City of Middlesboro v. New South Brewing & Ice Co.

• Decision Date: 20 April 1900
• Citation: 56 S.W. 427,108 Ky. 351
• Parties: CITY OF MIDDLESBORO et al. v. NEW SOUTH BREWING & ICE CO. [1]
• Court: Kentucky Court of Appeals

56 S.W. 427

108 Ky. 351

CITY OF MIDDLESBORO et al. v. NEW SOUTH BREWING & ICE CO. ^[1]

Court of Appeals of Kentucky.

April 20, 1900

Appeal from circuit court, Bell county.

"To be officially reported."

Action by the New South Brewing & Ice Company against the city of Middlesboro and others to enjoin the collection of taxes. Judgment for plaintiff, and defendants appeal. Reversed.

T. G Anderson and E. J. Howard, for appellants.

G. W Saulsberry, for appellee.

HOBSON J.

By the original charter of the city of Middlesboro, which became a law March 14, 1890 (see Sess. Acts 1889-90, vol. 1, p. 688, § 116), it was provided: "The provisions of this charter as to ad valorem taxation shall not apply to any tools or machinery belonging to manufactories or to any raw material for manufacture or goods manufactured in said city, for a space of five years from the passage of this act; but the same shall be exempt for that period." The appellee, New South Brewing & Ice Company, located at Middlesboro, and was assessed for the years 1891, 1892, and 1893 on its property which was not exempted from taxation by the above provision. These taxes it paid. It was then assessed in the same way for the year 1894, and, refusing to pay the taxes, brought this suit to enjoin their collection, after the tax collector had made a levy upon its real property therefor. Its claim is that it is exempt from taxation altogether by the laws now in force. The constitution of the state, adopted in September 1891, provides: "The general assembly may authorize any incorporated city or town to exempt manufacturing establishments from municipal taxation for a period not exceeding five years as an inducement to their location." Section 170. Pursuant to this provision of the constitution, section 3490, Ky. St., governing cities of the class to which Middlesboro belongs, was enacted, providing: "The board of council may by an ordinance exempt manufacturing establishments and the machinery from taxation for a period not exceeding five years from the establishment in said city." Under this authority, the board of council of Middlesboro, on January 29, 1894, made the following ordinance: "Be it ordained by the board of council of the city of Middlesboro first, that all manufacturing establishments and the machinery connected therewith shall be exempt from municipal taxation for a period of five years from the time of their establishment in said city; second, all ordinances or parts of ordinances in conflict herewith are hereby repealed; third, this ordinance shall take effect from and after its passage and publication." It will be observed that this is a different exemption from taxation than that conferred by the original charter. The original charter exempted only the tools or machinery or raw material for manufacture or goods manufactured in the city. The ordinance, however, exempts the manufacturing establishments and the machinery connected therewith. The exemption under the original charter was for five years from the passage of the act. The exemption under the ordinance is for five years from the time of the establishment of the manufactory in the city.

It is insisted for appellee that the exemption under the original charter ceased with the adoption of the present act for the government of cities of this class, and that by virtue of this act it is entitled to an exemption of all its property for five years; it being only partially established at the time the ordinance above quoted was passed. It is insisted however, for the city, that the constitutional provision, as well as the statute and ordinance made by virtue of it, are prospective in their operation, and do not refer to manufactories already established in the city. After a...