co. v.Dodge County, 80 Neb. 18, 113 N.W. 805; People ex rel. MexicanTelephone Co. v. State Tax Com., 219 A.D. 401, 220 N.Y. Supp. 8; Pittsburgh, C.C. St. Louis Ry. Co. v. Backus,154 U.S. 421, 439, 38 L. Ed. 1031, 1041, 14 Sup. Ct. Rep. 1114, 1122;State v. State Board of Equalization, 56 Mont. 413,185 P. 708, 186 P. 697.)

The unity of tangible property such as will support the application of the unit method of valuation is not dependent upon physical connections between the separate pieces of property composing the unit. The unity required is unity of ownership and use. (Adams Express Co. v. Ohio State Auditor, 165 U.S. 194,41 L. Ed. 683, 17 Sup. Ct. Rep. 305.)

The inclusion of these cable lines in the valuation of the entire property for the purpose of ascertaining the value of that portion lying within a particular state is not new even to the appellant company. (Western Union Tel. Co. v. Taggart,163 U.S. 1, 41 L. Ed. 49, 16 Sup. Ct. Rep. 1054; Western Union Tel.Co. v. Massachusetts, 125 U.S. 530, 31 L. Ed. 790, 8 Sup. Ct. Rep. 961; People ex rel. Mexican Tel. Co. v. State Tax Com.,219 A.D. 401, 220 N.Y. Supp. 8.)

Appellant contends that if the taxing laws of Montana are to be construed as giving the power to the Montana board of equalization to tax ocean cables of the telegraph company they violate section 11, Article XII, of the Constitution. There is no question of the soundness of this contention, but the statute is not to be so construed. The principle of value of the system as a whole, and allocating a portion thereof to the property in a particular state, based upon the percentage that the state mileage bears to the entire mileage wherever situated, has been held not to constitute taxing property beyond the jurisdiction of the state. It is but the means of arriving at the value of that part of the property situated in the state. (See State v.State Board of Equalization, 56 Mont. 413, 185 P. 708, 186 P. 697; Pittsburgh etc. Ry. Co. v. Backus, 154 U.S. 421,439, 38 L. Ed. 1031, 1041, 14 Sup. Ct. Rep. 1114, 1122.) Of course, as held in Wallace v. Hines, 253 U.S. 66, 64 L. Ed. 782, 40 Sup. Ct. Rep. 435, the unit rule of valuation cannot be used where, due to special facts and circumstances, the value arrived at is so disproportionately in excess of the true value of the property within the state that it amounts to fraud or arbitrary assessment. But this is the exception to the rule, and it is not involved in this case.

It is claimed by appellant that the inclusion of these cables in the unit of property violates the equal protection clause of the state Constitution and the federal Constitution. This, of course, is predicated upon the theory that in arriving at the value of appellant's property in Montana the value of the other parts of the unit which lie beyond the limits of the state is taken into consideration, while in valuing the property of some other corporations extraterritorial property of the owner is not taken into consideration. For this reason appellant contends that its property has been classified without a just basis of classification existing and therefore has been discriminated against. Assuming that there is a classification, as appellant contends, but which we deny, it has been repeatedly held that the railroad and telegraph companies are the subject of classification and that their property need not be assessed by the same method or taxed at the same rate as other property. (Kentucky Railroad Tax Cases, 115 U.S. 321, 29 L. Ed. 414,6 Sup. Ct. Rep. 57; Adams Express Co. v. Ohio State Auditor,165 U.S. 194, 41 L. Ed. 683, 17 Sup. Ct. Rep. 305.)

It was alleged in the complaint, and had to be taken as true, that the value arrived at by the unit method of valuation was excessive and represented more than the true cash value of the property in the state to an extent as to amount to an arbitrarily excessive valuation. This is the exception hereinbefore adverted to in this brief to the general rule. But in order to invoke the exception, facts must be shown to the court which show that by the employment of the unit rule a valuation was produced which was so excessive as to amount to an arbitrary or fraudulent assessment. (People v. State Tax Com., 219 A.D. 401,220 N Y Supp. 8.) In In re Assessment of Western Union Tel. Co., 35 Okla. 626,130 P. 565, it was said that in the absence of evidence to the contrary, the presumption is that all the property of an interstate telegraph company is part of its corporate plant, and that its tangible and intangible property are equally distributed throughout its mileage. (Citing Atchison, T. S.F. Ry. Co. v.Sullivan, 173 Fed. 456, 97 C.C.A. 1.)

Under the decision in State v. State Board ofEqualization, 56 Mont. 413, 185 P. 708, 186 P. 697, if the appellant would question the value of its property situated in Montana as fixed by the state board by the use of the unit method of valuation, it must show facts and circumstances which would render that method a fundamentally wrong principle of valuation in the particular case, or that the value so arrived at was so excessive that it amounted to fraud.

