WOE UNTO YOU, LAWYERS!

property tax. And indeed the Court implied as much in its opinion and has said so,
definitely, since.
Now as everybody knows, a property tax is universally considered to be a tax
measured by the value of the property and collected every year whether the owner
makes profits out of the property or not. The tax on Max Senior was measured by his
profits, and if there hadn’t been any profits there wouldn’t have been any tax. But
that little practical matter didn’t stop the Supreme Court from calling it a property
tax anyway.
The Court’s excuse presumably was (and notice how often you have to guess
what the Court means just to make its decision fit its own principles of Law) that the
Ohio legislature, in writing the tax statute, had inadvertently labeled it a property
tax, even though it was measured by income. The fact that the Ohio Supreme Court
had ignored this slip and treated the tax as what, practically speaking, it was, didn’t
phase the U.S. Supreme Court. Nor did the fact that it is strictly the business of the
Ohio courts and no concern at all of any federal court to “interpret” the statutes of
Ohio. For the U.S. Supreme Court blithely treated the tax as a property tax,
meanwhile proclaiming, you may remember, “Our concern is with realities, not
nomenclature.” In Constitutional Law, a rose by any other name does not always
smell so sweet.
Even granting then, with a gulp, that it was a property tax that Max Senior
didn’t want to pay, why had Ohio no “jurisdiction” to collect it? For one of the
cardinal sub-principles of the “jurisdiction” rule is that a state has “jurisdiction” to
put a property tax on property owned by someone who lives in the state, if that
property, instead of being land or goods, consists of pieces of paper, such as stocks
or bonds, which give the owner certain rights. And surely what Max Senior owned
was a few pieces of paper, called trust certificates, that entitled him to some of the
profits from seven plots of land, on which he had no right at all to go build a fence, or
a house. There is at least no doubt that if Max had bought, instead of trust
certificates, shares of stock in a corporation that managed plots of land, just as the
trustees managed the plots Max had a stake in, then the state of Ohio could have
taxed those shares of stocks without the Supreme Court raising a finger to stop it.
What difference?
The difference, and the only difference, is in the legal wording of the pieces of
paper that did give or might have given Max a right to Share in the profits. If he had
held shares of stock he would have been nothing but a stockholder. But since he
held trust certificates, he was, in legal language, a “cestui que trust.” And being a
“cestui que trust” – which only means someone-who-trusts-someone-else-to-hold-
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