Lancaster v. Clayton, &C.
| Decision Date | 03 December 1887 |
| Citation | 86 Ky. 373 |
| Court | Kentucky Court of Appeals |
| Parties | Lancaster v. Clayton, &c. |
APPEAL FROM SCOTT CIRCUIT COURT.
D. W. LINDSEY FOR APPELLANT.
OWENS & FINNELL FOR APPELLEE.
JUDGE HOLT DELIVERED THE OPINION OF THE COURT.
The appellant, George Lancaster, proposed to the board of trustees of the town of Georgetown to erect at said place a fine hotel, costing not less than a certain sum, if they would exempt the property from the payment of town taxes for ten years. The offer was submitted to a vote of the people, and a majority favoring it, the proposal was accepted by the board, and, thereupon, the hotel was built. The following year, however, they had it assessed for such taxes, and the appellant now seeks to enjoin their collection.
The contract and its performance upon his part are admitted. There is no doubt of the morality of his claim to the exemption; but even a court of equity can not enforce a merely moral obligation. The legality of the contract must be considered, because the appellee has the right to insist upon its strict legal rights.
Section 3, article 1, chapter 92 of our General Statutes provides: "All property, real and personal, within this State, not herein expressly exempt by law, shall be assessed, as nearly as practicable, according to a uniform rate, in the manner hereinafter provided."
The charter of the appellee authorizes its board of trustees to assess and levy annually a tax upon all the real estate in the town; makes it the duty of the assessor to list all that is liable to taxation; and vests the board with the control of the fiscal matters of the town. (Acts 1879, vol. 1, p. 357.)
No power to exempt property from taxation is attempted to be given in express words. We shall, however, waive the question whether this has been done by implication, and proceed to a consideration of the power to do so, even with attempted legislative sanction, in a case like this one. Mr. Dillon says: "In the absence of special constitutional restriction, the Legislature may confer the taxing power upon municipalities in such measure as it deems expedient; in other words, with such limitations as it sees fit as to the rate of taxation, the purposes for which it is authorized, and the objects (that is, the property) which shall be subjected to taxation; but it can not, of course, confer any greater power than the State itself possesses, and must observe the restrictions and limitations of the organic law." (2 Dillon on Municipal Corporations, section 590.)
Our State Constitution has no provision as to taxation eo nomine; but the first section of the Bill of Rights says: "That all freemen, when they form a social compact, are equal; and that no man, or set of men, are entitled to exclusive, separate public emoluments or privileges from the community, but in consideration of public services."
It is a "public privilege" to be exempt from taxation; and as the Legislature can only authorize the imposition of a tax when it is for a public purpose, so, as a general rule, it also passes its constitutional limit when it attempts to confer exemption from taxation save in consideration of public service. It may, however, exempt the property of educational, religious and benevolent institutions, although, as to some of them, a tax could not be levied for their support; and it may do so, because if any portion of the public expenses were imposed upon them, it would generally have to be collected from the citizens before it could be paid, and, moreover, these institutions so serve the State that its policy and interest require their encouragement. The courts will not inquire as to the extent of the public service upon which the Legislature has based an exemption. Indeed, they have no power to do so, but only whether the privilege has been given in consideration of such service. If so, it is then a question of policy and not of legislative power.
The burden of taxation is justly a common one. Its object is to provide means for the protection and benefit of all; and this being so, all should help to bear it. An exemption to one person is but additional burden to another. To take from one and give to another under the guise of taxation is, indeed, but robbery under a legalized form, and counter to the spirit and genius of our system of government. It is true, the taxing power is a broad and liberal one, and properly so. It extends aid to public schools, because education is a public purpose; to roads, because they are necessary for travel; for police purposes, to preserve the public peace — in short, for all purposes which, in a liberal sense, can be considered public. It can not be used, however, to take from one person his property and give it to another one more favored, and this, too, although it may incidentally benefit the...
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