Appellant's only real objection seems to be that these cables cannot be considered as a part of its entire plant or system because they are not physically connected with the land lines. As hereinbefore pointed out, this contention is not sound, as it is the unity of ownership and operation of separate properties as a system that authorizes the use of the unit system of valuation. (Southern P. Ry. Co. v. Richardson, 181 Cal. 280,184 P. 3; San Francisco-Oakland Terminal Rys. v. Johnson, 210 Cal. 138,291 P. 197.)

In this case the messages are transmitted from the land terminal to the cable terminal by its employees or agents, and the transmission is then continued across the ocean. As appears from the agreed statement of facts, the sending of a message from Montana to a foreign country over these land lines and cable lines is a continuous transaction handled by the appellant as a part of its business and the mere fact that for a short distance the messages are delivered from one terminal to another by an employee of the appellant does not destroy the unity of the land lines and cable lines. There is unity of ownership of both the cable and the land lines and unity of operation and that is all that is required.

Appellant asks the court to take judicial notice that "the cost of an ocean cable is about eight times that of land lines." Section 10532, Revised Codes of 1921, specifies the things of which the court may take judicial notice. The courts cannot enlarge the provisions of this section but are restricted by its terms. (McKnight v. Oregon Short Line R.R. Co., 33 Mont. 40,82 P. 661.) We respectfully submit that the court cannot take judicial notice of the above matter, and that, even if it did so, there would still be lacking any evidence which would establish as a fact that the valuation arrived at by the state board of equalization was arbitrary and amounted to fraud. This action was submitted to the lower court upon an agreed statement of facts, from which it appears that plaintiff is a New York corporation doing business in this state, and owning telegraph lines and other property of a single and continuous character operated in more than one county in the state. It is engaged in the business of accepting and transmitting telegraphic messages in this state, other states of the United States, and foreign countries. In addition to its land lines in the United States, it owns and operates submarine cables for the transmission of telegraphic messages from points on its land lines in this and other states to points in foreign countries. The ocean cable construction and the operation thereof are entirely unlike land line physical property and operations, and the cables are not connected physically with the land lines of plaintiff. Telegraphic and cable messages to and from land line points in Montana and the United States are transmitted over its lines and transferred manually by an employee or agent of plaintiff from the land lines to the cables at their termini in the United States. For the services rendered plaintiff receives payment from its customers upon messages transmitted from points in this state to the addresses in foreign countries for messages transmitted in part over its land lines and in part over its ocean cables.

In the year 1929, plaintiff made return to the state board of equalization disclosing all of its property, indebtedness, stock issues, expenses, mileages of wire, and valuation of stocks, bonds, and other property as required to be furnished for taxing purposes. Plaintiff, in arriving at the value of its property subject to taxation in this state, excluded from consideration the ocean cables owned by it. The value of the property in the state, as determined by it, was $1,060,120.

The state board of equalization, in arriving at the value of the property of plaintiff subject to taxation in the state, took that portion of the total valuation of the entire system of plaintiff wherever situated, including 37,563 miles of submarine cables lying and being in the oceans of the world, that the total mileage of telegraph wires within the state bears to the total wire mileage of plaintiff's entire telegraph system, including the mileage of submarine cables, and fixed the value of the property within the state at $1,246,150.

It is agreed that, if the valuation of the ocean cables be not included in determining the valuation of plaintiff's entire plant or system for the purpose of arriving at the value of its property in the state, the total valuation of the property in the state is as returned by it, but, if the ocean cables shall be included, the valuation of its property is as determined by the state board.

From a judgment for defendant plaintiff appeals.

The questions presented for determination, as stated in the agreed statement of facts, are: "1 (a) In arriving at the total value of the entire plant or system of the plaintiff company, may the defendant board include the valuation of plaintiff's submarine or ocean cables; (b) if the foregoing is answered in the affirmative, may the board then take that portion of such total value that the total wire mileage within this state bears to the total wire mileage of plaintiff's system, wherever it is situated, including the mileage of ocean cables. 2. Whether or not the including of such ocean cables by the defendant in arriving at the value of plaintiff's property in Montana does not do violence to (a) section 11 of Article XII of the Constitution of the state of Montana, (b) section 17 of Article XII of the Constitution of the state of Montana, (c) section 27 of Article III of the Constitution of the state of Montana: and 3. Whether or not an assessment under the laws of the state of Montana or rules and orders of the defendant herein, in thus including the value of plaintiff's ocean cables in arriving at the value of plaintiff's property in Montana does not deny it those guaranties contained in section 1 of the Fourteenth Amendment to the Constitution of the United States of America?"

