premium charge, will come from the earnings of the business, and he should be just as willing to pay a tax upon such income as if he had invested it in a grocery store or in a railroad bond. Since judicial interpretation has cleared the question of the difficulty of determining what are profits and what are premium returns, there can now be no good reason advanced why the law, as it has existed since 1909, should be changed in the interest of this particular class of taxpayers.

But it is argued that the tax upon mutual life insurance companies, necessarily paid by the policy holders, results in taxing individuals whose total income from all sources is within the $4,000 exemption. This is true, but it is an inconsistency in the law more apparent than real. The same thing is true of stockholders in all corporations. The cor poration pays a tax upon its earnings without exemption and such of its stockholders as would not be taxable because their incomes are less than $4,000 are thus taxed to the extent of the income which they receive from the corporation. The justification of this lies in the advantage which the individual obtains in having a corporation employ his money, and in the absence of personal liability on the part of the investor which comes because of his business being done in corporate form. It simply amounts to this-that if an individual desires to have for himself the benefits which accrue from doing business in corporate form, he pays to the Government this very small tax as a return for that benefit. He has his choice of investing his money as an individual or of investing it through a corporation. He accepts the latter plan on account of its manifest advantages, and this small drain upon his income derived from the employment of money in that way would undoubtedly be offset by the increased earnings of his money because joined with that of many others. It is true that following the former corporation tax act, certain quasi corporations are exempt, such as labor, agricultural or horticultural organizations, mutual savings banks not having a capital stock repre

sented by shares, fraternal beneficiary societies, orders or associations operating under the lodge system, building and loan associations, religious, charitable or educational institutions, and cemetery associations. In the case of each of these, however, it must be apparent that different conditions exist from those surrounding the business of mutual life insurance companies and the reason for the distinction is obvious.

The charge is being freely circulated that the bill, as it passed the House, would exempt, from the additional tax all incomes derived from dividends on the stock of corporations which pay the tax, and from interest or corporate indebtedness paid at the source. I have been informed that some gentlemen of great wealth whose incomes are largely derived from such sources and who, even in advance of the enactment of the law, are casting about for means to avoid the payment of some or all of this just tax, have been advised by eminent counsel that such is the effect of what they are pleased to style the "ambiguous wording of the bill." A critical writer in the Wall Street Journal, doubtless voicing the patriotic desire of the customary readers of that paper, to call attention to any error which would permit them to escape taxation, cites an illustration of such alleged exemption in the case of the "Astor estate which receives over $600,000 annually from dividends upon the stock of corporations which pay the normal tax." This construction arises from a misunderstanding of terms in the bill. It is alleged that Section B declares there shall be allowed as a deduction, among other things, "of the amount of income received or payable from any source at which the tax upon such income, which is or will become due, under the provisions of this section, has been withheld for payment at the source in the manner hereinafter provided;" and that consequently the taxable person, where his income from such source, exceeds $20,000, will escape payment of the additional or surtax upon such excess. But a careful reading of the bill will show that this is a deduction to be

allowed in computing the net income, not in returning it for computation and assessment. Indeed, it is expressly provided that every person subject to the additional or surtax shall for the purpose of its assessment and collection make personal return of his "total net income from all sources." The taxable who are liable for the additional tax, therefore, having made return of all the income, when the income is computed for taxation, is allowed a deduction for that income on which all tax due have been withheld at the source. As the corporation withholds only the normal tax, the income above $20,000 is not included within that on which the tax "which is or will become due" has been withheld, and consequently the income above $20,ooo will not be deducted in computing the net income subject to the additional or surtax.

No claim of infallibility is made for the framers of this new law. No men realize more keenly than the members of our profession the difficulties and dangers in the way of converting legislative intention into statutory enactment. Lawyers, who are also legislators, approach the work of writing laws with minds convinced in the rude school of experience of the frailties of lawmakers in all time. But I doubt if any bill, ever presented to the American Congress, received longer or more careful study on the part of its authors or was subjected to more rigid criticism by those interested to make it conform to its true intent than the Income Tax Measure which I have been discussing. It will be attacked in the courts, of course. It will be criticised by the ablest minds in the country, and meaning will be imputed to words and phrases which was never dreamed of by the men who penned them. Out of the crucible of litigation, conducted by American lawyers, in attack and defence, by thrust and parry, will come the same statute, strengthened, enforced and clarified by the interpretation of the American judiciary, with lasting benefit for the American Government and certain justice for the American citizen.

Guy W. Steele: Although some of us may regret that Mr. Palmer is not a member of this Association, yet the fact that he is not, gives us an opportunity to express our appreciation of his address. I, therefore, move that a vote of thanks be extended by the Association to Mr. Palmer for the able, scholarly, interesting and instructive paper to which we have had the pleasure of listening at this time.

The motion was duly seconded, and after was declared carried.

The President: I take great pleasure in extending to the Honorable Mr. Palmer the vote of thanks of this Association for the interesting and instructive paper with which has been honored us.

The address of Edgar H. Gans on the subject of "Sources of Maryland Testamentary Laws" will be given tomorrow morning. The next address will be by Judge Hammond Urner, of the Court of Appeals of Maryland, the subject being "The Case of the King vs. Raleigh." I now have the pleasure of introducing to you Judge Urner.

Judge Hammond Urner: Mr. President, Ladies and Gentlemen: I want to say, in order to relieve your anxiety, that this sketch is not quite as voluminous as it probably appears from your point of view. After listening to Mr. Palmer's exceedingly able and instructive discussion on one of the most vital problems of the present day, I will ask you to accompany me upon an excursion of several centuries in the past, but I hope we will be able to return without undue delay or fatigue.

THE CASE OF THE KING VERSUS RALEIGH.

The old and ponderous volumes of the State Trials of England record in minute detail some of the most impressive incidents of English History, but of all the memorable proceedings included in these reports there are none so full of dramatic interest as the case of the King vs. Raleigh.

When James Stuart, of Scotland, came to London in May, 1603, to reign as the successor of Queen Elizabeth, the most attractive figure at the English Court was Sir Walter Raleigh, Knight, of the County of Devon. He was a man of picturesque and magnetic personality, with a sparkling wit, profound intelligence and marvelous versatility. His career had been romantic and brilliant. He had fought for six years with the Huguenots in France, had contributed one year of military service in the Netherlands towards the rise of the Dutch Republic, and had spent two years in fighting the Spanish invaders of Ireland. He had joined with his own vessels in the defeat of the great Armada. He had led the advance squadron of the English fleet in the capture of Cadiz. He had explored the wilds of Guiana, and had presented to the Queen the vast domain of Virginia. His public service had included an extended parliamentary experience, various diplomatic functions and frequent consultations at the Council Board. In the midst of these exacting duties he had made some valuable contributions to English literature. Meanwhile he had played with consumate art the role of courtier, having won and held for years the favor, and even the affection of the Virgin Queen.

At the beginning of the new reign Sir Walter Raleigh held, by the late Queen's appointment, several positions of honor and profit, including the Governorship of the Isle of Jersey and the Captaincy of the Royal Guard. He was