Appalachian Power Co. v. County Court of Mercer County

• Decision Date: 21 February 1961
• Docket Number: No. 12062,12062
• Citation: 118 S.E.2d 531,146 W.Va. 118
• Parties: APPALACHIAN POWER COMPANY, etc. v. COUNTY COURT OF MERCER COUNTY, etc., et al.
• Court: West Virginia Supreme Court

Page 531

118 S.E.2d 531

146 W.Va. 118

APPALACHIAN POWER COMPANY, etc. v. COUNTY COURT OF MERCER COUNTY, etc., et al.

No. 12062.

Supreme Court of Appeals of West Virginia.

Submitted Jan. 17, 1961.

Decided Feb. 21, 1961.

Syllabus by the Court

1. 'If a constitutional provision is clear in its terms, and the intention of the electorate is clearly embraced in the language of the provision itself, this Court must apply and not interpret the provision.' Point 1 Syllabus, State ex rel. Trent v. Sims, 138 W.Va. 244 ; Point 3 Syllabus, State ex rel. Zickefoose v. West, W.Va. .

2. The provisions of Article X, Section 10 of the Constitution of West Virginia, known as the Better Schools Amendment, relate only to levies by school districts for public school purposes.

3. Chapter 133, Acts of the Legislature, Regular Session, 1959, is unconstitutional; and tax levies made by a county court in pursuance thereof are invalid.

4. 'Notwithstanding that an act of the Legislature was enacted with the best of motives and in the interest of good government, if such act clearly violates a provision of the West Virginia Constitution, it is the duty of this Court to declare the act void.' Point 27 Syllabus, State ex rel. Trent v. Sims, 138 W.Va. 250 .

W. W. Barron, Atty. Gen., Henry C. Bias, Jr., Asst. Atty. Gen., Edward B. Simms, Atty. Legal Div. Office of State Tax Commr., Charleston, Roscoe H. Pendleton, Pros. Atty., Mercer County, Princeton, for appellants.

Richardson, Hancock & Coulling, Bluefield, for appellee.

Jeremy C. McCamic, Asst. City Solicitor, Wheeling, amicus curiae, City of Wheeling, a Municipal Corporation.

George G. Bailey, Wheeling, amicus curiae, W. Va. League of Municipalities.

Robert Earl Maxwell, Elkins, amicus curiae, County Court of Randolph County.

CALHOUN, Judge.

This case involves a declaratory judgment proceeding instituted in the Circuit Court of Mercer County by Appalachian Power Company, a Virginia corporation, suing in its own behalf and in behalf of all other taxpayers of that county who are similarly situated, against the County Court of Mercer County, a corporation, and the several commissioners thereof, Frank Gibson, Fred Thomason, and Clarence C. Elmore. The parties will be referred to herein as 'petitioner' and 'respondents' in accordance with their designation in the trial court.

The purpose of the proceeding is to determine the validity of certain levies laid by the county court pursuant to Chapter 133, Acts of the Legislature, Regular Session, 1959, (Code, 13-1-35).

The case was submitted to the trial court for decision upon an undisputed state of facts established by the petition, an answer in behalf of the respondents, and a written stipulation of fact. From an adverse judgment of the circuit court, embodied in an order entered therein on March 25, 1960, the respondents prosecute this appeal.

Appalachian Power Company is a public utility corporation duly authorized to do business in West Virginia, and in addition to its other holdings in this state, it owns certain real estate and personal property which are subject to the annual ad valorem taxes levied by the respondent county court upon real estate and personal property situated within Mercer County. On August 18, 1959, the third Tuesday of that month, the respondent county court ordered the laying of certain tax levies to raise the sum of $523,690, which sum was found by the respondents to be necessary 'for county current purposes' for the then current (1959-1960) fiscal year. These levies for current expenses were laid at the maximum rates permitted by Article X, Section 1 of the Constitution of West Virginia, and Chapter 11, Article 8, Code, 1931, as amended.