It is contended by plaintiff that the assessment made by the[1, 2] board results in the taxation of a separate and distinct unit of property located outside the territorial limits of the state and not connected with or operated in physical or manual connection with any property within the state; in other words, that the assessment made by the board amounts to the taxation of property, i.e., cable lines, not situated within the state.

Section 2143, Revised Codes 1921, provides that the value for taxation of the property and plant of each telegraph, telephone, electric power, and transmission line and other properties to be assessed by the state board of equalization "shall be that portion of the total value of the entire plant and property, wherever situated, that the total mileage within this state bears to the total mileage wherever situated, after deducting from such portion the total assessed value of all property which has been assessed for taxation in this state by the county assessors of the several counties of this state."

The agreed statement shows that plaintiff will accept a message at any of its stations in Montana to be transmitted to foreign countries over ocean cables owned and operated by it; that it has published rates covering such service effective in Montana; that telegraph and cable messages from land lines in Montana are transmitted over its land lines, and are transferred manually by its employees to cable lines, or from cable to land lines at the cable terminus. For such services plaintiff receives payment from its customers upon messages transmitted from Montana points to foreign countries over its land lines and ocean cables.

The agreed statement shows that the cable lines are owned and operated by plaintiff in connection with its land lines, and, in our opinion, they constitute a part of its entire system. The whole transaction from the acceptance of messages in Montana to and including the transmission thereof over its cables is a single and continuous transaction of plaintiff in the conduct of its general business, and the fact that there is no physical connection between the land lines and the ocean cables is of no consequence.

The unity of tangible property such as will support the application of the unit method of assessment is not dependent upon physical connection of the separate pieces of property composing the unit. "Doubtless there is a distinction between the property of railroad and telegraph companies and that of express companies. The physical unity existing in the former is lacking in the latter; but there is the same unity in the use of the entire property for the specific purpose, and there are the same elements of value arising from such use. The cars of the Pullman Company did not constitute a physical unity, and their value as separate cars did not bear a direct relation to the valuation which was sustained in that case. [Pullman Palace Car Co. v.Pennsylvania, infra.] The cars were moved by railway carriers under contract, and the taxation of the corporation in Pennsylvania was sustained on the theory that the whole property of the company might be regarded as a unit plant, with a unit value, a proportionate part of which value might be reached by the state authorities on the basis indicated. * * * The unit is a unit of use and management. * * * We repeat that, while the unity which exists may not be a physical unity, it is something more than a mere unity of ownership. It is a unity of use, not simply for the convenience or pecuniary profit of the owner, but existing in the very necessities of the case, — resulting from the very nature of the business." (Adams Express Co. v. OhioState Auditor, 165 U.S. 194, 41 L. Ed. 683, 17 Sup. Ct. Rep. 305,309. See, also, Pullman Palace Car Co. v. Pennsylvania,141 U.S. 18, 35 L. Ed. 613, 11 Sup. Ct. Rep. 876; AmericanRefrigerator Transit Co. v. Hall, 174 U.S. 70, 43 L. Ed. 899, 19 Sup. Ct. Rep. 599; Union Refrigerator Transit Co. v. Lynch,177 U.S. 149, 44 L. Ed. 708, 20 Sup. Ct. Rep. 631; Union Tank Line v.Wright, 249 U.S. 275, 63 L. Ed. 602, 39 Sup. Ct. Rep. 276; SanFrancisco-Oakland Terminal Rys. v. Johnson, 210 Cal. 138,291 P. 197.)

In the case of Western Union Tel. Co. v. Taggart,163 U.S. 1, 41 L. Ed. 49, 16 Sup. Ct. Rep. 1054, the statement of facts shows that the state of Indiana, in arriving at the value of that part of plaintiff's telegraph lines situated in that state, took into consideration the value of all of plaintiff's property, including ocean cables, treating the property as a unit. The valuation was upheld. (See, also, Western Union Tel. Co. v.Massachusetts, 125 U.S. 530, 31 L. Ed. 790,8 Sup. Ct. Rep. 961.)

In People ex rel. Mexican Tel. Co. v. State Tax Com.,219 A.D. 401, 220 N.Y. Supp. 8, the state of New York, in valuing that part of the company's cable extending from the mainland to the three-mile limit, took into consideration the value of the cable as a whole, together with the value of telegraph lines having no direct connection with the cable line. The assessment was held valid.

