James Clark McReynolds

“ The court of common pleas held the tax 'is a charge for the privilege of transacting business in the state, measured by the amount of the business done;' there is 'nothing in the act of Congress to support the proposition that the defendant was authorized by it to transact its business in the state of Pennsylvania;' and in executing the specified bonds the surety company 'was in no sense an instrumentality of government.' Judgment was accordingly rendered for the state ”

“ We are asked to reverse a judgment of the supreme court of Pennsylvania which denied plaintiff in error's claim that, in becoming surety upon bonds required by the United States, it acted as a Federal instrumentality, and was not subject to taxation on the premiums received. 244 Pa. 67, 90 Atl. 437.
Incorporated under the laws of Maryland, the Fidelity & Deposit Company is empowered by its charter to act as surety. It was duty licensed to transact business in Pennsylvania. ”

“ As revealed by its title, the purpose of the act of 1894 is 'to allow certain corporations to be accepted as surety, etc.' It does not undertake to endow any corporation with power, but only to permit those complying with specified conditions to exercise their lawful powers, derived from other sources, by contracting with the government under official approval. ”