In addition to such levies for current expenses, the respondents on the same date further ordered that additional levies be laid for the current (1959-1960) fiscal year in order to raise the sum of $29,297 found by them to be necessary 'to pay the interest on and provide a sinking fund for the discharge of the principal of bond issues owing by the County as a whole', such portion of the county court's order being designated 'Airport Bond Purposes--Interest and Sinking Fund Order.' The 'airport bonds' in question were issued by the county court on October 1, 1950. The Honorable John A. Field, Jr., who was at that time state tax commissioner, signified to the respondents in writing under date of August 12, 1959, his approval of such levies, but his approval was expressly made subject to the following conditions: 'Approval conditioned on not expending funds made available for current expenditures by reason of laying levy for retirement of bonds outside of and in addition to the maximum rates of levy as provided by Article X, Section 1 of the Constitution until such time as the Supreme Court of Appeals has held Chapter 133, Acts of the Legislature, 1959, to be constitutional or until such time as it appears there will be no test case during the fiscal year.' The petitioner asserts that these additional levies are in excess of the maximum levies authorized by Article X, Section 1 of the Constitution of West Virginia and Code, 11-8, enacted in pursuance of such constitutional provision; and that such additional levies are therefore invalid.

In 1932 the voters of West Virginia ratified a constitutional proposal of the legislature which thereupon became Article X, Section 1 of the Constitution of West Virginia. This section is designated 'Taxation and Finance' but is popularly known as the Tax Limitation Amendment. It provides, among other things, that 'the aggregate of taxes assessed in any one year upon personal property * * * shall not exceed fifty cents on each one hundred dollars of value thereon and upon all property owned, used and occupied by the owner thereof exclusively for residential purposes and upon farms occupied and cultivated by their owners or bona fide tenants one dollar; and upon all other property situated outside of municipalities, one dollar and fifty cents; and upon all other such property situated within municipalities, two dollars; and the legislature shall further provide by general law, for increasing the maximum rates, authorized to be fixed, by the different levying bodies upon all classes of property, by submitting the question to the voters of the taxing units affected, but no increase shall effective unless at least sixty per cent of the qualified voters shall favor such increase, and such increase shall not continue for a longer period than three years at any one time, and shall never exceed by more than fifty per cent the maximum rate herein provided and prescribed by law; * * *.'

Pursuant to the foregoing constitutional provision, and in order to implement it, the Legislature of West Virginia at its Second Extraordinary Session of 1933 enacted enabling legislation. This legislation, as subsequently amended, appears in the present Code as Chapter 11, Article 8. By Section 5 thereof property is classified for levy purposes into Class I (personalty), Class II (realty occupied by owner), Class III (all real and personal property situated outside of the municipalities, exclusive of Classes I and II), and Class IV (all real and personal property situated inside of municipalities exclusive of Classes I and II). Section 6 provides that 'The aggregate of taxes assessed in any one year by all levying bodies * * * shall not exceed fifty cents on each one hundred dollars' assessed valuation on class I property; one dollar on class II property; one dollar fifty cents on class III property; and two dollars on class IV property.' Then the legislature allocated among the several taxing units the 'aggregate of taxes' established by Section 6. Section 6b allocates to county courts a total of 14.3 cents on each one hundred dollars assessed valuation for Class I property. It will be observed that in all cases the statutory allocation as to Class II property is double the allocation as to Class I, and the allocation as to Class III and Class IV property is four times the allocation as to Class I. Hereinafter all references will be to Class I, it being understood that rates for the other classes are arrived at by applying the proper multiplier to the Class I rate. The 1, 2, 4, 4 ratio was approved in Wilson v. Clay County Court, 114 W.Va. 603, 175 S.E. 224.

The maximum of 14.3 cents allowed to county courts is broken down by the statute into several categories, but Mercer County has at present no indebtedness incurred prior to the adoption of the Tax Limitation Amendment, nor are there any magisterial or special taxing districts for which the County Court of Mercer County is required to lay a levy, the result of which is that the entire 14.3 cents would be available for general county current expenses if there were no bonded indebtedness incurred subsequent to the adoption of the Tax Limitation Amendment. The Mercer County airport bonds are such bonds and prior to the levies of 1959 the county court provided the carrying charge on those bonds within and as part of the 14.3 cents limitation.

When the Tax Limitation Amendment was adopted, Article X, Section 8 of the Constitution was not changed. In Finlayson v. City of Shinnston, 113 W.Va. 434, 168 S.E. 479, it was held that levies for bonded indebtedness created subsequent to the adoption of the Tax Limitation Amendment must be within the maximum limits prescribed by that amendment.

In 1949 the legislature proposed and the people thereafter ratified an amendment of Article X, Section 8 of the Constitution specifically permitting levies over and above the maximum prescribed by the Tax Limitation Amendment, where bonds issued by any school district are concerned. Section 8, as so amended and as now in force, reads as follows, the matters inserted therein by the 1949 amendment being indicated by italics:

'No county, city, school district, or municipal corporation, except in cases where such...