Commonwealth Ex Rel. Moore v. P. Lorillard Co. Inc

• Citation: 105 S.E. 683
• Parties: COMMONWEALTH ex rel. MOORE, Auditor of Public Accounts. v. P. LORILLARD CO., Inc.
• Decision Date: 20 January 1921
• Court: Supreme Court of Virginia

105 S.E. 683

COMMONWEALTH ex rel. MOORE, Auditor of Public Accounts.

v.P. LORILLARD CO., Inc.

Supreme Court of Appeals of Virginia.

Jan. 20, 1921.

Error to Hustings Court of Richmond. Application by the P. Lorillard Company, Incorporated, for relief from income taxes against the Commonwealth of Virginia, on the relation of C. Lee Moore, Auditor of Public Accounts. To review judgment granting the relief prayed, the Commonwealth brings error. Affirmed.

Jno. R. Saunders, Atty. Gen., and J. Vaughan Gary and E. Warren Wall, both of Richmond, for plaintiff in error.

McGuire, Riely & Eggleston, of Richmond, for defendant in error.

BURKS, J. The examiner of records for the city of Richmond assessed the P. Lorillard Company, Incorporated, with $2,000 income tax for 1916, on income received during the year 1915, and $5,000 income tax for 1917, on income received during the year 1916, and reported it to the commissioner of the revenue, who entered the same on his books. The company, feeling aggrieved thereby, applied to the hustings court of the city of Richmond for relief. The application was made on June 17, 1918, under section 567 of the Code of 1887, as amended (Code 1919, § 2385). The hustings court granted the relief prayed for, and to its judgment a writ of error was awarded.

The first error assigned is that the hustings court had no jurisdiction of the question submitted to it. If this be true, its judgment is void. The Legislature alone can fix the classes of cases of which the courts of the commonwealth are to take jurisdiction, and no consent or waiver of the parties can in any way confer a jurisdiction not so fixed. Objection for the want of such jurisdiction may be made anywhere, or in any way, and at any time, and this court will, of its own motion, take judicial notice of the lack of such jurisdiction of the trial court.

The object of the statute relied on is to give speedy and inexpensive relief against taxes erroneously assessed, and, being remedial in its character, it will be liberally construed in order to further the remedy provided by the Legislature. Com. v. Smallwood Memorial Institute, 124 Va. 144, 97 S. E. 805.

The statute invoked is as follows:

"Any person assessed with taxes on lands or other property, aggrieved by any such assessment, may, unless otherwise specifically provided by law, within two years from the first day of September of the year in which such assessment is made, and any person assessed with a license tax, aggrieved thereby, may, within one year after such assessment, apply for relief to the court in which the commissioner gave bond and qualified. * * * " It is earnestly insisted by counsel for the commonwealth that a tax on income is not embraced in the language of the statute "taxes on land or other property." The meaning of words is frequently, if not generally, to be determined from the connection in which they are used. The word "property" is very comprehensive in its significance, and has often been construed, but we are not concerned with its meaning in the abstract or apart from its setting in the present case. Many definitions will be found in Words and Phrases, First and Second Series. We wish to confine ourselves to the meaning of the word as used in the statute under consideration.

The Code, from which the section is taken, is divided into titles, chapters, and sections; these terms being used in the descending grade. The title is "Public Revenue, " under which there are embraced nine chapters. The first of these chapters relates to "Assessments of lands and lots, and their subsequent reassessment." The second chapter under that title relates to "Assessment of taxes on persons and property; licenses, how procured; certain acts imposing taxes continued in force." None of the remaining chapters under this title affect the questions in controversy. In the chapter last mentioned is contained the section in controversy. This chapter also contains the provisions with respect to "forms of land and property books, " and many other things relating to the assessment of taxes. Prior to the year 1916, the commissioners of the revenue had but two books, known respectively as the land book and the personal property book. On the first there were listed all lands and lots, and on the second all personal property of every kind, tangible and intangible, including incomes. It would seem, therefore, that the Legislature had divided all property upon which the commissioners of the revenue were to extend the tax into two kinds (1) lands and lots, and (2) personal property, and that it intended to embrace "income" in the latter class, as it was placed on that book. As the commissioner had but two books on which to extend the taxes, and "income" was not "land and lots, " there was nowhere else to place it except on the personal property book. This view is strengthened by the fact that in 1916 the Legislature passed an act "To prevent undue publicity of income tax returns, " in which it provided that—

"In entering income tax returns for the year 1916 and every subsequent year, the commissioner of the revenue shall not use for such entry the property book, or any other public record book but shall use a special book, " to be kept under lock and key, and not open to public inspection. Acts 1916, p. 949.

The same Legislature of 1916, by another act (Acts 1916, p. 413), required the local board of review to review the fiduciary and other reports of the examiner of records, and report to the commissioner of revenue the values ascertained on intangible personal property, money, and incomes, and thereupon the commissioners of the revenue were required to "extend upon their personal property * * * or other tax books" the taxes thereon required by law. Taxpayers were allowed by the act to apply to the local board of review for correction of the assessments, but it is expressly provided that—

"Nothing contained in this section, however, shall prevent a taxpayer from applying directly to the court for the correction of the erroneous assessment of his taxes and levies without first applying to the local board of review."

It would seem from these statutes, read together, as they should be, that the Legislature intended to divide all taxes which were extended on the books of the commissioners of the revenue into but two classes, one real estate and the other personal property, and to include income in the latter, and that the application to the court permitted by the statute last mentioned had reference to section 567, Code 1904, as we have been unable to find any other statute under which the application could have been made.

What we have said above is to be restricted entirely to an interpretation of the statute, and not be otherwise extended.

The next assignment of error is to the action of the trial court in "granting relief in the absence of any evidence that the assessment complained of was erroneous or illegal." The holding of the trial court was that the assessment was illegal because there was "no law of this commonwealth which authorized, clearly and specifically, the assessment by this state of such a tax as is complained of in this proceeding."

The statute under which the income tax in the case at bar was imposed is the act of March 22, 1916. Acts 1916, c. 472, p. 794. It provides that—

"The classification under schedule D providing for the taxation of income...