Bd. of Com'Rs of Silver Bow Co. v. Davis

• Decision Date: 04 January 1887
• Citation: 6 Mont. 306
• Parties: BOARD OF COM'RS OF SILVER BOW CO. v. DAVIS.
• Court: Montana Supreme Court

6 Mont. 306

BOARD OF COM'RS OF SILVER BOW CO.

v.DAVIS.

Supreme Court of the Territory of Montana.

January 4, 1887.

Appeal from district court, Silver Bow county.

Action to recover taxes. Judgment for plaintiff. Defendant appeals.

Knowls & Forbis, for appellant, Davis.

W. W. Dixon, for respondent, Board of Com'rs of Silver Bow Co.

WADE, C. J.

This is an action by the plaintiff and respondent to recover the sum of $1,562.75 from the defendant and appellant for taxes levied for the year 1885 upon certain shares of the capital stock of the First National Bank of Butte, owned by the appellant. The cause was tried upon the following agreed statement of facts:

“(1) That the First National Bank of Butte is now, and was during all of the year 1885, and before that time, a corporation duly created under and by virtue of the laws of the United States relating to national banks, and located and carrying on a general banking business in Butte City, in the county of Silver Bow and territory of Montana, and that the capital stock of said bank is $100,000, divided into shares of $100 each.

“(2) That, during all of said year 1885, the said defendant, Andrew J. Davis, was the owner and holder of 940 shares of the capital stock of said bank, and that said shares were, during all of said year, and are now, of the true value in money at private sale, and of the market value, (which is the same,) of $125 each.

“(3) That, for and in the said year 1885, there was duly levied and assessed, according to the laws of Montana territory, in said Silver Bow county, for territorial, county, and other purposes, upon all property in said county subject to taxation, an ad calorem tax, amounting in all to thirteen and three-tenth mills on each dollar of assessed valuation.

“(4) That said 940 shares of stock of the said First National Bank of Butte were assessed for taxation, in the manner provided by the laws of said Montana territory for the said year 1885, to said defendant, Andrew J. Davis, (who then owned and held said shares in said county of Silver Bow,) at their estimated true value in money at private sale, and at their market value, (which is the same.)

“(5) That the said defendant has not, nor has said bank, or any one for him or it, ever paid said tax on said shares so assessed as aforesaid, or any part of said tax.

“(6) That, in the general assessment of said Silver Bow county for said year 1885, shares of stock in corporations generally were assessed in accordance with the provisions of section 1003 of chapter 53 of the fifth division of the Revised Statutes of Montana territory, as amended by the act of the legislative assembly of February 22, 1881, on page 67 of the Laws of 1881; and, where the entire capital stock of any incorporated company was invested in assessable property in said territory, such stock, or the shares thereof, were not taxed, and that mining claims not held under patent from the United States were not assessed or taxed at all, and, where held under patent from the United States, were assessed at the government price of five dollars per acre, without regard to their true market value; that there are a large number of mining corporations in Montana territory whose entire capital stock is invested in assessable property, and that part of said property consists of mining claims.”

There was a judgment for the plaintiff for the amount claimed, from which the defendant appeals, and asks for a reversal of the judgment, for the reasons, viz.: First, that, under the provisions of the general banking act, shares of stock in national banks in the territories are exempt from taxation; and, second, that by the laws of Montana, and by the showing of the agreed statement of facts, there has been an unjust discrimination against the appellant in the taxation of his shares of national bank stock. Both of these questions arise under the following section of the national banking act.

“Sec. 5219. Nothing herein shall prevent all the shares in any association from being included in the valuation of the personal property of the owner or holder of such shares, in assessing taxes imposed by authority of the state within which the association is located; but the legislature of each state may determine and direct the manner and place of taxing all the shares of national banking associations located within the state, subject only to the two restrictions that the taxation shall not be at a greater rate than is assessed upon other moneyed capital in the hands of individual citizens of such state, and that the shares of any national banking association owned by non-residents of any state shall be taxed in the city or town where the bank is located, and not elsewhere. Nothing herein shall be construed to exempt the real property of associations from either state, county, or municipal taxes to the same extent, according to its value, as any other real property is taxed.” Rev. St. Mont. § 1015.

1. The proposition of the appellant is that, by virtue of this section, the right to tax national bank shares, is limited to national banks located and doing business in a state, and that such shares are not subject to taxation in a territory. In construing this section, reference must be had to all the sections, and to the general scope and meaning of the act of congress authorizing and establishing our national banking system. The sections or different parts of every statute must be construed together, and as they are modified by one another. If the object and intent of the statute is distinctly defined and clearly expressed, ordinary words will be given such a meaning, if they have such a meaning, as to make them harmonize with such object and intent, even though they might be so interpreted as to be in conflict therewith. The word “state” has various meanings. It may mean a place; it may mean an organized political community. If used in the latter sense, the word might mean the same as territory, for that is also an organized political community.

The general scope and purpose of this act of congress was to give to the people of the United States, whether they lived in a state or in a territory, a uniform system of banking, whereby they should be authorized to form associations for carrying on that business. It requires such associations in their certificates to name the place where its operations of discount and deposit are to be carried on, designating the state, territory, or district, and the particular county, city, town, or village. Section 5134. Here the words “state, territory, or district,” mean simply the place-the locality-in which the business is to be carried on.

The right to form such associations is made a privilege, -a franchise,-which is distributed equally among the people of the states and territories, according to the population of either, (see sections 5178-5180;) and every association is allowed to charge and to receive interest at the rate allowed by the laws of any state, territory, or district where the bank is located, (section 5197.) Penalties for the violation of any of the provisions of the act, by the officers of any banking association, are the same, whether such violation occurs in a state or territory. Section 5239.

The banking system created and established by the act extends alike to the states and territories. The constitution and laws of the United States, which are not locally inapplicable, have the same force and effect in the territories as elsewhere within the United States. Rev. St. U. S. § 1891. The territories are as much a part of the United States as are the states. There is but one banking system for all. No provisions of the banking act are locally inapplicable to the territories. The legislative powers of the territories extend to all rightful subjects of legislation. It is just as competent for a territorial legislature to determine and to direct the manner and the place of taxing personal property as it is for a state legislature to do the same thing. In this respect their powers are alike. Either may levy and assess taxes upon property subject to taxation within its jurisdiction. Each must raise a revenue by taxation for carrying on the local government. The national banking system extending over each alike, it would seem that the words of section 5219, “in assessing taxes imposed by authority of the state within which the association is located,” ought to be interpreted to mean the legislative authority, or the authority within the locality in which the banking association is situated that may rightfully and legally levy and assess taxes upon personal property. Otherwise burdens are...