Adams State Revenue Agent v. Lamb-Fish Lbr. Co

• Decision Date: 04 November 1912
• Citation: 103 Miss. 491,60 So. 645
• Court: Mississippi Supreme Court
• Parties: ADAMS STATE REVENUE AGENT v. LAMB-FISH LBR. CO

60 So. 645

103 Miss. 491

ADAMS STATE REVENUE AGENT v. LAMB-FISH LBR. CO

Supreme Court of Mississippi

November 4, 1912

October 1912

APPEAL from the chancery court of Tallahatchie county, HON. M. E DENTON, Chancellor.

Suit by Wirt Adams, State Revenue Agent, for the use of the town of Charleston against the Lamb-Fish Lumber Company. From a judgment for defendant, complainant appeals.

The facts are fully stated in the opinion of the court.

Reversed and remanded. Suggestion of error overruled.

May &amp Sanders, attorneys for appellant.

The exemption ordinance is essentially a nullity for several reasons of substance and cannot operate to confirm the exemption claim, and even though the ordinance had been properly framed, adopted and published and applied to property within the jurisdictional limits of the municipality. As we proceed to discuss the questions involving the substance of the exemption claim, it is well enough to bear in mind the general rule governing construction of exemption claims as approved in the case of Y. & M. V. R. R. Co. v. Thomas, 65 Miss. 562, as follows: "Statutes exempting persons or property from taxation, being in derogation of sovereign authority and of common right, are according to all authorities, strictly construed. As taxation is the rule and exemption the exception, the intention to create an exemption must be expressed in clear and unambiguous terms, and it cannot be taken to have been intended when the language of the statute on which it depends is doubtful or uncertain. Legislation which relieves any species of property from its due proportion of the burdens of government, must be so clear that there can be neither reasonable doubt nor controversy in regard to its meaning." Applying this rule we call the court's attention to the fact that the manufactory sought to be exempted from taxation had been established and was in operation prior to the adoption of the so-called exemption ordinance. Section 3347, Code 1906, under which this exemption is claimed, begins with the significant words "To aid and encourage the establishment of manufactories," etc. We submit that the language of the statute clearly implies that it was the thought and purpose of the legislature, acting under the authority conferred by section 192 of the Constitution, to place in the hands of municipal authorities a means whereby they could draw to such municipalities, manufactories, and induce them to locate and develop manufacturing enterprises in municipalities, the substantial inducements being the exemption from municipal taxation. If this was the purpose of such legislation, and that construction is justified by the language of the statute, then it was never intended to authorize municipal authorities to legislate a gift or bonus of taxes to an enterprise already in existence. Now, if the language clearly means that, of course, no exemption could be held under this ordinance; and if the language is ambiguous and may mean that, and may not mean that, then the case of Railroad Co. v Thomas, supra, the exemption being "in derogation of the sovereign authority and of common right," must be denied. In the case of Yocona Cotton Mills v. Duke, 71 Miss. 790, it was held that the ordinance of the constitutional convention of 1890 exempting certain factories from taxation for a period of ten years, did not apply to existing factories. But if the court should resolve the doubt as to the legislative intent in favor of the exemption and against the rule in such cases as laid down in Railroad Co. v. Thomas, supra, we still maintain that the ordinance is void because it is class legislation, as it applies specially, solely and exclusively to the Lamb-Fish Lumber Company and its benefits and exemptions are not extended to other persons or corporations of the same class and in a like situation with the Lamb-Fish Lumber Company, and the exemption claimed is therefore obnoxious to section 112, of the Constitution of Mississippi, requiring taxation to be equal and uniform. It is also obnoxious to the fourteenth amendment of the constitution of the United States because it denies to others the equal protection of the laws afforded or attempted to be extended to the Lamb-Fish Lumber Co., and is also against the letter and the spirit of section 90 (h), of the Constitution of Mississippi, which prohibits the legislature from passing any local, private or special law exempting property from taxation.

