City of Portland v. Portland Gas & Coke Co.
| Decision Date | 25 April 1916 |
| Citation | 80 Or. 194,156 P. 1070 |
| Parties | CITY OF PORTLAND v. PORTLAND GAS & COKE CO. |
| Court | Oregon Supreme Court |
In Banc.
Appeal from Circuit Court, Multnomah County; W. N. Gatens, Judge.
On rehearing. Affirmed.
For former opinion, see 150 P. 273.
At an election held on June 5, 1911, the legal voters of the city of Portland adopted an ordinance which requires "every person, or corporation, engaged in the business of selling or furnishing gas, either natural or manufactured, for lighting heating, fuel or other commercial purposes within the City of Portland" to pay the city "a license of three (3) per centum of the gross receipts of such person or corporation received upon its business within the city." The defendant refused to pay, and the city commenced an action to recover for the period commencing June 6, 1911, and ending December 31, 1911. After alleging the corporate character of the plaintiff, and tat the defendant is a private corporation engaged in selling gas, the complaint recites the ordinance in extenso, alleges the amount of the gross receipts during the period mentioned, and demands judgment for the tax and penalty provided for in the ordinance. A demurrer to the complaint was sustained, and the plaintiff having elected to stand upon its complaint, the court granted the defendant a judgment for its costs and disbursements. The city prosecuted an appeal from the judgment, and after holding that the complaint was sufficient ( City of Portland v. Portland Gas & Coke Co., 150 P. 273) we granted a petition for a rehearing. Since the rendition of the first opinion we have not only heard a reargument of this cause, but we have also heard the oral arguments and examined the briefs in Portland v. Portland Railway, Light & Power Company, which involves every question presented here. Fourteen printed briefs, filed in the two cases, not only display an exhaustive research of the authorities, but they also record the last word which the industry and ingenuity of counsel can suggest in support of their respective contentions.
Henry A. Davie, of Portland (W. P. La Roche, City Atty., of Portland, on the brief), for appellant. W. W. Cotton, of Portland (H. W. Strong, John A. Laing, and J. G. Wilson, all of Portland, on the brief), for respondent.
HARRIS J. (after stating the facts as above).
The opinion which was delivered to-day in Portland v. Portland Railway, Light & Power Company, 156 P. 1058, is decisive of the instant case. The two ordinances were adopted by the same voters at the same election, and they are identical in terms, except that one applies to the sale of gas and the other to the sale of electricity. Applying the principles announced in Portland v. Portland Railway, Light & Power Company the ordinance concerning the sale of gas is void. It cannot be sustained as a tax on property, because the city cannot levy a property tax for general purposes, except on the property and in the manner pointed out by general laws. The ordinance cannot be upheld as a license, or as a tax on business, because it is not an exercise of the power conferred by subdivision 21 of section 73 of the charter. It is not necessary to indulge in any extended discussion of the instant case, for the reason that every issue raised here is examined at some length in the opinion relating to the tax on receipts derived from the sale of electricity; and since all that is said there concerning the power of the city to levy a property tax, as well as all that is stated about the right of the city to impose a tax or license on a business, applies here, the principles announced there will not be elaborated upon.
Supplementing, however, the discussion concerning the contention of the city that sections 3 and 74 endow the city with authority to pass the ordinance, attention is now called to section 5 of article 11 of the state Constitution:
"Acts of legislative assembly incorporating towns and cities shall restrict their powers of taxation. * * *"
The ordinance in question was submitted to the legal voters at a time when the legislative charter of 1903 was still in force. The charter of 1903 was enacted by the Legislature prior to the adoption of the constitutional amendments known as section 2 of article 11 and section 1a of article 4. When it is remembered that the language of section 5 of article 11 imperatively commanded the Legislature not to confer upon municipalities unrestricted powers of taxation, by no fair rule of construction can it be said that the lawmaking body by sections 3 and 74, when read in the light of the rest of the charter, intended to set the power of taxation at large, so that the municipality might reach out and assume unto itself the power to tax without limitation or restriction; and, moreover, section 3 expressly provides that it is "subject to the limitations prescribed by the Constitution and laws of the state."
The contention, persistently made by the city, that it is not necessary to trace its right to legislate to some provision of its charter, is set at rest by Robertson v. Portland, 149 P. 546. A charter is requisite now to the same extent as it was before the adoption of section 2 of article 11 and section 1a of article 4, as those sections now appear in our Constitution. The power of a city to enact or amend its charter is conferred by section 2 of article 11, and the very language of that section implies the necessity of a charter. Section 1a of article 4 does not empower a city or other municipality to take unto itself any municipal authority; the words "local, special and municipal legislation," found in this section of the Constitution, do not mean that a municipality can legislate unto itself a power to legislate. State ex rel. v. Port of Astoria, 154 P. 399, 407. None but a city or town can legislate unto itself a power to legislate, and that privilege exists because of section 2 of article 11.
The judgment entered by the circuit court is affirmed.
The opinion of Mr. Justice HARRIS on rehearing, affirming the circuit court in sustaining the demurrer to the complaint, is based upon the views he expressed in City of Portland v Portland Ry. L. & P. Company. An analysis of this latter opinion shows that it depends very largely, if not exclusively, upon the new matter in the answer. In the present case the issue of law is waged upon a demurrer to the complaint. That pleading contains no intimation of the various defenses set up in the other case. The only feature in common between these two cases is the applicability of subdivision 21 of section 73 of the Portland...
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City of Portland v. Homeaway.com, Inc.
...Court held that a predecessor to Section 1–102 was not intended to allow the City to tax "without limitation or restriction." 80 Or. 194, 156 P. 1070, 1071 (1916). My task is to determine whether this century-old case remains good law or whether it has been implicitly overruled.The City arg......