The authorities are in accord that in arriving at the value of property in a state such as telegraph lines, railroads, etc., there may be taken into consideration any value which that property has that is attributable to the fact that it is used in connection with and as a part of an entire plant or system operated both within and without the state, and that, in arriving at the value of the property within the state, the assessing officers may take into consideration the value of the entire plant or system, and fix the value of that portion of the property which is situated in the state at that part of the total value of the entire plant or system that the mileage or trackage in the state bears to the whole mileage or trackage, both within and without the state. (Baker v. Druesedow, 263 U.S. 137,68 L. Ed. 212, 44 Sup. Ct. Rep. 40; Adams Express Co. v.Kentucky, 166 U.S. 171, 41 L. Ed. 960, 17 Sup. Ct. Rep. 527; Adams Express Co. v. Ohio StateAuditor, 165 U.S. 194, 41 L. Ed. 683, 17 Sup. Ct. Rep. 305;Western Union Tel. Co. v. Taggart, 163 U.S. 1, 41 L. Ed. 49,16 Sup. Ct. Rep. 1054; Columbus Southern Ry. Co. v. Wright,151 U.S. 470, 38 L. Ed. 238, 14 Sup. Ct. Rep. 396; In reAssessment of Western Union Tel. Co., 35 Okla. 626, 130 P. 565;Western Union Tel. Co. v. Dodge County, 80 Neb. 18,113 N.W. 805; State v. State Board of Equalization, 56 Mont. 413,185 P. 708, 713, 186 P. 697.)

In the case last cited, this court, in construing section 6, Chapter 49, Laws of 1919, now section 2143, supra, held that the method of valuation for taxing purposes provided by that act "does not establish an arbitrary rule of assessment, but only requires that the total value of the plant and property, wherever situated, shall be taken into consideration in determining the actual cash value for taxation of that portion of the plant and property situated within this state."

There is here no attempt to tax property having a situs[3] outside this state. The value of such property as constitutes the plant or system is considered only for the purpose of determining the just value for taxation of that part within the state. The true and actual value of plaintiff's property is something more than an aggregation of the values of separate parts of it, operated separately, "it is the aggregate of those values, plus that arising from a connected operation of the whole; and each part contributes, not merely the value arising from its independent operation, but its mileage proportion of that flowing from a continuous and connected operation of the whole." (Western Union Tel. Co. v. Taggart, supra; Pittsburgh etc. Ry. Co. v. Backus, 154 U.S. 421,38 L. Ed. 1031, 14 Sup. Ct. Rep. 1114, 1117.)

In the case last cited it was contended, as here, that by the unit method of valuation for taxing purposes property beyond the territorial limits of the state is taxed, but the court held: "We do not think that the matters referred to justify any such imputation. It is not to be assumed that a state contemplates the taxation of any property outside its territorial limits, or that its statutes are intended to operate otherwise than upon persons and property within the state. * * * It is obvious that the intent of this Act was simply to reach the property of the railroad within the state."

In Wallace v. Hines, 253 U.S. 66, 64 L. Ed. 782,40 Sup. Ct. Rep. 435, 436, the court said: "The only reason for allowing a state to look beyond its borders when it taxes the property of foreign corporations is that it may get the true value of the things within it, when they are part of an organic system of wide extent, that gives them a value above what they otherwise would possess."

The fact that the unit rule of valuation was employed by defendant as commanded by section 2143 did not amount to taxing the ocean cables themselves. It is merely the means of arriving at the value of that part of plaintiff's property situated within the state.

The contention that section 2143, supra, violates section 27[4] of Article III of the state Constitution and section 1 of the Fourteenth Amendment to the federal Constitution, is wholly without merit. It is now settled by a long line of decisions that the due process clause does not prevent a state from ascertaining the value of railroads, telegraph, and telephone companies, substantially in the manner prescribed by section 2143, and that the equal protection clause is not violated by prescribing a different rule of taxation for such companies than for concerns engaged in other lines of business. (Baker v. Druesdow, supra; Adams Express Co. v. Kentucky, supra; Adams ExpressCo. v. Ohio State Auditor, supra; Western Union Tel. Co. v.Taggart, supra; Kentucky R. Tax Cases, 115 U.S. 321,29 L. Ed. 414, 6 Sup. Ct. Rep. 57.)

But we are asked to take judicial notice of the difference of[5] costs between ocean cables and land lines, counsel for plaintiff asserting that "the cost of an ocean cable is about eight times that of land lines." This we cannot do. Matters of which courts may take judicial notice are enumerated in section 10532, Revised Codes 1921, which establishes the law of this state respecting that subject. Further than this we cannot go. (State ex rel. Foster v. Mountjoy, 83 Mont. 162,271 P. 446; Masich v. American S. R. Co., 44 Mont. 36,118 P. 764; McKnight v. Oregon Short Line R. Co., 33 Mont. 40,82 P. 661.)

Finding no error, the judgment is affirmed.

MR. CHIEF JUSTICE CALLAWAY and ASSOCIATE JUSTICES GALEN, ANGSTMAN and MATTHEWS concur.