In Adams v. Railroad Co., 77 Miss. 271 et seq., the court exhaustively discusses an exemption contained in a railroad charter which was conferred by special legislative grant and which applied solely and exclusively to the said railroad, and, while holding that the legislature had the power to select certain classes for taxation and to exempt other classes, yet the exemption in that case was declared void because it did not apply alike to all of the same class. The court expressly holds and reaffirms many previous holdings, that in order to make any such exemption valid it must be extended to all of the same class and in the same situation. And the Adams case, supra, overrules Mississippi Mills v. Cook, 56 Miss. 40, in so far as the Mississippi Mills case is in conflict with Adams v. Railroad, and approves so much of it as is consistent with it and also overrules the Lambert case, 70 Miss. 779, which lays down a rule at variance with the rule announced in the Adams case. The Mississippi Mills charter was claimed to furnish an exemption to it in common with all others in like situation, and to that extent the court in the Adams case, supra, approves the Mississippi Mills case. In Adams v. Tombigbee Mills, 78 Miss. 676, at pages 684 and 685, the rule of uniformity required in such exemptions is again reaffirmed. In Adams v. Kuykendall, 85 Miss. 583, an exemption was claimed from liability to taxation on property of a certain kind by virtue of the charter provisions of the city of Vicksburg and an ordinance thereunder. The exemption was disallowed as being violative of the equality and uniformity rule of the Constitution and the case further holds that an unconstitutional exemption may be disregarded and taxes collected and that the rule of uniformity in taxation required by section 112 of the Constitution applies to municipalities. The rule of the Constitution requiring uniformity of taxation is again discussed and reaffirmed in Adams v. Standard Oil Co., 53 So. 694. We might multiply authorities on this proposition ad infinitum, but it seems to us sufficient merely to direct the court's attention to the language of the ordinance and cite the general rule.

In proceeding to discuss the contentions made by the appellee in the court below, we shall undertake to show: 1st. That a municipality can only be estopped by some affirmative act of its own as shown by its minutes or other written contract duly and properly made in a manner provided by law, and may not be estopped by the verbal promises and representations of some of its citizens and officials. 2nd. That a municipality can never be estopped when acting in its public or governmental capacities and can only be estopped when acting in its private, as contradistinguished from its public or governmental capacities. The universal rule is that a municipality can only be estopped by some affirmative act of its own, as by some legislative enactment, grant, or contract duly entered into in the manner provided by law and only then where the municipality is acting in its private as contradistinguished from its public or governmental capacities. Philadelphia, etc., Co., v. City of Omaha, 93 Am. St. Rep. 442; People v. City of Rock Island, 106 Am. St. Rep. 179; Flowers v. Logan County, 137 Am. St. Rep. 354. (Monographic note.) In this case the matter under discussion involves the exercise of one of the highest prerogatives attaching to sovereignty--the right of taxation; and the representations, promises, and undertakings between citizens of the municipality and officers of the municipality acting in their private and not in their official capacity with the appellee and its predecessors, touching the matter of taxation, certainly lacked two of the essentials of an estoppel. In the first place, no affirmative act of the municipality is shown prior to the erection of the appellee's manufacturing establishment. Nothing that was done by the municipality, as such, was relied upon by the appellee as an inducement to it to erect its manufacturing establishment and to expend its money, or to do any other act involving burden or expense upon it. In the second place, the question involves not the act of the municipality in its private capacity, but affects its right to exercise a strictly public and governmental power. The municipality cannot be bound, either directly or indirectly, upon any promise, agreement or undertaking not shown by an order duly and properly entered upon the minutes of the board. The mayor and board of Aldermen of a municipality like the county board of supervisors, as this court has many times decided, must speak through their minutes, and in that way alone. Pass Christion v. Washington, 81 Miss. 472; Marion County v. Woulard, 77 Miss. 343; Dixon v. Green County, 76 Miss. 394.

The learned chancellor in deciding the case adversely to the appellant, grounded his decision on the question of estoppel and cited in support of his decision, the case of Moore v. City of New York, 73 N.Y. 238, decided April 9, 1878. We respectfully urge the court to read that decision for it is manifest that the chancellor was misled by it. In that case the city had made a contract for the doing of certain public work. The contract was perfectly valid on its face and the proceedings leading up to it were proper...