Boston & M. R. R. v. City of Concord

• Decision Date: 30 June 1917
• Citation: 101 A. 663,78 N.H. 463
• Parties: BOSTON & M. R. R. v. CITY OF CONCORD. SAME v. STATE.
• Court: New Hampshire Supreme Court

101 A. 663

78 N.H. 463

BOSTON & M. R. R.

v. CITY OF CONCORD.

SAME

v. STATE.

Supreme Court of New Hampshire. Merrimack.

June 30, 1917.

Transferred from Superior Court, Merrimack County.

Petitions by the Boston & Maine Railroad against the City of Concord and the State to abate taxes. Cases transferred from superior court, without rulings. First case sustained, and tax abated; and second case dismissed. See, also, 78 N. H. 192, 98 Atl. 66.

Tax appeals. The first is an appeal from a tax assessed by the city of Concord in 1913 on materials used by the plaintiffs in building and repairing equipment at their Concord shops. After the opinion holding that the property was not taxable in Concord (78 N. H. 192, 98 Atl. 66) was filed, the Attorney General intervened and asked the court to order the plaintiffs to pay the state a tax on the property in question for that year as the price of a decree abating the illegal tax. The court found that the property would have been taxed by the state in 1913, but for the tax commission's mistake in thinking that it was taxable in Concord, and that it would be just for the court to assess a tax on the property in this proceeding, if it is taxable and the court has power to tax it. The questions whether the property is taxable under the provisions of Laws 1911, c. 169, and whether the court has power to tax it, were transferred by Sawyer, J., without a ruling from October term, 1916, of the superior court.

The second is an appeal from the tax commission's assessment of the general railroad tax assessed on the plaintiffs' property for the year 1916. The tax commission included the materials and supplies used in the plaintiffs' Concord and Keene shops at their average value for the year in the appraisal of their taxable property; and the question of whether these materials are taxable was transferred by Chamberlain, C. J., without a ruling, from the superior court.

Streeter, Demond, Woodworth & Sulloway, of Concord, and Branch & Branch, of Manchester, for plaintiff. James P. Tuttle, Atty. Gen., for the State.

YOUNG, J.The question whether the materials the plaintiffs use in building and repairing equipment are taxable by the state is common to both appeals, for if these materials are not taxable they were not taxable in 1913. Whether they are taxable depends on whether the plaintiffs use them in their ordinary business, within the meaning of Laws 1911, c. 169, for section 11 provides that:

"Every railroad * * * shall pay to the state an annual tax, * » * upon the actual value of its property and estate used in its ordinary business which would not be exempt from taxation if owned by a natural person or ordinary business corporation."

The plaintiffs concede that they ordinarily carry on the business of building and repairing equipment in connection with their transportation business, but contend that that is not their ordinary business, within the meaning of section 11. In other words, they contend that the property in question is not used in their ordinary business, within the meaning of that section, and that it is not taxable, even though it would be taxable, if owned by an individual or ordinary business corporation. They base this contention on what was said in Boston & Maine R. R. v. Franklin, 76 N. H. 459, 84 Atl. 44, as to the meaning of the term "ordinary business," as used in P. S. c. 64, § 12.

The purpose the Legislature had in mind when it enacted section 11, as well as the sense in which it used the term "ordinary business," are questions of fact pure and simple, and, like all such questions, to be decided, not by rules of law, but by weight of competent evidence. It is fair to assume that the Legislature did not intend, when it enacted that section, to put railroads in a better position, in so far as taxation is concerned, than individuals and ordinary business corporations; but that is the effect of section 11 if the term "ordinary business" is given its ordinary meaning. It is true there is a presumption that that is the sense in which the Legislature used that term; but it is a presumption of fact, not law, and consequently it may be rebutted by competent evidence, and the fact that, if that term is given its ordinary meaning in section 11, the personal property railroads use only mediately in the transportation business escapes taxation, notwithstanding it would be taxable if owned by an individual, tends very strongly to the conclusion that that was not the sense in which the Legislature used that term in that section. In other words, it is so improbable that the Legislature of 1911 intended to exempt property, when owned by a railroad, that would be taxable if owned by an individual or ordinary business corporation, as to warrant the court in holding that that was not the purpose it had in mind when it enacted section 11, if the terms it used are capable of the construction, that property which is taxable under the provisions of P. S. e. 55, when owned by an individual, is taxable under the provisions of chapter 169 when owned by a railroad. Phillips Academy v. Exeter, 58 N. H. 306, 42 Am. Rep. 589.

The language of section 11 is fairly capable of such a construction, for "ordinary business" is often used as synonymous with the business a person ordinarily carries on; and if that term is given that meaning in section 11 the property in question is taxable, if it would be taxable if owned by an individual. It does not necessarily follow, therefore, from the fact that the Legislature used the term "ordinary business" in P. S. c. 64, § 12, to describe the transportation business, that that is the sense in which it used that term in Laws 1911, c. 169, § 11; for, as we have seen, whether that was the sense in which it used it is a question of fact, and, while the evidence in the Franklin Case all tended to the conclusion that that was the sense in which the Legislature used it in section 12, the evidence in this case tends very strongly to the conclusion that that term, as used in section 11, includes any business railroads ordinarily carry on in connection with the transportation business. Since the plaintiffs ordinarily carry on the business of building and repairing equipment, the materials in question are taxable as stock in trade, if they would be so taxable if owned by an individual or ordinary...